TITLE 4. AGRICULTURE

PART 1. TEXAS DEPARTMENT OF AGRICULTRE

CHAPTER 1. GENERAL PROCEDURES

SUBCHAPTER E. ADVISORY COMMITTEES

4 TAC §1.203

The Texas Department of Agriculture (Department) proposes the repeal of 4 Texas Administrative Code, Chapter 1, Subchapter E, §1.203, concerning the Texas-Israel Exchange Fund (TIE) Advisory Committee. Section 56 of Senate Bill 703, 87th Texas Legislature, Regular Session (2021), among other things, repealed Chapter 45.009, Texas Agriculture Code, which provided for the creation of the TIE Advisory Committee. The repeal of Texas Agriculture Code, §45.009 necessitates repeal of corresponding rules for the TIE Advisory Committee.

LOCAL EMPLOYMENT IMPACT STATEMENT: The Department has determined that the proposed repeal will not affect a local economy, so the Department is not required to prepare a local employment impact statement under Texas Government Code, §2001.022.

GOVERNMENT GROWTH IMPACT STATEMENT: Pursuant to Texas Government Code, §2001.0221, the Department provides the following Government Growth Impact Statement for the proposed repeal. For each year of the first five years the proposed repeal will be in effect, the Department has determined the following:

1. the proposed repeal does not create or eliminate a government program;

2. implementation of the proposed repeal does not require the creation or elimination of employee positions;

3. implementation of the proposed repeal does not require an increase or decrease in future legislative appropriations to the Department;

4. the proposed repeal does not require an increase or decrease in fees paid to the Department;

5. the proposed repeal does not create a new regulation;

6. the proposed repeal will repeal an existing regulation;

7. the proposed repeal does not increase or decrease the number of individuals subject to the rule's applicability; and

8. the proposed repeal does not positively or adversely affect this state's economy.

FISCAL IMPACT ON STATE AND LOCAL GOVERNMENT: Mindy Weth Fryer, Director for Contracts and Grants, has determined that for each year of the first five years the proposed repeal is in effect, enforcing or administering the proposed repeal does not have foreseeable implications relating to costs or revenues of state or local governments.

PUBLIC BENEFITS AND PROBABLE ECONOMIC COST: Ms. Fryer has determined that for each year of the first five-year period the proposed repeal is in effect, the public benefit will be the elimination of rules that will no longer be administered by the Department. Ms. Fryer has also determined that for each year of the first five-year period the proposed repeal is in effect, there will be no cost to persons who are required to comply with the proposed repeal.

FISCAL IMPACT ON SMALL BUSINESSES, MICRO-BUSINESSES, AND RURAL COMMUNITIES: The Department has determined there will be no adverse economic effect on small businesses, micro-businesses, or rural communities as a result of the proposed repeal, therefore preparation of an economic impact statement and a regulatory flexibility analysis, as detailed under Texas Government Code, §2006.002, are not required.

Comments on the proposed repeal may be submitted to Skyler Shafer, Assistant General Counsel, P.O. Box 12847, Austin, Texas 78711, or by email to skyler.shafer@texasagriculture.gov. The deadline for comments is 30 days after publication in the Texas Register.

The repeal is proposed under Section 12.016 of the Texas Agriculture Code, which provides that the Department may adopt rules as necessary for the administration of its powers and duties under the Texas Agriculture Code. Texas Agriculture Code, Chapter 45 is affected by the repeal.

§1.203.Texas-Israel Exchange Fund (TIE) Advisory Committee.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202232

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


CHAPTER 17. MARKETING AND PROMOTION

SUBCHAPTER E. TEXAS-ISRAEL EXCHANGE RESEARCH PROGRAM

4 TAC §§17.100 - 17.104

The Texas Department of Agriculture (Department) proposes the repeal of 4 Texas Administrative Code, Chapter 17, Subchapter E, regarding Texas-Israel Exchange Research Program Rules, §§17.100 - 17.104. Section 56 of Senate Bill 703, 87th Texas Legislature, Regular Session (2021), among other things, repealed 45.009, Texas Agriculture Code, which provided for the creation of the TIE Advisory Committee. Furthermore, funding for the program has been suspended and the program has been inactive for the past 10 years. As a result, rules for the Texas-Israel Exchange Research Program are no longer necessary.

LOCAL EMPLOYMENT IMPACT STATEMENT: The Department has determined that the proposed repeals will not affect a local economy, so the Department is not required to prepare a local employment impact statement under Texas Government Code, §2001.022.

