1. Sales tax revenue remitted by the department of revenue to a governmental entity under section 418.12 or financial assistance received by a governmental entity pursuant to section 418.10 shall be deposited in the governmental entity’s flood project fund created for purposes of this chapter and shall be used to fund the costs of the governmental entity’s approved project, to reimburse the governmental entity for funds advanced internally or to help make payments on bonds incurred to pay for approved projects, and to pay principal and interest on bonds issued pursuant to section 418.14, if applicable.

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 2. In addition to the moneys received pursuant to section 418.10 or 418.12, a governmental entity may deposit in the flood project fund any other moneys lawfully received by the governmental entity, including but not limited to local sales and services tax receipts collected under chapter 423B.