(a) When the Grant Officer is dissatisfied with the State's
disposition of an audit, as specified in Sec. 627.481 of this part, or
other resolution of violations (including those arising out of incident
reports or compliance reviews), with the recipient's response to
findings resulting from investigations pursuant to Sec. 627.503 of this
part, or if the recipient fails to comply with the Secretary's decision
pursuant to Sec. 627.605(b) of this part, the initial and final
determination process shall be used to resolve the matter.
(b) Initial determination. The Grant Officer shall make an initial
determination on the findings for both those matters where there is
agreement and those where there is disagreement with the recipient's
resolution, including the allowability of questioned costs or
activities. Such initial determination shall be based upon the
requirements of the Act, regulations promulgated thereunder, grants,
contracts, or other agreements under the Act.
(c) Informal resolution. The Grant Officer shall not revoke a
recipient's grant in whole or in part, nor institute corrective actions
or sanctions, without first providing the recipient with an opportunity
to present documentation or arguments to resolve informally those
matters in controversy contained in the initial determination.
The initial determination shall provide for an informal resolution
period which shall be at least 60 days from issuance of the initial
determination. If the matters are resolved informally, the Grant Officer
shall issue a final determination pursuant to paragraph (d) of this
section which notifies the parties in writing of the nature of the
resolution and may close the file.
(d) Grant Officer's final determination. (1) If the matter is not
fully resolved informally, the Grant Officer shall provide each party
with a written final determination by certified mail, return receipt
requested. For audits of recipient-level entities and other recipients
which receive JTPA funds directly from DOL, ordinarily the final
determination will be issued not later than 180 days from the date that
the OIG issues the final approved audit report to the Employment and
Training Administration. For audits of subrecipients conducted by the
OIG, ordinarily the final determination will be issued not later than
360 days from the date the OIG issues the final approved audit report to
ETA.
(2) A final determination under this paragraph (d) shall:
(i) Indicate that efforts to informally resolve matters contained in
the initial determination have been unsuccessful;
(ii) List those matters upon which the parties continue to disagree;
(iii) List any modifications to the factual findings and conclusions
set forth in the initial determination;
(iv) Establish a debt, if appropriate;
(v) Require corrective action when needed;
(vi) Determine liability, method of restitution of funds and
sanctions; and
(vii) Offer an opportunity for a hearing in accordance with subpart
H of this part.
(3) Unless a hearing is requested, a final determination under this
paragraph (d) constitutes final agency action and is not subject to
further review.
(e) Nothing in this section shall preclude the Grant Officer from
issuing an initial determination and/or final determination directly to
a subrecipient, in accordance with section 164(e)(3) of the Act. In such
a case, the Grant Officer shall inform the recipient of such action.