GOVERNMENT GROWTH IMPACT STATEMENT: Pursuant to Texas Government Code, §2001.0221, the Department provides the following Government Growth Impact Statement for the proposed repeals. For each year of the first five years the proposed repeals will be in effect, the Department has determined the following:

1. the proposed repeals do not create or eliminate a government program;

2. implementation of the proposed repeals do not require the creation or elimination of employee positions;

3. implementation of the proposed repeals do not require an increase or decrease in future legislative appropriations to the Department;

4. the proposed repeals do not require an increase or decrease in fees paid to the Department;

5. the proposed repeals do not create a new regulation;

6. the proposed repeals will repeal an existing regulation;

7. the proposed repeals do not increase or decrease the number of individuals subject to the rule's applicability; and

8. the proposed repeals do not positively or adversely affect this state's economy.

FISCAL IMPACT ON STATE AND LOCAL GOVERNMENT: Mindy Weth Fryer, Director for Contracts and Grants, has determined that for each year of the first five years the proposed repeals are in effect, enforcing or administering the proposed repeals does not have foreseeable implications relating to costs or revenues of state or local governments.

PUBLIC BENEFITS AND PROBABLE ECONOMIC COST: Ms. Fryer has determined that for each year of the first five-year period the proposed repeals are in effect, the public benefit will be the elimination of rules that will no longer be administered by the Department. Ms. Fryer has also determined that for each year of the first five-year period the proposed repeals are in effect, there will be no cost to persons who are required to comply with the proposed repeals.

FISCAL IMPACT ON SMALL BUSINESSES, MICRO-BUSINESSES, AND RURAL COMMUNITIES: The Department has determined there will be no adverse economic effect on small businesses, micro-businesses, or rural communities as a result of the proposed repeals, therefore preparation of an economic impact statement and a regulatory flexibility analysis, as detailed under Texas Government Code, §2006.002, are not required.

Comments on the proposed repeals may be submitted to Skyler Shafer, Assistant General Counsel, P.O. Box 12847, Austin, Texas 78711, or by email to skyler.shafer@texasagriculture.gov. The deadline for comments is 30 days after publication in the Texas Register.

The repeals are proposed under Section 12.016 of the Texas Agriculture Code, which provides that the Department may adopt rules as necessary for the administration of its powers and duties under the Texas Agriculture Code. Texas Agriculture Code, Chapter 45 is affected by these repeals.

§17.100.Definitions.

§17.101.Purpose.

§17.102.Administration.

§17.103.Selection Criteria.

§17.104.Application Procedure.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202233

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


CHAPTER 30. COMMUNITY DEVELOPMENT

The Texas Department of Agriculture (Department) proposes the repeal of Title 4, Part 1, Chapter 30, Subchapter A in its entirety. Specifically, the Department proposes the repeal of Subchapter A, Texas Community Development Block Grant Program, Division 1, §§30.1 - 30.8, relating to General Provisions; Division 2, §§30.20 - 30.31, relating to Application Information; Division 3, §§30.50 - 30.60 and 30.62 - 30.67, relating to Administration of Program Funds; Division 4, §§30.80 - 30.84, relating to Awards and Contract Administration; and Division 5, §§30.100 - 30.103, relating to Reallocation of Program Funds. In conjunction with this proposed repeal, the Department proposes new Subchapter A, relating to the Texas Community Development Block Grant Program, consisting of §§30.1 - 30.13.

The Department has determined that due to the extensive changes to program rules, repeal of the entire subchapter and replacement with new rules is more efficient than proposing numerous amendments to make the required changes. The changes are necessary in order to simplify the rules, focusing on the most generally applicable program requirements and removing details more efficiently addressed in the Application Guides. The current rules contain separate requirements for each program category. The new rules focus on program-wide requirements of general applicability. The proposed new rules will allow the Department flexibility to develop program procedures and guidelines in a more timely and efficient manner to ensure compliance with all statutory and applicable regulatory requirements.

New §30.1 describes the Department's authority to implement and administer the Texas Community Development Block Grant Program (TxCDBG) program.

New §30.2 provides definitions for terms and abbreviations applicable to this subchapter.

New §30.3 provides the method of allocation of grant funds.

New §30.4 describes who is eligible to apply for TxCDBG grants.

New §30.5 outlines the application process and provides that the specific application procedures, requirements, and evaluation criteria will be stated in a Request for Applications.

New §30.6 describes application threshold requirements.

New §30.7 explains the citizen participation process.

New §30.8 provides the appeal process for denial or disqualification of applications.

New §30.9 describes project implementation requirements.

New §30.10 sets out the requirement for grant training.

New §30.11 prescribes the conflict of interest standards for grant recipients.

New §30.12 describes the process for requesting amendments to a grant agreement.

New §30.13 concerns the range of sanctions the Department may impose on grant recipients.

