3-Attachment 3 - TDHCA Regulations - TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS FY 2026 TEXAS HOMELESS HOUSING AND SERVICES PROGRAM YOUTH SET-ASIDE GENERAL REVENUE CONTRACT 18266000003.pdf

City of Dallas 18266000003 1

TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS

FY 2026 TEXAS HOMELESS HOUSING AND SERVICES PROGRAM

YOUTH SET-ASIDE

GENERAL REVENUE

CONTRACT NUMBER 18266000003

WITH

City of Dallas, a political subdivision of the State of Texas

SECTION 1. PARTIES TO THE CONTRACT

This 2026 Texas Homeless Housing and Services Program (“HHSP”) Youth Set-Aside Contract Number 18266000003 (“Contract”) is made by and between the Texas Department of Housing and Community Affairs, a public and official agency of the State of Texas ("Department"), and City of Dallas, a political subdivision of the State of Texas, ("Subrecipient"), hereinafter the “Parties”.

SECTION 2. CONTRACT TERM FOR PERFORMANCE AND CLOSE-OUT PROCESS

This Contract shall commence on September 1, 2025 and, unless earlier terminated as provided herein, terminate as follows: (1) the Subrecipient is permitted to incur allowable expenses under this Contract until August 31, 2026 (“Contract Term”), and (2) the Department’s obligations under the Contract upon the completion of Subrecipient’s performance shall end on November 14, 2026, and is conditioned on the Subrecipient’s successful completion of the terms herein (“Close-Out Process”).

SECTION 3. SUBRECIPIENT PERFORMANCE

A. Subrecipient agrees to administer a HHSP award in accordance with, but not limited to, Section

2306.2585 of the Texas Government Code (“State Act”), and the implementing rules under Title 10, Part 1, Chapter 1, Chapter 2, and Subchapters A and B of Chapter 7, of the Texas Administrative Code (“HHSP State Rules”), and representations made as part of the Previous Participation and Executive Award Process, as defined in the HHSP State Rules.

B. Subrecipient agrees to perform all activities in accordance with the terms of the “Performance Statement” attached hereto as Exhibit A and the “Budget” attached hereto as Exhibit B.

Subrecipient further agrees to comply with the “Certification Regarding Drug-Free Workplace Requirements” attached hereto as Addendum A; the “Certification Regarding Debarment, Suspension and Other Responsibility Matter” attached hereto as Addendum B; the “PRWORA Requirements” attached hereto as Addendum C; and the assurances, certifications, and all other statements made by Subrecipient in its application for the project funded under this Contract, and with all other terms of this Contract. All exhibits and addendums are attached hereto and incorporated herein for all relevant purposes.

C. Except for changes that are required because of changes described in Section 11(A) of this

Contract or as otherwise specifically described in this Contract, Subrecipient shall implement HHSP in accordance with the requirements of the HHSP State Rules in effect on February 27, 2024.

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D. Subrecipient shall provide services to unaccompanied homeless youth and homeless young adults 24 years of age and younger in Subrecipient’s Service Area in accordance with the Performance Statement attached hereto as Exhibit A and the Budget attached hereto as Exhibit B.

E. Performance related to established targets will be reported by Subrecipient in the HHSP Monthly

Performance Report, as such term is defined in 10 TAC §7.2(37) and Section 10(c) of this Contract, and meeting targets may be considered for future funding opportunities with the Department.

F. All funds must be fully expended within the Contract Term and reported within the Close-Out Process in accordance with all Exhibits and Addendums of this Contract. The Department reserves the right to request an Expenditure plan if it appears funds will not be expended within the Contract Term at the Department’s reasonable discretion.

G. Subrecipient activities related to construction, rehabilitation, or conversion of a building or buildings may require that Subrecipient enter into a Land Use Restriction Agreement (“LURA”) in accordance with 10 TAC §7.3.

SECTION 4. DEPARTMENT FINANCIAL OBLIGATIONS

A. In consideration of Subrecipient's satisfactory performance of this Contract, Department shall reimburse Subrecipient for the actual, allowable, and approved costs incurred by Subrecipient in the amount specified in the Budget.

B. The Contract shall not be construed as creating a debt on behalf of the Department in violation of Article III, Section 49a of the Texas Constitution. Department's obligations under this Contract are contingent upon the actual receipt and availability by the Department of adequate HHSP funds from the legislature. If sufficient HHSP funds are not available to make payments under this Contract, Department may notify Subrecipient in writing within a reasonable time after such fact is determined. Department may then terminate this Contract and will not be liable for the failure to make any payment to Subrecipient under this Contract.

C. Department is not liable for any cost incurred by Subrecipient which:

(1) has been reimbursed to Subrecipient or are subject to reimbursement to Subrecipient by any source other than Department;

(2) is not an allowable cost, as set forth in the provisions of the State Act and the HHSP State Rules and Section 8(B) of this Contract;

(3) is not strictly in accordance with the terms of this Contract, including the Exhibits;

(4) has not been reported to Department within the Close-Out Process of this Contract; or

(5) is not incurred during the Contract Term.

D. Department reserves the right to obligate additional funds or deobligate funds and shall notify the Subrecipient in writing of its decision. Department may consider such factors as the ability to use grant funds under the HHSP State Rules in a timely manner or Subrecipient’s overall compliance with the terms of this Contract.

