The Department annually shall allocate available funds as described below: Up to 10 percent of the funds shall be placed in a reserve fund for emergency projects and for grant amendments and loan or loan guarantee increases necessitated by change orders and cost overruns; Not more than 25 percent of the funds not reserved under §A, of this regulation, shall be set aside for grants; and Funds remaining after the reserve fund and grant fund are established shall be used for loans and loan guarantees.