Ms. Suzanne Barnard, Director for TxCDBG Programs, has determined that for the first five-year period the proposed rules are in effect, there will be no fiscal implications for the state or local governments as a result of enforcing or administering the rules.

Ms. Barnard has also determined that for each year of the first five years the proposed rules are in effect, the public benefit will be improved readability and clarity of the rules.

Ms. Barnard has determined there are no anticipated economic costs to persons required to comply with the proposed rules.

Ms. Barnard has provided the following government growth impact statement, as required pursuant to Texas Government Code, §2001.0221. During the first five years the proposed rules are in effect:

(1) no government programs will be created or eliminated;

(2) no employee positions will be created or eliminated;

(3) there will be no increase or decrease in future legislative appropriations to the Department;

(4) there will be no increase or decrease in fees paid to the Department;

(5) new regulations will be created by the proposal;

(6) there will be a repeal of existing regulations;

(7) there may be an increase in the number of individuals subject to the rules, depending on the number of applicants who seek to participate in the program; and

(8) there will be no positive or adverse effect on the Texas economy.

The Department has determined the proposed rules will not affect a local economy within the meaning of Texas Government Code §2001.022 and will not have an adverse economic effect on small businesses, micro-businesses, or rural communities.

Written comments on the proposal may be submitted by mail to Ms. Suzanne Barnard, Director for TxCDBG Programs, Texas Department of Agriculture, P.O. Box 12847, Austin, Texas 78711, or by email to suzanne.barnard@texasagriculture.gov. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register.

SUBCHAPTER A. TEXAS COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM

DIVISION 1. GENERAL PROVISIONS

4 TAC §§30.1 - 30.8

The repeal of Subchapter A, Division 1, §§30.1 - 30.8, is proposed under Texas Government Code, §487.051, which designates the Department as the agency to administer the federal community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposed repeal is Texas Government Code, Chapter 487.

§30.1.Applicable Law.

§30.2Definitions and Abbreviations.

§30.3.Program Overview.

§30.4.National Program Objectives.

§30.5.Ineligible Activities.

§30.6.Administrative Appeal.

§30.7.Conflict of Interest.

§30.8.Document Retention.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202205

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


4 TAC §§30.1 - 30.13

The new rules are proposed pursuant to Texas Government Code §487.051, which provides the Department authority to administer the state's community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposal is Texas Government Code, Chapter 487.

§30.1.Authority.

(a) The Department administers the Texas Community Development Block Grant (TxCDBG) Program, which administers the state's allocation of federal funds provided under the community development block grant non-entitlement program pursuant to §§487.051(a)(6), 487.351, and 487.354 of the Texas Government Code and in accordance with the Housing and Community Development Act of 1974 (42 USC §§5301 et seq.), 24 CFR Part 570, and this subchapter.

(b) This subchapter does not apply to grants funded under the Colonia Self Help Center legislative set-aside program. Administrative procedures for these grants will be adopted and implemented by the Texas Department of Housing and Community Affairs (TDHCA).

§30.2.Definitions.

In addition to the general definitions contained with Title 4, Part 1, Chapter 1, §1.1, the following terms, when used in this subchapter, shall have the following specific meaning unless the context clearly indicates otherwise:

(1) Applicant--A unit of general local government in a non-entitlement area that submits an application to the Department for funding under the TxCDBG program.

(2) ARO--The administrative review official.

(3) CDBG--community development block grant.

(4) CFR--Code of Federal Regulations.

(5) Grant recipient--An applicant that has been awarded or received a grant under the TxCDBG Program.

(6) HUD--United States Department of Housing and Urban Development.

(7) Non-entitlement area--An area of the state which is not a metropolitan city or part of an urban county, as defined in 42 USC §5302, and does not include Indian tribes.

(8) RFA--Request for Applications.

(9) TxCDBG--Texas Community Development Block Grant Program.

(10) TxGMS--Texas Grant Management Standards promulgated by the Texas Comptroller of Public Accounts.

(11) Unit of general local government--a city, county, town, township, village, or other general purpose political subdivision of the state, or as otherwise defined in 42 USC §5302.

(12) USC--United States Code.

§30.3.Funding.

(a) The Department shall allocate the state's annual CDBG grant and establish the funding of TxCDBG programs in accordance with the state's annual action plan, which is available on the Department's website and the HUD Exchange, HUD's online platform for program information, guidance, and tools.

