(1) Public grant applications are evaluated and ranking points awarded by the department. Applicants shall gain points for proposals that establish the project's approach has technical merit and that the project will:

(a) implement an action identified as a priority in the state water plan adopted by the department, support water storage priorities, preserve farmland or be located on family farmland;

(b) initiate the use of water reserved under Montana law or help resolve Native American/federal reserved water rights;

(c) conserve, develop, manage, or protect a water and/or other renewable natural resource;

(d) be multi-purpose, used by the public, have public support, have co-funding from non-state funds in an amount greater than the grant request, or will be a source of new, permanent jobs.

(2) Applicants shall lose points when adverse environmental impact and/or poor financial feasibility are indicated.

(3) Tie-breaker points may be added for otherwise high scoring proposals that will also mitigate human health or safety problems or show that, without grant funds, the project cannot be accomplished by the applicant.

(4) Applicants shall be assigned a net ranking score based on all points gained or lost. Ranking scores will be used to determine department funding recommendations and incorporated in a report to the legislature recommending public grant applications for funding and the amount of grant award suggested. Funding recommendations are made to maximize benefit to Montanans and will be based on the total amount of grant funds available, the amount of grant funds requested, the total project cost, availability and amount of other funding, and affordability data presented in the grant application or gathered in the application review.