Proceeds of a loan may finance improvements which are necessary to provide adequate indoor plumbing connecting to adequate water supply and sewage disposal systems which include without limitation: Wells; Septic tanks and drain fields; Piping from the system into the buildings; Connection fees and assessments; Plumbing fixtures and equipment, including fixtures for the handicapped; Additions, modifications, and alterations required to provide adequate private space for toilet and bath facilities; Sand mound systems; Water treatment systems; For owner-occupants only, related costs described in Regulation .03B(27) of this chapter, and other costs or improvements essential to implementing the required system, and consistent with the purposes of the Act as determined by the Department; and Alternative and innovative septic and water systems which comply with the requirements of and are approved by MDE and all governmental entities having jurisdiction over those systems. Proceeds of a loan may not finance any improvements which serve a nonresidential portion of a building.