|(a) Eligibility. (1) Any college or university defined as a private or independent institution of higher education by Texas Education Code, §61.003, or that is located in Texas and accredited by the Southern Association of Colleges and Schools, except theological or religious seminaries, is eligible to participate in the TEG Program. (2) No institution may, on the grounds of race, color, national origin, gender, religion, age, or disability exclude an individual from participation in, or deny the benefits of the program described in this subchapter. (3) Each participating institution must follow the Civil Rights Act of 1964, Title VI (Public Law 88-352) in avoiding discrimination in admissions. (b) Approval. (1) Agreement. Each approved institution must enter into an agreement with the Board, the terms of which shall be prescribed by the Commissioner. (2) Approval Deadline. An institution must enter into an agreement with the Board and indicate an intent to participate in the program by February 1 in order for qualified students enrolled in that institution to be eligible to receive grants in the following fiscal year. (c) Responsibilities. (1) Probation Notice. If the institution is placed on public probation by its accrediting agency, it must immediately notify Board staff and advise grant recipients of this condition and maintain evidence in each student's file to demonstrate that the student was so informed. (2) Disbursements to Students. (A) Documentation. The institution must maintain records to prove the receipt of program funds by the student or the crediting of such funds to the student's school account. (B) Procedures in Case of Illegal Disbursements. If the Commissioner has reason for concern that an institution has disbursed funds for unauthorized purposes, Board staff will notify the institution and offer an opportunity for a hearing pursuant to the procedures outlined in Chapter 1 of this title (relating to Agency Administration). Thereafter, if Board staff determines that funds have been improperly disbursed, the institution shall become primarily responsible for restoring the funds to the Board. No further disbursements of grants or scholarships shall be permitted to students at that institution until the funds have been repaid. (3) Reporting. (A) Requirements/Deadlines. All institutions must meet Board reporting requirements in a timely fashion. (i) Such reporting requirements shall include but are not limited to reports specific to allocation and reallocation of grant funds (including the TEG Need Survey, the TEG year-end student-by-student report, the Coordinating Board's Education Data Center CBM001 and CBM009 reports, and the Financial Aid Database Report) as well as progress and year-end reports of program activities. (ii) Each participating institution shall have its TEG Program operations audited on an annual basis by an independent auditor or by an internal audit office that is independent of the financial aid and disbursing offices. Reports on findings and corrective action plans (if necessary) are due to the Board by April 15 each year. (B) Penalties for Late Reports and/or Late Refunds. (i) An institution that postmarks or electronically submits a progress report a week or more after its due date will be ineligible to receive additional funding through the reallocation occurring at that time. (ii) The Commissioner may penalize an institution by reducing its allocation of funds in the following year by up to 10 percent for each report that is postmarked or submitted electronically more than a week late. The penalty may also be invoked if the report is timely, but refunds owed to the Program by the institution are not made to the Board or the Comptroller of Public Accounts' Office within one week after due. (iii) The Commissioner may assess more severe penalties against an institution if any report or refund is received by the Board more than one month after its due date. The Commissioner may penalize an institution by reducing its allocation of funds in the following year by up to 10 percent for each late refund of grant funds. If grant funds are returned more than a week after the announced return date, they will be considered late. (iv) The maximum penalty for a single year is 30 percent of the school's allocation. If penalties are invoked in two consecutive years, the institution may be penalized an additional 20 percent. (C) Appeal of Penalty. If the Commissioner determines that a penalty is appropriate, the institution will be notified by certified mail, addressed to the Chief Executive Officer and copied to the Program Officer and/or Financial Aid Director. Within 21 days from the time that the Program Officer receives the written notice, the institution must submit a written response appealing the Commissioner's decision, or the penalty shall become final and no longer subject to an appeal. An appeal under this section will be conducted in accordance with the rules provided in Chapter 1 of this title. (4) Program Reviews. If selected for such by Board staff, participating institutions must submit to program reviews of activities related to the TEG Program.