The Authority may withhold or require the district to repay, upon written notice to the district, grant disbursements, or any portion thereof, where it determines that a district has failed to comply with any provision of the Act, any condition of the grant agreement or any requirement of this chapter. The Authority may also release the grant disbursement but refer the matter to the Department for further action, which may include an audit and/or a request to the Treasurer to withhold funds payable by the State from the district.
N.J. Admin. Code § 19:32-1.11