Certification of Compliance with New Meal Pattern Requirements

Certification of Compliance with New Meal Pattern Requirements
FNS published an interim rule entitled Certification of Compliance with Meal Pattern Requirements for the NSLP, April 27, 2012 This interim rule establishes the requirements for the certification of SFAs for an additional 6 cents per lunch reimbursement. The rule becomes effective July 1, 2012 USDA is accepting public comments for 90 days

Agenda Background Certification - SFA Responsibilities
Certification - State Agency Responsibilities SY Validation Reviews Administrative Reviews and Ongoing Compliance Reporting Requirements Implementation Funding Questions These are the topics we will discuss today: We will give some background on this rule Certification - SFA Responsibilities Certification - State Agency Responsibilities SY Validation Reviews – a new requirement to validate 25% of the SFA’s certified Administrative Reviews and ongoing compliance– what this means Reporting Requirements Implementation Funding Questions

Background

Background - HHFKA Requires SFAs follow the updated meal patterns (rule published January 26, 2012) Provides performance-based reimbursement for SFAs that demonstrate compliance with updated meal pattern – this includes both lunch and breakfast Additional reimbursement is available October 1, 2012 6 cents reimbursement will be adjusted beginning July 2013 Section 201 of the HHFKA makes an additional 6 cents reimbursement available for meals meeting the updated meal pattern requirements on October 1, 2012, and no earlier. In order to be eligible to receive this new performance-based reimbursement, the State agency must certify that the SFA is in compliance with the requirements of the final meal pattern rule published in the Federal Register on January 26, 2012. section 201 of the HHFKA limits the 6 cents per lunch reimbursement to only those SFAs certified by the State agency to be in compliance with the updated lunch and breakfast meal patterns. FNS will prescribe annual adjustments to the 6 cents reimbursement at the same time adjustments are made to the national average payment rates These adjustments, which reflect changes in the food away from home series of the Consumer Price Index for all Urban Consumers, are annually announced by the Notice in July in the Federal Register The first adjustment to the 6 cents will occur in July 2013

Background - Interim Rule
The interim rule lays out the requirements and framework for certification for the performance-based reimbursement The certification process works as follows: SFA submits certification documentation to State agency State agency makes a certification determination within 60 days State agencies conduct validation review of at least 25 percent of certified SFAs in SY Ongoing compliance with the meal pattern requirements is monitored during administrative reviews (CRE) State agencies will not be required to conduct administrative reviews (CRE) in SY The interim rule lays out the requirements and framework for certification for the performance based reimbursement The 6 cents certification process works as follows: First, SFA submits certification documentation to State agency (TDA) Then, TDA makes a certification determination within 60 days After that, in FY , TDA conducts a validation review of at least 25 percent of the certified SFAs. Finally, Ongoing compliance with the meal pattern requirements is monitored during the normal administrative review process. State agencies will not be required to conduct administrative reviews (CRE) in SY – there are a couple of exceptions to this that I will discuss later

Background - Interim Rule
Some aspects of the meal pattern are phased in over several years SFAs must demonstrate compliance with those requirements in effect at time of certification SFAs must demonstrate compliance with both breakfast and lunch if SFA offers breakfast SFAs must demonstrate compliance with those meal pattern requirements in effect at the time the SFA applies for certification. While most of the updated requirements are effective SY , several requirements are phased in later. So, an SFA applying in SY would need to demonstrate compliance with all of the SY requirements in order to be certified. An SFA applying for certification in SY would need to demonstrate compliance with all of the SY requirements and all requirements phased in for SY And again, SFAs must demonstrate compliance with both breakfast and lunch if the SFA offers breakfast

Certification - Definition
Paper or electronic documentation submitted to the State agency by the SFA to demonstrate compliance with new meal pattern requirements Documentation must include both breakfast and lunch if SFA offers breakfast Representative of meal service for all schools within the SFA State agency reviews and approves or denies documentation for certification Certification is a term I will use throughout the presentation Certification includes paper or electronic documentation submitted to the State agency by the SFA to demonstrate compliance with new meal pattern requirements Certification documentation must include both breakfast and lunch if SFA offers breakfast All schools within the SFA must be in compliance with the meal pattern requirements for the SFA to be certified for the 6 cents per lunch reimbursement. If the SFA participates in the SBP, the schools must also be in compliance with the updated breakfast requirements in effect at the time of certification. This means that if one school is not in compliance with the new meal pattern, the whole SFA will be denied the 6 cent reimbursement State agency are the one’s who review and approve or deny documentation for certification Certification is a one-time process. SFAs will only need to submit certification documentation once to receive the 6 cents reimbursement

