Public Law 196-554, the Consolidated Appropriation Act, 2001, enacted on December 21, 2000 amended section 17(a)(2)(B) of the Richard B. Russell National School Lunch Act (NSLA, 42 U.S.C. 1766(b)) to permit for profit child care centers and centers providing child care outside of school hours to participate in the Child and Adult Care Food program (CACFP) if 25 percent of their participants are eligible for free and reduced price (F/RP) meals. This provision became effective on December 21, 2000 and remains in effect until September 30, 2001. It does not remove the eligibility status of for profit organizations that participate in the CACFP under the Title XX provision. New or currently participating for profit organizations may choose to participate under either eligibility provision (provided they meet the appropriate requirements) through September 30, 2001.

For profit organizations entering the CACFP under this new provision must meet all other program requirements applicable to participating institutions, including the requirement to maintain a nonprofit meal service. Proprietary F/RP centers that are making initial application to participate in the CACFP under this provision may receive reimbursement retroactive to December 21, 2000, only if they provide the State agency with documentation showing that they met all program requirements relative to center eligibility and necessary to receive meal reimbursement. Pre-approval visits are still required for new institutions participating under this provision.

Proprietary F/RP centers may participate and claim reimbursement for meals served in any month in which they have 25 percent of their enrollment or licensed capacity, whichever is less, eligible for free and reduce price meals. In addition, proprietary F/RP centers that are making initial application to participate in the CACFP under this provision may receive reimbursement retroactive to December 21, 2000, only if they provide the State agency with documentation showing that they met all program requirements relative to center eligibility and necessary to receive meal reimbursement. Valid retroactive claims for meals served will be paid without regard to the normal 60-day time limit on submission of claims if they are submitted prior to April 1, 2001. After that date, the provision in section 226.11(a) limiting reimbursement to meals served in the month before the month in which an agreement is signed will apply.

Proprietary centers may not combine children receiving Title XX support with children meeting the free and reduced price eligibility criteria in order to meet the 25 percent threshold; they must participate as either proprietary Title XX centers or proprietary F/RP centers. However, a center can be a Title XX center one month but switch to a F/RP center the next month, depending on which is most advantageous to the center and as long as the center can document that for that month either they met the 25% free and reduced OR they met the 25% Title XX.

Just like proprietary Title XX centers, proprietary F/RP centers may not sponsor day care homes and may only sponsor centers if they are part of the same legal entity as the sponsoring organization.

Enclosed are facts about the Child and Adult Care Food Program and training dates for clients interested in participating in the program.

If you have questions or know of centers that may be interested in participating in this program, please contact the regional consultant assigned to their county. A list of regional consultants and the counties they serve is attached.

enclosure

cc: SNP Staff
Auditors
Budget Office
Controller's Office
Talitha Wright, Division of Child Development
Kathy Dail, NC Child Care Health and Safety Resource Center
Child Care Resource and Referrals
Child Health Consultants
Smart Start Partnerships