(a) A Board or AEL grant recipient shall meet or exceed expenditure and performance targets as set forth in its contracts. The Commission shall determine the Boards' or AEL grant recipients' performance targets based on federal and state performance standards and by using factors that may be necessary to achieve the mission of the Commission and reflect local conditions. The Commission approves individual Board or AEL grant recipient performance targets annually, which may be adjusted based on local conditions including, but not limited to, specific economic conditions and demographic characteristics of the workforce area.     
      (b) An Agency grantee shall meet or exceed expenditure and performance targets as set forth in its contracts.     
      (c) A Board, AEL grant recipient, and Agency grantee shall comply with the following:      
        (1) applicable laws, regulations, provisions of contracts and Board plans, and official directives and circulars including, but not limited to, DOL Training and Employment Guidance Letters, DOL Training and Employment Notices, U.S. Department of Health and Human Services guidance letters, U.S. Department of Education Office of Vocational and Adult Education guidance, Commission rules contained in Part 20 of this title, Texas Workforce Commission WD Letters and AEL Letters, the Agency's Financial Manual for Grants and Contracts, and other Agency guidance;       
        (2) appropriate uniform administrative requirements for grants and agreements applicable for the type of entity receiving funds as promulgated in OMB's Uniform Grant Management Standards circulars or rules; and       
        (3) Agency-Board agreements and applicable program contracts.       
      (d) A Board's or AEL grant recipient's achievement of high levels of performance may result in the Commission providing incentives for the Board as set forth in Subchapter I of this chapter (relating to Incentive Awards). In addition, the Commission may adopt additional performance incentives.     
      (e) The failure of Boards, AEL grant recipients, or Agency grantees to meet minimum levels of performance as referenced in their contracts may result in corrective actions, other performance review and assistance activities, or sanctions as specified in:      
        (1) Part 20 of this title, including this chapter;       
        (2) the contract with the Agency; or       
        (3) federal or state statute or rule.       
      (f) A Board or AEL grant recipient may submit to the Commission a request for a performance target adjustment in the format prescribed by the Agency.     
      (g) The Commission may determine what constitutes a necessary adjustment to local performance targets and may consider specific economic conditions and demographic characteristics to be served in the workforce area and other factors the Commission deems appropriate including the anticipated impact of the adjustment on the state's performance.     
     Source Note:        The provisions of this §802.102 adopted to be effective February 7, 2011, 36 TexReg 604; amended to be effective February 24, 2014, 39 TexReg 1201