(1)    Definition. In this section:

      (a)    “Hospital” has the meaning given under s. 50.33 (2).

      (b)    “Rural” means outside a metropolitan statistical area, as specified under 42 CFR 412.62 (f) (ii) (A).

   (4)   Departmental duties. The department shall negotiate with each recipient of a loan made under s. 146.62 (2) and (3), 1989 stats., the schedule of repayments and collect the loan repayments as they are due. Loan repayments shall be deposited in the general fund. Except as provided in sub. (5), repayment for each loan shall begin no later than 12 months after the project funded under the loan begins operation.

   (5)   Loan forgiveness. If a rural hospital that receives a loan under s. 146.62 (2) and (3), 1989 stats., is unable to undertake the proposed project, the rural hospital may submit to the department a final report concerning the feasibility of loan repayment. The department shall review the report and may forgive all or part of the loan.