(a) Except as specified in Section 87162(a), which provides that the applicant may be issued a provisional license based upon substantial compliance and immediate need, the licensing agency shall deny an application for an initial license if it is determined that the applicant is not in compliance with applicable law and regulations.

(b) The licensing agency shall have the authority to deny an application for an initial license if the applicant has failed to pay any civil penalty assessments pursuant to Section 87768, Unlicensed Facility Penalties, and in accordance with a final judgment issued by a court of competent jurisdiction, unless payment arrangements acceptable to the licensing agency have been made.

(c) The licensing agency shall have the authority to deny an initial application if the applicant does not comply with Sections 87155(a)(2) and (9), and Health and Safety Code sections 1569.1515(b) and 1569.50.

(d) If the application for an initial license is denied, the application processing fee shall be forfeited.

(e) If the application for an initial license is denied, the licensing agency shall send a written notice of denial by certified mail. The notification shall inform the applicant of the denial; set forth the reasons for the denial; and advise the applicant of the right to appeal.

(f) Except as otherwise specified by Health and Safety Code section 1569.50(d), an applicant may appeal the denial of the application by sending a written notice of appeal to the licensing agency within 15 days of the postmark date of the denial notice.

(g) The licensing agency shall, upon receipt of the notice of appeal, advise the applicant in writing of the appeal procedure.

(h) The proceedings to review such denial shall be conducted pursuant to the provisions of Chapter 5 (commencing with Section 11500), Part 1, Division 3, Title 2 of the Government Code.