(a) When the Corporation has made a preliminary determination of one or more of the following, the Corporation shall issue a written notice to the recipient and the Chair of the recipient's governing body: that a recipient's grant or contract should be terminated, that a limited reduction of funding shall be imposed, or that a recipient should be debarred. The notice shall:

1. (1) State the substantial noncompliance that constitutes the grounds for the proposed action;
2. (2) Identify, with reasonable specificity, any facts or documents relied upon as justification for the proposed action;
3. (3) Inform the recipient of the proposed amount and proposed effective date for the proposed action;
4. (4) Advise the recipient of its procedural rights for review of the proposed action under this part;
5. (5) Inform the recipient of its right to receive interim funding pursuant to § 1606.13 of this part;
6. (6) Specify what, if any, corrective action the recipient can take to avoid the proposed action; and
7. (7) Summarize prior attempts, if any, for resolution of the substantial noncompliance.