(1) Determination. If the Undersecretary of the Department determines, on the basis of a final decision in a review pursuant to § 678B of the CSBG Act, 42 U.S.C. § 9914, and 760 CMR 29.09 that a CAA or other eligible entity fails to comply with the terms of a Department funding agreement, or the Annual Consolidated CSBG State plan, to provide services under the CSBG Act, 42 U.S.C. § 9901 et seq., or to meet appropriate standards, goals, and other requirements established by the State (including performance objectives), the Department shall:

1. (a) inform the entity of the deficiency to be corrected;
2. (b) require the entity to correct the deficiency;

3. (c) 1. offer training and technical assistance, if appropriate, to help correct the deficiency, and prepare and submit to the Secretary a report describing the training and technical assistance offered; or

   1. 2. if the Department determines that such training and technical assistance are not appropriate, prepare and submit to the Secretary a report stating the reasons for the determination;

4. (d) 1. at the discretion of the Department (taking into account the seriousness of the deficiency and the time required to correct the deficiency), allow the entity to develop and implement, within 60 days after being informed of the deficiency, a quality improvement plan to correct such deficiency within a reasonable period of time, as determined by the Undersecretary of the Department; and

   1. 2. not later than 30 days after receiving from an eligible entity a proposed quality improvement plan, either approve such proposed plan or specify the reasons why the proposed plan cannot be approved; and
5. (e) after providing adequate notice and an opportunity for a hearing, initiate proceedings to terminate the designation of or reduce the funding of the eligible entity unless the entity corrects the deficiency.