(1) County legislative authorities may establish local public works assistance funds for the purpose of funding public works projects located wholly or partially within the county. Moneys may be deposited in local public works assistance funds from existing revenue sources of the county.

(2) Moneys deposited in local public works assistance funds, and interest earned on balances from the funds, may only be used:

(a) To make loans to the county and to other local governments for funding public works projects as provided in this chapter; and

(b) For costs incurred in the administration of funds.

(3) No more than fifty percent of the moneys loaned from a fund in a calendar year may be loaned to the county providing local public works assistance funds. At least twenty-five percent of the moneys anticipated to be loaned from a fund in a calendar year must be made available for funding public works projects in cities or towns.

(4) No more than one percent of the average annual balance of a county’s fund, including interest earned on balances from the fund, may be used annually for administrative costs.