Technical Assistance Q & A’s Prototype contract
Tools to support certification will be issued in late May Before getting into the details of the rule, I want to mention that FNS is providing the following technical assistance to help SFAs and State agencies with the certification process: Q&As issued Prototype solicitation contract will be ready for release early in May Finally, tools to support certification will be issued in late May I will talk about these tools in more detail later in the presentation

Certification – SFA Responsibilities
I first want to talk about responsibilities of SFAs in the certification process

Certification Options
Option 1: SFA submits one week menus, menu worksheet and nutrient analysis Option 2: SFA submits one week menus, menu worksheet and simplified nutrient assessment Option 3: State agency on-site review Per the rule, SFAs can request certification through one of 3 options. Texas will only be offering Options 1 & 2 to schools (Sharon can talk more about that later) which is a state agency prerogative. But we’ll go through all three in more detail so you are aware. Wanted to point out that all three options include one week of menus, a menu worksheet and some sort of nutrient assessment The basic differences between the options are in what type of nutrient assessment is conducted and who completes the assessment These options were designed to use, to the maximum extent practicable, existing processes and information.

Certification – Option 1
SFAs must submit: One week of menus for each menu type offered Detailed menu worksheet Nutrient analysis of calories and saturated fat for each menu type Menu worksheet includes food items and quantities used to assess compliance Option 1 allows SFAs to submit one week of menus, detailed menu worksheets showing food items and quantities for breakfast and lunches, and a nutrient analysis of calories and saturated fats. SFAs that choose this option must submit one week of each distinct menu type, by age grade group, and a detailed menu worksheet for each menu showing food components and quantities by reimbursable meal. I will explain what we mean by menu type after I go through all of the options SFAs that chose this option must use FNS approved nutrient analysis software This option acknowledges that a large number of SFAs use nutrient analysis software to monitor the nutrient levels in their meals.

SFAs must submit: One week of menus for each menu type offered Detailed menu worksheet Simplified Nutrient Assessment of calories and saturated fat for each menu type Simplified nutrient assessment will serve as a proxy for a nutrient analysis Option 2 allows SFAs to submit one week of menus, detailed menu worksheets showing food items and quantities for breakfasts and lunches, and a simplified nutrient assessment. SFAs that choose this option must submit (same as option 1) one week of each distinct menu type, by age grade group, and a detailed menu worksheet for each menu showing food components and quantities by reimbursable meal. This option acknowledges that not all SFAs use nutrient analysis software. The simplified nutrient assessment is intended to be a proxy for the nutrient analysis. The simplified assessment assumes certain nutrient values for milk, vegetables and fruit. SFAs enter information about entrees including grains to assess compliance

State agencies may document SFA compliance during an on- site review Menus, menu worksheets with food items and quantities, nutrient analyses are required as part of the materials used to demonstrate compliance The final option for certification is left to the discretion of the State agency – Option 3 allows State agencies to certify a SFA during a an on-site review. If the State agency offers this option, the SFA would need to have menus, detailed menu worksheets (same as options 1 and 2), and all information needed for the State agency to conduct a nutrient analysis of calories saturated fat. TDA will not be offering Option 3.

Certification Documentation
Menu Type: For each certification option SFAs must submit one week of each menu offered (for both breakfast and lunch) within the SFA, by age grade group Example: If an SFA serves an elementary, middle and high school menu for lunch and one menu for breakfast, the SFA must submit four menus and four menu worksheets I mentioned that each option requires the SFA to submit each type of menu offered within the SFA This means for each certification option SFAs must submit one week of each menu offered (for both breakfast and lunch) within the SFA, by age grade group For example: If an SFA serves an elementary, middle and high school menu for lunch and one menu for all three age grade groups for breakfast, the SFA must submit four menus and four menu worksheets If the SFA serves multiple, distinct menus within one age grade group, the SFA must submit all menus served. This is an area where will have more information to come. We have more examples in the Q&As that will be issued tomorrow and will have additional information in the near future. Refer to Question 16 – in the FAQ’s – that clarifies a distinct menu as having different entrees.