(b) For funds allocated to the Community Development Fund category within the TxCDBG program, funds are allocated among the twenty-four State planning regions based on a combination of the following two formulas:

(1) Original CD formula, which takes into account the following factors:

(A) Non-Entitlement Population;

(B) Number of Persons in Poverty;

(C) Percentage of Poverty Persons;

(D) Number of Unemployed Persons; and

(E) Percentage of Unemployed Persons; and

(2) HUD formula, which is the same methodology that HUD uses to allocate CDBG funds among the States for use in non-entitlement areas. The HUD factors, percentages, and methodology are specified in 42 USC §5306(d).

§30.4.Eligible Applicants.

(a) Units of general local government located in non-entitlement areas that are not eligible to participate or that opt not to participate in the entitlement portion of the federal CDBG Program are eligible to apply for funding under the TxCDBG Program. An exception to this requirement is Hidalgo County, an entitlement county, which is eligible to apply for the Colonia Fund only.

(b) Non-entitlement cities are cities located predominately in rural areas and generally:

(1) have a population of less than 50,000;

(2) are not designated as a central city of a metropolitan statistical area; or

(3) are not participating in urban county CDBG programs.

(c) Non-entitlement counties are counties that are predominately rural in nature and generally have fewer than 200,000 persons in the non-entitlement cities and unincorporated areas located in the county.

§30.5.Application Process.

(a) Subject to available funding, the Department will issue a RFA for current TxCDBG programs. The RFA shall be publicly available through the Department's website.

(b) The RFA, at a minimum, will provide the following information:

(1) eligibility requirements for the particular grant program;

(2) the maximum and minimum amount of individual grants;

(3) any limitations on the type of eligible applicants;

(4) limits, if any, on the number of grant applications that may be submitted by an applicant for a particular grant program;

(5) filing instructions and the deadline for the submission of applications;

(6) any match requirements;

(7) program objectives and guidelines for proposed projects;

(8) evaluation and award criteria, including guidance regarding the range of possible scores or points to be awarded to each of the selection criteria and any special factors to be evaluated in assigning points under the selection criteria;

(9) any prohibitions on the use of grant funds; and

(10) Department contact information.

(c) The application submitted to the Department must be:

(1) fully completed;

(2) received by the deadline in the manner stated in the RFA; and

(3) certified by an authorized individual.

(d) Once the application is filed, it will be initially screened for completeness and eligibility, and if complete and eligible it will be evaluated and reviewed, and a grant decision will be made.

(e) Providing false information, knowingly or unknowingly, on a grant application may cause an application to be denied or cause the grant agreement, once awarded, to be terminated.

§30.6.Application Threshold Requirements.

To be eligible to receive funding under the TxCDBG Program, an applicant must meet the following criteria:

(1) Grant administration. Demonstrate the ability to manage and administer the proposed project. The Department may consider the applicant's past performance and completion of previously awarded TxCDBG contracts, outstanding compliance and/or audit findings, and history of actively working with the Department to resolve any outstanding audit, monitoring, and/or reporting issues identified by the Department.

(2) Financial capacity. Demonstrate the financial management capacity to sustain operation and maintenance of any improvements made in conjunction with the proposed project. Applications for TxCDBG funding must demonstrate financial capacity through compliance with the audit requirements in the Texas Local Government Code, as described in the RFA.

(3) Proposed benefits. Demonstrate the ability to meet all proposed benefits identified in the application, including job creation if applicable.

(4) Levy and collect tax. Levy and collect a local property tax or local sales tax option.

(5) Open TxCDBG grants. If applicable, an applicant that has an open or pending TxCDBG grant must meet progress threshold requirements specified by the Department in the RFA and/or current TxCDBG action plan, including thresholds to obligate at least 50% of grant funding and to complete closeout reporting, as applicable.

(6) Single Audits. Communities are required to comply with all federal single audit requirements, as described in the TxCDBG Project Implementation Manual, regardless of whether the required compliance is based on received funds other than TxCDBG awards. If applicable, an applicant must submit any past due audits to the Federal Audit Clearinghouse within the timeframes prescribed by the Department.

(A) One delinquent audit. If the applicant meets threshold requirements for funding and has only one federal single audit delinquency, the Department will withhold the issuance of a grant award or grant agreement until it receives a satisfactory audit from the applicant. If the Department does not receive the applicant's delinquent audit within ninety (90) days after the application deadline, the application will be considered withdrawn by the applicant.

(B) Multiple delinquent audits. An applicant with more than one delinquent federal single audit is ineligible to participate in the TxCDBG Program.

(C) Delinquency of five years or more. An applicant that has been delinquent in meeting federal single audit requirements or that has failed to submit a required single audit for five years or more is ineligible to participate in the TxCDBG Program for a period of five years. After the five-year ineligibility period, the applicant may re-establish eligibility by following the program eligibility process described in Policy Issuance 12-01 or the TxCDBG Project Implementation Manual.

