Department of Education Administrative Memorandum

August
2004

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It is the policy of the Department of Education and Cultural Affairs to provide services to all persons, without regard to race, color, creed, religion, sex, disability, ancestry, or national origin, in accordance with federal and state laws.

Program agreements due Sept. 3

Program agreements and application renewal packets for the 2004-05 program year have been mailed by Child and Adult Nutrition Services. They are due back by Friday, Sept. 3, 2004. Forms also can be downloaded from the CANS Web site by clicking on “Forms and Documents.” Please call the CANS office at (605) 773-3413 with questions.

Make note of changes to Child Nutrition Programs

A number of changes will go into effect this fall with implementation of the 2004-2005 program year. Some changes are due to reauthorization, while others are due to changes in business procedures at the Department of Education.

1. Child Nutrition Reauthorization

The Child Nutrition Program reauthorization (P.L. 108-265) has passed, with some changes affecting local agencies immediately. While final regulations have not come out, some of the items had been implemented in policy prior to this time. Those issues now become permanent. Numbered memos detailing the changes will be provided to the authorized representatives of the affected programs, which include National School Lunch & School Breakfast Programs, Child & Adult Care Food Program, and Summer Food Service Program. There were no changes that affected the Special Milk Program.

In summary, the changes with major impact that go into effect this year are:

STATUTORY PROVISION
Sec 102 Requires offering fluid milk in a variety of fat contents - drops prior year preference for schools. (Requires offering milk in a variety of fat contents but no longer requires the milk offered to be based on the percentage of sales in the prior year.)
Sec 102 Allows schools to substitute non-dairy beverages nutritionally equivalent (as established by the Secretary of US Dept of Agriculture to fluid milk for medical or other special dietary needs at the request of a medical authority or a parent/guardian.)
Sec. 106 Duration of eligibility for free/reduced price meals. Applications are good for the entire year – families not required to report changes of income. (This was passed after the application for free/reduced price meals had already been distributed in SD. Families will not be penalized if changes not reported.)
Sec 107 Categorical Eligibility of Migrants, Runaway and Homeless Youth for free lunches and breakfasts. (This had been previously implemented through policy.)
Sec 109 Permanent Exclusion of Privatized Military Housing Allowances. (This had been previously implemented through policy.)
Sec 113 Special Assistance: Adds district-wide claiming percentages for Provisions 2 and 3. (SFAs on Provisions 2 or 3 may use district-wide percentages rather than calculating and reporting by site.)
Sec 119 Child and Adult Care Food Program - Makes permanent the option for proprietary centers to qualify for CACFP if at least 25% of the children they serve are from households qualifying for free or reduced price meals. (This had been previously implemented through policy.)
Sec 119 (b) Child and Adult Care Food Program - Duration of determination as tier 1 family or group day care homes from 3 to 5 years.
Sec 119 (c) Child and Adult Care Food Program - Disregard an overpayment identified during a management evaluation, review or audit in an amount that is consistent with the disregard provision of other Child Nutrition Programs (currently $600 in the school programs).
Sec 119 (g) Child and Adult Care Food Program – Raises age limits from 12 to 18 in emergency shelters.
Sec 124 Free Lunch and Breakfast Eligibility - Elimination of free/reduced price category. (5 States - unlimited duration). (While this does not directly impact SD at this time, it does begin testing and study of eliminating meal eligibility categories)
Sec 201 Severe Need Assistance – eliminated cost accounting in severe need breakfast. Effective July 1, 2004. (Schools on Severe Need School Breakfast will no longer have to spend time documenting and proving breakfast costs exceed reimbursement in order to receive the higher rate of reimbursement.)

2. ACH Payments

Beginning fall 2004, the Department of Education’s Office of Finance and Management will begin processing payments for the Child Nutrition Programs through the Automated Clearing House (ACH) system. Requests for information to make this process possible will be coming from the Office of Finance and Management. The automated process has been requested by a number of agencies, and their foresight is appreciated. The recap sheets will continue to be mailed. These should be reviewed to be sure that deposit amounts are the same as payment to the agency and will document which fund should receive which amount. The recap sheets should be retained on file with other Child Nutrition Program records.

3. Single Inventory

Another change effective fall 2004 is allowing use of a single inventory system, except in schools that use a food service management company (FSMC). Single inventory system means that schools are no longer required to maintain separate inventories for commodities and purchased foods. Schools may keep separate inventories if they so desire. The increased use of commercially labeled foods by USDA makes the separated inventory system more difficult. Schools that use a FSMC need to be able to determine the value of commodities, and the company needs to be able to document that it is using commodities to the maximum extent.

4. Increased Reporting for Verification

Most school food authorities (SFAs) are required to complete verification of free and reduced-price meals. Those exempted are residential child care institutions with no day students and SFAs that are beyond the base year for Special Provisions 2 and 3. The process and information reported to Child and Adult Nutrition Services will both change effective this fall 2004. Information on the changed requirements will be issued in a numbered memo in August.

5. Public Release Regarding School Nutrition Programs

The public release required for School Nutrition Programs was sent to the media via fax on July 21, 2004. A copy of the release and participating schools is available on the Child and Adult Nutrition Services Web site under “Current News and Events” at http://www.state.sd.us/deca/CSCF/CANS/index.htm. Federal regulations require that the public release contain both free and reduced price income eligibility guidelines, while the letter to parents may only include the reduced price guidelines for School Lunch and Breakfast, and only free guidelines for Special Milk Programs that accept applications for free milk. The regulations also require that boarding schools, residential child care institutions and schools that include meal charges as a part of tuition shall not be required to issue a public release. School personnel may provide additional information to the local paper regarding the meal programs.

6. Reimbursement Rates

Reimbursement rates for meals in the Child Nutrition Programs have been posted on the CANS Web site under “Forms and Documents.” Rates increased a few cents for free and reduced lunches, free and reduced breakfasts, and day care home Tier 1 breakfasts, lunches and suppers, while rates for paid and Tier 2 breakfast and lunches as well as supplements (snacks) across the board saw no increase or an increase of 1 cent from the prior year.