(a) The selection committee shall recommend to the department guidelines for the awarding of forgivable loans to outstanding rural scholars.
(b) The department, acting on the advice of the selection committee, shall award forgivable loans to outstanding rural scholars based on the availability of money in the fund.

(c) If in any year the fund is inadequate to provide loans to all eligible applicants, the department shall award forgivable loans on a priority basis according to the applicants’ academic performance, test scores, and other criteria of eligibility.