E. Department shall not be obligated to pay Subrecipient for any costs incurred by Subrecipient which are not allowable costs.

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F. Notwithstanding any other provision of this Contract, the total of all payments and other obligations incurred by Department under this Contract shall not exceed the sum of TWO

HUNDRED ELEVEN THOUSAND AND THIRTEEN DOLLARS ($211,013.00).

G. Notwithstanding any other provision of this Contract, Department shall only be liable to

Subrecipient for allowable costs actually incurred or performances rendered for activities specified in the HHSP State Rules.

SECTION 5. METHOD OF PAYMENT/CASH BALANCES

A. DISBURSEMENT PROCEDURES. Subrecipient shall establish procedures to minimize the time elapsing between the transfer of funds from Department to Subrecipient and the disbursement of such funds by Subrecipient.

B. METHOD OF PAYMENT. The Department will reimburse Subrecipient for eligible costs incurred by the Subrecipient during the Contract Term so long as Subrecipient submits the Monthly Performance Report and Monthly Expenditure Report in accordance with the requirements of 10 TAC §7.5. The Department reserves the right to utilize a cost reimbursement method of payment, as defined by 10 TAC §7.2(12), if the Subrecipient violates any of the terms of this Contract or other Department contract.

C. ALLOWABLE EXPENSES. All funds paid to Subrecipient pursuant to this Contract are paid in trust for the exclusive benefit of the eligible Program Participants (as such term is defined in 10 TAC §7.2(42)) of HHSP services and for the payment of allowable expenditures.

D. OFFSET. At its sole discretion, Department may offset or withhold any amounts otherwise owed to Subrecipient under this Contract against any amount owed by Subrecipient to Department arising under this Contract.

E. REFUND. Subrecipient shall refund to the Department any funds which Department determines has not been spent strictly in accordance with the terms of this Contract. Subrecipient shall make such refund no later than the date specified in the notice that repayment is required, but if no date is specified within seven (7) days in accordance with 10 TAC §1.21(e).

SECTION 6. COST PRINCIPLES, ADMINISTRATIVE REQUIREMENTS, AND AUDIT REQUIREMENTS

A. COST PRINCIPLES, ADMINISTRATIVE REQUIREMENTS. Except as expressly modified by law or the terms of this Contract, Subrecipient shall comply with the cost principles and uniform administrative requirements set forth in the Texas Grant Management Standards under Chapter 783 of the Texas Government Code (“TXGMS”) in effect on the effective date of this Contract.. All references therein to “local government” shall be construed to mean Subrecipient.

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B. AUDIT REQUIREMENTS. In accordance with 10 TAC §1.403(e), if a Subrecipient for a fiscal year that began on or after October 1, 2024, expends One Million and No/100 Dollars ($1,000,000.00) or more in state awards, or has an outstanding loan balance associated with state resources of One Million and No/100 Dollars ($1,000,000.00) or more with continuing compliance requirements, or a combination thereof, must have a Single Audit. Subrecipient agrees to comply with any applicable TXGMS updates that may be released during the Contract Term. Updates to TXGMS may be found this website: https://comptroller.texas.gov/purchasing/grant-management/.

C. AUDIT REVIEW. Department reserves the right to conduct additional audits of the funds received and performances rendered under this Contract. Subrecipient agrees to permit Department or its authorized representative to audit Subrecipient’s records and to obtain any documents, materials, or information necessary to facilitate such audit.

D. AUDIT CERTIFICATION FORM. For any fiscal year ending within or immediately after the Contract Term, Subrecipient must submit an "Audit Certification Form" (available on the Department’s website) within sixty (60) days after the Subrecipient's fiscal year end. If the Subrecipient’s Single Audit is required by 2 CFR Part 200, Subpart F, the report must be submitted to the Federal Audit Clearinghouse ("FAC") the earlier of thirty (30) calendar days after receipt of the auditor's report or nine (9) months after the end of its respective fiscal year. As noted in 10 TAC §1.403 (f), Subrecipient is required to submit a notification to Department within five (5) business days of submission to the FAC. Along with the notice, indicate if the auditor issued a management letter.

If there is a management letter, a copy of the letter must be sent to the Department. Both the notice and the copy of the management letter, if applicable, must be submitted to SAandACF@tdhca.texas.gov.

E. STATE AUDITOR’S RIGHT TO AUDIT. Pursuant to Section 2262.154 of the Texas Government Code, the state auditor may conduct an audit or investigation of any entity receiving funds from the state directly under any contract or indirectly through a subcontract under the Contract. The acceptance of funds by the Subrecipient or any other entity or person directly under the Contract or indirectly through a subcontract under the Contract acts as acceptance of the authority of the state auditor, under the direction of the legislative audit committee, to conduct an audit or investigation in connection with those funds. Under the direction of the legislative audit committee, the Subrecipient or other entity that is the subject of an audit or investigation by the state auditor must provide the state auditor with access to any information the state auditor considers relevant to the investigation or audit. Subrecipient shall ensure that this paragraph concerning the authority to audit funds received indirectly by subcontractors through the contract and the requirement to cooperate is included in any subcontract it awards.

