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<br />If PERFORMING AGENCY subcontracts a portion of this contract, PERFORMING AGENCY agrees to make a <br />good faith effort to subcontract with HUBs during the performance of its contract Attachment(s) with RECEIVING <br />AGENCY and will report HUB subcontract activity on a quarterly basis to RECEIVING AGENCY. <br /> <br />PERFORMING AGENCY and its subrecipient(s), if any, are encouraged to use minority banks (a bank which is <br />owned at least 50 percent by minority group members). <br /> <br />ARTICLE 27. Sanctions <br /> <br />RECEIVING AGENCY may impose sanctions for any breach of contract. PERFORMtNG AGENCY will be <br />monitored both for programmatic and financial compliance. RECEIVING AGENCY may, at its own discretion, <br />impose one or more sanctions for each item of noncompliance and will determine sanctions on a case-by-case basis. <br />A state or federal statute, rule, regulation, or federal guideline will prevail over the provisions of this Article unless <br />the statute, rule, regulation, or guideline can be read together with the provision( s) of this Article to give effect to <br />both. <br /> <br />RECEIVING AGENCY may: <br /> <br />A. terminate all or a part of the contract. Termination is the permanent withdrawal of the PERFORMING <br />AGENCY's authority to obligate previously awarded funds before that authority would otherwise expire <br />or the voluntary relinquishment by the PERFORMING AGENCY to obligate previously awarded funds. <br />PERFORMING AGENCY costs resulting from obligations incurred by'th~ PERFORMING AGENCY <br />after termination of an award are not allowable unless expressly authorized by the notice of termination. <br />Termination does not include: (1) withdrawal of funds awarded on the basis of the grantee's <br />underestimate of the unobligated balance in a prior period; (2) withdrawal of the unobligated balance as <br />of the expiration of a grant; (3) refusal to extend a grant or award additional funds, to make a competing <br />or noncompeting continuation, renewal, extension, or supplemental award; or (4) voiding of a grant upon <br />determination that the award was obtained fraudulently, or was otherwise illegal or invalid from <br />inception; <br /> <br />B. suspend all or part of the contract. Suspension is, depending on the context, either (1) the temporary <br />withdrawal of the PERFORMING AGENCY's authority to obligate funds pending corrective action by <br />the PERFORMING AGENCY or its subrecipient(s) or pending a decision to terminate or amend the <br />contract, or (2) an action taken by a suspending official in accordance with agency regulations <br />implementing Executive Order 12549 to immediately exclude a person from participating in grant <br />transactions for a period, pending completion of an investigation and such legal or debarment <br />proceedings as may ensue. PERFORMING AGENCY costs resulting from obligations incurred by the <br />PERFORMING:AGENCY during a suspension are not allowable unless expressly authorized by the <br />notice of suspension; <br /> <br />C. disallow (deny both use of funds and matching credit for) all or part of the activities or action not in <br />compliance; <br /> <br />D. temporarily withhold cash payments. Temporarily withholding cash payments means the temporary <br />withholding of advances or reimbursements to PERFORMING AGENCY or its subrecipient(s) for <br />proper charges or obligations incurred, pending resolution of issues of noncompliance with grant <br />conditions or indebtedness to the United States or to the State of Texas; <br /> <br />(LGS;' <br /> <br />1999 GENERAL PROVISIONS Page 16 <br /> <br />4/98 <br />