(a)  The agency shall be the instrumentality of the state for administration of the water pollution control revolving fund, the Rhode Island water pollution control revolving fund, and the local interest subsidy trust fund, and such other funds it holds or for which it is responsible, and, in conjunction with the department, is empowered to and shall take all action necessary or appropriate to secure to the state the benefits of title VI of the Clean Water Act, 33 U.S.C. § 1381 et seq., and other federal or state legislation pertaining to the funds and to the financing of approved projects. Without limiting the generality of the foregoing and other powers of the agency provided in this chapter, the agency is empowered to and shall:

(1)  Cooperate with appropriate federal agencies in all matters related to administration of the water pollution control revolving fund and, pursuant to the provisions of this chapter, administer the fund and receive and disburse such funds from any such agencies and from the state as may be available for the purpose of the fund.

(2)  Administer the Rhode Island water pollution control revolving fund and the local interest subsidy trust fund, and receive and disburse such funds from the state as may be available for the purpose of the funds subject to the provisions of this chapter.

(3)  In cooperation with the department, prepare, and submit to appropriate federal agencies applications for capitalization grants under title VI of the Clean Water Act, 33 U.S.C. § 1381 et seq., and enter into capitalization grant agreements, operating agreements, and other agreements with appropriate federal and state agencies, and accept and disburse, as provided herein, any capitalization grant awards made under title VI of the Clean Water Act, 33 U.S.C. § 1381 et seq.

(4)  Cooperate with the department in the preparation and submission to appropriate federal and state agencies of intended use plans identifying the use of capitalization grant awards and other moneys in the water pollution control revolving fund.

(5)  In cooperation with the department, prepare and submit to appropriate federal agencies, the department and the governor, annual and other reports and audits required by law.

(6)  Subject to the provisions of this chapter both to make, and enter into binding commitments to provide financial assistance to local governmental units, persons or corporations from amounts on deposit in the water pollution control revolving fund, the Rhode Island water pollution control revolving fund and from other funds of the agency; and to provide, and enter into binding commitments to provide subsidy assistance for loans, local governmental obligations and non-governmental obligations from amounts on deposit in the local interest subsidy trust fund.

(7)  Establish and maintain fiscal controls and accounting procedures conforming to generally accepted government accounting standards sufficient to ensure proper accounting for receipts in and disbursements from the water pollution control revolving fund, the Rhode Island water pollution control revolving fund, the local interest subsidy trust fund and other funds it holds or for which it is responsible and, adopt such rules, regulations, procedures, and guidelines which it deems necessary to ensure that local governmental units, persons and corporations administer and maintain approved project accounts and other funds and accounts relating to financial assistance in accordance with generally accepted government accounting standards.

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(b)  The agency shall establish and set up on its books a special fund, designated the water pollution control revolving fund, to be held in trust and to be administered by the agency solely as provided in this chapter and in any trust agreement securing bonds of the agency. The agency shall credit to the water pollution control revolving fund or one or more accounts therein:

(1)  All federal capitalization grant awards received under title VI of the Clean Water Act, 33 U.S.C. § 1381 et seq., provided the agency shall transfer to the department the amount allowed by § 603(d)(7) of the Water Quality Act, 33 U.S.C. § 1383(d)(7), to defray administration expenses;

(2)  All amounts appropriated or designated to the agency by the state for purposes of the fund;

(3)  To the extent required by federal law, loan repayments and other payments received by the agency on any loans, local governmental obligations and non-governmental obligations;

(4)  All investment earnings on amounts credited to the fund to the extent required by federal law;

(5)  All proceeds of bonds of the agency to the extent required by any trust agreement for such bonds;

(6)  All other monies which are specifically designated for this fund, including, amounts from the Rhode Island Clean Water Act environmental trust fund, gifts, bequests, administrative, civil and criminal penalties, or other funds from any public or private sources; and

(7)(i)  Any other amounts required by the provisions of this chapter, agreement, or any other law or by any trust agreement pertaining to bonds to be credited to the fund or which the agency in its discretion shall determine to credit thereto.

(ii)  At the request of the governor, the agency shall take all action necessary to transfer the state’s allotment under title II of the Clean Water Act, 33 U.S.C. § 1281 et seq., for federal fiscal year 1989 and each federal fiscal year thereafter, to the purposes of the water pollution control revolving fund, provided that any portion of any allotment which, under the provisions of the Clean Water Act, 33 U.S.C. § 1251 et seq., may not be transferred to or used for the purposes of the water pollution control revolving fund, shall continue to be received and administered by the department as provided by law.

(c)  The agency shall establish and set up on its books a special fund, designated the Rhode Island water pollution control revolving fund, to be held in trust and to be administered by the agency solely as provided in this chapter and in any trust agreement securing bonds of the agency. The agency shall credit to the Rhode Island water pollution control revolving fund or one or more accounts therein:

(1)  All amounts appropriated or designated to the agency by the state for purposes of the fund;

(2)  At its discretion, and to the extent allowed by law, loan repayments and other payments received by the agency on any loans, local governmental obligations and non-governmental obligations;

(3)  At its discretion, all investment earnings and amounts credited to the fund;

(4)  All proceeds of bonds of the agency to the extent required by any trust agreement for such bonds;

(5)  All other monies which are specifically designated for this fund, including, amounts from the Rhode Island Clean Water Act environmental trust fund, gifts, bequests, administrative, civil and criminal penalties, or other funds from any public or private sources; and

(6)  Any other amounts required by provisions of this chapter or agreement, or any other law or any trust agreement pertaining to bonds to be credited to the fund or which the agency in its discretion shall determine to credit thereto.

