Funds received for implementation of a county partnership's implementation/management grant may not be used for capital expenses for new construction. However, funds may be made available for renovating, refurbishing, or upgrading of existing facilities used to support First Steps to School Readiness activities and services for children, families, and providers from funds made available to the partnerships in Section 59-152-150(C) and Section 63-11-1750(A). The county partnership must demonstrate to the satisfaction of the First Steps to School Readiness Board that the capital expenditure is:

1. (1) a priority need for the local initiative and other state or federal funds for such projects are insufficient; and
2. (2) necessary to provide services to under-served children and families.