In furtherance of the development, control and conservation of the water resources of the state and the State Water Resources Development System it is the policy of the state to provide financial assistance to public agencies for the construction of water projects to meet local requirements in which there is a statewide interest by making grants or loans, or both, and by participating in the construction and operation of water projects, and also to provide financial assistance to public agencies for the preparation of certain feasibility reports on such water projects by making loans, in accordance with this chapter.