Minimum terms and compliance with terms.
  (1) Entities receiving grants or loans shall be required to execute an agreement in the form prescribed by the council setting out the terms and conditions of the grant or loan as approved by the council. A true and complete copy of the application made by the recipient and all additions or amendments thereto shall be attached to the agreement and made a part thereof. Applicants are advised that the council must comply with the Open Records Act, Texas Government Code, Chapter 552, and therefore that the application and supporting documentation are subject to the Open Records Act.
  (2) Agreements shall be executed by the chairman and by the chief executive officer of the recipient or by such other officer authorized by the governing body of the entity to execute the agreement. A certified copy of a resolution of the governing body of the recipient consenting to the terms and conditions of the agreement and authorizing the officer executing it to do so shall be attached to the agreement.
  (3) The agreement shall contain at least the following terms and conditions, together with all such other terms and conditions prescribed by the council:
    (A) performance under the grant shall strictly comply with the proposal submitted in the application, unless specifically modified by the council;
    (B) all equipment purchased through the grant or loan shall be maintained and operated in compliance with manufacturer's warranty requirements, state and federal laws, and in conformance with the SIP. The recipient shall immediately report all citations by regulatory authorities for violations of such provisions to the council;
    (C) the recipient shall assume all liability for the operation and maintenance of equipment purchased through the grant or loan and indemnify the council and the State of Texas from all liability arising therefrom, to the extent permitted by law;
    (D) at the direction of the council, may provide for funding of purchases or construction, in stages, conditioned on delivery of equipment or completion and approval by the council or other appropriate authority of specified stages of construction;
    (E) provide that further funding may terminate at the discretion of the council for the failure of the recipient to comply with the requirement of the grant or loan;
    (F) provide that the agreement may be terminated by mutual agreement of the recipient and the council, and all unexpended funds returned to the council, in the event of either impossibility, including unavailability of equipment planned to be purchased with loan or grant funds, or the commercial unfeasibility of project;
    (G) bind the recipient to refund to the council all funds expended by the recipient in violation of the terms of the agreement, together with all administrative costs, attorneys fees, expenses, and court costs incurred by the council; and
    (H) grant to the council the right to demand and receive reports of progress of the project at specified intervals, the right to audit the recipient with respect to the project, and the right to perform inspections of the project at reasonable times.

Source Note: The provisions of this §655.100 adopted to be effective February 11, 1994, 19 TexReg 628.