(7) Other application requirements. Other threshold requirements relevant to a particular grant program may be included in the RFA.

§30.7.Citizen Participation Process.

(a) Citizen Participation Plan. An applicant must develop and follow a detailed citizen participation plan that sets forth the applicant's policies and procedures for citizen participation and must make the plan public. The plan must be completed and available before an application for TxCDBG funding is submitted to the Department. The applicant must meet the following requirements:

(1) provide for and encourage citizen participation, particularly by low and moderate income persons who reside in slum or blighted areas and areas in which TxCDBG funds are proposed to be used;

(2) ensure that citizens will be given reasonable and timely access to local meetings, information, and records relating to the applicant's proposed and actual use of TxCDBG funds;

(3) furnish citizens information, including but not limited to:

(A) the amount of TxCDBG funds expected to be made available for the current program year;

(B) the range of activities that may be undertaken with the TxCDBG funds;

(C) the estimated amount of the TxCDBG funds proposed to be used for activities that will meet he national objective of benefit to low and moderate income persons; and

(D) which of the proposed activities, if any, are likely to result in displacement and the applicant's anti-displacement and relocation plans required under 24 CFR §570.488;

(4) provide technical assistance to groups representative of persons of low and moderate income that request assistance in developing proposals for the use of TxCDBG funds;

(5) provide for a minimum of two public hearings for the purpose of obtaining citizens' views and responding to proposals and questions. Together the hearings must cover community development and housing needs, development of proposed activities, and a review of program performance. Public hearings must be held at the following stages:

(A) Initial public hearing. A public hearing to cover community development and housing needs must be held before submission of an application to the Department; and

(B) Final public hearing. A public hearing must be held after completion of a funded project to afford citizens an opportunity to review and comment on the grant recipient's performance, including the actual use of TxCDBG funds provided under the grant. The final public hearing must be held prior to submitting a closeout report to the Department;

(6) provide reasonable notice of hearings and hold hearings at times and locations convenient to potential or actual beneficiaries, with reasonable accommodations including material in accessible formats for persons with disabilities;

(7) provide citizens with reasonable advance notice of, and opportunity to comment on, proposed activities in an application and, for grants already made, activities which are proposed to be added, deleted or substantially changed from the grant application that was submitted to the Department. Substantially changed means changes made in terms of purpose, scope, location or beneficiaries as defined by criteria established by the Department; and

(8) provide written procedures that citizens must follow when submitting complaints and grievances, which include the address, phone number, and times for submitting complaints and grievances, and provide timely written answers to written complaints and grievances within 15 working days where practicable.

(b) Public notice of proposed application. An applicant must provide reasonable notice of the availability of a proposed application in order to afford affected citizens an opportunity to examine the application's contents to determine the degree to which they may be affected, and to submit comments on the proposed application, as described in the RFA.

(c) Preparation of final application. In the preparation of the final application, the applicant shall consider comments and views received related to the proposed application and may, if appropriate, modify the final application prior to submission of the application to the Department. The final application shall be made available to the public.

(d) Records retention. The applicant shall retain all documentation of the hearing notices, a list of attendees at each hearing, minutes of the hearings, and any other records concerning the proposed use of funds for a period of three years after the application deadline date or until the project, if funded, is closed out. Such records must be made available to the public in accordance with the Texas Public Information Act, Chapter 552 of the Texas Government Code.

§30.8.Administrative Appeal.

(a) Actions subject to appeal. The following actions are subject to appeal.

(1) An appeal may only be filed based on denial or disqualification of an application for TxCDBG funding as a result of procedural errors by Department staff. All other decisions regarding contracts and grant administration are final.

(2) The failure of a grant administrator or consultant to properly submit all required documentation to the Department is not a basis for appeal.

(3) A request to waive program requirements is not a basis for appeal.

(b) Procedures for requesting an appeal. The following procedures shall apply when an applicant requests an appeal.

(1) Notice of denial or disqualification. The Department shall send the applicant a written notice of denial or disqualification of its application and the ground(s) on which the denial or disqualification is based. The notice shall be provided by certified mail, return receipt (or its equivalent), or sent electronically by email or facsimile. The notice is considered to be received by the applicant when it is delivered by certified mail, return receipt (or the equivalent private delivery service), by facsimile, or by email. If the notice is undeliverable, it is considered to be received by the applicant five days after being sent to the addressee's last known mailing address, facsimile number, or email address.

(2) Who may file. Only the chief (executive or elected) official or designated representative of the applicant may submit the request for appeal.

