A refugee who is eligible for, and is required to participate in, an alternative project implemented pursuant to Section 412(e)(7) of the federal Immigration and Nationality Act (Section 1522(e)(7) of Title 8 of the United States Code), shall not be eligible for benefits under this chapter. This section shall apply only when an alternative project uses payment levels for project participants that are substantially equal to payment levels in effect for persons receiving aid under this chapter, with respect to both cash and in-kind payments, and if the assistance

provided to the alternative project participant is considered a grant rather than a loan.