(a) The commission by rule shall establish criteria for setting priorities for projects eligible to receive grants under this chapter. The commission shall review and may modify the criteria and priorities as appropriate.
(b) A school bus proposed for retrofit must be used on a regular, daily route to and from a school and have at least five years of useful life remaining unless the applicant agrees to remove the retrofit device at the end of the life of the bus and reinstall the device on another bus.

(c) A school bus proposed for replacement must:
(1) be of model year 2006 or earlier;
(2) have been owned and operated by the applicant for at least the two years before submission of the grant application;
(3) be in good operational condition; and
(4) be currently used on a regular, daily route to and from a school.
(d) A school bus proposed for purchase to replace a pre-2007 model year school bus must be of the current model year or the year before the current model year at the time of submission of the grant application.