(b) Operation of a family care home shall be in accordance with an operating certificate issued pursuant to section 16.05 of this article, subject to the following additional requirements:

1. (1) Operating certificates for family care homes shall be issued only to natural persons, and corporations for profit shall not be formed under the business corporation law for any such purpose.
2. (2) Except as provided in paragraph three of this subdivision no family care homes shall be issued an operating certificate for the purpose of providing suitable care therein to more than six persons.
3. (3) Any provider of service providing family care to more than six persons on July first, nineteen hundred seventy-five shall be issued an operating certificate for a family care home effective April first, nineteen hundred seventy-seven, pursuant to the provisions of this section, provided that such person fulfills all requirements of this section except for the number of persons in care, and that such person agrees to provide family care to no more than ten persons on and after April first, nineteen hundred seventy-seven.

(e) The commissioner shall establish a procedure, subject to the approval of the state comptroller, whereby payments may be made to operators of family care homes for one or more of the following needs of clients residing in such facilities, limited to two hundred ninety dollars per client per year and paid semi-annually in the manner specified by such procedures:

1. (1) Replacement of necessary clothing;
2. (2) Personal requirements and incidental needs of clients;
3. (3) Recreational and cultural activities of clients. Such payments may be made from monies appropriated to the office for this purpose. Such payments shall be audited by the office pursuant to an audit plan approved by the comptroller.