Documentation must reflect current meal service: Meals served in the calendar month the certification materials are submitted Meals served in the month preceding the calendar month of submission SFAs must submit documentation that reflects current SFA practices. This means documentation must reflect meal service in the calendar month that certification materials are submitted, or in the month preceding the calendar month of submission. For example, if a SFA submits documentation in March 2013, the menus must reflect meal service in either March or February 2013. SFAs should be reminded that the materials provided are a snapshot of meal service activity and are considered representative of the on-going meal service.

FNS will provide State agencies and SFAs a prototype menu worksheet and simplified nutrient assessment tool FNS will provide guidance and training for these materials FNS will provide State agencies and SFAs a prototype menu worksheets and simplified nutrient assessment in May As I mentioned before, the prototype menu worksheet will take into account food items and quantities to assess compliance The simplified nutrient assessment will serve as a proxy for a full nutrient analysis and will assess saturated fat and calories FNS will provide guidance and training for these materials including a webinar to demonstrate how to use the tools

Early submission (before Sept 30, 2012) SFAs may submit documentation for compliance reflecting planned meal service for October or November 2012 An exception to this is for the time period prior to availability of funds (July 1 through Sept, 2012), In this time period, SFAs seeking certification must submit documentation for compliance reflecting planned meal service for October or November 2012

Example: If an SFA submits certification documentation in August 2012, the documentation for compliance must reflect meals planned for October or November 2012 So, if an SFA submits certification documentation in August 2012, the documentation for compliance must reflect meals planned for October or November 2012. The reason for this exception is that only meals served on or after October 1, 2012 are eligible for the 6 cents reimbursement This also allows State agency flexibility in managing the certification process

Certification Documentation- Attestation
As part of certification, SFAs must attest that: They are in compliance with all current meal pattern requirements Documentation is representative of the ongoing meal service within the SFA The minimum required food quantities for all meal components are available to students in every serving line As part of certification, SFAs must attest that: 1. They are in compliance with all current meal pattern requirements 2. Documentation is representative of the ongoing meal service within the SFA 3. The minimum required food quantities for all meal components are available to students in every serving line

Annual Attestation Certified SFAs must annually attest, through SY , to compliance with the meal pattern requirements, as new requirements are phased-in The attestation must be provided to the State agency as an addendum to the permanent agreement between States and SFAs Subsequent to the initial attestation at the time of certification, SFAs must also annually attest through SY to compliance with the meal pattern requirements, as new requirements are phased-in. The attestation must be provided to the State agency as an addendum to the permanent written agreement between States and SFAs.

Certification – State Agency Responsibilities

Establish process for certification in the State based on interim rule and FNS guidance Train and disseminate information to SFAs Receive, review and approve/deny SFA certification documentation within 60 days of receipt Disburse 6 cents reimbursement to certified SFA Now I will talk about State agency responsibilities in the certification process State agencies (TDA) must establish a process for certification in the State based on the information in the interim rule and guidance provided by FNS States (Texas) must also train and disseminate information about certification to SFAs TDA must review certification materials and, for documentation submitted after October 1, 2012, make certification determinations within 60 days of receipt of the certification request from the SFA. For example, if a SFA submits documentation on November 1, 2012 the State agency must make a certification determination by January 1, 2013 – 60 days. Finally, TDA must disburse 6 cents reimbursement to certified SFAs

State agencies may not approve/deny certification until July 1, 2012 SFAs can start earning 6 cents reimbursement October 1,2012 The earliest an SFA can start earning the 6 cents reimbursement is when funds become available on October 1, 2012 So meals served in September, even at a certified SFA, can not earn the 6 cents reimbursement until October 1, 2012

For applications submitted on or before September 30, 2012, the State agency has 60 days from October 1, 2012 to review certification materials and make a determination I just mentioned that State agencies have 60 days from the time of receipt to make a certification determination Recognizing a large number of SFAs may request certification prior to October 1, 2012, an exception to the 60 day requirement is provided for any certification documentation request submitted prior to September 30, For certification requests submitted on or before September 30, 2012, the State agency has 60 days from October 1, 2012 to review certification materials and make certification determinations.

