Sec. 531. FAILURE TO COMPLY WITH AGREEMENTS

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## SEC. 531 FAILURE TO COMPLY WITH AGREEMENTS **[**290cc–31**]** ###

(a)Repayment of Payments ####

(1)The Secretary may, subject to subsection (c), require a State to repay any payments received by the State under section 521 that the Secretary determines were not expended by the State in accordance with the agreements required to be contained in the application submitted by the State pursuant to section 529. ####

(2)If a State fails to make a repayment required in paragraph (1), the Secretary may offset the amount of the repayment against the amount of any payment due to be paid to the State under section 521. ###

(b)Withholding of Payments ####

(1)The Secretary may, subject to subsection (c), withhold payments due under section 521 if the Secretary determines that the State involved is not expending amounts received under such section in accordance with the agreements required to be contained in the application submitted by the State pursuant to section 529. ####

(2)The Secretary shall cease withholding payments from a State under paragraph

(1)if the Secretary determines that there are reasonable assurances that the State will expend amounts received under section 521 in accordance with the agreements referred to in such paragraph. ####

(3)The Secretary may not withhold funds under paragraph

(1)from a State for a minor failure to comply with the agreements referred to in such paragraph. ###

(c)Opportunity for Hearing Before requiring repayment of payments under subsection (a)(1), or withholding payments under subsection (b)(1), the Secretary shall provide to the State an opportunity for a hearing. ###

(d)Rule of Construction Notwithstanding any other provision of this part, a State receiving payments under section 521 may not, with respect to any agreements required to be contained in the application submitted under section 529, be considered to be in violation of any such agreements by reason of the fact that the State, in the regular course of providing services under section 522(b) to eligible homeless individuals, incidentally provides services to homeless individuals who are not eligible homeless individuals.