A State that receives an application for a subgrant shall take the following steps:
(a) Review. The State shall review the application.
(b) Approval - entitlement programs. The State shall approve an application if:
(1) The application is submitted by an applicant that is entitled to receive a subgrant under the program; and
(2) The applicant meets the requirements of the Federal statutes and regulations that apply to the program.
(c) Approval - discretionary programs. The State may approve an application if:
(1) The application is submitted by an eligible applicant under a program in which the State has the discretion to select subgrantees;
(2) The applicant meets the requirements of the Federal statutes and regulations that apply to the program; and
(3) The State determines that the project should be funded under the authorizing statute and implementing regulations for the program.
(d) Disapproval - entitlement and discretionary programs. If an application does not meet the requirements of the Federal statutes and regulations that apply to a program, the State shall not approve the application.