(a) Within the limits of funds determined by the Secretary to be available for such purposes, the Secretary may award grants under this subpart to applicants therefor which, in his judgment, will provide needed health services in a catchment area not served by another project funded under this part and meet the applicable requirements of section 319(d)(1)(B) of the Act and this part, in accordance with the priorities established pursuant to section 319(b) of the Act and §56.107 of subpart A of this part; Provided, That in the case of applicants which propose to serve substantially the same catchment area or where available funds are insufficient to fund all approvable applications within a priority category specified in §56.107, the Secretary will award the grant to the applicants which, in his judgment, will best promote the purposes of section 319(d)(1)(B) of the Act and the applicable regulations of this part, taking into account with respect to each application:

(1) The degree to which the project would provide the services enumerated in §56.102(g)(1) and the feasibility of its providing all of such enumerated services by the end of the period of support under section 319(d)(1)(B) of the Act and this subpart;

(2) The degree to which the applicant intends to integrate services supported by a grant under this subpart with health services provided under other federally assisted health service or reimbursement programs or projects;

(3) The capability of the project to provide quality health care services;

(4) The administrative and management capability of the applicant; and

(5) The capability of the applicant to provide primary health services directly. In evaluating the relative capability of the applicant to provide such services directly, the Secretary shall take into consideration whether the direct provision of services is inappropriate because:

(i) Provision of such services through contract or other arrangement would be more cost-effective;

(ii) Provision of such services directly would unnecessarily duplicate existing resources; or

(iii) Provision of the services other than directly would enhance the accessibility or acceptability of the services to the population served.

(6) The extent to which community resources will be utilized by the project; and

(7) Consistent with the other requirements of this part, the degree to which and the manner in which the applicant provides specific health services which the Secretary has, through publication of a notice in the Federal Register, established as services which should receive emphasis by applicants.

(b) The Secretary shall:

(1) Make no more than two grants for the same entity under section 319(d)(1)(B) of the Act;

(2) Not make any grant under section 319(d)(1)(B) to an entity which, for the same project, has been awarded more than one grant under section 319(c) of the Act;

(3) Not make a grant under section 319(d)(1)(B) to an entity which has been awarded a grant under section 319(d)(1)(A) of the Act.