Snohomish County Legal Services 1/8/2021

7. Audits& Inspections: All Su brecipient records with respect to any matters covered by this Agreement shall be made available to the City, its designees or the Federal Government, at any time during normal business hours, as often as the City deems necessary, to audit,examine, and make excerpts or transcripts of all relevant data. Any deficiencies noted in audit reports must be fully cleared by the Su brecipientwith in 30 days after receipt by the Su brecipient. Failure of the Su brecipientto comply with the above audit requirements will constitute a violation of this Agreement and may result in the withholding of future payments. The Su brecipient hereby agrees to have an annual agency audit conducted in accordance with current City policy concerning Subrecipient audits and,as applicable,2 CFR Part 200 (Uniform Administrative Requirements, Cost Principles,and Audit Requirements for Federal Awards). C. Reporting and Payment Procedures 1. Program Income: The Subrecipient shall report quarterly all program income as defined at 24 CFR 570.500(a) generated by activities carried outwith CDBG funds made available under this Agreement. The use of program income by the Subrecipientshall comply with the requirements set forth at 24 CFR 570.504. By way of further limitations,the Subrecipient may use such income during the contract period for activities permitted underthis Agreement and shall reduce requests for additional funds by the amountof any such program income balances on hand. All unused program income shall be returned to the City at the end of the contract period. Any interest earned on cash advances from the U.S. Treasury is not program income and shall be remitted promptly to the City. 2. Indirect Costs: If indirect costs are charged, the Subrecipientwill develop an indirect cost allocation plan for determin ing the appropriate Su brecipient's share of administrative costs and shall submit such plan to the City for approval, in a form specified by the City. 3. Payment Procedures and Timing: The City will pay to the Subrecipientfunds available underth is Agreement based upon information submitted by the Su brecipient and consistentwith any approved budget and City policy concerning payments. With the exception of certain advances, payments will be made for eligible expenses actually incurred by the Subrecipient,and not to exceed actual cash requirements. Payments will be adjusted by the City in accordance with advance fund and program income balances available in Su brecipient accou nts. The Su brecipient agrees to submit payment request at least quarterly. In addition,the City reserves the right to liquidate funds available under this Agreementfor costs incurred by the City on behalf of the Su brecipient.