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‘‘(4) RECOVERY
AUDITS.—The Secretary shall
conduct a recovery audit (as that term is defined by
the Director of the Office of Management and Budget
under section 3561 of title 31, United States Code) for
any grant administered by the Department with a
total value of $1,000,000 or greater.
‘‘(c) REMEDIES FOR NONCOMPLIANCE.—
‘‘(1) IN GENERAL.—If the Administrator finds,
after reasonable notice and an opportunity for a
hearing, that a recipient of a grant under this title
has failed to substantially comply with any provision
of this title, or with any regulations or guidelines of
the Department regarding eligible expenditures, the
Administrator shall—
‘‘(A) terminate any payment of grant funds
to be made to the recipient under this title;
‘‘(B) reduce the amount of payment of
grant funds to the recipient by an amount equal
to the amount of grants funds that were not ex-
pended by the recipient in accordance with this
title; or
‘‘(C) limit the use of grant funds received
under this title to programs, projects, or activi-
ties not affected by the failure to comply.
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‘‘(2) DURATION
OF
PENALTY.—The Adminis-
trator shall apply an appropriate penalty under
paragraph (1) until such time as the Secretary deter-
mines that the grant recipient is in full compliance
with this title or with applicable guidelines or regula-
tions of the Department.
‘‘(3) DIRECT FUNDING.—If a State fails to sub-
stantially comply with any provision of this title or
with applicable guidelines or regulations of the De-
partment, including failing to provide local or tribal
governments with grant funds or resources purchased
with grant funds in a timely fashion, a local or tribal
government entitled to receive such grant funds or re-
sources may petition the Administrator, at such time
and in such manner as determined by the Adminis-
trator, to request that grant funds or resources be pro-
vided directly to the local or tribal government.
‘‘SEC. 2009. AUDITING.
‘‘(a) AUDITS OF GRANTS.—
‘‘(1) IN GENERAL.—Not later than the date de-
scribed in paragraph (2), and every 2 years there-
after, the Inspector General of the Department shall
conduct an audit of each entity that receives a grant
under the Urban Area Security Initiative, the State
Homeland Security Grant Program, or the Emer-
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gency Management Performance Grant Program to
evaluate the use of funds under such grant program
by such entity.
‘‘(2) TIMING.—The date described in this para-
graph is the later of 2 years after—
‘‘(A) the date of enactment of the Improving
America’s Security Act of 2007; and
‘‘(B) the date that an entity first receives a
grant under the Urban Area Security Initiative,
the State Homeland Security Grant Program, or
the Emergency Management Performance Grant
Program, as the case may be.
‘‘(3) CONTENTS.—Each audit under this sub-
section shall evaluate—
‘‘(A) the use of funds under the relevant
grant program by an entity during the 2 full fis-
cal years before the date of that audit;
‘‘(B) whether funds under that grant pro-
gram were used by that entity as required by
law; and
‘‘(C)(i) for each grant under the Urban
Area Security Initiative or the State Homeland
Security Grant Program, the extent to which
funds under that grant were used to prepare for,
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protect against, respond to, or recover from acts
of terrorism; and
‘‘(ii) for each grant under the Emergency
Management Performance Grant Program, the
extent to which funds under that grant were used
to prevent, prepare for, protect against, respond
to, recover from, or mitigate against all hazards,
including natural disasters, acts of terrorism,
and other man-made disasters.
‘‘(4) PUBLIC
AVAILABILITY
ON
WEBSITE.—The
Inspector General of the Department shall make each
audit under this subsection available on the website of
the Inspector General.
‘‘(5) REPORTING.—
‘‘(A) IN GENERAL.—Not later than 2 years
and 60 days after the date of enactment of the
Improving America’s Security Act of 2007, and
annually thereafter, the Inspector General of the
Department shall submit to Congress a consoli-
dated report regarding the audits conducted
under this subsection.
‘‘(B) CONTENTS.—Each report submitted
under this paragraph shall describe—
‘‘(i)(I) for the first such report, the au-
dits conducted under this subsection during