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proficiency, unless the client has requested that person and using the person would not compromise <br />the effectiveness of services or violate the client's confidentiality and the client is advised that a free <br />interpreter is available. <br />ARTICLE III FUNDING <br />Section 3.01 Debt to State and Corporate Status. Pursuant to Tex. Gov. Code § 403.055, the <br />Department will not approve and the State Comptroller will not issue payment to Contractor if <br />Contractor is indebted to the State for any reason, including a tax delinquency. Contractor, if a <br />corporation, certifies by execution of this Contract that it is current and will remain current in its <br />payment of franchise taxes to the State of Texas or that it is exempt from payment of franchise taxes <br />under Texas law (Tex. Tax Code §§ 171.001 et seq.). Contractor, if a corporation, further certifies <br />that it is and will remain in good standing with the Secretary of State's office. A false statement <br />regarding franchise tax or corporate status is a material breach of this Contract. If franchise tax <br />payments become delinquent during the Contract term, all or part of the payments under this Contract <br />may be withheld until Contractor's delinquent franchise tax is paid in full. <br />Section 3.02 Application of Payment Due. Contractor agrees that any payments due under this <br />Contract will be applied towards any debt of Contractor, including but not limited to delinquent taxes <br />and child support that is owed to the State of Texas. <br />Section 3.03 Use of Funds. Contractor shall expend Department funds only for the provision of <br />approved services and for reasonable and allowable expenses directly related to those services. <br />Section 3.04 Use for Match Prohibited. Contractor shall not use funds provided through this <br />Contract for matching purposes in securing other funding unless directed or approved by the <br />Department in writing. <br />Section 3.05 Program Income. Gross income directly generated from Department funds through a <br />project or activity performed under a Program Attachment and/or earned only as a result of a <br />Program Attachment during the term of the Program Attachment are considered program income. <br />Unless otherwise required under the terms of the grant funding this Contract, Contractor shall use the <br />addition alternative, as provided in UGMS § _.25(g)(2), for the use of program income to further the <br />program objectives of the state or federal statute under which the Program Attachment was made, and <br />Contractor shall spend the program income on the same Program Attachment project in which it was <br />generated. Contractor shall identify and report this income in accordance with the Compliance and <br />Reporting Article of these General Provisions, the Contractor's Financial Procedures Manual located <br />at htti): / /www.dshs.state.tx.us /contracts /cfpm.shtm and the provisions of the Program Attachment(s). <br />Contractor shall expend program income during the Program Attachment term and may not carry <br />forward to any succeeding term. Contractor shall refund program income not expended in the term in <br />which it is earned to DSHS. DSHS may base future funding levels, in part, upon Contractor's <br />proficiency in identifying, billing, collecting, and reporting program income, and in using it for the <br />purposes and under the conditions specified in this Contract. <br />Section 3.06 Nonsupplanting. Contractor shall not supplant (i.e., use funds from this Contract to <br />replace or substitute existing funding from other sources that also supports the activities that are the <br />subject of this Contract) but rather shall use funds from this Contract to supplement existing state or <br />General Provisions (Core Subrecipient) 2011 7 <br />