SPIRO T. AGNEW, Governor                       689

to which it was found to be entitled under the provisions of the
Federal Water Pollution Control Act, the petition may include a
request for the advance payment of the Federal deficit, provided
that the petitioner shall contract to repay to the State for deposit
to the Water Quality Loan account all subsequent Federal funds
which the petitioner may receive to make up the original Federal
deficiency.

4. When the petitioner has received a grant offer under the
Federal Water Pollution Control Act for the construction of facilities
to demonstrate an improved method of controlling the discharge to
any waters of the State of untreated or inadequately treated sewage
or other wastes from sewers which carry stormwater or both
stormwater and sewage or other wastes; to demonstrate advanced
waste treatment and water purification methods; or to provide for
new or improved methods of joint treatment for municipal and in-
dustrial wastes; and for the purpose of reports, plans and specifica-
tions in connection therewith, then the funds made available
under this Act shall be allocated as an outright grant to the petitioner
in an amount equal to one-half (½) of the difference between the
eligible cost and the amount of the federal grant offer.

LOANS FOR SEWER CONSTRUCTION

(c) Of the actual cash proceeds from the sale of Certificates of
Indebtedness to be issued under this Act, the sum of twenty-five
million dollars ($25,000,000), less a proportionate share of the costs
specified in Section 4 of this Act, shall be used exclusively to provide
loans to assist in the construction of sewer facilities.

Any county, municipality, or any agency of the State or its sub-
divisions which is charged with providing sewerage facilities may
petition the State Department of Health for a loan to assist in the
construction of such facilities, within the following conditions and
limitations:

1.    The project must be included in the county water and sewer-
age plan as approved by the governing body and the State Health
Department pursuant to the provision of Section 387(c) of Article
43 of the Annotated Code of Maryland, as amended from time to time.

2.    The full amount of the State loan for any one project shall
not exceed the cost of the project less the amount of any Federal
grant or loan for that project and the loan for any one project shall
not exceed the amount of two hundred and fifty thousand dollars
($250,000).

3.    The cost of the project eligible for a loan under this sub-
section shall include reports, plans, specifications, legal and
administrative costs, equipment, construction, land, easements and
rights-of-way.

4.    The sewer facility must meet all requirements and regula-
tions of the State and have the final approval of the State Depart-
ment of Health pursuant to Section 390 of Article 43. No loan may
be granted for a project that is not connected directly or indirectly
through a sewer system of adequate capacity to a sewage treatment
plant capable of maintaining the Water Quality Standards of the
State. No loan shall be made for a project which is likely to cause
untreated sewage to spill from an existing sewer or cause untreated
or inadequately treated sewage to by-pass a sewage treatment plant.