1. (a) The Executive Director will appoint an Enforcement Committee, as defined in §2.102 of this chapter (relating to Definitions).
2. (b) The Compliance Division will recommend the initiation of administrative penalty proceedings to the Committee by referral of a compliance monitoring matter to the secretary of the Committee.
3. (c) The secretary of the Committee shall promptly contact the Responsible Party describing the violations involved. If the secretary is able to facilitate closure of the matter without further action by the Committee, the secretary will report back to the Compliance Division. Should the secretary and Responsible Party fail to come to closure, the matter will be presented to the Committee for possible action.

4. (d) The Committee will first offer to hold an informal meeting with the Responsible Party to attempt to reach an agreed resolution. If any such meeting is held:

   1. (1) Statements made in the meeting shall not be used as evidence in any proceedings if agreed resolution is not reached. This does not preclude establishing such matters through the introduction of proper evidence;
   2. (2) The Responsible Party may, but is not required to be, represented by legal counsel of their choosing at their own cost and expense;
   3. (3) The Responsible Party may bring to the meeting third parties, employees, and agents with knowledge of the issues; and
   4. (4) In order to facilitate candid dialogue, informal meetings will not be open to the public; however, the Committee may include such other persons or witnesses as the Committee deems necessary for a complete and full development of relevant information and evidence.

5. (e) An informal meeting may result in:

   1. (1) An agreement to dismiss the matter with no further action, which will then be reported to the Executive Director;
   2. (2) A Compliance Assistance Notice issued by the Committee, available for Responsible Parties appearing for the first time before the committee for matters which the Committee determines do not necessitate the assessment of an administrative penalty, but for which the Committee wishes to place the Responsible Party on specific notice with regard to possible future violations;
   3. (3) An agreement to resolve the matter through corrective action without penalty. In this circumstance, the agreement shall be reported to the Executive Director;
   4. (4) An agreement to resolve the matter through corrective action with the assessment of an administrative penalty which may be probated in whole or in part, and may, where appropriate, include additional action to promote compliance such as agreements to obtain training. In this circumstance, a proposed agreed order and draft report will be prepared and presented to Board for approval;
   5. (5) A recommendation by the Committee to the Executive Director regarding the issuance of a report to the Board and issuance of a Notice of Violation to the Responsible Party seeking the assessment of administrative penalties;
   6. (6) A determination that the Responsible Party should be referred for debarment, in which case the Responsible Party will be offered another opportunity to appear before the Committee, shall be reported to the Executive Director; or
   7. (7) Other action as the Committee deems appropriate, shall be reported to the Executive Director.
6. (f) Upon receipt of a recommendation from the Committee regarding the issuance of a report and assessment of an administrative penalty, the Executive Director shall determine whether a violation has occurred. If needed, the Executive Director may request additional information and/or return the recommendation to the Committee for further development. If the Executive Director determines that a violation has occurred, the Executive Director will issue a report to the Board in accordance with §2306.043 of the Texas Government Code.

7. (g) Not later than fourteen (14) days after issuance of the report to the Board, the Executive Director will issue a Notice of Violation to the Responsible Party. The Notice of Violation issued by the Executive Director will include:

   1. (1) a summary of the alleged violation(s) together with reference to the particular sections of the statutes and rules alleged to have been violated;
   2. (2) a statement informing the Responsible Party of the right to a hearing before the State Office of Administrative Hearings ("SOAH"), if applicable, on the occurrence of the violation(s), the amount of penalty, or both;
   3. (3) any other matters deemed relevant; and
   4. (4) the amount of the recommended penalty. In determining the amount of a recommended administrative penalty, the Executive Director shall take into consideration whether the Responsible Party has timely taken appropriate actions within their control, the amount of penalty necessary to deter future violations, and, in the instance of a proceeding to assess administrative penalties against a Responsible Party administering CSBG, CEAP, ESG or HHSP, whether the assessment of such penalty will interfere with the uninterrupted delivery of services under such program(s). He or she shall further take into account whether the Department's purposes may be achieved or enhanced by the use of full or partial probation of penalties subject to adherence to specific requirements and whether the violation(s) in question involve disallowed costs or other matters giving rise to financial exposure to the Department.
8. (h) The amount of recommended penalty will be determined with reference to a penalty schedule shown in the tables in subsection (j) of this section.
9. (i) Not later than twenty (20) days after the Responsible Party receives the Notice of Violation, the Responsible Party may accept the determination and recommended penalty or request a hearing.
10. (j) If the Responsible Party requests a hearing or does not respond to the Notice of Violation, the Executive Director, with the approval of the Board, shall cause the hearing to be docketed before a SOAH administrative law judge in accordance with Chapter 1, §1.13 of this title (relating to Adjudicative Hearing Procedures).
    Attached Graphic
    
    Attached Graphic
    
    Attached Graphic
    

Source Note:The provisions of this §2.302 adopted to be effective November 19, 2014, 39 TexReg 8976.