(7) 119.7 Award of Loans

The awarding of all loans shall be at the sole discretion of the state fire marshal.

(a) Upon determining which small governments shall receive a loan, the state fire marshal shall notify the qualifying small government in writing of his intent to grant the loan and of the terms and conditions of the loan.

(b) Promptly after receiving notification that the state fire marshal intends to grant a loan to the qualifying small government, the qualifying small government must adopt a resolution or ordinance which shall:

(i) Authorize the small government to accept the loan;

(ii) Agree to conditions of the loan as stipulated by the state fire marshal including the authority to execute any documents necessary to grant or secure the loan.

(c) Within forty-five days of receipt of the notice of the state fire marshal's intent to award the loan the qualifying small government shall forward a copy of the resolution or ordinance to the state fire marshal.

(d) Upon receipt of the resolution or ordinance the state fire marshal shall establish a line of credit from the loan fund in the name of the qualifying small government.

(e) Within one hundred twenty days of the date the notice of intent to award the loan was received, the qualifying small government shall provide to the state fire marshal a properly executed contract or purchase agreement for the construction, addition or alteration of the building or purchase of the vehicle or equipment described in the original loan application.

(f) Upon determination that the contract or purchase agreement is for substantially the same project as described in the original loan application, the loan funds will be released to the qualifying small government according to the term of the loan agreement.