(a) No person who is a director, officer or employee of the applicant or an officer or employee of the State and no firm, organization, corporation, or partnership in which any such person, his or her spouse, children, or parents has any interest, direct or indirect, may receive, by contract or otherwise, funds granted by the State.

(b) Upon the written request by the applicant the OMH may waive the provisions of subdivision (a) of this section by giving prior written approval after full disclosure of all relevant facts and circumstances.