(3) Request for appeal. The request for appeal must be submitted in writing and postmarked, or received by the Department if submitted by email, on or before 5:00 p.m. Central Time not later than fifteen (15) days after the receipt, or deemed receipt, of the notice of denial or disqualification. The request for appeal must clearly identify the action being appealed, include a statement of facts or other pertinent information to support the appeal, and include a copy of the notice of denial or disqualification.

(4) Acknowledgement of receipt. The Department shall acknowledge the receipt of the request for appeal within ten (10) days of its receipt of the request.

(c) Hearing Procedures. The administrative hearing shall be conducted in accordance with the Administrative Procedure Act, Government Code, Chapter 2001, and this section.

(1) Venue. All hearings shall be held in Austin, Texas, unless for good cause and in the public interest another place of hearing is designated by the administrative review official (ARO).

(2) Notice of hearing. Upon receipt of a timely request for appeal, the Department shall set a hearing and send written notice of the hearing to the appellant at least ten (10) days before the date of the hearing. The hearing notice shall state:

(A) the date, time, and place where the hearing is to be held; and

(B) that failure of appellant or appellant's representative to appear at the hearing shall constitute a waiver of appellant's right to appear personally before the ARO, unless the ARO reschedules the hearing.

(3) Conduct of hearing.

(A) The ARO shall conduct the hearing as an informal proceeding. The formal rules of court shall not apply unless necessary for efficient conduct of the hearing.

(B) The hearing shall be recorded by a tape recorder or teleconference equipment and kept on file for ninety (90) days after the hearing. During this period, the appellant may copy or transcribe this information at its own expense.

(4) Burden of proof. Appellant has the burden of proof to show, by a preponderance of the evidence, that the Department's denial or disqualification of appellant's application was based on a procedural error made by Department staff.

(5) Documentary evidence. A party must file all documents relating to the appeal with the docket clerk and must serve, at the same time, a copy on the other party.

(d) Proposal for Decision. Within sixty (60) days after the date of the hearing, the ARO shall issue a proposal for decision based on information provided by the Department and the appellant, and on program regulations. This timeframe is an administrative requirement for the Department and may not be used as a basis for overturning the Department's action if a decision is not made within the specified timeframe.

(e) Final Decision.

(1) The Commissioner, or designee, shall review the ARO's proposal for decision and issue a final decision on the appeal. The final decision shall be issued within ninety (90) days after the date of the hearing and shall be based on and limited to review of the ARO's proposal for decision and information presented by the parties in support of their positions.

(2) The Commissioner's decision of the appeal shall be the final decision of the Department.

(f) Effect of State Agency Action.

(1) The Department's action shall remain in effect during the appeal process.

(2) If the final decision on the appeal is in favor of the appellant, the appellant is not guaranteed to receive grant funding. The appellant's application will be scored and compared to other applications scored during the application cycle. If the revised score does not put the appellant in funding range when ranked against other applications from the same scoring round, no award will be made.

(g) Computation of time. In computing any period of time prescribed by this section, the day of the act, event, or default after which the designated period of time begins to run is not to be included. The last day of the period so computed is to be included, unless it is a Saturday, Sunday or legal holiday, in which event the period runs until the end of the next day which is not a Saturday, Sunday or legal holiday.

§30.9.Project Implementation.

(a) Grant recipients must carry out approved projects in accordance with the grant agreement, applicable program regulations and requirements, and the TxCDBG Project Implementation Manual, which is available on the Department's website. The Department may periodically amend the TxCDBG Project Implementation Manual. Amendments will be effective upon posting a new version of the TxCDBG Project Implementation Manual on the Department's website.

(b) In accordance with §487.354 of the Texas Government Code, a community that receives TxCDBG money targeted toward street improvement projects in eligible colonia areas must allocate not less than five percent (5%) but not more than 15 percent (15%) of the total amount of targeted money to providing financial assistance to colonias within the community to enable the installation of adequate street lighting in those colonias if street lighting is absent or needed.

§30.10.Grant Administrator Certification Requirement.

Any consultant, administrator, or employee of a grant recipient whose duties and responsibilities include administration of a TxCDBG grant shall complete CDBG administrator certification annually as required by the Department.

§30.11.Conflict of Interest.

(a) Applicability.

(1) The conflict of interest and procurement regulations prescribed by HUD in 2 CFR Part 200 and 24 CFR Part 570 apply to all agreements, contracts, subcontracts, awards, and subawards made under the TxCDBG Program.

(2) In addition to the federal conflict of interest and procurement regulations, state and local procurement and conflict of interest laws apply.

(3) The conflict of interest restrictions and procurement requirements identified in this section shall apply to a business, utility provider, or other third party entity that benefits from or receives any assistance, directly or indirectly, under a TxCDBG grant, or that has any involvement in completing the project or meeting program objectives.

