California Code, Water Code - WAT § 78674

The department may make loans to local agencies, at the interest rates authorized under this article and under any terms and conditions as may be determined necessary by the department, for the purposes of financing feasibility studies of projects potentially eligible for funding under this article.  No single project shall be eligible to receive more than one hundred thousand dollars ($100,000), and not more than 3 percent of the total amount of bonds authorized to be expended for purposes of this article may be expended for the purposes of financing feasibility studies.  A loan for a feasibility study shall not decrease the maximum amount of any other loan which may be made under this article.