(a) Grants or loans may be awarded under this section to any State or local governmental entity responsible by law for the provision of sewerage systems to finance the construction of sewerage systems needed to improve water quality whether or not the project is eligible for construction grant assistance under the federal Clean Water Act.

(b) Projects which may receive financial assistance under this section include those providing for:

(1) Chlorine removal;

(2) Nitrogen removal;

(3) Phosphorus removal when in conjunction with a nitrogen removal cost-share grant; or

(4) Wastewater collection or treatment otherwise undertaken to correct existing special water quality needs or an extraordinary public health problem.

(c) Grants or loans awarded under this section may be awarded for up to 100 percent of eligible costs.