# Health - General (GHG)

## Title 24. Miscellaneous Provisions

### Subtitle 10. Assisted Living Facilities Grant Program

#### Section 24-1001

(a) In this subtitle the following words have the meanings indicated.

(b) "Assisted living facility" means a residential facility or facility-based program that:

  (1) Meets the definition in Sec. 19-1801 of this article; and

  (2) Is licensed by the Department.

(c) "Facility" means an assisted living facility that is wholly owned by and operated under the authority of:

  (1) A county;

  (2) A municipal corporation; or

  (3) A nonprofit organization.

(d) "Nonprofit organization" means:

  (1) A bona fide religious organization, no part of the earnings of which inures to the benefit of any individual or is used for any purpose other than the maintenance and operation of a facility, the purchase of equipment to be used in a facility, or the expansion of a facility; or

  (2) An organization:

    (i) That is chartered as a nonprofit corporation and classified by the Internal Revenue Service as nonprofit; and

    (ii) No part of the earnings of which inures to the benefit of any individual or is used for any purpose other than the maintenance and operation of a facility, the purchase of equipment to be used in a facility, or the expansion of a facility.

(e) "Wholly owned" includes leased, if:

  (1)

    (i) The lease is for a minimum term of 30 years following project completion; or

    (ii) The lease agreement extends the right of purchase to the lessee; and

  (2) The lessor consents to the recording in the land records of the county or Baltimore City in which the facility is located, of a notice of the State's right of recovery as provided under Sec. 24-1006 of this subtitle.

#### Section 24-1002

On the recommendation of the Secretary, the Board of Public Works may make grants to counties, municipal corporations, and nonprofit organizations for:

(1) The conversion of public buildings or parts of buildings to assisted living facilities;

(2) The acquisition of existing buildings or parts of buildings for use as assisted living facilities;

(3) The renovation of assisted living facilities;

(4) The purchase of capital equipment for assisted living facilities; or

(5) The planning, design, and construction of assisted living facilities.

#### Section 24-1003

(a) Any county, municipal corporation, or nonprofit organization sponsoring a project involving work specified in Sec. 24-1002 of this subtitle may apply to the Secretary for a State grant to be applied toward the cost of that project.

(b) On approval of a project and the project plans by the Department, the Secretary shall promptly report the application to the Board of Public Works, together with the Secretary's recommendation that the Board make funds available as provided in this subtitle.

#### Section 24-1004

(a) The allocation and use of State funds under this subtitle are subject to the following terms and conditions.

(b) If the local government and the Department certify to the Board of Public Works that a surplus public building appropriate for use as an assisted living facility does not exist in the area in which the facility is to be located, State funds may be used to:

  (1) Acquire an existing building or part of a building for use as an assisted living facility; or

  (2) Plan, design, and construct an assisted living facility.

(c) Any federal or other grant that is received for an eligible project shall be applied first to the cost of the project.

(d) Except as provided in subsections (e) and (f) of this section, a State grant may not exceed 50% of the cost of eligible work remaining unpaid after all federal and other grants have been applied.

(e) At the discretion of the Board of Public Works, a State grant may exceed 50% of the cost of eligible work remaining unpaid after all federal and other grants have been applied, if:

  (1) The project involves the conversion of a public building or part of a building to an assisted living facility, the renovation of an assisted living facility, or the planning, design, and construction of an assisted living facility;

  (2) The value of real property and improvements made available by the local government, or the value of the center to be renovated, equals or exceeds the amount of the State grant;

  (3) State funds have not been used for the acquisition, construction, or maintenance of any real property and improvements made available by the local government or any building to be converted or renovated; and

  (4) The State is not responsible for any bonded indebtedness in connection with any real property and improvements made available by the local government or any building to be converted or renovated.

(f) For a project designated as eligible for poverty area funding under federal regulations, State plans, or departmental regulations, a State grant may cover up to 75% of the cost of eligible work remaining unpaid after all federal and other grants have been applied.

(g) The amount of the State grant for any project shall be determined after consideration of:

  (1) All eligible applications;

  (2) The total of unallocated State funds available at the time the application is received; and

  (3) The priorities of area need established by the Department.

(h)

  (1) No portion of the proceeds of a State grant may be used:

    (i) To further sectarian religious instruction;

    (ii) In connection with the design, acquisition, or construction of any building to be used as a place of sectarian religious worship or instruction; or

    (iii) In connection with any program or department of divinity for any religious denomination.

  (2) On the request of the Board of Public Works, the applicant shall submit evidence satisfactory to the Board that the proceeds of the grant are not being used for a purpose prohibited under this subsection.

#### Section 24-1005

(a) The Board of Public Works shall make allocations from funds available under this subtitle in accordance with this subtitle.

(b) The Board shall certify the allocations to the proper State officers, and the Treasurer shall make payments to or on behalf of the applicant, when needed, for the approved project.

(c) The Board of Public Works may adopt regulations to implement this section.