F. SUBCONTRACTS. Subrecipient shall include language in any subcontract or subgrant that provides the Department the ability to directly review, monitor, and/or audit the operational and financial performance and/or records of work performed under this Contract.

https://comptroller.texas.gov/purchasing/grant-management/ https://comptroller.texas.gov/purchasing/grant-management/ mailto:SAandACF@tdhca.texas.gov

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SECTION 7. TERMINATION AND SUSPENSION

A. TERMINATION. Pursuant to 10 TAC Chapters 2 and 7, Department may terminate or suspend this Contract, in whole or in part, at any time Department determines that there is cause for termination. If Subrecipient fails to submit within forty-five (45) calendar days of its due date, any report in accordance with 10 TAC §7.5 or responses to monitoring reports, Department may, in its sole discretion, suspend payments, place Subrecipient on Cost Reimbursement method of payment, and initiate proceedings to terminate any active Contract. In accordance with 10 TAC §2.202(b)(6), cause for termination includes, but is not limited to, fraud, waste, abuse, fiscal mismanagement, or other serious Findings in the Subrecipient's performance. Department may suspend or terminate this Contract or invoke other remedies in the event monitoring or other reliable sources reveal material deficiencies in Subrecipient’s performance or if Subrecipient fails to correct any deficiency within the time allowed by federal or state law or regulation, or by the terms of this Contract.

B. SUSPENSION. Nothing in this Section shall be construed to limit Department’s authority to withhold payment and immediately suspend this Contract if Department identifies possible instances of fraud, abuse, waste, fiscal mismanagement, or other deficiencies in Subrecipient’s performance. Suspension shall be a temporary measure pending either corrective action by Subrecipient or a decision by Department to terminate this Contract.

C. DEPARTMENT LIABILITY. Department shall not be liable for any costs incurred by Subrecipient after termination of this Contract or for any costs that are disallowed.

D. WITHHOLDING OF PAYMENTS. Notwithstanding any exercise by Department of its right of termination or suspension, Subrecipient shall not be relieved of any liability to Department for damages by virtue of any breach of this Contract by Subrecipient. Department may withhold any payment due to Subrecipient until such time as the exact amount of damages due to Department is agreed upon or is otherwise determined in writing between Parties.

E. FUNDS. Upon termination of this Contract, all funds remaining on hand on the date of termination, and all accounts receivable attributable to the use of funds received under this Contract shall transfer back to Department. Subrecipient shall return the remaining funds to Department within sixty (60) calendar days after the date this Contract terminates.

SECTION 8. ALLOWABLE EXPENDITURES

A. The allowability of Subrecipient’s costs incurred in the performance of this Contract shall be determined in accordance with the provisions of the State Act and the HHSP State Rules, subject to the limitations and exceptions set forth in this Contract.

B. HHSP general revenue funds may be used for administrative activities as well as allowable expenditures under this Contract, to include activities outlined in 10 TAC §7.21, provided Subrecipient receives prior written approval from the Department.

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SECTION 9. RECORDKEEPING REQUIREMENTS

A. GENERAL. Subrecipient shall comply with all the recordkeeping requirements set forth below and shall maintain fiscal and programmatic records and supporting documentation for all expenditures of funds made under this Contract in accordance with the TXGMS. Subrecipient agrees to comply with any changes to the TXGMS’ recordkeeping requirements and 10 TAC §7.8.

For purposes of compliance monitoring, all associated documentation must be readily available, whether stored electronically or hard copy to demonstrate compliance with Subrecipient performance as outlined in Section 3.

B. WRITTEN POLICIES AND PROCEDURES. Subrecipient must have written policies and procedures to ensure that sufficient records are established and maintained to enable a determination that HHSP requirements are being met. The written standards must be applied consistently for all Program Participants. The written standards must include but are not limited to Inclusive Marketing as identified in 10 TAC §7.10.

C. PROGRAM PARTICIPANT FILES. In accordance with 10 TAC §7.28(g), Subrecipient shall maintain

Program Participant files, for non-emergency activities providing direct subsidy to a Program Participant regardless if the client is directly receiving the funds, that contain the following:

(1) An HHSP Intake Application including an area for execution by all adult Household members (which may include an electronic signature), certifying the validity of information provided and an area to identify the staff person completing the intake application, and must provide a space for applicants to indicate if they are a veteran as required by Section 434.212 of the Texas Government Code. In addition, the application must include the following statement: "Important Information for Former Military Services Members. Women and men who served in any branch of the United States Armed Forces, including Air Force, Army, Navy, Marines, Coast Guard, Reserves or National Guard, may be eligible for additional benefits and services. For more information, please visit the Texas Veterans Portal at https://veterans.portal.texas.gov/ ;

(2) Certification whereby the Applicant certifies whether they meet the definition of Homeless or Homeless Individual or At-risk of homelessness pursuant to 10 TAC §7.2. The certification must include the Program Participant’s signature or legally identifying mark (which may include an electronic signature);

(3) Documentation which demonstrates that the Program Participant meets income eligibility, if applicable, or, if proof of income is unobtainable, a Declaration of Income Statement as defined in 10 TAC §7.2(13);

(4) Documentation of annual recertification, as applicable, including income eligibility and that the Program Participant lacks sufficient resources and support networks necessary to retain housing without assistance;

(5) Documentation of determination of ineligibility for assistance when assistance is denied.

