an OEO official who is authorized to make the grant of assistance in question.

(d) The term "assistance" means assistance under titles I-D, II, and III-B of the Act in the form of grants of Federal funds for the administration of which OEO has primary responsibility.

(e) The term "recipient" means a public or private agency, institution or organization or a State or other political jurisdiction which has received assistance under title I-D, II, or III-B of the Act, but does not include individuals who ultimately receive benefits under any program of assistance.

(f) The term "delegate agency" means a public or private agency, institution or organization or a State or other political jurisdiction to which the development, conduct, or administration of all or part of a project assisted under titles I-D, II, or III-B of the Act has been delegated by a direct recipient of the assistance or by another agency or organization which has received assistance by or through a direct recipient, but does not include individuals who ultimately receive benefits under any program or assistance.

(g) The term "party" in the case of a termination hearing means OEO, the recipient concerned, and any other agency or organization which has a right or which has been granted permission by the presiding officer to participate in a hearing concerning termination of assistance to the recipient pursuant to § 1067.1-5(e).

(h) The term "termination" means any action permanently terminating or curtailing assistance to all or any part of a program prior to the time that such assistance is concluded by the terms and conditions of the document in which such assistance is extended, but does not include the refusal to provide new or additional assistance.

(i) The term "suspension" means any action temporarily suspending or curtailing assistance in whole or in part, to all or any part of a program, prior to the time that such assistance isconcluded by the terms and conditions of the document in which such assistance is extended, but does not include the refusal to provide new or additional assistance. § 1067.1-4 Suspension.

(a) General. The responsible OEO official may suspend assistance to a recipient in whole or in part for breach or threatened breach of any requirement stated in § 1067.1-1. Such suspension

shall be pursuant to notice and opportunity to show cause why assistance should not be suspended as provided in paragraph (b) of this section. However, in emergency cases where the responsible OEO official determines summary action is appropriate, the alternative summary procedure of paragarph (c) of this section shall be followed.

(b) Suspension on notice. (1) Except as provided in paragraph (c) of this section, the procedure for suspension shall be on notice of intent to suspend as hereinafter provided.

(2) The responsible OEO official shall notify the recipient by letter or by telegram that OEO intends to suspend assistance in whole or in part unless good cause is shown why assistance should not be suspended. In such letter or telegram the responsible OEO official shall specify the grounds for the proposed suspension and the proposed effective date of the suspension.

(3) The responsible OEO official shall also inform the recipient of its right to submit written material in opposition to the intended suspension and of its right to request an informal meeting at which the recipient may respond and attempt to show why such suspension should not occur. The period of time within which the recipient may submit such written material or request the informal meeting shall be established by the responsible OEO official in the notice of intent to suspend. However, in no event shall the period of time within which the recipient must submit written material or request such a meeting be less than 5 days after the notice of intent to suspend assistance has been sent. If the recipient requests a meeting, the responsible OEO official shall fix a time and place for the meeting, which shall not be less than 5 days after the recipient's request is received by OEO.

(4) In lieu of the provisions of subparagraph (3) of this paragraph dealing with the right of the recipient to request an informal meeting, the responsible OEO official may on his own initiative establish a time and place for such a meeting. However, in no event shall such a meeting be scheduled less than 7 days after the notice of intent to suspend assistance is sent to the recipient.

(5) The responsible OEO official may in his discretion extend the period of time or date referred to in the previous paragraphs of this section and shall notify the recipient of any such extension,

(6) At the time the responsible OEO official sends the notification referred to in subparagraphs (2), (3), and (4) of this paragraph to the recipient, he shall also send a copy of it to any delegate agency whose activities or failures to act are a substantial cause of the proposed suspension, and shall inform such delegate agency that it shall be entitled to submit written material or to participate in the informal meeting referred to in subparagraphs (3) and (4) of this paragraph. In addition the responsible OEO official may in his discretion give such notice to any other delegate agency.

(7) Within 3 days of receipt of the notice referred to in subparagraphs (2), (3), and (4) of this paragraph, the recipient shall send a copy of such notice and a copy of these regulations to all delegate agencies which would be financially affected by the proposed suspension action. Any delegate agency that wishes to submit written material may do so within the time stated in the notice. Any delegate agency that wishes to participate in the informal meeting with the responsible OEO official contemplated herein (if not afforded a right to participate under the previous subparagraphs) may request permission to do so from the responsible OEO official, who may in his discretion grant or deny such permission. In acting upon any such request from a delegate agency, the responsible OEO official shall take into account the effect of the proposed suspension on the particular delegate agency, the extent to which the meeting would become unduly complicated as a result of granting such permission, and the extent to which the interests of the delegate agency requesting such permission appear to be adequately represented by other participants.