Example: If an SFA submits certification materials on August 15, 2012 with planned menus for October 1, 2012, the State agency has 60 days from October 1, 2012 to make a certification determination For example, a SFA submits certification materials on August 15, 2012 with planned menus for October 1, The State agency has 60 days from October 1st to make a certification determination So basically, we are giving State agencies more time upfront to certify SFAs because we realize there may be more certification requests during this time

Promptly disburse 6 cents reimbursement to the certified SFA for each lunch served beginning at the start of the month in which the certified menus are served Upon certification, the State agency must reimburse the certified SFA with the 6 cents reimbursement for each lunch served beginning in the start of the month in which the certified lunches are served.

Example: If menus for the week of March 15-19, 2013 are certified in May 2013, the State agency must retroactively reimburse the additional 6 cents for all lunches served on or after March 1, 2013 For example, if menus for the week of March 15-19, 2013 are certified in May 2013 (within the 60 days) , the State agency must retroactively reimburse the additional 6 cents for all lunches served on or after March 1, 2013. In other words, the SFA is entitled to the 6 cents reimbursement starting in the beginning of the month in which the certified menus are served

SY 2012-13 Validation Reviews

SY Validation Review: An on-site visit conducted by the State agency to affirm that a certified SFA has been and continues to meet the updated meal patterns For purposes of the 6 cents rule, a validation review is an on-site visit conducted by the State agency The purpose of the validation review is to affirm that a certified SFA has been and continues to meet the updated meal patterns from the beginning of the certification through the validation review The validation review must also ensure that the meal service at the time of the validation review is consistent with the certification documentation submitted by the SFA.

Validation reviews are only required in SY During a validation review, State agencies must: Observe a meal service for each type of menu certified Review the school production records for observed meals Review the documentation submitted for certification Validation reviews are a one year requirement and must only be conducted in SY During a validation review, State agencies must: 1. observe a meal service for each type of menu certified, 2. review the production records for observed meals to ensure they are consistent with the menus on which the certification determination was based and that observed meals meet updated meal pattern requirements, and 3. review the documentation submitted for certification to ensure that ongoing meal service operations are consistent with certification documentation.

State agencies must conduct random on-site validation reviews of at least 25 percent of SFAs certified via documentation (Options 1 and 2) 25 percent must include all large SFAs SFAs that receive certification through an onsite review (Option 3) are not required to receive a validation review Review one school representing each type of menu certified Randomly selected by State State agencies must conduct random on-site validation reviews of at least 25 percent of SFAs certified via documentation (Options 1 and 2 which I discussed earlier) – all large SFAs must be included in 25 percent SFAs who are certified by the State agency during an on-site review (option 3) are exempt from a validation review in SY since the State agency-conducted administrative review provides an independent validation of the menus, the detailed menu worksheet and includes a nutrient analysis, there is no further need for a validation review. One school representing each type of certified menu by the SFA should be randomly selected for a validation review by the State agency For example, if a SFA submits 3 lunch menus for certification (one for each age grade group), the State agency would randomly select one school representing each type of menu submitted to visit during the validation review (three total).

Draw “sample” during three time periods October – December January – March April – June The total number of validation reviews at the end of SY must be at least 25 percent of certified SFAs in the State Must be completed by June 30, 2013 State agencies should select certified SFAs for validation reviews throughout the school year because certification is a rolling process and State agencies do not know at the beginning of the school year how many SFAs will be certified State agencies are encouraged to randomly select at least 25 percent of the SFAs certified during the periods October-December, January-March, and April-June. Any SFA not selected for a validation review during one period is automatically in the “pool” for possible selection during the next time period. The total number of validation reviews at the end of SY must be at least 25 percent of certified SFAs in the State Since an erroneous certification could lead to the recovery of improperly paid funds, State agencies are strongly encouraged to conduct validation reviews prior to certification or to the SFA’s submission of first Claim for Reimbursement including the 6 cents, if possible. Validation reviews must occur during periods when meal service is in operation so State agencies can confirm the documentation submitted reflects actual program operation. All validation reviews must be completed by June 30, 2013

All large certified SFAs in State must have a validation review A large SFA (§210.18) includes: All SFAs with 40,000 or more children If there are less than 2 SFAs with 40,000 or more children, the 2 largest SFAs with at least 2,000 children SFAs that the State agency select for a validation review must include all large certified SFAs in State A large SFA, as defined in CRE regulations at §210.18, includes: All SFAs with 40,000 or more children enrolled If there are less than 2 SFAs with 40,000 or more children, the 2 largest SFAs with at least 2,000 children enrolled

