HARRY HUGHES, Governor

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expended and are committed. It shall also contain his projection
of projects to be constructed for the following two years for
which grants, loans, or loan guarantees are anticipated.

SECTION 8. AND BE IT FURTHER ENACTED, That Section 5(c) of
Chapter 262 of the Acts of the General Assembly of 1975, as
amended by Chapter 658 of the Acts of the General Assembly of
1980, be and it is hereby repealed and reenacted, with
amendments, to read as follows:

Chapter 262 of the Acts of 1975

5.

(c) The remainder of the proceeds of such loan shall be
credited on the books of the State Comptroller, to be used as
needed by the State, upon approval by the Board of Public Works,
exclusively to provide State grants to assist in the construction
and equipping of sewage treatment plants and related facilities
and in the extension and improvements of existing public sanitary
sewer systems. However, the portion of capital costs for
construction of improvements to and enlargement of sanitary
sewage facilities outside the State of Maryland required to serve
the State of Maryland, its political subdivisions or agencies
thereof shall be deemed eligible for State grants and loans
hereunder, provided there is a written agreement between the
agency constructing the sewerage facilities and the agency
receiving sewerage service. All grants and loans authorized or
made hereunder shall be subject to the following conditions and
limitations:

(1)  A State grant offer shall be made only for the
construction of projects that meet the specifications required by
the Federal Water Pollution Control Act and all applicable State
legislation and regulations, as amended from time to time.

(2)  Except as provided in paragraph (3) below, a
State grant offer shall be made only for a project or part of a
project on which a Federal grant offer is made, and the State
grant offer shall BE IN AN amount [to up to one-half of the
eligible cost remaining after the maximum Federal grant has been
applied] THAT WHEN COMBINED WITH THE MAXIMUM FEDERAL GRANT, THE
COMBINED GRANTS SHALL NOT EXCEED 87 1/2 PERCENT OF AFTER OCTOBER
1, 1984 shall BE IN AN amount [to] up to [one-half] 72.22 PERCENT
of the eligible cost remaining after the maximum Federal grant
has been applied[, except that when] OR UP TO 32.5 PERCENT OF THE
TOTAL ELIGIBLE PROJECT COSTS. WHEN the maximum Federal grant
offer for an innovative or alternative project as defined by the
Federal Environmental Protection Agency is greater than [75] 55
percent, the State grant offer shall be [three-quarters] UP TO 85
PERCENT of the eligible cost remaining or [12 1/2 percent,
whichever is the lesser] UP TO 21.25 PERCENT OF THE TOTAL
ELIGIBLE PROJECT COSTS. In the case of a project to be operated
by a State owned institution or facility, the State grant offer