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(2) Have submitted to the Government (UMTA) all financial <br /> and progress reports required to date under this Agreement; and <br /> (3) Have identified the source(s) of financial assistance <br /> provided under this Project or Program from which the payment is <br /> to be derived. <br /> ' b. Pavment by the Government. <br /> The Government (UMTA) will determine whether payment will be <br /> made by Letter of Credit or by the Automated Clearing House (ACH) <br /> method of payment after submission of a requisition. <br /> (1) Letter of Credit. If payment is made under a letter of <br /> credit, the Recipient agrees to comply with the following letter <br /> of credit requirements pursuant to 31 C.F.R. Part 205: <br /> (a) The Recipient may initiate cash drawdowns only when <br /> actually needed for immediate disbursement required for Project <br /> purposes. Therefore, the Recipient shall expend all Federal funds <br /> obtained under the Project for Project purposes no lat�r than <br /> three (3) days after receipt of those funds. Failure to expend <br /> those Federal funds within three (3) days of their receipt or to <br /> return the funds to the Government (UMTA) within a reasonable <br /> period may result in the termination of the Recipient's letter of <br /> credit or other remedies authorized by Federal law or regulation. <br /> (b) The Recipient shall report its cash disbursements <br /> and balances in a timely manner as required by the Government. <br /> (c) The Recipient shall provide for effective control <br /> and accountability for all Project funds consistent with Federal <br /> requirements and procedures for use of the letter of credit. <br /> (d) The Recipient shall impose on its sub-recipients <br /> all applicable requirements of Subsections 105.b. (1) (a) , (b) , <br /> and (c) of Part II of this Agreement. <br /> . (e) The amount authorized on a letter of credit may <br /> include cash requir�ments for Projects not yet obligated, and thus <br /> does not always represent an amount legally obligated by the <br /> , Government (UMTA) . Therefore, the Recipient may not draw down <br /> funds for a Project in an amount that would exceed the sum <br /> obligated by the Government (UMTA) for that Project. Thus the <br /> certifying statement on SF 1193A, Letter of Credit, is not <br /> applicable if the amount authorized on the letter of credit <br /> exceeds the amount obligated. <br /> (f) If the Recipient fails to honor the requirements of <br /> Subsections 105.b. (1) (a) , (b) , (c) , (d) , or (e) of Part II of this <br /> Agreement, the Goverr.ment may revoke the portion of the letter of <br /> credit that has not been obligated. <br /> Page 7 <br />