Two types of fiscal action: Fiscal action associated with 6 cents Fiscal action associated with free/reduced/paid reimbursement For validation reviews, just fiscal action associated with 6 cents Throughout this presentation I will talk about two types of fiscal action: Fiscal action associated with the 6 cents Fiscal action associated with the free/reduced/paid reimbursement For purposes of the validation reviews, I will only be referring to fiscal action associated with the 6 cents Later I will discuss fiscal action associated with free/reduced/paid reimbursement

If the State agency is unable to validate the certification documentation, the State agency must assess: Whether corrective action can occur immediately; and The longevity and severity of the problems These assessments determine whether an SFA can earn the 6 cents in the future and what fiscal action occurs in the current month and prior periods If the State agency is unable to validate the certification documentation, the State agency must assess: Whether corrective action can occur immediately; and The longevity and severity of the problems. These assessments determine whether an SFA can earn the 6 cents in the future and what fiscal action occurs in the current month and prior periods This applies to violations in both breakfast and lunch. The HHFKA makes it clear that only those SFAs meeting both the updated lunch and breakfast requirements are eligible for the 6 cents During a validation review a State agency may recover improperly paid 6 cents funds for a breakfast or lunch violation because the SFA cannot validate an SFA’s eligibility for the 6 cents reimbursement

If corrective action does occur immediately 6 cents is not turned off for future months If corrective action does not occur immediately 6 cents must be turned off for future months If during a validation review: Corrective action does occur immediately 6 cents is not turned off for future months Corrective action does not occur immediately 6 cents must be turned off for future months

The longevity and severity of the violation determines fiscal action for the 6 cents States have discretion to determine proper fiscal action The longevity and severity of the violation and whether it is systematic determines fiscal action for the 6 cents States have discretion to determine proper fiscal action So, whether they want to take back the 6 cents for the week or month or all the way back to the time of certification

SFAs whose 6 cents is turned off for future months as a result of the validation review must re-apply for certification SFAs whose 6 cents is turned off as a result of the validation review must re-apply for certification and will be subject to an administrative review early in the SY administrative review cycle. SFAs may re-apply for certification at any time

Administrative Reviews (CRE) and Ongoing Compliance

SY 2012-13 Administrative Reviews
State agencies will not be required to conduct administrative reviews (CRE) in SY except for: Additional Administrative Reviews Administrative reviews of any “at-risk” SFAs Planned follow up reviews FNS – 640 reporting is required for any administrative reviews conducted in SY State agency administrative reviews scheduled for SY may be postponed until SY , the first year of the new administrative review cycle. However, if the State agency is aware of an SFA at risk for improper payments, the State agency must conduct the administrative review in SY State agencies must also conduct Additional Admin Reviews and planned follow up reviews in SY FNS – 640 reporting is still required for any administrative reviews conducted in SY

SY 2013-14 Administrative Review
Final Meal Pattern Rule 3 year State agency review cycle Begins School Year (July 1, 2013) Breakfast included in administrative review SMI reviews eliminated Modified Performance Standard 2 (CRE) Nutrition Provisions This slide highlights the monitoring provisions in the final meal pattern rule. These provisions are based in part on the requirements of section 207 of HHFKA, which requires that USDA establish a “unified accountability system” for monitoring compliance in the NSLP and SBP, and that reviews be conducted on a 3-year cycle. The final meal pattern rule establishes a framework for State agency administrative reviews in the coming years. The rule includes a 3-year State agency review cycle, beginning School Year In addition, the State administrative review now includes breakfast as well as lunch, beginning the same year. Finally, the rule eliminated the School Meal Initiative Reviews effective July 1, 2012, and made modifications to CRE’s Performance Standard 2.

SY 2013-14 Administrative Review
First year of new 3 year cycle State agency must review any SFA whose review was postponed in SY In addition, State agencies are required to conduct an administrative review of non-certified SFAs early in the review cycle As part of the 6 cents rule, States must include in the 1st year of the three year cycle (which is SY ): 1. Any SFA scheduled for review in SY but whose review was postponed In addition, State agencies are required to conduct an administrative review of non-certified SFAs earlier in the review cycle

