| (a) Subrecipients that enter into a Contract with the
Department to administer programs are required to follow all Legal
Requirements governing these programs.
(b) If a Subrecipient fails to comply with program
and Contract requirements, rules, or regulations and in the event
monitoring or other reliable sources reveal material Deficiencies
or Findings in performance, or if the Subrecipient fails to correct
any Deficiency or Finding within the time allowed by federal or state
law, the Department, in order to protect state or federal funds, may
take reasonable and appropriate actions, including, but not limited
to, one or more of the items described in paragraphs (1) - (6) of
this subsection. In so doing, the Department will not take any action
that exceeds what it is permitted to do under applicable state and
federal law. The Department, as appropriate, may provide written notice
of its actions and the rights of a Subrecipient to appeal.
(1) Place it on Cost Reimbursement.
(2) With the exception of non-Discretionary CSBG, withhold
all payments from the Subrecipient (both reimbursements and advances)
until acceptable confirmation of compliance with the rules and regulations
are received by the Department;
(3) Reduce the allocation of funds to Subrecipients
as described in §2.203 of this subchapter (relating to Termination
and Reduction of Funding for CSBG Eligible Entities) and as limited
for LIHEAP funds as outlined in Tex. Gov't Code, Chapter 2105;
(4) With the exception of non-Discretionary CSBG, suspend
performance of the Contract or reduce funds until proof of compliance
with the rules and regulations are received by the Department or a
decision is made by the Department to initiate proceedings for Contract
termination;
(5) If permitted by applicable state and federal statute
and regulations, elect not to provide future grant funds to the Subrecipient,
either prospectively in general or until appropriate actions are taken
to ensure compliance; or
(6) Terminate the Contract. Adhering to the requirements
governing each specific program administered by the Department, as
needed, the Department may determine to proceed with the termination
of a Contract, in whole or in part, at any time the Department establishes
there is good cause for termination. Such cause may include, but is
not limited to: fraud; waste; abuse; fiscal mismanagement; not providing
services to clients, or failing to expend Contract funds to serve
clients, as contemplated under the Contract; or other serious Findings
in the Subrecipient's performance. For CSBG contract termination procedures,
refer to §2.203 of this subchapter.
(c) Contract Closeout. When a Contract is terminated,
or voluntarily relinquished, the procedures described in paragraphs
(1) - (12) of this subsection will be implemented. The terminology
of a "terminated" Subrecipient below is intended to include
a Subrecipient that is voluntarily terminating the Contract.
(1) The Department will issue a termination letter
to the Subrecipient no less than 30 days prior to terminating the
Contract; in the case of a Subrecipient that has notified the Department
in writing of voluntarily relinquishment, the Department will acknowledge
that termination in writing. If the entity is an Eligible Entity the
Department, following the CSBG Act, will simultaneously initiate proceedings
to terminate the Eligible Entity status and the effectiveness of the
contractual termination will be stayed automatically pending the outcome
of those proceedings. The Department may determine to take one of
the following actions: suspend funds immediately or allow a temporary
transfer to another provider; require Cost Reimbursement for closeout
proceedings, or provide instructions to the Subrecipient to prepare
a proposed budget and written plan of action that supports the closeout
of the Contract. The plan must identify the name and current job titles
of staff that will perform the closeout and an estimated dollar amount
to be incurred. The plan must identify the CPA or firm which will
perform the Single Audit. The Department will issue an official termination
date to allow all parties to calculate deadlines which are based on
such date.
(2) If the Department determines that Cost Reimbursement
is appropriate to accomplish closeout, the Subrecipient will submit
backup documentation for all current Expenditures associated with
the closeout. The required documentation will include, but not be
limited to, the chart of accounts, detailed general ledger, revenue
and expenditure statements, time sheets, payment vouchers and/or receipts,
and bank reconciliations.
(3) No later than 30 calendar days after the Contract
is terminated, the Subrecipient will take a physical inventory of
client files, including case management files.
(4) The terminated Subrecipient will have 30 calendar
days from the date of the physical inventory to make available all
current client files, which must be boxed by county of origin. Current
and active case management files also must be inventoried, and boxed
by county of origin.
(5) Within 60 calendar days following the Subrecipient
due date for preparing and boxing client files, Department staff will
retrieve the client files.
(6) The terminated Subrecipient will prepare and submit
no later than 30 calendar days from the date the Department retrieves
the client files, a final report containing a full accounting of all
funds expended under the contract.
(7) A final monthly expenditure report and a final
monthly performance report for all remaining expenditures incurred
during the closeout period must be received by the Department no later
than 45 calendar days from the date the Department determines that
the closeout of the program and the period of transition are complete.
(8) The Subrecipient will submit to the Department
no later than 45 calendar days after the termination of the Contract,
an inventory of the non-expendable personal property acquired in whole
or in part with funds received under the Contract.
(9) The Department may require transfer of title to
Equipment to the Department or to any other entity receiving funds
under the program in question. The Department will make arrangements
to remove Equipment covered by this paragraph within 90 calendar days
following termination of the Contract.
(10) Upon selection of a new service provider, the
Department will transfer to the new provider client files and, as
appropriate, Equipment.
(11) A current year Single Audit must be performed
for all entities that have exceeded the federal expenditure threshold
under 2 CFR Part 200, Subpart F or the State expenditure threshold
under UGMS, as applicable. The Department will allow a proportionate
share of program funds to pay for accrued audit costs, when an audit
is required, for a Single Audit that covers the date up to the closeout
of the contract. The terminated Subrecipient must have a binding contract
with a CPA firm on or before the termination date of the contract.
The actual costs of the Single Audit and accrued audit costs including
support documentation must be submitted to the Department no later
than 45 calendar days from the date the Department determines the
closeout is complete.
(12) Subrecipients shall submit within 45 calendar
days after the date of the closeout process all financial, performance,
and other applicable reports to the Department. The Department may
approve extensions when requested by the Subrecipient. However, unless
the Department authorizes an extension, the Subrecipient must abide
by the 45 calendar day requirement of submitting all referenced reports
and documentation to the Department.
|
