(a) When HHS withholds funds from a recipient under these regulations, the Secretary may disburse the withheld funds directly to an alternate recipient: any public or non-profit private organization or agency, or State or political subdivision of the State.
(b) The Secretary will require any alternate recipient to demonstrate:
(1) The ability to comply with these regulations; and
(2) The ability to achieve the goals of the Federal statute authorizing the Federal financial assistance.
[47 FR 57858, Dec. 28, 1982, as amended at 70 FR 24322, May 9, 2005]