#### Section 24-1006

(a) The State may recover from either the transferor or transferee or, in the case of a property that has ceased to be a "facility", from the owner, an amount bearing the same ratio to the then current value of so much of the property as constituted an approved project as the amount of the State participation bore to the total eligible cost of the approved project, together with all costs and reasonable attorney's fees incurred by the State in the recovery proceedings, if, within 30 years after completion of a project, a property for which funds have been paid under this subtitle:

  (1) Is sold or transferred to any person, agency, or organization that would not qualify as an applicant under this subtitle, or that is not approved as a transferee by the Board of Public Works; or

  (2) Ceases to be a "facility" as defined in this subtitle.

(b)

  (1) Before the State makes any funds available for an approved project, the Department shall cause a notice of this right of recovery to be recorded in the land records of the county or Baltimore City in which the property is located.

  (2) The recording of the notice:

    (i) Does not create a lien against the property; but

    (ii) Shall constitute notice to any potential transferee, potential transferor, potential creditor, or other interested party of the possibility that the State may obtain a lien under this subtitle.

(c)

  (1)

    (i) The Secretary of the Board of Public Works may file a civil claim under subsection (b) of this section, in the circuit court for the county or Baltimore City in which the property is located, against the owner of the property and any other interested parties, including any transferor that the State wishes to make a party.

    (ii) The claim shall be filed with:

      (1) Sworn affidavits stating facts on which the allegations of default are based; and

      (2) A detailed justification of the amount claimed.

  (2) If the circuit court determines from the State's initial filing that there is probable cause to believe that a default has occurred, pending full determination of the State's claim, the court shall authorize a temporary lien on the property:

    (i) In the amount of the State's claim plus any additional amount estimated to be necessary to cover the costs and reasonable attorney's fees incurred by the State; or

    (ii) In other amounts that the court determines to be reasonable.

  (3)

    (i) A temporary lien shall take effect:

      (1) On the date of the court's authorization, if the Secretary of the Board of Public Works records a notice of temporary lien in the land records of the county or Baltimore City in which the property is located within 10 days after the court's authorization; or

      (2) On the date a notice of temporary lien is recorded.

    (ii) While the temporary lien is in effect, neither the owner nor any person who acquired an interest in the property after the State first made funds available in connection with the property may without the prior written consent of the State:

      (1) Take any action that would affect the title to the property; or

      (2) Institute any proceedings to enforce a security interest or other similar rights in the property.

  (4)

    (i) The owner of the property or any other interested party may obtain release of a temporary lien at any time by filing with the court a bond securing the payment in full of the State's claim and any additional amount necessary to cover the costs and reasonable attorney's fees incurred by the State.

    (ii) The owner or other interested party may cause the release to be recorded in the land records.

(d) Proceedings to determine the State's right to recover and the amount of its recovery under this subtitle shall have priority over other civil proceedings in the circuit courts.

(e)

  (1)

    (i) At the conclusion of full adversary proceedings on the issue of default and of any disputes over the amount of the State's recovery, the circuit court shall, if it finds that a default has occurred, issue a final judgment for the amount it finds to be recoverable by the State.

    (ii) All parties involved in the default, including in every case the owner of the property, shall be held jointly and severally liable to the State for the amount of the judgment.

  (2)

    (i) Except as the State may otherwise provide by a written subordination agreement, if the amount of the final judgment remains unpaid after 30 days following the court's final order, the final judgment shall constitute a lien on the property, superior to the lien or other interest of a mortgagee, pledgee, purchaser, or judgment creditor whose interest became perfected against third persons after the State first made funds available under this subtitle.

    (ii)

      (1) Except as provided in item 2 of this item, a lien takes effect on the date a notice of lien is recorded.

      (2) A lien takes effect on the 31st day following the court's final order if the Secretary of the Board of Public Works records a notice of lien in the land records of the county or Baltimore City in which the property is located on or before the 41st day following the final order.

    (iii)

      (1) At the time that a lien takes effect, any temporary lien then in effect shall be automatically and fully released.

      (2) The recorded notice of a lien shall constitute notice of the release of a temporary lien.

    (iv) A lien imposed under this subsection may be enforced and foreclosed in accordance with the procedures prescribed in the Maryland Rules, except that neither the State nor any agent appointed by the State to sell the property need file a bond.

  (3)

    (i) The owner or any other interested party may obtain release of a lien at any time by paying to the State the full amount of the judgment rendered by the circuit court, together with interest from the date of judgment.

    (ii) On payment in full, the Secretary of the Board of Public Works shall cause a release to be recorded in the land records.

  (4) If the circuit court finds that there has been no default or if the full amount of the court's judgment is paid to the State within 30 days after the court's final order, a temporary lien then in effect shall be released immediately and the Secretary of the Board of Public Works shall cause the release to be recorded in the land records.

(f)

  (1) All funds recovered as a result of this right of recovery shall be deposited in the Annuity Bond Fund and applied to the debt service requirements of the State.

  (2) If the Board determines that there is good cause for releasing the transferor, transferee, or owner from the obligation imposed under this subtitle, the Board of Public Works may waive the State's right of recovery under this subtitle.

#### Section 24-1007

The Department shall adopt regulations to implement the provisions of this subtitle.

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Md. Code Ann., Health-Gen. (as displayed at mgaleg.maryland.gov, October 16, 2026)