1. Each legislative body shall create a revolving loan account in the treasury of the community. The account must be administered by the agency.
2. The money in a revolving loan account created pursuant to this section must be invested as money in other accounts in the treasury of the community is invested. All interest and income earned on the money in a revolving loan account must be credited to the account. Any money remaining in a revolving loan account at the end of a fiscal year does not revert to the general fund of the community, and the balance in the account must be carried forward.
3. All payments of principal and interest on loans made to a small business from a revolving loan account must be deposited with the treasurer of the community for credit to the account.
4. Claims against a revolving loan account must be paid as other claims against the agency are paid.
5. An agency may accept gifts, grants, bequests and donations from any source for deposit in the revolving loan account.