Use of Federal Grants and Other Grants. Any federal or other grant that is received for an eligible project shall be applied first to the cost of the project. All other sources of funds shall be expended before the State grant is expended on an approved project. Limits of State Grant. Except as provided in §D(1) and (2) of this regulation, a State grant may not exceed 50 percent of the cost of eligible work remaining unpaid after all federal and other grants have been applied. A State grant may not be used for retroactive participation in the cost of conversion, construction, renovation, acquisition, or purchase of equipment. The State grant may include only those costs incurred or obligations contracted for after the application has been approved by the Department. Costs necessary and appropriate for filing an application, such as appraisals, surveys, and test borings, shall be paid by the applicant. These costs may be approved for funding by the Board of Public Works, if the project is approved by the Board of Public Works. State grant funds may not be used to pay certain costs. These costs include: Closing costs; Noncapital equipment; Consultant services; Land; Off-site improvements; and Amounts that exceed the appraised value of the real property. Exceptions on State Grant Limits. The Department may request Board of Public Works approval for a State grant to exceed 50 percent of the cost of eligible work remaining unpaid after all federal and other grants have been applied, if: 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; 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; 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 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. A project designated as eligible for poverty area under §D of this regulation may receive a State grant to cover up to 75 percent of the cost of eligible work remaining unpaid after all federal and other grants have been applied. Poverty Area Funding. An applicant is eligible for poverty area funding for a facility if: The project complies with all applicable federal regulations and State plans or Departmental regulations; and The majority of individuals served by the facility: Are certified by a local department of social services as eligible for General Public Assistance or Medical Assistance; Are eligible for Supplemental Security Income benefits; or Have income levels which do not exceed 150 percent of the federal poverty level. Funding Contribution Requirements The applicant shall provide, from other sources, funds equal to the total cost of the eligible project less the State grant award. The applicant shall assume the risk of all costs associated with the project that are incurred before the date of approval of a State grant award by the Board of Public Works. An applicant may not expend the State grant award before other sources of funds are expended unless the Board of Public Works approves otherwise. The Department may not consider as contributions: Real or personal property; In-kind contributions; or Unless approved by the Board of Public Works under §B(4) of this regulation, funds expended before the date a grant award is approved by the Board of Public Works. Prohibition Against Use of the Project for Purposes Other Than Assisted Living. A grantee may not use a project funded by a State grant primarily: For the furtherance of sectarian religious instruction or services; As a place of sectarian religious worship or instruction, or primarily in connection with any program or department of divinity for any religious denomination; or For any purpose other than assisted living. Upon the request of the Board of Public Works, the grantee shall submit evidence satisfactory to the Board that none of the proceeds of the grant has been, or is being, used for a purpose prohibited by the Act.