1. (a) The Commission or its designees will monitor the activities of grantees as necessary to ensure that Commission grant funds are used for authorized purposes in compliance with laws, regulations, and the provisions of grant agreements.
2. (b) The monitoring program may consist of formal audits, monitoring reviews, and technical assistance. The Commission or its designees may implement monitoring through on-site review at the grantee location or through a desk review based on grantee reports. In addition, the Commission or its designees may require grantees to submit relevant information to the Commission to support any monitoring review. The Commission may contract with an outside provider to conduct the monitoring.
3. (c) Grantees must make available to the Commission or its designees all requested records relevant to a monitoring review. The Commission or its designees may make unannounced monitoring visits at any time. Failure to provide adequate documentation upon request may result in disallowed costs or other remedies for noncompliance as detailed under §173.307 of this chapter (relating to Remedies for Noncompliance).
4. (d) After a monitoring review, the fiscal monitor shall issue a report to the authorized official and financial officer within 45 days of the on-site monitoring visit to a county, unless a documented exception is provided by the executive director, with an alternative deadline provided, not later than 90 days from the on-site monitoring visit. The report shall contain each finding of noncompliance.
5. (e) Within 60 days of the date the report is issued, the authorized official or financial officer shall respond in writing to each finding of noncompliance, and shall describe the proposed corrective action to be taken by the county. The county may request the executive director to grant an extension of up to 60 days.

6. (f) The corrective action plan shall include the:

   1. (1) titles of the persons responsible for implementing the corrective action plan;
   2. (2) corrective action to be taken; and
   3. (3) anticipated completion date.
7. (g) If the grantee believes corrective action is not required for a noted deficiency, the response shall include an explanation, specific reasons, and supporting documentation for the grantee's position to be considered.
8. (h) The Commission or its designees will approve the corrective action plan and may require modifications prior to approval. The grantee's replies and the approved corrective action plan, if any, will become part of the final report.
9. (i) The grantee shall correct deficiencies identified in the final report within the time frame specified in the corrective action plan.
10. (j) The fiscal monitor shall conduct an additional on-site visit to counties where the report included significant noncompliance findings. The follow-up visit shall occur within 12 months following receipt of a county's response to the report. The fiscal monitor shall review a county's implementation of corrective actions and shall report to the county and Commission any remaining issues not corrected. Within 30 days of the date the follow-up report is issued by the fiscal monitor, the authorized director or financial officer shall respond in writing to each finding of noncompliance, and shall describe the proposed corrective action to be taken by the county. The county may request the director to grant an extension of up to 30 days.
11. (k) If a county fails to respond to a monitoring report or follow-up report within the required time, then a certified letter will be sent to the authorized official, financial officer, county judge, local administrative district court judge, local administrative statutory county court judge, and chair of the juvenile board notifying them that all further payments will be withheld if no response to the report is received by the Commission within ten days of receipt of the letter. If funds are withheld under this section, then the funds will not be reinstated until the Commission or the Grants and Reporting Committee approves the release of the funds.
12. (l) If a county fails to correct any noncompliance findings, the Commission may impose a remedy under §173.307 of this chapter.

Source Note:The provisions of this §173.401 adopted to be effective September 13, 2012, 37 TexReg 7083.