Documentation must include the reason for the determination of ineligibility;

(6) Copies of all leases and rental assistance agreements for the provision of rental assistance, documentation of payments made to owners for the provision of rental assistance, and supporting documentation for these payments, including dates of occupancy by Program Participants;

(7) Documentation of the monthly allowance for utilities used to determine compliance with the rent restriction; and https://veterans.portal.texas.gov/

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(8) Documentation that the Dwelling Unit (as such term is defined in 10 TAC §7.2(14)) for Program Participants receiving rental assistance complies with the Housing Standards in 10 TAC §7.29, Shelter and Housing Standards.

D. ACCESS TO RECORDS. Subrecipient shall give the Department, the Auditor of the State of Texas, the Comptroller of the State of Texas or any of their duly authorized representatives, access to and the right to examine and to copy, on or off the premises of Subrecipient, all records pertaining to this Contract. Such right to access shall continue as long as the records are retained by Subrecipient. Subrecipient agrees to cooperate with any examination conducted pursuant to this Subsection D. Subrecipient agrees to maintain such records in an accessible location.

E. RECORD RETENTION. Records regarding Program Participant eligibility shall be retained by Subrecipient for a period of five (5) years. Activities that require a LURA, must maintain the records until the expiration of the LURA. All other records pertinent to this Contract shall be retained by Subrecipient for a period of three (3) years that starts on the day the Single Audit is due or would be due if the Single Audit requirements are not triggered, except if any litigation, claim, negotiation, audit, monitoring, inspection or other action has started before the expiration of the required record retention period. In this case, records must be retained until completion of the action and resolution of all issues which arise from it, or until the end of the required recordkeeping period as described herein, whichever is later.

F. OPEN RECORDS. Subrecipient acknowledges that all information written, produced, collected, assembled, or maintained by Subrecipient pursuant to this Contract is subject to the Texas Public Information Act (Chapter 552 of Texas Government Code) and must be provided to citizens, public agencies, and other interested parties in accordance with the Texas Public Information Act.

Subrecipient understands that the Department will comply with the Texas Public Information Act (Chapter 552 of the Texas Government Code) as interpreted by judicial rulings and opinions of the Attorney General of the State of Texas. Information, documentation, and other material in connection with this Contract or any resulting contract or grant may be subject to public disclosure pursuant to the Texas Public Information Act. In accordance with Section 2252.907 of the Texas Government Code, Subrecipient is required to make any information created or exchanged with the State of Texas pursuant to this Contract, available in a format that is accessible by the public at no additional charge to the State. A request to the Subrecipient for public information shall be communicated to Department’s contact identified in this Agreement, by the close of business on the following business day after the request is received. Subrecipient shall not provide to the requestor any information that was written, produced, collected, assembled, or maintained under this Contract, but shall respond to the requestor that the request has been forwarded to Department for processing. After gathering all information that is responsive to the request, but in no event later than five (5) business days after receiving the information request, Subrecipient shall send the information to Department. Subrecipient shall timely contact Department if there will be any delay in sending the information request or responsive documents to Department.

G. SUBCONTRACTS. Subrecipient shall include the substance of this Section 9 in all of its subcontracts and subgrants.

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SECTION 10. REPORTING REQUIREMENTS

A. DATA COLLECTION. In accordance with 10 TAC §7.6, Subrecipient must ensure that data on all persons served and all activities assisted under Homeless Programs is entered into the applicable HMIS, or HMIS-comparable database for domestic violence or legal service providers.

B. REPORT CONDITIONS. Subrecipient shall submit to Department such reports on the performance of this Contract as may be required by Department including, but not limited to, the reports specified in this Section. Subrecipient represents and warrants that it will submit timely, complete, and accurate reports in accordance with the Contract and maintain appropriate backup documentation to support any assertions made in the reports.

C. MONTHLY REPORTS. In accordance with 10 TAC §7.5(b), Subrecipient must submit a Monthly Performance Report and a Monthly Expenditure Report through the Contract System, as such terms are defined in 10 TAC §7.2 not later than the last day of each month which reflects performance and expenditures conducted in the prior month.

D. BIENNIAL REPORTING. In accordance with 10 TAC §7.5(h)(2), HHSP Subrecipient will submit information to the Department for biennial reporting to the Texas Legislature.

E. CONSTRUCTION ACTIVITIES. In accordance with 10 TAC §7.3(c), if Subrecipient intends to expend funds for new construction, rehabilitation, or conversion, Subrecipient must submit a copy of the activity budget inclusive of all sources and uses of funding, documents for a construction plan review, and identification of the entity and signature authorization of the individual (name and title) that will execute the LURA. These documents must be submitted no less than ninety (90) calendar days prior to the end of the Contract Term under which funds for the activity are provided. The Department may elect to reconsider award amounts if financial resources other than those presented in the Application are subsequently committed to an activity.