(b) Conflicts prohibited. Grant recipients shall avoid, neutralize or mitigate actual or potential conflicts of interest so as to prevent an unfair competitive advantage or the existence of conflicting roles that might impair the performance of a TxCDBG grant or impact the integrity of the procurement process. Conflicts related to the procurement of property or services are prohibited regardless of any mitigating actions.

(c) Match requirements. A grant recipient's cash match may not be obtained from any person or entity that provides contracted professional or construction-related services (other than utility providers) to implement the project.

(d) Administration and engineering services. Grant recipients may not procure the same firm or consultant to provide administration and engineering services.

(e) Conflicting laws. In the event of a conflict between federal, state and local law, the more stringent provision shall control.

§30.12.Changes or Amendments.

(a) Whenever a proposed change requires Department approval, the Department may require citizen participation in accordance with §30.7 of this subchapter (relating to Citizen Participation Process). A grant recipient shall provide citizens with reasonable advance notice of, and opportunity to comment on, activities which are proposed to be added, deleted or substantially changed from the grant application to the Department. Substantially changed means changes made in terms of purpose, scope, location or beneficiaries as defined by criteria established by the Department.

(b) The Department is not required to approve amendment requests and does not guarantee that extensions will be approved.

(1) Consideration of requests for amendment by a grant recipient that is out of compliance on any TxCDBG grant award may be withheld until the grant recipient satisfies all requirements for all outstanding grant agreements.

(2) Requests to change the original project as described in the application, or to add a different or new activity, may not be approved generally; however, the Department may consider approval of a new project under either of the following circumstances:

(A) a natural disaster, documented by a presidential or gubernatorial declaration; or

(B) a decision by a federal or state agency prevents the grant recipient from completing the original project.

(3) Requests for extensions to grant agreements that have not made sufficient progress during the existing grant period will not be approved.

(c) A request for extension must be received no later than 30 days prior to the termination date of the grant agreement.

(d) A request for amendment must be in a manner and format prescribed by the Department and include, but not limited to, the following as applicable:

(1) Proposed amendments to a performance statement or budget: a detailed explanation why the amendment is required and a revised plan of work and/or budget must be submitted.

(2) Extension requests: a request for extension must include a timeline of events beginning on the date of grant award, a detailed explanation why the project is not expected to be completed within the grant term, and, if applicable, supporting documentation demonstrating extenuating circumstances.

(e) The Department will not approve changes that would have resulted in a lower application score and thus causing the application to be out of funding range.

§30.13.Corrective Action and Remedies for Noncompliance.

(a) Failure to comply with regulations or program requirements.

(1) If a grant recipient fails to comply with applicable federal or state regulations, the Department will require corrective action to address the violations. If the violation is egregious or the result of failure to implement a previous corrective action plan, the Department will take any action(s) available under the grant agreement, 24 CFR Part 570, and/or the TxGMS.

(2) If applicable, if the violation or noncompliance is not cured within the period allowed for cure, all TxCDBG funds awarded to the grant recipient will be suspended, including all open grants and any pending awards, until the non-compliance is resolved.

(b) Failure to meet grant agreement requirements. If the Department finds that a grant recipient did not provide the level of benefits specified in its grant agreement, the following actions may be taken, including but not limited to:

(1) holding the grant recipient ineligible to apply for or receive TxCDBG funds for a period of at least two program years or until any issue of restitution is resolved, whichever is longer; and

(2) requiring the grant recipient to reimburse the Department for the difference between the amount of funds provided for the level of benefits specified in the agreement and the amount of funds actually expended in providing such level of benefits.

(c) Corrective action plan.

(1) The Department may require a corrective action plan which includes:

(A) a statement acknowledging the violation as determined by the Department;

(B) identification of the cause of the violation and timeline of events;

(C) a plan outlining actions the grant recipient will take to improve performance to meet program requirements, the persons (or position titles) responsible for implementing the corrective action plan, and the date the plan will be implemented; and

(D)a statement acknowledging that failure to effectively improve performance may result in a reduction of funding or other sanctions as determined by TDA.

(2) If the grant recipient fails to provide a corrective action plan, or if the Department determines that proposed project benefits may not be met without an extension of the grant term, the Department may terminate the grant agreement.

(3) If a grant agreement is terminated, the grant recipient is required to repay all TxCDBG funds received under the grant prior to termination.

(d) Withdrawal, suspension or termination. The Department may withdraw, suspend or terminate an award or grant agreement under other circumstances when warranted by federal or state law, including applicable federal grant management standards or the TxGMS.

(e) Disqualification of an Administrator.

