Health & Saf. Code, § 44291

(a) The state board shall assist districts with developing procedures to monitor whether the emission reductions projected in successful grant applications are actually achieved. Monitoring procedures may include project audits, and may also include requirements, as part of the contract between the state board or districts and the grant recipients, that each grant recipient provide information about the project on an annual basis. Information required from grant recipients should be minimized and the format for reporting the information should be made simple and convenient.

(b) As soon as practicable, the state board, in consultation with the districts, shall publish procedures to monitor and audit infrastructure projects. These procedures shall ensure that the amount of qualifying fuel dispensed annually is greater than or equal to the amount upon which the grant award is based and that any project qualifying for funding on the basis of public accessibility or limited public accessibility is, in fact, providing that accessibility.

(c) The monitoring and auditing procedures shall be sufficient to allow emission reductions generated to be fully credited to air quality plans. The monitoring procedures shall contain provisions for recapturing grant awards in proportion to any loss of emission reductions or underachievement in dispensing qualifying fuel compared with the reductions and fuel dispensing projected in the grant application. Monitoring and auditing procedures shall be revised as appropriate to enhance program effectiveness.

(d) The state board shall monitor district programs to ensure that participating districts conduct their programs consistent with the criteria and guidelines established by the state board and the commission pursuant to this chapter. The monitoring procedures shall contain provisions for return of funds not yet awarded to approved projects if a district fails to show that they are implementing a program consistent with the approved program. If the state board determines, pursuant to this subdivision, that moneys from the fund allocated to a district should be returned, the state board shall hold at least one public meeting to consider public comments prior to requiring the return of the allocated funds. The state board shall make every effort to assist districts to implement programs in an approved manner and shall only require the return of allocated funds if these efforts fail to address problems adequately. Returned funds shall be deposited in the fund. The state board shall not require the return of funds already awarded to approved projects.

(e) Program funds recaptured as a result of a settlement agreement executed by the state board shall be returned to the district that provided the funds to the grant recipient. A penalty resulting from a settlement agreement executed by the state board with a grant recipient or from a civil action brought by the Attorney General shall be deposited in the fund.