F. FINAL INSPECTION REPORT. A Subrecipient must request a final construction inspection within thirty (30) calendar days of construction completion. The inspection will cover the Shelter and Housing Standards, Uniform Physical Construction Standards, 2012nternational Residential Code (or municipality adopted later version), Minimum Energy Efficiency Requirements for Single Family Construction Activities, and the Accessibility Standards in Title 10, Part 1, Chapter 1, Subchapter B, of the Texas Administrative Code, as applicable for the activity.

G. REPORTS ON DISASTER RECOVERY AND CONTINUTITY. Upon request of the Department, Subrecipient shall provide copies of its most recent business continuity and disaster recovery plans.

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SECTION 11. CHANGES AND AMENDMENTS

A. AMENDMENTS AND CHANGES REQUIRED BY LAW. Any change, addition or deletion to the terms of this Contract required by a change in federal or state law regulation is automatically incorporated herein and is effective on the date designated by such law or regulation without the requirement of a written amendment hereto but may be further evidenced by a written amendment.

B. GENERAL. Except as specifically provided otherwise in this Contract, any changes, additions, or deletions to the terms of this Contract shall be in writing and executed by both Parties to this Contract.

C. FACSIMILE SIGNATURES. If any Party returns an executed copy by facsimile machine or electronic transmission, the signing party intends the copy of its authorized signature printed by the receiving machine or the electronic transmission, to be its original signature.

D. REQUESTS. Amendment requests may be considered at the discretion of the Department in accordance with 10 TAC §7.4(e).

SECTION 12. PROGRAM INCOME

A. In accordance with 10 TAC §7.25 and TXGMS, program income includes but is not limited to:

income from fees for services performed, the use or rental or real of personal property acquired under this award, the sale of commodities or items fabricated under this award, and from payments of principal and interest on loans made with this award, where authorized. Interest earned in excess of $250 on grants or loans from purely state sources is considered program income. Security and utility deposits must be reimbursed to the Program Participant and are not considered program income if they remain with the Program Participant and are returned only to the Program Participant.

B. Program income that is received during the Contract Term must be used for allowable expenditures as described in Section 8 of this Contract.

C. Program income that is received after the Contract Term, or not expended within the Contract Term must be returned to the Department within ten (10) calendar days of receipt.

SECTION 13. INDEPENDENT CONTRACTOR

It is agreed that Department is contracting with Subrecipient as an independent contractor. To the extent authorized by law, Subrecipient agrees to indemnify Department against any disallowed costs or other claims which may be asserted by any third party in connection with the services to be performed by Subrecipient under this Contract. The Department acknowledges governmental entities cannot create an unfunded debt pursuant to the Texas Constitution.

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SECTION 14. PURCHASE AND PROCUREMENT STANDARDS

Subrecipient shall comply with TXGMS, 10 TAC §1.404, this Contract, and all applicable state, and local laws, regulations, and ordinances for making procurement transactions and purchases under this Contract.

SECTION 15. SUBCONTRACTS

A. Subrecipient may not subcontract the primary responsibilities of this Contract, including but not limited to expenditure and performance reporting and drawing funds through the Department’s systems, and only may enter into properly procured contractual agreements for consulting and other professional services if Subrecipient has received Department’s prior written approval.

B. Subrecipient may subcontract or subgrant for the delivery of client assistance without obtaining Department’s prior approval. Subrecipient is responsible for ensuring that subcontractors and subgrantees adhere to the same program requirements and regulations as apply to the Subrecipient including, but not limited to confirmation that Subrecipient checked the appropriate federal and state records for debarred and suspended parties in accordance with TXGMS.

Subrecipient must have processes and procedures in place to monitor subcontractors or subgrantees. Subrecipient represents and warrants that it shall monitor the activities of the subcontractors or subgrantees to ensure that the subaward is used for authorized purposes, according to applicable statutes, regulations, and the terms and conditions of the subaward, and that subaward performance goals are achieved. Any subcontract or subgrant for the delivery of client assistance will be subject to monitoring by the Department pursuant to 10 TAC §7.11.

C. In accordance with 10 TAC §7.7(c), Subrecipient will notify the Department and provide contact information for subgrants or subcontractors within thirty (30) calendar days of the effective date of subcontract. Contact information for the entities with which the Subrecipient subgrants or subcontracts must be provided to the Department, including: organization name, name and title of authorized person who entered into the subgrant or subcontract, phone number, e-mail address, and type of services provided.

D. In no event shall any provision of this Section 15 be construed as relieving Subrecipient of the responsibility for ensuring that the performances under all subcontracts and subgrants are rendered so as to comply with all of the terms of this Contract, as if such performances rendered were rendered by Subrecipient. Department maintains the right to monitor and require Subrecipient’s full compliance with the terms of this Contract. Department’s approval under this Section does not waive any right of action which may exist or which may subsequently accrue to Department under this Contract.

SECTION 16. MANAGEMENT OF EQUIPMENT AND INVENTORY

A. In accordance with 10 TAC §1.401 and 10 TAC §1.407, Subrecipient shall submit to Department no later than forty-five (45) calendar days after the termination of this Contract a cumulative inventory report of all real property and equipment with a unit acquisition cost of Ten Thousand and No/100 Dollars ($10,000.00) or more and/or a useful life of more than one (1) year, if purchased or acquired in whole or in part with funds received under this Contract or previous HHSP contracts. Aggregate Supplies of over $10,000 must be reported to the Department at the

18266000003 11 end of the Contract Term Upon the termination of this Contract, Department may demand the transfer of title to any equipment to the Department or to any other entity receiving HHSP funds from the Department.

