1. Except as otherwise provided in NRS 445A.260 and 445A.280, money in the Account for the Revolving Fund, including repayments of principal and interest on loans, and interest and income earned on money in the Account for the Revolving Fund, may be used only to:

(a) Make loans at or below the market rate to public water systems for the construction of projects.

(b) Buy or refinance at or below the market rate the obligations of public water systems if:

(1) The project for which the obligations were incurred complies with the Safe Drinking Water Act and regulations adopted pursuant thereto; and

(2) The obligations were incurred after July 1, 1993.

(c) Guarantee or purchase insurance for local obligations, including nongovernmental debt or municipal debt, if the action would improve access to credit or reduce the rate of interest applicable to the obligation.

(d) Arrange for the sale of state securities, including state securities issued to provide money from the State to match the federal grant, as required by the Safe Drinking Water Act, if the net proceeds from the sale of those state securities are deposited in the Account for the Revolving Fund.

(e) Provide or guarantee loans or as a source of reserve and security for leveraged loans, except that repayments of interest on loans, and interest and income earned on money in the Account for the Revolving Fund, may be used to secure the sale of state securities or otherwise be pledged to provide money from the State to match the federal grant, as required by the Safe Drinking Water Act.

2. Money in the Account for Set-Aside Programs may be used only to fund set-aside programs authorized by the Safe Drinking Water Act. Money in the Account for Set-Aside Programs may be transferred to the Account for the Revolving Fund pursuant to the Safe Drinking Water Act.

3. A public water system which requests a loan or other financial assistance must demonstrate that it has:

(a) Complied with the Safe Drinking Water Act and regulations adopted pursuant thereto; or

(b) Agreed to take actions that are needed to ensure that it has the capability to comply with the Safe Drinking Water Act and regulations adopted pursuant thereto.

4. Funding from the Account for the Revolving Fund may not be given to an existing public water system unless it has the technical, managerial and financial capability to ensure compliance with the Safe Drinking Water Act and regulations adopted pursuant thereto. A new public water system, to receive such funding, must demonstrate that it has the technical, managerial and financial capability to ensure compliance with the Safe Drinking Water Act and regulations adopted pursuant thereto.

(Added to NRS by 1997, 1824)