(a) Failure to comply with regulations or program requirements.
  (1) If a grant recipient fails to comply with applicable federal or state regulations, the Department will require corrective action to address the violations. If the violation is egregious or the result of failure to implement a previous corrective action plan, the Department will take any action(s) available under the grant agreement, 24 CFR Part 570, and/or the TxGMS.
  (2) If applicable, if the violation or noncompliance is not cured within the period allowed for cure, all TxCDBG funds awarded to the grant recipient will be suspended, including all open grants and any pending awards, until the non-compliance is resolved.
(b) Failure to meet grant agreement requirements. If the Department finds that a grant recipient did not provide the level of benefits specified in its grant agreement, the following actions may be taken, including but not limited to:
  (1) holding the grant recipient ineligible to apply for or receive TxCDBG funds for a period of at least two program years or until any issue of restitution is resolved, whichever is longer; and
  (2) requiring the grant recipient to reimburse the Department for the difference between the amount of funds provided for the level of benefits specified in the agreement and the amount of funds actually expended in providing such level of benefits.
(c) Corrective action plan.
  (1) The Department may require a corrective action plan which includes:
    (A) a statement acknowledging the violation as determined by the Department;
    (B) identification of the cause of the violation and timeline of events;
    (C) a plan outlining actions the grant recipient will take to improve performance to meet program requirements, the persons (or position titles) responsible for implementing the corrective action plan, and the date the plan will be implemented; and
    (D) a statement acknowledging that failure to effectively improve performance may result in a reduction of funding or other sanctions as determined by TDA.
  (2) If the grant recipient fails to provide a corrective action plan, or if the Department determines that proposed project benefits may not be met without an extension of the grant term, the Department may terminate the grant agreement.
  (3) If a grant agreement is terminated, the grant recipient is required to repay all TxCDBG funds received under the grant prior to termination.
(d) Withdrawal, suspension or termination. The Department may withdraw, suspend or terminate an award or grant agreement under other circumstances when warranted by federal or state law, including applicable federal grant management standards or the TxGMS.
(e) Disqualification of an Administrator.
  (1) Third-party administrators. If there is at least one unresolved finding of noncompliance that results in significant required repayment by the grant recipient to the Department, the following actions will be taken:
    (A) after the first finding related to a third-party administrator, administrative costs will be disallowed and funds paid for administration will not be considered toward match requirements; and
    (B) after the second finding related to the same administrator, administrative costs will be disallowed, funds paid for administration will not be considered toward match requirements, and the third-party administrator will be ineligible to administer a TxCDBG grant for a period of three years from the date of the finding.
  (2) Self-administering communities. In the event there is at least one unresolved finding that results in significant required repayment by a grant recipient that self-administers the grant, the following actions will be taken:
    (A) after the first finding, administrative costs will be disallowed and funds paid for administration will not be considered toward match requirements; and
    (B) after the second finding, administrative costs will be disallowed, funds paid toward administration will not be considered toward match requirements, and in order to be eligible for a future TxCDBG grant award, the grant recipient will be required to hire a third-party administrator in good standing with the Department for subsequent TxCDBG grants for a period of three years from the date of the finding.

Source Note: The provisions of this §30.13 adopted to be effective August 28, 2022, 47 TexReg 5099