(8) In the notice of intent to suspend assistance the responsible OEO official shall invite voluntary action to adequately correct the deficiency which led to the initiation of the suspension proceeding.

(9) The responsible OEO official shall consider any timely material presented to him in writing, any material presented to him during the course of the informal meeting provided for in subparagraphs (3) and (4) of this paragraph as well as any showing that the recipient has adequately corrected the deficiency which led to the initiation of suspension proceedings. If after considering the material presented to him the responsible

OEO official concludes that the recipient has failed to show cause why assistance should not be suspended, he may suspend assistance in whole or in part and under such terms and conditions as he shall specify.

(10) Notice of such suspension shall be promptly transmitted to the recipient and shall become effective upon delivery. Suspension shall not exceed 21 days unless during such period of time termination proceedings are initiated in accordance with § 1067.1-5, or unless the responsible OEO official and the recipient agree to a continuation of the suspension for an additional period of time. If termination proceedings are initiated, the suspension of assistance shall remain in full force and effect until such proceedings have been fully concluded.

(11) During a period of suspension no new expenditures shall be made and no new obligations shall be incurred in connection with the suspended program except as specifically authorized in writing by the responsible OEO official. Expenditures to fulfill legally enforceable commitments made prior to the notice of suspension, in good faith and in accordance with the recipient's approved work program, and not in anticipation of suspension or termination, shall not be considered new expenditures. However, funds shall not be recognized as committed solely because the recipient has obligated them by contract or otherwise to a delegate agency.

NOTE: Willful misapplication of funds may violate section 301 of the Economic Opportunity Amendments of 1967, 42 U.S.C. 2703, or other criminal statutes.

(12) The responsible OEO official may in his discretion modify the terms, condition and nature of the suspension or rescind the suspension action at any time on his own initiative or upon a showing satisfactory to him that the recipient has adequately corrected the deficiency which led to the suspension and that repetition is not threatened. Suspensions partly or fully rescinded may, in the discretion of the responsible OEO official be reimposed with or without further proceedings: Provided however, That the total time of suspension may not exceed 21 days unless termination proceedings are initiated in accordance with § 1067.15 or unless the responsible OEO official and the recipient agree to a continuation of the suspension for an additional period of time. If termination proceedings

are initiated, the suspension of assistance shall remain in full force and effect until such proceedings have been fully concluded.

(c) Summary suspension. (1) The responsible OEO official may suspend assistance without the prior notice and opportunity to show cause provided in paragraph (b) of this section if he determines in his discretion that immediate suspension is necessary because of a serious risk of (i) substantial injury to or loss of project funds or property, or (ii) violation of a Federal, State or local criminal statute, or (iii) violation of section 603 (b) or 613 of the Economic Opportunity Act or of OEO Instructions implementing these sections of the Act, and that such risk is sufficiently serious to outweigh the general policy in favor of advance notice and opportunity to show cause.

(2) Notice of summary suspension shall be given to the recipient by letter or by telegram, shall become effective upon delivery to the recipient, and shall specifically advise the recipient of the effective date of the suspension and the extent, terms, and condition of any partial suspension. The notice shall also forbid the recipient to make any new expenditures or incur any new obligations in connection with the suspended portion of the program. Expenditures to fulfill legally enforceable commitments made prior to the notice of suspension, in good faith and in accordance with the recipient's approved work program, and not in anticipation of suspension or termination, shall not be considered new expenditures. However, funds shall not be recognized as committed by a recipient solely because the recipient obligated them by contract or otherwise to a delegate agency. (See note under paragraph (b) (11) of this section.)

(3) In the notice of summary suspension the responsible OEO official shall advise the recipient that it may request OEO to provide it with an opportunity to show cause why the summary suspension should be rescinded. If the recipient requests such an opportunity, the responsible OEO official shall immediately inform the recipient in writing of the specific grounds for the suspension and shall within 7 days after receiving such request from the recipient hold an informal meeting at which the recipient may show cause why the summary suspension should be rescinded. Notwithstanding the provisions of this subpara

graph, the responsible OEO official may proceed to initiate termination proceedings at any time even though assistance to the recipient has been suspended in whole or in part. In the event that termination proceedings are initiated, the responsible OEO official shall nevertheless afford the recipient, if it so requests, an opportunity to show cause why suspension should be rescinded pending the outcome of the termination proceedings.

