(a) Purpose. This section describes the process for handling award funds that are not spent by a AAA at the end of a federal fiscal year, including the process for distributing funds in the statewide carryover pool.
(b) Award funds. HHSC allocates to a AAA federal funds awarded under the Older Americans Act to spend in implementing its area plan during a federal fiscal year. These funds are referred to in this section as "award funds."
(c) Unspent award funds.
  (1) If, at the end of a federal fiscal year, a AAA has unspent award funds that were received in the first six-month period of the federal fiscal year, the unspent funds are handled as follows:
    (A) the AAA may spend up to five percent of the unspent award funds in the next federal fiscal year to implement its area plan; and
    (B) HHSC places any unspent award funds that are more than five percent in the statewide carryover pool.
  (2) The AAA may spend any unspent award funds received in the second six-month period of the fiscal year in the next federal fiscal year to implement its area plan.
(d) Distribution of statewide carryover pool. The funds placed in the statewide carryover pool, as described in subsection (c)(1)(B) of this section, are distributed by HHSC:
  (1) in accordance with the formula described in subsection (e) of this section; and
  (2) to a AAA for the fiscal year before the distribution will occur if the following criteria are met:
    (A) the AAA has submitted to HHSC all reports listed in the AAA Report Due Date Schedule by the time and date listed on such schedule or by the time and date of an extension granted by HHSC in accordance with §85.201(d)(3) of this chapter (relating to AAA Administrative Responsibilities);
    (B) as determined by HHSC, the AAA meets all performance measures set by HHSC under the contract or is above or below such measures within five percent;
    (C) HHSC did not place unspent award funds of the AAA in the statewide carryover pool in accordance with subsection (c)(1)(B) of this section;
    (D) the AAA has not had a Level Three Sanction or Level Four Sanction imposed by HHSC in accordance with §81.13 of this title (relating to Compliance with Contractor Responsibilities, Rewards and Sanctions);
    (E) if unallowable costs have been identified for the AAA in accordance with §85.202(e) of this chapter (relating to AAA Fiscal Responsibilities), the AAA has either refunded the amount of such costs to HHSC or is current under a payment agreement approved by HHSC to refund the amount of such costs;
    (F) the AAA has met the adequate proportion requirement, which may include a waiver granted by HHSC, in accordance with §85.202(k) of this chapter; and
    (G) if the AAA is part of a host agency as defined in 26 TAC §88.2 (relating to Definitions), the AAA has complied with 26 TAC §88.406 (relating to Requirements Regarding Expenditures for the Ombudsman Program).
(e) Formula for distribution of statewide carryover pool. HHSC distributes funds from the statewide carryover pool to AAAs that meet the criteria described in subsection (d) of this section as follows:
  (1) 50 percent of the funds are distributed in equal amounts to the qualifying AAAs; and
  (2) 50 percent of the funds are distributed to the qualifying AAAs in accordance with §85.501(g) and (h)(1) - (3) of this chapter (relating to the AAA Funding Allocation Formula for Older Americans Act Programs).

Source Note: The provisions of this §213.303 adopted to be effective September 1, 2011, 36 TexReg 4811; amended to be effective April 5, 2018, 43 TexReg 2027; transferred effective November 15, 2020, as published in the Texas Register October 30, 2020, 45 TexReg 7721