(1) Whenever, at the request of the governor, the president of the United States has declared a major disaster to exist in this state, the governor is authorized:

(a) Upon the governor's determination that a local government of the state will suffer a substantial loss of tax and other revenues from a major disaster and has demonstrated a need for financial assistance to perform its governmental functions, to apply to the federal government, on behalf of the local government, for a loan and to receive and disburse the proceeds of any approved loan to any local government making application therefor;

(b) To determine the amount needed by any local government making application therefor to restore or resume its governmental functions and to certify the same to the federal government; except that no application shall exceed twenty-five percent of the annual operating budget of the applicant for the fiscal year in which the major disaster occurs;

(c) To recommend to the federal government, based upon the governor's review, the cancellation of all or any part of repayment when, in the first period of three full fiscal years following the major disaster, the revenues of the local government are insufficient to meet its operating expenses, including additional disaster-related expenses of a municipal character; and

(d) To determine the percentage at which the state and a local government will contribute moneys to cover the nonfederal cost share required by the federal "Robert T. Stafford Disaster Relief and Emergency Assistance Act", as amended, 42 U.S.C. sec. 5121 et seq., required by the federal highway administration pursuant to 23 U.S.C. sec. 125, or required by any other federal law in order to receive federal disaster relief funds. After making such a determination, the governor may amend the percentage at which the state and local government will contribute moneys to the nonfederal cost share based on the needs of the individual local governments. As soon as practicable after making or amending such a determination, the governor shall notify the joint budget committee of the source and amount of state moneys that will be contributed to cover a nonfederal cost share pursuant to this paragraph (d).