(4) Notices of summary suspension shall also be furnished by the responsible OEO official and by the recipient to delegate agencies in the same manner as notices of intent to suspend as set forth in paragraph (b) (6), (7), and (8) of this section. Delegate agencies shall have the same right to submit written material to the responsible OEO official or to participate in the informal meeting as in the case of intended suspension proceedings set forth in paragraph (b) (6) and (7) of this section.

(5) The effective period of a summary suspension of assistance may not exceed 10 days unless terminated proceedings are initiated in accordance with § 1067.15, or unless the parties agree to a continuation of summary suspension for an additional period of time, or unless the recipient, in accordance with subparagraph (3) of this pargaraph, requests an opportunity to show cause why the summary suspension should be rescinded.

(6) If the recipient requests an opportunity to show cause why a summary suspension action should be rescinded the suspension of assistance shall continue in effect until the recipient has been afforded such opportunity and a decision has been made. Such a decision shall be made within 5 days after the conclusion of the informal meeting referred to in subparagraph (3) of this paragraph. If the responsible OEO official concludes, after considering all material submitted to him, that the recipient has failed to show cause why the suspension should be rescinded, the responsible OEO official may continue the suspension in effect for an additional 7 days: Provided however, That if termination proceedings are initiated, the summary suspension of assistance shall remain in full force and effect until all termination proceedings have been fully concluded.

§ 1067.1-5 Termination.

(a) If the responsible OEO official believes that an alleged failure to comply with any requirement stated in § 1067.1

1 may be sufficiently serious to warrant termination of assistance, whether or not assistance has been suspended, he shall so notify the recipient by letter or telegram. The notice shall state that there appear to be grounds which warrant terminating the assistance and shall set forth the specific reasons therefor. If the reasons result in whole or substantial part from the activities of a delegate agency, the notice shall identify that delegate agency. The notice shall also advise the recipient that the matter has been set down for hearing at a stated time and place, in accordance with § 1067.1-6. In the alternative the notice shall advise the recipient of its right to request a hearing and shall fix a period of time which shall not be less than 10 days in which the recipient may request such a hearing.

(b) Termination hearings shall be conducted in accordance with the provisions of §§ 1067.1-7 and 1067.1-8. They shall be scheduled for the earliest practicable date, but not later than 30 days after a recipient has requested such a hearing. Consideration shall be given to a request by a recipient to advance or postpone the date of a hearing scheduled by OEO. Any such hearing shall afford the recipient a full and fair opportunity to demonstrate that it is in compliance with all applicable laws, regulations, and other requirements specified in § 1067.1-1. In any termination hearing, OEO shall have the burden of justifying the proposed termination action. However, if the basis of the proposed termination is the failure of a recipient to take action required by law, regulation, or other requirement specified in § 1067.1-1, the recipient shall have the burden of proving that such action was timely taken.

(c) If a recipient requests OEO to hold a hearing in accordance with paragraph (a) of this section, it shall send a copy of its request for such a hearing to all delegate agencies which would be financially affected by the termination of assistance and to each delegate agency identified in the notice pursuant to paragraph (a) of this section. This material shall be sent to these delegate agencies at the same time the recipient's request is made to OEO. The recipient shall promptly send OEO a list of the delegate agencies to which it has sent such material and the date on which it was sent.

(d) If the responsible OEO official pursuant to paragraph (a) of this section informs a recipient that a proposed termination action has been set for hearing, the recipient shall within 5 days of its receipt of this notice send a copy of it to all delegate agencies which would be financially affected by the termination and to each delegate agency identified in the notice pursuant to paragraph (a) of this section. The recipient shall send the responsibile OEO official a list of all delegate agencies notified and the date of notification.

(e) If the responsible OEO official has initiated termination proceedings because of the activities of a delegate agency, that delegate agency may participate in the hearing as a matter of right. Any other delegate agency, person, agency or organization that wishes to participate in the hearing may, in accordance with § 1067.1-7 (d), request permission to do so from the presiding officer of the hearing. Such participation shall not, without the consent of OEO and the recipient, alter the time limitations for the delivery of papers or other procedures set forth in this section.