(d)  Except to the extent limited by federal law, and subject to the provisions of this chapter, to the provisions of any agreement with the state authorized by § 46-12.2-7, and to any agreements with the holders of any bonds of the agency or any trustee therefor, amounts held by the agency for the account of either the water pollution control revolving fund or the Rhode Island water pollution control revolving fund shall be applied by the agency, either by direct expenditure, disbursement, or transfer to one or more other funds and accounts held by the agency or maintained under any trust agreement pertaining to bonds, either alone or with other funds of the agency, to the following purposes:

(1)  To provide financial assistance to a local governmental unit or corporation to finance costs of approved projects, and to refinance the costs of the projects, subject to such terms and conditions, if any, as are determined by the department and/or the agency in accordance with § 46-12.2-8;

(2)  To purchase or refinance debt obligations of a local governmental unit or corporation, or to provide guarantees, insurance or similar forms of financial assistance for the obligations;

(3)  To fund reserves for bonds of the agency and to purchase insurance and pay the premiums therefor, and pay fees and expenses of letters or lines of credit and costs of reimbursement to the issuers thereof for any payments made thereon or on any insurance, and to otherwise provide security for, and a source of payment for, by pledge, lien, assignment, or otherwise as provided in § 46-12.2-14, bonds of the agency issued in accordance with this chapter; and

(4)(i)  To pay expenses of the agency and the department in administering the funds and the financial assistance programs of the agency authorized by this chapter. As part of the annual appropriations bill, the department shall set forth the gross amount of expenses received from the agency and a complete, specific breakdown of the sums retained and/or expended for administrative expenses.

(ii)  By way of illustration, not by limitation, in the personnel area, the breakdown of administrative expenses should contain the number of personnel paid, the position numbers of the personnel, and whether or not the position is a new position or a position which had been funded previously by federal funds or a position which had been previously created but unfunded.

(e)  The agency shall also establish and set up on its books a special fund, designated the local interest subsidy trust fund, to be held in trust and to be administered by the agency solely as provided in this chapter and in any trust agreement securing bonds of the agency. The agency may maintain a separate account in the local interest subsidy trust fund for each local governmental unit or corporation which has received a loan from the agency, in accordance with this chapter, to separately account for or otherwise segregate all or any part of the amounts credited to the fund and receipts in and disbursements from the fund. To the extent that the agency is required by this chapter, by any loan agreement or by any trust agreement, it shall, and, to the extent that it is permitted, it may in its discretion, credit to the local interest subsidy trust fund, and to one or more of the accounts or subaccounts therein:

(1)  All amounts appropriated or designated to the agency by the state for purposes of the fund;

(2)  Loan repayments and other payments received on loans, local governmental obligations, and non-governmental obligations;

(3)  Investment earnings on amounts credited to the local interest subsidy trust fund;

(4)  Proceeds of agency bonds;

(5)  All other monies which are specifically designated for this fund including, amounts from the Rhode Island Clean Water Act environmental trust fund, gifts, bequests, administrative, civil and criminal penalties, or other funds from any public or private sources; and

(6)  Any other amounts permitted by law.

(f)  Subject to any agreement with the state authorized by § 46-12.2-7, to the provisions of § 46-12.2-8, and to any agreement with the holders of any bonds of the agency or any trustee therefor, amounts held by the agency for the account of the local interest subsidy trust fund shall be applied by the agency, either by direct expenditure, disbursement, or transfer to one or more other funds and accounts held by the agency or maintained under any trust agreement pertaining to bonds, either alone or with other funds of the agency, to the following purposes:

(1)  To pay or provide for all or a portion of the interest otherwise payable by local governmental units, persons or corporations on loans, local governmental obligations, and non-governmental obligations, in the amounts and on terms determined by the agency in accordance with § 46-12.2-8;

(2)  To provide a reserve for, or to otherwise secure, amounts payable by local governmental units, persons or corporations on loans, local governmental obligations and non-governmental obligations outstanding in the event of default thereof; amounts in any account in the local interest subsidy trust fund may be applied to defaults on loans outstanding to the local governmental unit, person or corporation for which the account was established and, on a parity basis with all other accounts, to defaults on any loans, local governmental obligations, or non-governmental obligations outstanding; and

(3)  To provide a reserve for, or to otherwise secure, by pledge, lien, assignment, or otherwise as provided in § 46-12.2-14, any bonds of the agency.

(g)  Subject to any express limitation of this chapter pertaining to expenditure or disbursement of funds or accounts held by the agency, funds or accounts held by the agency may be transferred to any other fund or account held by the agency and expended or disbursed for purposes permitted by the fund or account.