922 KAR 6:040.
Termination of funding and hearing procedures.
RELATES TO: KRS
KRS 194A.050, 273.448, 42 U.S.C. 9901-9912, Title 45 C.F.R. 96.1
AND CONFORMITY: This administrative regulation establishes the conditions by
which the cabinet may terminate Community Services Block Grant (CSBG) funding
to a grantee. This administrative regulation also addresses the grantee's right
to request and receive a hearing before a qualified hearing officer.
Section 1. Grantee
Termination. For the purpose of this part, administrative requirements
specified in 42 U.S.C. 9901-9912 and KRS 273.451 are applicable.
(1) A community
action agency (CAA), either established with local designation or state
recognition under the Community Services Block Grant Act (the Act) or under the
Kentucky CSBG program in accordance with the Act and the Community Action Law
in KRS Chapter 273 shall be awarded continuing CSBG program administering
responsibilities in its established jurisdiction unless the following shall
(a) The CAA submits
written communication to the Department for Community-Based Services stating
its desire to discontinue operation of the program;
(b) Material failure
by the CAA to comply with 42 U.S.C. 9901-9912, or 45 C.F.R. 96.30, 96.51,
96.90, or 96.91; the provisions of the state CSBG plan or provisions of KRS
273.405-273.453; or 922 KAR 6:010. Material failure includes:
2. Disallowance of
costs which could render a CAA insolvent; or
3. Denial of access
to records of grant-related transactions.
(c) The CAA lacks
the authority or capability to receive, administer, and account for funds in a
manner that conforms with applicable federal or state requirements or with
generally accepted accounting principles;
(d) The CAA is not
capable of effectively planning, conducting, administering, or evaluating CSBG
funded programs or projects;
(e) The CAA fails to
conform in one (1) or more ways to the assurances relating to the structure and
operation of CSBG program contractors that the Commonwealth of Kentucky has
provided the United Stated Department of Health and Human Services, including
prohibitions regarding partisan political activities, voter registration, and
transportation of voters to the polls; or
(f) The CAA is
structured and functions in a manner inconsistent with state or federal laws or
(2) Upon discovery
of one (1) or more of the conditions noted in paragraphs (b) through (f) of
this subsection, the cabinet shall notify the CAA in writing of its initiation
of the termination process and the reasons for termination. The notice shall
advise the CAA that, in accordance with this section and 42 U.S.C. 9901-9912,
it is entitled to an informal hearing.
Section 2. Hearing
Procedures. The CAA shall be given fifteen (15) days from receipt of
notification to inform the cabinet in writing that it wishes to exercise its
right to a hearing. The hearing shall be conducted within thirty (30) days of
the original notification of initiation of the termination process. The
notification shall also include:
(1) A requirement
that the CAA, to receive continued CSBG funding, shall agree to cooperate with
the cabinet appointed hearing officer throughout the termination process.
(2) If the CAA does
not agree to submit to the cabinet review specified in Section 1 of this
administrative regulation, the cabinet shall send to the CAA a notice of
funding suspension, pending termination, pursuant to this administrative
regulation and as governed by KRS 273.451. Simultaneous with suspension notice
to the CAA's, the cabinet shall notify the U.S. Department of Health and Human
Services and the department shall advise the suspended CAA of its right to seek
direct funding from the U.S. Department of Health and Human Services.
(3) The services of
an impartial hearing officer shall be obtained by the cabinet. Notice of the
hearing time and date shall be provided, with proof of receipt of notice, to
both the CAA or appropriate public officials at least ten (10) days prior to
the hearing. The cost for the hearing officer and the services of the certified
reporter and the original transcript of the proceedings shall be borne by the
Cabinet for Health and Family Services. The CAA shall bear the cost of its copy
of the transcript of proceedings.
(4) The hearing
shall be conducted in accordance with due process before a qualified hearing
officer. The report of the hearing officer shall be sent by registered mail to
both parties within thirty (30) days of the completion of the hearing.
(5) The cabinet
shall review the hearing officer's recommendation and shall base its decision
on findings of fact and conclusions of law that substantiate grant termination
pursuant to this administrative regulation. The cabinet shall notify the CAA of
the cabinet's final determination within thirty (30) days.
(6) If the cabinet's
decision is to suspend or terminate funding to the CAA, the cabinet shall also,
with its notice to the CAA, advise the CAA of the provisions for review of the
termination proceedings to the Secretary of the U.S. Department of Health and
Human Services pursuant to Section 676(a) of the Act. (16 Ky.R. 306; Am. 551;
eff. 9-20-89; 20 Ky.R. 2452; 2863; eff. 3-23-94; Recodified from 905 KAR 6:040,