Actually, I think the final word will have to come from either an updated admin manual or updated challenge cup rules or both. Because, either statement could be true. I copied this from the SCYSA web page.
10. The Board approved a provision to allow three South Carolina teams that qualified for Premier League in each age and gender division to participate in the Premier League and not be required to participate in the SC State Challenge League.
The word qualified, leads me to believe something was done as Coach P points out.