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(1) An agency agreement that provides state financial assistance to a recipient or <br />subrecipient, as those terms are defined in s 215 97, or that provides federal <br />financial assistance to a subrecipient, as defined by applicable United States Office <br />of Management and Budget circulars, must include all of the following <br />(a) A provision specifying a scope of work that clearly establishes the tasks <br />that the recipient or subrecipient is required to perform <br />(b) A provision dividing the agreement into quantifiable units of deliverables <br />that must be received and accepted in writing by the agency before payment. <br />Each deliverable must be directly related to the scope of work and specify <br />the required minimum level of service to be performed and the criteria for <br />evaluating the successful completion of each deliverable <br />(c) A provision specifying the financial consequences that apply if the <br />recipient or subrecipient fails to perform the minimum level of service <br />required by the agreement. The provision can be excluded from the <br />agreement only if financial consequences are prohibited by the federal <br />agency awarding the grant. Funds refunded to a state agency from a <br />recipient or subrecipient for failure to perform as required under the <br />agreement may be expended only in direct support of the program from <br />which the agreement originated <br />(d) A provision specifying that a recipient or subrecipient of federal or state <br />financial assistance may expend funds only for allowable costs resulting from <br />obligations incurred during the specified agreement period. <br />(e) A provision specifying that any balance of unobligated funds which has <br />been advanced or paid must be refunded to the state agency <br />(f) A provision specifying that any funds paid in excess of the amount to <br />which the recipient or subrecipient is entitled under the terms and conditions <br />of the agreement must be refunded to the state agency <br />(g) Any additional information required pursuant to s 215 97 <br />Failure to comply <br />Failure to comply with any of the provisions outlined above shall result in disallowance of <br />reimbursement for expenditures <br />E. Exercises <br />Exercises specifically designed for or that include participation from non-governmental <br />entities and the general public are allowable activities and may include testing public <br />warning systems, evacuation/shelter in-place capabilities, family/school/business <br />preparedness, and participating in table -top or full scale emergency responder exercises at <br />the local, State, tribal, territorial, or national level, to include the National Level Exercises. <br />Grantees are encouraged to develop exercises that test their SOPs/SOGs in accordance <br />with the FY 2014 Priority requirements <br />Allowable exercise -related costs include <br />25 <br />