(a) Submit annually to the department a program statement approved by the local governing entity defining the status of the current required and allowable services the local health department provides. After review and approval by the department, the program statement shall serve as a basis of determining priorities for local development with appropriate state policy and technical assistance.

(b) Submit annually to the department the budget approved by the local governing entity. The budget shall reflect the program statement and include the required services which the local health department provides, other health services proposed for state reimbursement as allowable services, and services proposed for full local or categorical state or federal funding. After review, the department shall determine the services eligible as allowable services for state reimbursement. Determinations regarding proposed allowable services shall be made annually for each local health department.