(1) Requests for financial assistance for the implementation phase shall be submitted to the department between November 1 of any year and the last day of February of the following year.

(2) The applicant will submit two preapplication forms to the nearest local clearinghouse; one for the department and one for planning and community affairs. These forms are available from either the department or the clearinghouse.

(3) The applicant shall accompany the request for financial assistance with a copy of the completed comprehensive water conservation plan as approved by the department indicating which part(s) of the plan the proposed project fits under and the location of the proposed project on a United States Geological Survey Quadrangle map or any other comparable and readily available map.

(4) Within ninety days of receipt of the request for financial assistance, the department will notify the applicant of its preliminary findings regarding eligibility as to organization, type of project, purpose(s) of project, and conformance with the objectives of Referendum 38. In all cases the department shall make its final selection of funded projects and notify the applicant no later than May 31 of the year following the close of the current application period.

(5) Requests for loan funding must be accompanied by a resolution executed by the applicant's governing body that they will follow the procedures for indebtedness in chapter 87.03 RCW and establish a reserve account into which funds will be deposited in an amount adequate to provide coverage for principal and interest payments due under the loan agreement, whenever circumstances beyond the applicant's control preclude payments from standard sources.