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Can we install customized tiles in the entrance to our facility that showcase our city’s history and beauty, since the facility was designed to reflect our regional geography/culture?

Yes, in this example, the tiles would serve a functional purpose by protecting the interior walls or floors of the facility from deterioration. Hence, the cost of acquiring, arranging, and installing commercially available tiles that reflect local designs or aesthetics (e.g. a “southwestern” pattern) would be eligible for FTA grant funding.  However, if the transit agency decided to commission an artist to create a work of art on or from such materials, the costs attributable to the artist’s work would not be eligible for reimbursement or included in the total cost of the project for purposes of determining the Federal and local share.