(a) CNCS shall notify the sponsor in writing, at least 75 calendar days before the anticipated denial or reduction of VISTA assistance, that CNCS proposes to deny or reduce VISTA assistance. CNCS's written notice shall state the reasons for the decision to deny or reduce assistance and shall provide an opportunity period for the sponsor to respond to the merits of the proposed decision. CNCS retains sole authority to make the final determination whether the VISTA assistance at issue shall be denied or reduced, as appropriate.

(b) Where CNCS's notice of proposed decision is based upon a specific charge of the sponsor's failure to comply with the applicable term(s) or condition(s) of a contract, grant agreement, or an applicable Memorandum of Agreement, the notice shall offer the sponsor an opportunity period to respond in writing to the notice, with any affidavits or other supporting documentation, and to request an informal hearing before a mutually agreed-upon impartial hearing officer. The authority of such a hearing officer shall be limited to conducting the hearing and offering recommendations to CNCS. Regardless of whether or not an informal hearing takes place, CNCS shall retain full authority to make the final determination whether the VISTA assistance is denied or reduced, as appropriate.

(c) If the recipient requests an informal hearing, in accordance with paragraph (b) of this section, such hearing shall be held at a date specified by CNCS and held at a location convenient to the sponsor.

(d) If CNCS's proposed decision is based on ineffective management of resources, or on the substantial failure to comply with CNCS policy and overall objectives under a contract, grant agreement, or an applicable Memorandum of Agreement, CNCS shall inform the sponsor in the notice of proposed decision of the opportunity to show cause why VISTA assistance should not be denied or reduced, as appropriate. CNCS shall retain full authority to make the final determination whether the VISTA assistance at issue shall be denied or reduced, as appropriate.

(e) The recipient shall be informed of CNCS's final determination on whether the VISTA assistance at issue shall be denied or reduced, and the basis for the determination.

(f) The procedure in this section does not apply to a denial or reduction of VISTA assistance based on legislative requirements, availability of funding, or on general policy.