There is hereby created for the State of Mississippi a Water Pollution Abatement Loan Program (“program”) from which shall be made loans in aid of construction. Funds shall be available to any political subdivision legally authorized to own, maintain and operate a sewage, industrial waste or other waste collection, transport, treatment and disposal system. No recipient shall receive from state funds any loan in excess of twenty-five percent (25%) of the cost of construction of a project, unless said recipient shall become eligible on or after October 1, 1988, as set forth in Section 49-17-85(3).

Such cost of construction includes: preliminary planning to determine the economic and engineering feasibility of treatment works, the engineering, architectural, legal, fiscal and economic investigations and studies, surveys, designs, plans, working drawings, specifications, procedures, and other action necessary to the construction of treatment works; and the erection, building, acquisition, alteration, remodeling, improvement or extension of treatment works; and the inspection and supervision of the construction of treatment works.

No loan shall be made for any project under the provisions of Sections 49-17-61 through 49-17-67 unless such project is in conformity with the State Water Pollution Control Plan and has been certified by the Mississippi Commission on Natural Resources as entitled to priority over eligible projects on the basis of financial as well as water pollution control needs.

Loan funds generated by the issuance of bonds, legislative appropriations or otherwise, shall be deposited in an appropriate account or accounts created under the program.

There is hereby established a special fund designated as the Water Pollution Abatement Bond Fund (“bond fund”), which fund shall be maintained as a separate account in the State Treasury. All bonds which shall be issued by the State of Mississippi to generate funds to be used for loans under this section shall be payable as to principal, interest, premiums, if any, and service fees from the funds deposited in the bond fund. The bond fund hereby established shall be identical to and be a continuation of the Water Pollution Abatement Bond Fund authorized and established by the provisions of Chapter 471, General Laws of the State of Mississippi, 1971.

No funds heretofore deposited under any other laws to the credit of a special fund heretofore maintained in the State Treasury, and heretofore designated under such laws as the Water Pollution Abatement Bond Fund, shall be removed or transferred from such Water Pollution Abatement Bond Fund so maintained and designated under any other laws, except as shall be specifically authorized by law. When such removal or transfer shall be authorized, funds removed or transferred shall be deposited to the credit of a special fund hereby established and designated as the Water Pollution Abatement Loan Fund (“loan fund”), which fund shall be maintained as a separate account in the State Treasury.

Funds on deposit in the loan fund (a) may be used to make loans in aid of construction for water pollution abatement upon appropriation by the Legislature; (b) in the discretion of the commission, may be transferred to the Water Pollution Control Revolving Fund for the purpose of matching federal capitalization grants and for allowable uses; and (c) may be used for administration of the State Revolving Loan Program subject to legislative appropriation.