The State Fiscal Accountability Authority may make contracts with responsible manufacturers or installers of nationally recognized hazard reducing systems for the installation of approved nationally recognized hazard reducing systems in state institutions. If such contracts are made, the authority may make loans to the institutions involved for the payment for such systems or may accept in such contracts any terms deemed advisable which may be agreed upon with the manufacturers or installers as to the payment therefor. Such contracts shall be made only when, in the judgment of the authority, the resultant reduction in the premium rate, together with any funds which may be made available from other sources, will be sufficient to repay loans made by the authority or to pay for the systems according to contract terms within a period of time satisfactory to the authority. No reduction in the premium rate shall be allowed until such loans have been discharged or until payment has been made in full for the installation of such systems. The authority may also make loans to owners, other than the State, of property insured by them for the purpose of installing such systems when, in their judgment, the reduction in premium rate will be sufficient to retire such loan, or loans, within a period of time satisfactory to the authority. No reduction in the premium rate shall be made until such loans have been liquidated, and a provision to this effect shall be embodied in any such loan agreement.