[Code of Federal Regulations]
[Title 45, Volume 2]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 45CFR286.195]

[Page 196-197]
 
                        TITLE 45--PUBLIC WELFARE
 
     CHAPTER II--OFFICE OF FAMILY ASSISTANCE (ASSISTANCE PROGRAMS), 
ADMINISTRATION FOR CHILDREN AND FAMILIES, DEPARTMENT OF HEALTH AND HUMAN 
                                SERVICES
 
PART 286--TRIBAL TANF PROVISIONS--Table of Contents
 
                 Subpart D--Accountability and Penalties
 
Sec. 286.195  What penalties will apply to Tribes?


    (a) Tribes will be subject to fiscal penalties and requirements as 
follows:
    (1) If we determine that a Tribe misused its Tribal Family 
Assistance Grant funds, including providing assistance beyond the 
Tribe's negotiated time limit under Sec. 286.115, we will reduce the 
TFAG for the following fiscal year by the amount so used;
    (2) If we determine that a Tribe intentionally misused its TFAG for 
an unallowable purpose, the TFAG for the following fiscal year will be 
reduced by an additional five percent;
    (3) If we determine that a Tribe failed to meet the minimum work 
participation rate(s) established for the Tribe, the TFAG for the 
following fiscal year will be reduced. The amount of the reduction will 
depend on whether the Tribe was under a penalty for this reason in the 
preceding year. If not, the penalty reduction will be a maximum of five 
percent. If a penalty was imposed on the Tribe in the preceding year, 
the penalty reduction will be increased by an additional 2 percent, up 
to a maximum of 21 percent. In determining the penalty amount, we will 
take into consideration the severity of the failure and whether the 
reasons for the failure were increases in the unemployment rate in the 
TFAG service area and changes in TFAG caseload size during the fiscal 
year in question; and
    (4) If a Tribe fails to repay a Federal loan provided under section 
406 of the Act, we will reduce the TFAG for the following fiscal year by 
an amount equal to the outstanding loan amount plus interest.
    (b) In calculating the amount of the penalty, we will add together 
all applicable penalty percentages, and the total is applied to the 
amount of the TFAG that would have been payable if no penalties were 
assessed against the Tribe. As a final step, we will subtract other 
(non-percentage) penalty amounts.
    (c) When imposing the penalties in paragraph (a) of this section, we 
will not reduce an affected Tribe's grant by more than 25 percent. If 
the 25 percent limit prevents the recovery of the full penalty imposed 
on a Tribe during a fiscal year, we will apply the remaining amount of 
the penalty to the TFAG payable for the immediately succeeding fiscal 
year.
    (1) If we reduce the TFAG payable to a Tribe for a fiscal year 
because of penalties that have been imposed, the Tribe must expend 
additional Tribal funds to replace any such reduction. The Tribe must 
document compliance with this provision on its TANF expenditure report.
    (2) We will impose a penalty of not more than 2 percent of the 
amount of the TFAG on a Tribe that fails to expend additional Tribal 
funds to replace amounts deducted from the TFAG due to penalties. We 
will apply this penalty

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to the TFAG payable for the next succeeding fiscal year, and this 
penalty cannot be excused (see Sec. 286.235).
    (d) If a Tribe retrocedes the program, the Tribe will be liable for 
any penalties incurred for the period the program was in operation.