1. (a) Purpose. The purpose of this rule is to establish the contract monitoring roles and responsibilities of the Texas Youth Commission (TYC) staff, including the monitoring system used by TYC to ensure compliance with contract and service delivery requirements by service providers.
2. (b) Applicability. This rule applies to all public or private entities with which TYC has a contract.

3. (c) General Provisions.

   1. (1) TYC will periodically monitor all public and private entities which contract with TYC.
   2. (2) TYC will establish a monitoring schedule based on a risk assessment methodology. Higher risk contracts shall be monitored more frequently and more comprehensively than lower risk contracts.
   3. (3) For residential program-related client services contracts, TYC will obtain and evaluate program cost information to ensure that each cost, including an administrative cost, is reasonable and necessary to achieve program objectives.

4. (d) Contract Monitoring Roles and Responsibilities.

   1. (1) The TYC Internal Audit department audits contracted services and oversight monitoring activity in accordance with Human Resources Code §61.0331 and based on the results of the annual risk assessment.
   2. (2) Quality assurance staff will conduct program reviews of all residential facilities and parole programs operated under contract with TYC to ensure operations comply with applicable statutes, policies, procedures, and standards.

   3. (3) Individual program areas will:

      1. (A) provide day-to-day monitoring activities regarding financial and performance requirements;
      2. (B) provide technical assistance to providers; and
      3. (C) initiate corrective action and/or sanctions for non-compliance when appropriate.

Source Note:The provisions of this §385.1105 adopted to be effective July 15, 2011, 36 TexReg 4416; transferred effective June 4, 2012, as published in the Texas Register June 22, 2012, 37 TexReg 4639.