(a) If the project is to be funded in whole or in part by a grant, the contract may include such provisions as may be agreed upon by the parties to the contract, and shall include in substance, the following provisions:

(1) An agreement by the state to pay the county an amount up to and including one hundred percent (100%) of the actual cost of the project. Part of the grant may be paid to the county as a first advance prior to the construction and during the progress of the construction at a rate in proportion to the rate of construction. The grant may be paid following completion of the construction, as may be agreed upon by the parties;

(2) An agreement by the county to proceed expeditiously with and complete the project in accordance with approved plans; and

(3)

(A) An agreement by the county to reserve, keep and maintain a specified number of available cell spaces in the jail for state prisoners under the terms of the contract;

(B) An agreement by the county as to the types of state prisoners with regard to offenses committed and sentences imposed who may be housed in the jail under the terms of the contract; provided, that the county agrees to house any and all felons sentenced to six (6) years or less, if sufficient cell space is provided, or such other felons as may be mutually agreed to by the county and the department of correction, if additional space is reserved by contract;

(C) An agreement that any new construction shall conform to American Correctional Association standards for the purposes proposed for the facilities;

(D) An agreement that the county will repay grant funds to the state if the county withdraws or otherwise terminates the contract to keep state prisoners;

(E) An agreement that in the event a prisoner held in the county facility becomes a discipline problem sufficient to require a closer custody status that cannot be provided adequately or safely in the county facility, the county shall have the authority to petition the sentencing judge for transfer of that prisoner to the department; and

(F) An agreement may provide for a gradual reduction or increase in the number of state prisoners held pursuant to subdivision (a)(3)(A).

(b) Any proposal by the county to subcontract for management of the facility, or any other proposal that would alter the management or operational arrangement specified in the contract, shall be submitted to the department and the funding board for approval. No management or operational change shall be made without the prior approval of the department and the funding board and until an amendment to the contract between the state and the county is effectuated.

(c) Compensation for the housing of state prisoners in any correctional facility constructed or renovated with funds provided in whole or in part by a grant under this chapter shall be paid in accordance with § 41-8-106 and no other jailer's fees for those prisoners shall be paid by the state.