B. When the Subrecipient no longer needs equipment purchased with HHSP grant funds, regardless of purchase price, or upon the termination of this Contract, Department may take possession and demand the transfer of title to any such property or equipment to the Department or to a third party or may seek reimbursement from Subrecipient of the current unit price of the item of equipment, in Department’s sole determination. Subrecipient must request permission from the Department to transfer title or dispose of equipment purchased with HHSP grant funds.

SECTION 17. TRAVEL

Subrecipient shall abide by travel policies that adhere to TXGMS and the State of Texas travel rules and regulations found on the Comptroller of Public Accounts website at www.cpa.state.tx.us for any travel funded by this Contract either directly or indirectly.

SECTION 18. BONDING AND INSURANCE REQUIREMENTS

A. INSURANCE REQUIREMENTS. Notwithstanding hereinabove, Subrecipient is a self-funded entity in accordance with Chapter 2259 of the Texas Government Code subject to statutory tort laws and, as such, generally, it does not maintain commercial general liability insurance and/or worker’s compensation claims.

B. BONDING REQUIREMENTS. Subrecipient must comply with the bond requirements Articles 2252, 2253, and 5160 of Texas Civil Statutes, and §252.044 and Section 262.032 of the Local Government Code. If Subrecipient will enter into a public works contract with a third-party in the amount of Fifty Thousand and No/100 Dollars ($50,000.00) or greater, Subrecipient must execute with the contractor a payment bond in the full amount of the contract. If the Subrecipient will enter into a contract with a prime contractor in excess of One Hundred Thousand and No/100 Dollars ($100,000.00), a performance bond in the full amount of the contract is also required.

These bonds must be executed by a corporate surety authorized to do business in Texas, a list of which may be obtained from the State Insurance Department. Such assurances of completion will run to the Department as obligee and must be documented prior to the start of construction. This bonding requirement applies as set forth in 10 TAC §1.405 and to the extent required by federal or state law.

SECTION 19. LITIGATION AND CLAIMS

Subrecipient shall give Department immediate written notice of any claim or action filed with a court or administrative agency against Subrecipient arising out of the performance of this Contract or any subcontract or subgrant hereunder. Subrecipient shall furnish to Department copies of all pertinent papers received by Subrecipient with respect to such action or claim.

SECTION 20. TECHNICAL ASSISTANCE AND MONITORING

http://www.cpa.state.tx.us/

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A. Department may provide technical guidance to explain the rules and provide directions on terms of this Contract.

B. Department or its designee may conduct periodic on- or off-site monitoring and evaluation of the efficiency, economy, and efficacy of Subrecipient’s performance of this Contract in accordance with the HHSP State Rules. Department will advise Subrecipient in writing of any deficiencies noted during such monitoring. Department will suggest or require changes in Subrecipient’s program implementation or in Subrecipient’s accounting, personnel, procurement, and management procedures in order to correct any Observations, Concerns, or Findings. Department may conduct follow-up visits to review and assess the efforts Subrecipient has made to correct previously-noted Observations, Concerns, or Findings.

C. Department may suspend or terminate this Contract, or invoke other remedies in the event monitoring or other reliable sources reveal material deficiencies in Subrecipient’s performance or if Subrecipient fails to correct any deficiency within the time allowed by federal or state law or regulation, or by the terms of this Contract.

SECTION 21. LEGAL AUTHORITY

A. LEGAL AUTHORITY. Subrecipient represents that it possesses legal authority to apply for the grant. A resolution, motion or similar action has been duly adopted or passed as an official act of the Subrecipient’s governing body, authorizing the filing of the contract, including all understandings and assurances contained therein, and directing and authorizing the person identified as the official representative, or the designee of Subrecipient to act in connection with the contract and to provide such additional information as may be required. Subrecipient assures and guarantees that it possesses the legal authority to enter into this Contract, to receive and manage the funds authorized by this Contract, and to perform the services Subrecipient has obligated itself to perform hereunder. The execution, delivery, and performance of this Contract will not violate Subrecipient’s constitutive documents or any requirement to which Subrecipient is subject and represents the legal, valid, and binding agreement of Subrecipient, enforceable in accordance with its terms.

B. DULY AUTHORIZED; GOOD STANDING. Subrecipient is and will continue to remain organized, validly existing and in good standing under the laws governing its creation and existence, and will continue to be duly authorized and qualified to transact any and all applicable business contemplated hereunder in the State of Texas. Subrecipient possesses and will continue to possess all requisite authority, power, licenses, permits and franchises to conduct its business and to execute, deliver and comply with its obligations under the terms of this Contract, the execution, delivery and performance of which have been or will be duly authorized by all necessary action.

C. SIGNATURE AUTHORITY. The person signing this Contract on behalf of Subrecipient hereby warrants that he/she has been duly authorized by Subrecipient's governing body to execute this Contract on behalf of Subrecipient and to validly and legally bind Subrecipient to the terms, provisions and performances herein.

