(a) Of the funds made available by Section 91010, three hundred eighty-six million two hundred fifty thousand dollars ($386,250,000) shall be available, upon appropriation by the Legislature, to the water board for grants and projects related to water reuse and recycling, including, but not limited to, the following:

1. (1) Treatment, storage, conveyance, and distribution facilities for potable and nonpotable recycling projects.
2. (2) Dedicated distribution infrastructure to serve residential, commercial, agricultural, and industrial end user retrofit projects to allow use of recycled water.
3. (3) Multiple-benefit recycled water projects that improve water quality.

(c) The water board shall adopt modified grant funding requirements for large-scale water recycling or reuse projects, including all of the following requirements:

1. (1) Ancillary facilities that are part of large-scale water recycling or reuse projects shall be eligible for funding. Ancillary facilities include, but are not limited to, pipelines, extraction wells, injection wells, recharge basins, and nitrogen removal treatment systems, pertinent structures, and connection assemblies.
2. (2) This section does not preclude the water board from awarding funding to a large-scale water recycling or reuse project for multiple project phases or components, or more than once during the project development period. The water board shall not require user agreements or contracts for water delivery, nor shall full completion of the project be required before the submission of a subsequent grant application, as a condition for award of grant funding.
3. (3) At least 10 percent of the grant funding shall be awarded for the purpose of planning and design.
4. (4) Reasonable geographic allocation to eligible projects throughout the state, including both northern and southern California and coastal and inland regions.