It appears that not only yeshivos affiliated with Peleg Yerushalmi are banned from accepting state funds, but the same holds true for shuls.
Beis Knesset Mishkan Aharon, located on Netivot HaMishpat Street in Modi’in Illit now exhibits a sign stating “The outside of the building was done with city funding with the exception of this floor” which is left without the traditional Jerusalem stone.
The upper floor of the multi-story building is home to Beis Knesset M’shovav Netivot headed by HaGaon Rav Ephraim Rothschild, and the bottom floor is the Peleg-affiliated shul, which was left with its raw concrete exterior instead of the traditional Jerusalem stone outer wall.
One of the mispallalim in the upper floor Beis Knesset M’shovav Netivot is quoted telling Kikar Shabbos “The sign does not reflect reality since the outer stone covering to the upper floor shul was accomplished by private funding and not from the city”.
Kikar News adds that the sign was hung simply to silence the critics who fear the Peleg shul may have taken state funding.
(YWN Israel Desk – Jerusalem)