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D. TERMINATION; LIABILITY. Department shall have the right to terminate this Contract if there is a dispute as to the legal authority of either Subrecipient or the person signing this Contract on behalf of Subrecipient to enter into this Contract or to render performances hereunder.

Subrecipient is liable to Department for any money it has received from Department for performance of the provisions of this Contract, if the Department has terminated this Contract for reasons enumerated in this Section 21.

E. MERGER; DEFAULT. Subrecipient understands that it is an event of default under this Contract if the Subrecipient liquidates, terminates, dissolves, merges, consolidates or fails to maintain good standing in the State of Texas, and such is not cured prior to causing material harm to Subrecipient’s ability to perform under the terms of this Contract.

SECTION 22. COMPLIANCE WITH LAWS

A. FEDERAL, STATE AND LOCAL LAW. Subrecipient shall comply with the State Act, the HHSP State Rules, and all federal, state, and local laws, rules, regulations, and policies in effect or hereafter established applicable to the performance of this Contract, including, but not limited to the program requirements and fair housing laws. Subrecipient represents and warrants that it will comply, and assure the compliance of all its subrecipients and contractors, with all applicable federal and state laws, rules, regulations, and policies in effect or hereinafter established. In addition, Subrecipient represents and warrants that it will comply with all requirements imposed by the Department concerning special requirements of law, program requirements, and other administrative requirements. In instances where multiple requirements apply to Subrecipient, the more restrictive requirement applies. Upon request by Department, Subrecipient shall furnish satisfactory proof of its compliance therewith. Subrecipient shall not violate any federal, state, or local laws, stated herein or otherwise, nor commit any illegal activity in the performance of or associated with the performance of this Contract. No funds under this Contract shall be used for any illegal activity or activity that violates any federal, state or local laws.

B. DRUG-FREE WORKPLACE ACT OF 1988. The Subrecipient affirms by signing this Contract and the ”Certification Regarding Drug-Free Workplace Requirements” attached hereto as Addendum A that it is implementing the Drug-Free Workplace Act of 1988 (41 USC §701 et seq) and the regulations promulgated thereunder including, without limitation, 2 CFR Parts 182 and 2429.

C. INFORMATION SECURITY AND PRIVACY REQUIREMENTS.

(1) General. Subrecipient shall comply with the information security and privacy requirements under 10 TAC §1.24 to ensure the security and privacy of Protected Information (as said term is defined under 10 TAC §1.24).

(2) Information Security and Privacy Agreement (“ISPA”). Prior to beginning any work under this Contract, Subrecipient shall either (i) have an effective, fully executed ISPA, as required by 10 TAC §1.24, on file with the Department, or (ii) will execute and submit to the Department an ISPA in accordance with instructions found on the Department’s website at the “Information Security and Privacy Agreement” link.”

D. AFFIRMATIVE OUTREACH. Subrecipient shall affirmatively reach out to populations that are least likely to apply for services as further outlined in 10 TAC §7.10(c)(3).

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E. LEAD-BASED PAINT. Subrecipient shall comply with the Lead-Based Paint Poisoning Prevention

Act, 42 U.S.C. §4821 et seq. and 24 CFR Part 35.

F. EXECUTIVE HEAD OF A STATE AGENCY AFFIRMATION. In accordance with Section 669.003 of the Texas Government Code, relating to contracting with the executive head of a state agency, Subrecipient certifies that it is not (1) the executive head of the Department, (2) a person who at any time during the four years before the date of the Contract was the executive head of the Department, or (3) a person who employs a current or former executive head of the Department.

G. PROHIBITED EXPENDITURES ON CERTAIN TELECOMMUNICATIONS AND

VIDEO SURVEILLANCE SERVICES AND EQUIPMENT.

(1) General. Pursuant to 2 CFR §200.216, Subrecipient and its contractors are prohibited from using funds under this Contract for equipment, services, or systems that use the following covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system in accordance with Section 889 of Public Law 115-232 (National Defense Authorization Act 2019) or enter into, extend or renew a contract to procure the following covered telecommunications equipment or services:

a) Telecommunications equipment produced by Huawei Technologies Company or ZTE Corporation (or any subsidiary or affiliate of such entities).

b) For the purpose of public safety, security of government facilities, physical security surveillance of critical infrastructure, and other national security purposes, video surveillance and telecommunications equipment produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company (or any subsidiary or affiliate of such entities).

c) Telecommunications or video surveillance services provided by such entities or using such equipment.

d) Telecommunications or video surveillance equipment or services produced or provided by an entity that the Secretary of Defense, in consultation with the Director of the National Intelligence or the Director of the Federal Bureau of Investigation, reasonably believes to be an entity owned or controlled by, or otherwise connected to, the government of a covered foreign country.

e) Systems that use covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.

(2) Subcontracts. Subrecipient must incorporate this prohibition in any contract and require its subgrantees or subcontractors to incorporate this requirement into any contract.

H. CYBERSECURITY TRAINING PROGRAM.

1) Subrecipient represents and warrants its compliance with Section 2054.5191 of the Texas Government Code relating to the cybersecurity training program for local government employees who have access to a local government computer system or database.

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2) If Subrecipient has access to any state computer system or database, Subrecipient shall complete cybersecurity training and verify completion of the training program to the Department pursuant to and in accordance with Section 2054.5192 of the Government Code.

