(1)    Aid applications approved but unfunded because of a lack of funds remain eligible for future funding, subject to updating as the department may require. A lack of funding under this subchapter does not preclude a district from implementing all or part of an approved plan with funding from any other source but these projects are not eligible for retroactive financial assistance.

   (2)   The department shall return rejected applications to the district with a concise statement of the reasons for rejection.