(a) Except for those positions designated as unclassified under (b), the Local Agency shall allocate every Program position to a Classification consistent with the Local Agency's approved Personnel System that is appropriate for the duties of the position.

(b) Every Local Agency may designate a limited number of positions within the Program as unclassified or otherwise not subject to merit system requirements and the requirements of these regulations so long as such designation is consistent with the Local Agency's approved Personnel System concerning the type, number, level and process for establishing such unclassified positions.