29 U.S. Code § 2934 - Fiscal controls; sanctions
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(a) Establishment of fiscal controls by States
(1) In general
Each State shall establish such fiscal control and fund accounting procedures as may be necessary to assure the proper disbursal of, and accounting for, Federal funds allocated to local areas under subchapter II of this chapter. Such procedures shall ensure that all financial transactions carried out under subchapter II of this chapter are conducted and records maintained in accordance with generally accepted accounting principles applicable in each State.
(2) Cost principles
(A) In general
Each State (including the Governor of the State), local area (including the chief elected official for the area), and provider receiving funds under this chapter shall comply with the applicable uniform cost principles included in the appropriate circulars of the Office of Management and Budget for the type of entity receiving the funds.
The funds made available to a State for administration of statewide workforce investment activities in accordance with section 2864 (a)(3)(B) of this title shall be allocable to the overall administration of workforce investment activities, but need not be specifically allocable to—
(3) Uniform administrative requirements
(A) In general
Each State (including the Governor of the State), local area (including the chief elected official for the area), and provider receiving funds under this chapter shall comply with the appropriate uniform administrative requirements for grants and agreements applicable for the type of entity receiving the funds, as promulgated in circulars or rules of the Office of Management and Budget.
Each Governor of a State shall conduct on an annual basis onsite monitoring of each local area within the State to ensure compliance with the uniform administrative requirements referred to in paragraph (3).
(5) Action by Governor
If the Governor determines that a local area is not in compliance with the uniform administrative requirements referred to in paragraph (3), the Governor shall—
The Governor shall, every 2 years, certify to the Secretary that—
(B) the State has monitored local areas to ensure compliance with the uniform administrative requirements as required under paragraph (4); and
(7) Action by the Secretary
If the Secretary determines that the Governor has not fulfilled the requirements of this subsection, the Secretary shall—
(b) Substantial violation
(1) Action by Governor
If, as a result of financial and compliance audits or otherwise, the Governor determines that there is a substantial violation of a specific provision of this chapter, and corrective action has not been taken, the Governor shall—
(B) impose a reorganization plan, which may include—
(A) In general
The actions taken by the Governor pursuant to subparagraphs (A) and (B) of paragraph (1) may be appealed to the Secretary and shall not become effective until—
(c) Repayment of certain amounts to the United States
(1) In general
Every recipient of funds under this chapter shall repay to the United States amounts found not to have been expended in accordance with this chapter.
(2) Offset of repayment
If the Secretary determines that a State has expended funds made available under this chapter in a manner contrary to the requirements of this chapter, the Secretary may offset repayment of such expenditures against any other amount to which the State is or may be entitled, except as provided under subsection (d)(1) of this section.
(3) Repayment from deduction by State
If the Secretary requires a State to repay funds as a result of a determination that a local area of the State has expended funds contrary to the requirements of this chapter, the Governor of the State may use an amount deducted under paragraph (4) to repay the funds, except as provided under subsection (e)(1)  of this section.
(4) Deduction by State
The Governor may deduct an amount equal to the misexpenditure described in paragraph (3) from subsequent program year allocations to the local area from funds reserved for the administrative costs of the local programs involved, as appropriate.
(d) Repayment of amounts
(1) In general
Each recipient of funds under this chapter shall be liable to repay the amounts described in subsection (c)(1) of this section, from funds other than funds received under this chapter, upon a determination by the Secretary that the misexpenditure of funds was due to willful disregard of the requirements of this chapter, gross negligence, failure to observe accepted standards of administration, or a pattern of misexpenditure as described in paragraphs (2) and (3) of subsection (c) of this section. No such determination shall be made under this subsection or subsection (c) of this section until notice and opportunity for a fair hearing has been given to the recipient.
(2) Factors in imposing sanctions
In determining whether to impose any sanction authorized by this section against a recipient for violations by a subgrantee or contractor of such recipient under this chapter (including the regulations issued under this chapter), the Secretary shall first determine whether such recipient has adequately demonstrated that the recipient has—
(A) established and adhered to an appropriate system for the award and monitoring of grants and contracts with subgrantees and contractors that contains acceptable standards for ensuring accountability;
(B) entered into a written grant agreement or contract with such subgrantee or contractor that established clear goals and obligations in unambiguous terms;
(C) acted with due diligence to monitor the implementation of the grant agreement or contract, including the carrying out of the appropriate monitoring activities (including audits) at reasonable intervals; and
If the Secretary determines that the recipient has demonstrated substantial compliance with the requirements of paragraph (2), the Secretary may waive the imposition of sanctions authorized by this section upon such recipient. The Secretary is authorized to impose any sanction consistent with the provisions of this chapter and any applicable Federal or State law directly against any subgrantee or contractor for violation of this chapter, including regulations issued under this chapter.
(e) Immediate termination or suspension of assistance in emergency situations
In emergency situations, if the Secretary determines it is necessary to protect the integrity of the funds or ensure the proper operation of the program or activity involved, the Secretary may immediately terminate or suspend financial assistance, in whole or in part, to the recipient if the recipient is given prompt notice and the opportunity for a subsequent hearing within 30 days after such termination or suspension. The Secretary shall not delegate any of the functions or authority specified in this subsection, other than to an officer whose appointment is required to be made by and with the advice and consent of the Senate.
(f) Discrimination against participants
If the Secretary determines that any recipient under this chapter has discharged or in any other manner discriminated against a participant or against any individual in connection with the administration of the program involved, or against any individual because such individual has filed any complaint or instituted or caused to be instituted any proceeding under or related to this chapter, or has testified or is about to testify in any such proceeding or investigation under or related to this chapter, or otherwise unlawfully denied to any individual a benefit to which that individual is entitled under the provisions of this chapter or the Secretary’s regulations, the Secretary shall, within 30 days, take such action or order such corrective measures, as necessary, with respect to the recipient or the aggrieved individual, or both.
The remedies described in this section shall not be construed to be the exclusive remedies available for violations described in this section.
 So in original. Probably should be subsection “(d)(1)”.
Source(Pub. L. 105–220, title I, § 184,Aug. 7, 1998, 112 Stat. 1042.)
References in Text
This chapter, referred to in subsecs. (a)(2)(A), (3)(A), (B), (b)(1), (c)(1) to (3), (5), (d)(1), (2)(D), (3), and (f), was in the original “this title” meaning title I of Pub. L. 105–220, Aug. 7, 1998, 112 Stat. 939, which enacted this chapter, repealed sections 1501 to 1505, 1511 to 1583, 1592 to 1735, 1737 to 1791h, 1792 to 1792b, 2301 to 2314 of this title, section 211 of former Title 40, Appendix, Public Buildings, Property, and Works, sections 11421, 11441 to 11447, 11449, 11450, 11461 to 11466, 11471, and 11472 of Title 42, The Public Health and Welfare, and sections 42101 to 42106 of Title 49, Transportation, enacted provisions set out as notes under sections 1501, 2301, and 2940 of this title and section 11421 of Title 42, and repealed provisions set out as notes under sections 801 and 2301 of this title and section 1255a of Title 8, Aliens and Nationality. For complete classification of title I to the Code, see Tables.
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