(f) The results of the proceeding and any measure taken thereafter by OEO pursuant to this part shall be fully binding upon the recipient and all its delegate agencies whether or not they actually participated in the hearing.

(g) A recipient may waive a hearing and submit written information and argument for the record. Such material shall be submitted to the responsible OEO official within a reasonable period of time to be fixed by him upon the request of the recipient. The failure of a recipient to request a hearing, or to appear at a hearing for which a date has been set, unless excused for good cause, shall be deemed a waiver of the right to a hearing and consent to the making of a decision on the basis of such information as is then in the possession of OEO.

(h) The responsible OEO official may attempt, either personally or through a representative, to resolve the issues in dispute by informal means prior to the date of any applicable hearing.

§ 1067.1-6 Time and place of termination hearings.

The termination hearing shall be held in Washington, D.C., or in the appropriate Regional Office, at a time and place fixed by the responsible OEO official unless he determines that the con

(a) General. The termination hearing, decision, and any review thereof shall be conducted in accordance with the rules of procedure set forth in this section and §§ 1067.1-8 and 1067.1-9.

(b) Presiding officer. (1) The presiding officer at the hearing shall be the responsible OEO official or, at the discretion of the responsible OEO official, an independent hearing examiner designated as promptly as possible in accordance with section 3105 of title 5 of the United States Code. The presiding officer shall conduct a full and fair hearing, avoid delay, maintain order, and make a sufficient record for a full and true disclosure of the facts and issues. To accomplish these ends, the presiding officer shall have all powers authorized by law, and he may make all procedural and evidentiary rulings necessary for the conduct of the hearing. The hearing shall be open to the public unless the presiding officer for good cause shown shall otherwise determine.

(2) After the notice described in paragraph (f) of this section is filed with the presiding officer, he shall not consult any person or party on a fact in issue unless on notice and opportunity for all parties to participate. However, in performing his functions under this part the presiding officer may use the assistance and advice of an attorney designated by the General Counsel of OEO or the appropriate Regional Counsel: Provided, That the attorney designated to assist him has not represented OEO or any other party or otherwise participated in a proceeding, recommendation, or decision in the particular matter.

(c) Presentation of evidence. Both OEO and the recipient are entitled to present their case by oral or documentary evidence, to submit rebuttal evidence and to conduct such examination and cross-examination as may be required for a full and true disclosure of all facts bearing on the issues. The issues shall be those stated in the notice required to be filed by paragraph (f) of this section, those stipulated in a prehearing conference or those agreed to by the parties.

(d) Participation. (1) In addition to OEO, the recipient, and any delegate

agencies which have a right to appear, the presiding officer in his discretion may permit the participation in the proceedings of such persons or organizations as he deems necessary for a proper determination of the issues involved. Such participation may be limited to those issues or activities which the presiding officer believes will meet the needs of the proceeding, and may be limited to the filing of written material.

(2) Any person or organization that wishes to participate in a proceeding may apply for permission to do so from the presiding officer. This application, which shall be made as soon as possible after the notice of suspension or proposed termination has been received by the recipient, shall state the applicant's interest in the proceeding the evidence or arguments the applicant intends to contribute, and the necessity for the introduction of such evidence or arguments.

(3) The presiding officer shall permit or deny such participation and shall give notice of his decision to the applicant, the recipient, and OEO, and, in the case of denial, a brief statement of the reasons therefor: Provided however, That the presiding officer may subsequently permit such participation if, in his opinion, it is warranted by subsequent circumstances. If participation is granted, the presiding officer shall notify all parties of that fact and may, in appropriate cases, include in the notification a brief statement of the issues as to which participation is permitted.

(4) Permission to participate to any extent is not a recognition that the participant has any interest which may be adversely affected or that the participant may be aggrieved by any decision, but is allowed solely for the aid and information of the presiding officer.

(e) Filing. All papers and documents which are required to be filed shall be filed with the presiding officer. Prior to filing, copies shall be sent to the other parties.

(f) Notice. The responsible OEO official shall send the recipient and any other party a notice which states the time, place, nature of the hearing, the legal authority and jurisdiction under which the hearing is to be held. The notice shall also identify with reasonable specificity the facts relied on as justifying termination and the OEO requirements which it is contended the recipient has violated. The notice shall be filed and