(a) If HUD makes a preliminary determination that an agency has not complied with Sec. 115.309, the agency will be given written notice of this determination and an opportunity to show, through demonstrable facts and data, that it has done so within a time prescribed by HUD.
(b) If an agency fails to demonstrate to HUD's satisfaction that it has met program review standards, HUD will request the agency to submit and comply with proposals for action to correct, mitigate, or prevent performance deficiencies, including, but not limited to:
(1) Preparing and/or following a schedule of actions for carrying out the affected fair housing activities;
(2) Establishing and/or following a management plan that assigns responsibilities for carrying out the actions required;
(3) Canceling or revising activities likely to be affected by a performance deficiency before expending FHAP funds for the activities; and
(4) Redistributing or suspending disbursement of FHAP funds that have not yet been disbursed.
(c) HUD may condition the use of FHAP award amounts with respect to an agency's succeeding fiscal year's allocation on the satisfactory completion by the agency of appropriate corrective actions. When the use of funds is so conditioned, HUD will specify the deficiency(ies), the required corrective action(s), and the time allowed for taking these actions. Failure of the agency to complete the actions as specified will result in a reduction or withdrawal of the FHAP allocation in an amount not to exceed the amount conditionally granted.