Resource Management Overview Kala Constant, SNS| Resource Management Specialist March 21, 2019

Healthy Hunger-Free Kids Act 2010 Background Healthy Hunger-Free Kids Act 2010 New Meal Patterns Increased Funding School Wellness Policy Provisions Revised Administrative Review Process 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

USDA Memo SP 56 – 2013 Collaborative Effort State School Business Officials State Child Nutrition Staff Local School Business Officials Local Child Nutrition Staff 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Administrative Review Objectives Determine whether the school meets program requirements Provide technical assistance Secure any needed corrective action Assess fiscal action, if applicable 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Administrative Review Process Pre HHFKA 2010 Once every 5 years CRE – Coordinated Review Effort SMI – School Meals Initiative 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Administrative Review Process Meal Access and Reimbursement Meal Pattern and Nutritional Quality General Program Compliance Other Federal Program Review Resource Management Post HHFKA 2010 Once every 3 years 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Why now? They didn’t look at all this the last time… The Big Question 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

What to Expect Meal Access and Reimbursement Meal Pattern and Nutritional Quality General Program Compliance Other Federal Program Review 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Notification Notification #1 Notification #2 To: SFA Business Manager September Resource Management Overview Questionnaire Month Notification #2 Link to the access the Questionnaire Instructions Due dates To: SFA Business Manager Cc: Foodservice Director 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

On-line Questionnaire “ This message is to inform you that the financial component of the review is now available. Please reference the Administrative Review Manual for School Food Authorities – Resource Management Review before beginning the questionnaire, and throughout the course of your review. A detailed explanation of the review questions can be found starting on page 6.” Click Here to Start the Questionnaire 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Perform Risk Assessment Review Documentation Assess Compliance with Regulation Provide Technical Assistance 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Communicate Review Report Finding Corrective Action Technical Assistance 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Close-out 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Resource Management Review Areas Maintenance of the NSFSA Indirect Costs Paid Lunch Equity Nonprogram Food Revenue 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Maintenance of the NSFSA Financial System Net Cash Resource Allowable Costs 3 Components: 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Uniform Financial Accounting and Reporting Standards Financial System Uniform Financial Accounting and Reporting Standards Fund 02 Program 770 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Fund Balance Net Cash Resources Net Cash Resource Nonspendable Restricted 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Allowable Costs Federal Regulation Program Regulation State Statute 2 CFR 7 CFR State Statute Federal Regulation Program Regulation State Statute 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

MN 124D.111 124D.111 LUNCH AID; FOOD SERVICE ACCOUNTING. (c) Revenues and expenditures for food service activities must be recorded in the food service fund. The costs of processing applications, accounting for meals, preparing and serving food, providing kitchen custodial services, and other expenses involving the preparing of meals or the kitchen section of the lunchroom may be charged to the food service fund or to the general fund of the district. The costs of lunchroom supervision, lunchroom custodial services, lunchroom utilities, and other administrative costs of the food service program must be charged to the general fund. 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Necessary, Reasonable and Allocable Is the cost necessary for the operation or administration of the program? Would the prudent person consider this reasonable in the context of normal business? Can it be quantified to an amount equal to the benefit received? Necessary Reasonable Allocable 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Adequate Documentation 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Chargeback equals Direct Charge Chargebacks Chargeback equals Direct Charge Necessary Reasonable Allocable Documented 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Indirect Cost Rate Method Approved Indirect Cost Rate Modified Direct Cost Base Maximum Indirect Costs 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Restricted Rate Unrestricted Rate ÷ ÷ Indirect Cost Rate (lower) (higher) Total Indirect Costs ÷ Total Direct Costs Total Indirect Costs ÷ Total Direct Costs Total Costs are the same; the difference is what’s included as indirect. 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Modified Direct Cost Base Total Program Costs Less: Cost of Food/Milk Value of USDA Foods Equipment Value of Contracts > $25,000 Modified Direct Cost Base 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Indirect Cost Rate Method Calculation Example Indirect Cost Rate Method a Total Program 770 Direct Costs (cannot include indirect cost pool program costs) $5,000,000 b Food/Milk Costs $2,000,000 c Capital Outlay $50,000 d USDA Foods Value $300,000 e Contracts>$25,000 $80,000 f Modified Direct Cost Base (a-b-c-d-e=f) $2,570,000 g Approved Unrestricted Indirect Cost Rate 10% h Maximum Indirect Costs to be recovered by Fund 01 (f*g=h) $257,000 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Consistency 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Paid Lunch Equity Provision Section 205 Healthy Hungry Free Kids Act (HHFKA) Federal Reimbursements from previous school year SY2018-19 $2.92 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Revenue from Nonprogram Foods Section 206 Healthy Hunger Free Kids Act “Any food sold in the food service operation, other than a reimbursable meal, must generate at least the same proportion of revenue as it contributes to costs.” Nonprogram food revenue Cost of nonprogram food Total Revenue Total food cost 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Assessing Compliance through Proper Allocation 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

USDA Nonprogram Food Revenue Calculator 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov

Thank you! Minnesota Department of Education Nutrition, Health and Youth Development Toll Free: 800-366-8922 or Local: 651-582-8526 Email: mde.fns@state.mn.us 5/30/2019 Leading for educational excellence and equity, every day for every one. | education.mn.gov