(a) A modification or termination of the permanent guardianship may be requested by the permanent guardian, by the child if the child is sixteen (16) years of age or older, the parent, or by the state. A modification or termination may also be ordered by the juvenile court on its own initiative.

(b) Where the permanent guardianship is terminated by a juvenile court order, the court shall make further provisions for the permanent guardianship or custody of the child, based upon the best interests of the child.

(c) An order for modification or termination of the permanent guardianship shall be based on a finding, by a preponderance of the evidence, that there has been a substantial change in material circumstances, or a determination by the court that one (1) or more findings required by § 37-1-802(b) no longer can be supported by the evidence. In determining whether there has been a substantial change in circumstances, the court may consider whether the child's parent is currently able and willing to care for the child, or that the permanent guardian is unable to continue to care for the child.

(d) Prior to issuing an order modifying or terminating the order of permanent guardianship, the court shall also find that the proposed modification or termination is in the best interests of the child. In determining whether it is in the child's best interest that the permanent guardianship be modified or terminated, the court shall consider, along with other evidence determined to be relevant, the following factors:

(1) The child's need for continuity of care and caregivers, and for timely integration into a stable and permanent home, taking into account the differences in the development and the concept of time of children of different ages;

(2) The physical, mental, and emotional health of all individuals involved, to the degree that each affects the welfare of the child, the decisive consideration being the physical, mental, and emotional needs of the child; and

(3) The quality of the interaction and interrelationship of the child with the child's parent, siblings, relatives, and caregivers, including the proposed permanent guardian.

(e) Prior to modifying or terminating the permanent guardianship order to return the child to the parent, the court must consider whether there has been resolution of the factors in the home that resulted in the adjudication of the child as dependent and neglected, unruly, or delinquent. Where there has been involvement of the family with the department, consideration may include the parent's history of participation in working toward completion of the permanency plan.

(f) In the event that it is necessary to appoint a successor permanent guardian, appropriate parties may be considered by the court, with the parent having no greater priority than a third party. The court may also consider, where appropriate, return of custody to the parent.

(g) If a child is in partial or permanent guardianship of the department pursuant to title 36, that guardianship may be transferred to a permanent guardian pursuant to this section with the consent of the guardian.