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ATTACHMENT 18-C (8) <br />Revised 1/25/2021 <br />Page 8 of 14 <br />Any deficiencies noted in audit reports must be fully cleared by the Subrecipient within <br />30 days after receipt by the Subrecipient. Failure of the Subrecipient to comply with the <br />above audit requirements will constitute a violation of this Agreement and may result in <br />the withholding of future payments. <br />The Subrecipient that expends $750,000 or more in a fiscal year in federal funds from all <br />sources hereby agrees to have an annual agency audit conducted in accordance with <br />current Local Government policy concerning Subrecipient audits and 2 CRF 200.501. The <br />Catalog of Federal Domestic Assistance (CFDA) number is 14.228. <br />C.Reporting <br />1.Program Income <br />The Subrecipient will report annually all program income (as defined at 24 CFR <br />570.500(a)) generated by activities carried out with CDBG funds made available under <br />this Agreement. The use of program income by the Subrecipient will comply with the <br />requirements set forth at 24 CFR 570.504. <br />2.Periodic Reports <br />The Subrecipient, at such times and in such forms as the Local Government may require, <br />will furnish the Local Government such periodic reports as it may request pertaining to <br />the work or services undertaken pursuant to this Agreement, the costs and obligations <br />incurred or to be incurred in connection therewith, and any other matters covered by <br />this Agreement. <br />D.Use and Reversion of Assets <br />The use and disposition of real property and equipment under this Agreement will be in <br />compliance with the requirements of 2 CFR 200.311 and 313, 24 CFR 570.502, 570.503, <br />570.504, as applicable, which include but are not limited to the following: <br />1.The Subrecipient will transfer to the Local Government any CDBG funds on hand and <br />any accounts receivable attributable to the use of funds under this Agreement at the <br />time of expiration, cancellation, or termination. <br />2.Real property under the Subrecipient’s control that was acquired or improved, in whole <br />or in part, with funds under this Agreement in excess of $25,000 will be used to meet <br />one of the CDBG National Objectives pursuant to 24 CFR 570.208 until ten (10) years <br />after the contract between Commerce and the Local Government is closed. If the <br />Subrecipient fails to use CDBG-assisted real property in a manner that meets a CDBG <br />National Objective for this 10-year period of time, the Subrecipient will pay the Local <br />Government an amount equal to the current fair market value of the property less any <br />portion of the value attributable to expenditures of non-CDBG funds for acquisition of, <br />or improvement to, the property after the CDBG program’s approval. Such payment will <br />constitute program income to the Local Government. The Subrecipient may retain real <br />property acquired or improved under this Agreement after the expiration of the ten- <br />year period. <br />3.In cases in which equipment acquired, in whole or in part, with funds under this <br />Agreement is sold, the proceeds will be program income. Equipment not needed by the