(a) When the department has reason to believe that one or more grounds for funding action exist as set forth in section 700.3(a), (b) or (c), the department shall serve upon the grantee a written preliminary determination of funding action, by certified mail, return receipt requested, which shall state the ground(s) for the proposed action and shall identify with reasonable specificity any facts or documents relied upon as a basis for that action.

(b) The preliminary determination shall advise the grantee that it has the opportunity within 20 business days of receipt of the preliminary determination, to make a written request for an adjudicatory hearing under this Part.

(c) The preliminary determination shall also advise the grantee of its right, if any, to continued funding under section 700.8 of this Part for funding action which falls within section 700.3(a) or (b).

(d) If the grantee advises the department in writing that it will not request a hearing or fails to request a hearing within the time prescribed in subdivision (b) of this section, or fails to resume performance of the services abandoned as set forth in section 700.3(b) or (c) of this Part, the department's preliminary determination of funding action under section 700.3(a), (b) or (c) shall become final and effective.