A. Money in the forest land protection revolving fund may be used to administer and carry out the purposes of the Forest and Watershed Restoration Act and to fund projects authorized by the division on any lands in the state for: (1)     on-the-ground restoration treatments;

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(2)     project planning;

(3)     economic development programs to advance the use of small-diameter trees and wood biomass removed for hazardous fuel reduction and forest and watershed restoration; or

(4)     workforce development for wood utilization projects.

B. A project is eligible for funding if the project is for a public benefit and:

(1)     is part of a current state forest and watershed health plan or forest action plan, a community wildfire protection plan, other comprehensive forest and watershed treatment plan or wildlife conservation or habitat improvement plan approved by the board;

(2)     incorporates actions recommended by current plans or, where new plans are developed, seeks to integrate forest, fire and water management with community and economic development plans;

(3)     protects watersheds that are the source of drinking or irrigation water; (4)     targets an area at high risk of catastrophic wildfire; or

(5)     has obtained all requisite state and federal permits and authorizations necessary to initiate the project, if the project is other than a planning project.

C. A project that is eligible for funding in accordance with Subsection B of this section shall be given priority for funding by the division if the project:

(1)     leverages federal, state, local, tribal or private sources and, if available, support from other public or private water, forest, fire, wildlife habitat or economic development programs;

(2)     is in an area:

(a) with a wood supply that can be used as biomass for energy production; (b) where small-diameter trees may be put to commercial use; or

(c) where traditional forest products may be produced;

(3)     is clustered around priority areas that are able to supply a useful amount of wood products for industry; or

(4)     creates incentives to increase investment by federal, state, local, tribal or private entities, including investment by downstream water users to manage forested headwaters and water sources.

D. Beginning July 1, 2019, sponsors may apply to the division for project funding.