Upon execution of the grant agreement, payments may be made to the eligible applicant as provided in the grant agreement either to advance to or to reimburse the applicant for the actual and necessary cost(s) of providing the infrastructure improvements. Payments, however, shall not be conditioned on prepayment by the applicant. Such payments shall be made in accordance with the agency's prompt payment policy.

If the agency so requires, fidelity bonds covering the employees of the grantee who will handle the funds to be received under the act will be required. Funds advanced are to be considered funds of the agency and not funds of the grantee.