(1) Third-party administrators. If there is at least one unresolved finding of noncompliance that results in significant required repayment by the grant recipient to the Department, the following actions will be taken:

(A) after the first finding related to a third-party administrator, administrative costs will be disallowed and funds paid for administration will not be considered toward match requirements; and

(B) after the second finding related to the same administrator, administrative costs will be disallowed, funds paid for administration will not be considered toward match requirements, and the third-party administrator will be ineligible to administer a TxCDBG grant for a period of three years from the date of the finding.

(2) Self-administering communities. In the event there is at least one unresolved finding that results in significant required repayment by a grant recipient that self-administers the grant, the following actions will be taken:

(A) after the first finding, administrative costs will be disallowed and funds paid for administration will not be considered toward match requirements; and

(B) after the second finding, administrative costs will be disallowed, funds paid toward administration will not be considered toward match requirements, and in order to be eligible for a future TxCDBG grant award, the grant recipient will be required to hire a third-party administrator in good standing with the Department for subsequent TxCDBG grants for a period of three years from the date of the finding.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202211

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


DIVISION 2. APPLICATION INFORMATION

4 TAC §§30.20 - 30.31

The repeal of Subchapter A, Division 2, §§30.20 - 30.31, is proposed under Texas Government Code §487.051, which designates the Department as the agency to administer the federal community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposed repeal is Texas Government Code, Chapter 487.

§30.20.Eligible Applicants.

§30.21.Type and Number of Applicants.

§30.22.Application Costs.

§30.23.Citizen Participation Process.

§30.24.Additional Public Hearing Requirements.

§30.25.Application Threshold Requirements.

§30.26.Audit Requirements.

§30.27.Beneficiary Identification Methods.

§30.28.Public Information in Applications.

§30.29.Application Review.

§30.30.False Information in Applications.

§30.31.Withdrawal after Notice of Award.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202206

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


DIVISION 3. ADMINISTRATION OF PROGRAM FUNDS

4 TAC §§30.50 - 30.60, 30.62 - 30.67

The repeal of Subchapter A, Division 3, §§30.50 - 30.60 and 30.62 - 30.67, is proposed under Texas Government Code §487.051, which provides the Department authority to administer the state's community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposed repeal is Texas Government Code, Chapter 487.

§30.50.Community Development (CD) Fund.

§30.51.Texas Capital Fund (TCF)--General Provisions.

§30.52.Texas Capital Fund--Real Estate and Infrastructure Development Programs.

§30.53.Texas Capital Fund--Downtown Revitalization Program (DRP).

§30.54.Texas Capital Fund--Main Street Improvements Program.

§30.55.Colonia Fund (CF)--General Provisions.

§30.56.Colonia Fund: Construction (CFC).

§30.57.Colonia Fund: Planning (CFP).

§30.58.Colonia Economically Distressed Areas Program Set-Aside (CEDAP).

§30.59.Colonia Self-Help Centers Fund.

§30.60.State Urgent Need (SUN) Fund.

§30.62.Planning/Capacity Building (PCB) Fund.

§30.63.Small Towns Environment Program (STEP) Fund.

§30.64.Fire, Ambulance & Services Truck (FAST) Fund.

§30.65.Texas Capital Fund--Small and Microenterprise Revolving Fund (SMRF).

§30.66.Colonias-to-Cities Initiative Program (CCIP).

§30.67.Utility U Job Training Program.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202210

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


DIVISION 4. AWARDS AND CONTRACT ADMINISTRATION

4 TAC §§30.80 - 30.84

The repeal of Subchapter A, Division 4, §§30.80 - 30.84, is proposed under Texas Government Code §487.051, which provides the Department authority to administer the state's community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposed repeal is Texas Government Code, Chapter 487.

§30.80.Department Grant Training Requirement.

§30.81.Grant Administration by a Third Party.

§30.82.Disqualification of an Administrator.

§30.83.Changes or Amendments.

§30.84.Corrective Action.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202208

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360


DIVISION 5. REALLOCATION OF PROGRAM FUNDS

4 TAC §§30.100, 30.102, 30.103

The repeal of Subchapter A, Division 5, §§30.100 - 30.103, is proposed under Texas Government Code §487.051, which provides the Department authority to administer the state's community development block grant non-entitlement program, and §487.052, which provides authority for the Department to adopt rules as necessary to implement Chapter 487.

The code affected by the proposed repeal is Texas Government Code, Chapter 487.

§30.100.Reallocation of Funds.

§30.102.Unobligated Funds.

§30.103.Program Income.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 13, 2022.

TRD-202202209

Skyler Shafer

Assistant General Counsel

Texas Department of Agriculture

Earliest possible date of adoption: July 24, 2022

For further information, please call: (512) 936-9360