Alice Lenihan
Head, Nutrition Services Branch

On May 25, 2000, Congress passed Child and Adult Care Food Program legislation (Public Law 106-224) designed to address integrity issues by improving program operations. President Clinton signed this bill on June 20, 2000. Because of changes in the CACFP regulations and additional requirements by the Department of Health and Human Services (State Agency) there will be some changes made to the application for the CACFP as well as the way the CACFP operates. We have highlighted some of the changes you can expect.

Changes as a result of Public Law 106-224:

• Nonprofit institutions applying for CACFP participation must have tax exempt status, as defined under the Internal Revenue Code of 1986 or operate a Federal program requiring nonprofit status to participate in the program. Nonprofit institutions must submit a copy of its tax exempt letter or certify that it operates another Federal program requiring nonprofit status. If these conditions are not met, the institution may participate as a for-profit institution, if it receives Title XX compensation for at least 25 percent of the children enrolled in the day care center or 25 percent of the licensed capacity, whichever is less. We will no longer accept the IRS Release of Tax Exempt Status (CAC 19) as permission to verify Tax Exempt status. For institutions that were approved prior to June 20, 2000 this requirement is in effect beginning October 1, 2000. (Family and group day care homes are exempt from these requirements).

• Sponsoring organizations must employ enough monitors to ensure effective oversight of homes and centers. Further guidance on this will be forthcoming. Until that time, continue to use current staffing standards for monitors.

• Beginning immediately, sponsoring organizations must have a policy that restricts other employment by employees if that employment would interfere with their responsibilities and duties as sponsor employees. General principles to consider in approving outside employment would include likely schedule conflicts with CACFP responsibilities and duties and ethical or conflict of interest issues.

• Beginning immediately, if an institution is prohibited from participation in another publicly funded program (State, Federal or local government) by reason of violation of the requirements of the program, that institution will also be prohibited from participating in the CACFP. Institutions will be required to certify that the institution has not been disqualified from participating in any other public-funded program.

• Sponsoring organizations are required to periodically make unannounced visits to family day care homes and day care centers not less than once every three (3) years and at least one scheduled visit each year to family day care homes and day care centers. This requirement is in effect beginning October 1, 2000.

• Beginning October 1, 2000, providers under the auspices of sponsoring organizations may only change sponsoring organizations once a year, unless there are extenuating circumstances.

• Day Care Homes and child care centers (or their Sponsoring Organizations) must provide the parents of newly enrolled children and families currently participating with information on CACFP, the name of the State CACFP agency and the name and telephone number of the sponsoring organization. This requirement is effective immediately for newly enrolled children. For children that are already enrolled in the program, parent notification must be provided by September 20, 2000. Please remember that published materials about the CACFP must contain the nondiscrimination statement. 

Changes due to Department of Health and Human Services Requirements:

• Certification regarding Drug-Free Workplace Requirements, Certification Regarding Lobbying, Certification Regarding Environmental Tobacco Smoke, and Certification regarding Debarment, Suspension, Ineligibility and voluntary Exclusion-Lower Tier Coverage Transaction have been added to the agreement. This is a requirement for all participating institutions.

• All nonprofit institutions must submit a conflict of interest policy. You can submit your institution's conflict of interest policy or you can submit the CAC2 supplement that will be provided with your renewal packet. By submitting and signing the CAC 2 supplement, your institution is agreeing to accept this document as its Conflict of Interest policy. The conflict of interest policy must have an original signature (signed by an authorized representative) and an original notary stamp. Nonprofit institutions will not receive reimbursement until we have a signed, notarized conflict of interest statement on file.

Other:

• Each nonprofit institution must list the names, mailing address, phone number and family relationship for each board member.

• If your institution is contracting for food with a Food Service Management Company (other than with a public or private nonprofit school) and the total food cost is $10,000 or more, you must competitively bid the contract. You will be required to submit a copy of the bid with your agreement. While this is not a new requirement, the State Agency will be enforcing the procurement requirements as stated in 7 C.F.R. Section 226.22. You are still required to use the Food Service Contract provided by the state Agency (CAC-17).

• Enclosed with this mailing are "Building for the Future" posters announcing that your institution receives cash assistance to serve healthy meals to children. This poster must be displayed in a conspicuous place at each of your centers and day care homes. If you need additional posters, please contact Vickie Peretic at (919) 715-1925.

If you have questions or need assistance, please contact your SNP regional consultant.

cc: Arnette Cowan
Regional Consultants
SNP Staff