The Board shall authorize the making of a loan under the provisions of § 10.1-638 A only when the following conditions exist:
1. An application for the loan has been submitted by the borrower in the manner and form specified by the Board, setting forth in detail the need for the storage of water, the amount of the loan requested and the use to which the loan shall be applied as well as any efforts made to secure funds from any other source, and such other information required by the Board. The application shall be first submitted to the soil and water conservation district or districts encompassing the watershed wherein the proceeds of the loan would be applied. When the application is approved by the district or districts, the application shall be forwarded to the Board.
2. The borrower agrees and furnishes assurance, satisfactory to the Board, that it will satisfactorily maintain any structure financed in whole or in part through the loans provided by this article.
3. The purpose for which the loan is sought is to acquire land, easements and rights-of-way, or engineering or legal services necessary for a water storage facility or project, or to construct the water storage facility itself. If the requested loan or any part thereof is for the purpose of acquiring land, easements and rights-of-way, then the loan or part thereof designated for such purpose shall not be granted in the absence of evidence satisfactory to the Board that the borrower requesting the loan will in fact acquire the land, easements or rights-of-way if the loan is granted.