I. DISCLOSURE PROTECTIONS FOR CERTAIN CHARITABLE ORGANIZATIONS, CHARIABLE TRUSTS, AND

PRIVATE FOUNDATIONS. Subrecipient represents and warrants that it will comply with Section

2252.906 of the Texas Government Code relating to disclosure protections for certain charitable organizations, charitable trusts, and private foundations.

J. PROCUREMENT OF RECOVERED MATERIALS. Subrecipient represents and warrants that it will comply with the requirements of Section 6002 of the Solid Waste Disposal Act (Chapter 361 of the Texas Health and Safety Code, formerly Tex. Rev. Civ. Stat. Ann. Art. 4477-7), as amended by the Resource Conservation and Recovery Act.

K. RECORDS RETENTION. Subrecipient represents and warrants its compliance with the records retention requirements of 2 CFR §200.333. The Department reserves the right to direct a Subrecipient to retain documents for a longer period of time or transfer certain records to Department custody when it is determined the records possess longer term retention value.

Subrecipient must include the substance of this clause in all subawards and subcontracts.

L. NOTIFICATION OF INVESTIGATION. Subrecipient must notify the Department if Subrecipient is under federal or state investigation (by, for example, including, but not limited to, Office of Inspector General and the Office of State Inspector General). Subrecipient must inform the Department in writing of this investigation in accordance with the Notice Provisions in Section

41. Subrecipient must also inform the Department in writing, in accordance with the Notice Provisions in Section 41, of any written requests for information by the State Auditor’s Office, the Office of the Attorney General, or any other investigative agency, unless otherwise prohibited by law.

M. REMEDIES. Upon an occurrence of an event of default, the Department, in its sole discretion may,

(i) apply to any court having jurisdiction of the subject matter for specific performance of this Contract, and/or for an injunction against any violation of this Contract, or (ii) take any action authorized under Title 10, Part 1, Chapter 10, Subchapters F and G of the Texas Administrative Code or Title 10, Part 1, Chapter 2 of the Texas Administrative Code, or (iii) take any and all action at law, in equity, or otherwise for such other relief as may be appropriate, it being acknowledged that the beneficiaries of Subrecipient's obligations thereunder cannot be adequately compensated by monetary damages in the event of Subrecipient's default. The Department shall be entitled to its reasonable attorneys' fees in any such judicial action in which the Department shall prevail. The Department shall also be compensated for fees associated with additional compliance monitoring during corrective periods of non-compliance upon a default by Subrecipient hereunder.

SECTION 23. PREVENTION OF WASTE, FRAUD, AND ABUSE

A. Subrecipient shall establish, maintain, and utilize systems and procedures to prevent, detect, and correct waste, fraud, and abuse in activities funded under this Contract. The systems and

18266000003 16 procedures shall address possible waste, fraud, and abuse by Subrecipient, its employees, clients, vendors, subcontractors and administering agencies. Subrecipient’s internal controls systems and all transactions and other significant events are to be clearly documented, and the documentation is to be readily available for monitoring by Department.

B. Subrecipient shall give Department complete access to all of its records, employees, and agents for the purpose of monitoring or investigating HHSP. Subrecipient shall immediately notify Department of any discovery of waste, fraud, or abuse. Subrecipient shall fully cooperate with Department's efforts to detect, investigate, and prevent waste, fraud, and abuse.

C. Subrecipient represents and warrants that it will comply with Section 321.022 of the Texas Government Code which requires that suspected fraud and unlawful conduct be reported to the State Auditor’s Office.

D. Subrecipient may not discriminate against any employee or other person who reports a violation of the terms of this Contract, or of any law or regulation, to Department or to any appropriate law enforcement authority, if the report is made in good faith.

SECTION 24. CERTIFICATION REGARDING UNDOCUMENTED WORKERS

Pursuant to Chapter 2264 of the Texas Government Code, by execution of this Contract, Subrecipient hereby certifies that Subrecipient, or a branch, division, or department of Subrecipient does not and will not knowingly employ an undocumented worker, where “undocumented worker” means an individual who, at the time of employment, is not lawfully admitted for permanent residence to the United States or authorized under law to be employed in that manner in the United States. If, after receiving a public subsidy, Subrecipient or a branch, division, or department of Subrecipient is convicted of a violation under 8 U.S.C. §1324a(f), Subrecipient shall repay the public subsidy with interest, at the rate of five percent (5%) per annum, not later than the one hundred twentieth (120th) day after the date the Department notifies Subrecipient of the violation.

SECTION 25. CONFLICT OF INTEREST/NEPOTISM

A. Subrecipient shall maintain written standards of conduct governing the performance of its employees engaged in the award and administration of contracts. Failure to maintain written standards of conduct and to follow and enforce the written standards is a condition of default under this Contract and may result in termination of the Contract or deobligation of funds.

B. No employee, officer, or agent of Subrecipient shall participate in the selection, award, or administration of a contract supported by federal funds if a real or apparent conflict of interest would be involved. Such a conflict would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the Parties indicated herein, has a financial or other interest in the firm selected for an award.

C. The officers, employees, and agents of the Subrecipient shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, or parties to sub-agreements.

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Subrecipients may set standards…