Administrative Review Fiscal Action (6 cents)
Ongoing compliance assessed during administrative reviews Any violation of Performance Standard 2 requirements set forth in the new lunch pattern will result in a “turning off” of the 6 cents reimbursement unless immediate corrective action occurs Since 6 cents reimbursement is earned for lunches, SFAs cannot lose 6 cents for breakfast violations during an administrative review Now I want to talk about if a problem is found during an administrative review SFAs may not earn the 6 cents per lunch reimbursement if the State agency finds, during an administrative review, that the certified SFA has violated any requirement of Performance Standard 2 set forth in the new lunch meals unless corrective action can occur immediately . As I’ve already mentioned, the HHFKA requires SFAs to be in compliance with both the breakfast and lunch meal pattern requirements at the time of certification. Subsequently, the 6 cents reimbursement is earned for lunches only. Thus, if any violations of the updated lunch meal pattern are found, the 6 cents per lunch reimbursement would be subject to fiscal action After that, the 6 cents reimbursement is earned for lunches only. Thus, if an SFA is found out of compliance with the breakfast requirements during an administrative review, the State agency would pursue corrective action, follow-up review activity, and as appropriate, fiscal action as required under ; however, the SFA would continue to receive the 6 cents per lunch reimbursement. It is important to note that while a SFA can lose the 6 cent reimbursement for a breakfast violation during a SY validation review, a SFA cannot lose the 6 cent reimbursement for a breakfast violation during an administrative review

Administrative Review Fiscal Action (6 cents)
If the SFA is able to correct a Performance Standard 2 violation by the end of the week in which the administrative review is conducted, the State agency need not turn off the 6 cents reimbursement For example, if the school is missing a vegetable subgroup during the administrative review and is able to change its food order to include the missing vegetable subgroup during the week of review, then the SFA would not lose the 6 cents reimbursement If the SFA is able to correct the identified problem by the end of the week in which the review is conducted, the State agency need not turn off the 6 cents reimbursement. For example, if the a school is missing a vegetable subgroup during the review and is able to change its food order to include the missing vegetable subgroup during the week of review, then the SFA would not lose the 6 cents reimbursement.

Administrative Review Fiscal Action
As always, State agencies must recover improperly paid funds Includes free/reduced price/paid reimbursement plus 6 cents States have discretion in determining longevity and severity of violations As always, the State agency must recover any improperly paid funds for current and prior periods – this includes the free/reduced price/paid reimbursement plus the 6 cents. States have discretion in determining longevity and severity of violations States also have discretion in proper fiscal action and how far back they wish to recover funds

Administrative Review Fiscal Action
Missing Menu Items/Food Items Milk Type and Vegetable Subgroup Whole Grain Rich, Food Quantities and Dietary Specs Standard Fiscal Action for F/R/P (from updated Meal Pattern rule) Immediate fiscal action required Fiscal action required for unresolved, repeat violations (after technical assistance and corrective action have taken place) State agencies may take fiscal action for unresolved, repeated violations (after technical assistance and corrective action have taken place) New Fiscal Action for 6 cents Standard fiscal action includes 6 cents Absent immediate corrective action, must turn off 6 cents for future months This is a chart explaining fiscal action for Performance Standard 2 violation during an administrative review – you probably recognize the top row from the Meal Pattern webinar State agencies should use this as a guide when making fiscal action determinations on administrative reviews As I mentioned earlier, we now have two types of fiscal action: fiscal action associated with the free/reduced/paid reimbursement (referred to standard fiscal action in chart) and fiscal action associated with the 6 cents. This chart shows what fiscal action is required by State agencies depending on the nature PS2 violation You will see that when standard fiscal action is taken by the State agency, it must include the 6 cents reimbursement as well Discretion is left to States to determine the appropriate recovery period of funds based on the longevity and severity of the violation State agencies should note that while not all situations require fiscal action associated with the free/reduced/paid reimbursement, the 6 cents must be turned off for future months in all situations, unless immediate corrective action can occur

Ongoing Compliance State agencies must provide technical assistance to SFAs who violate the lunch and breakfast requirements after certification 6 cents reimbursement can be “turned back on” when SFA demonstrates they are back into compliance with the lunch requirements An on-site review is not required for the 6 cents to be turned back on State agencies must provide technical assistance to SFAs who violate the lunch and breakfast requirements after certification The State agency may re-start the 6 cent per lunch reimbursement beginning with the first full month the SFA demonstrates to the satisfaction of the State agency that they have corrected the violation identified during the administrative review. An on-site review is not required for the 6 cents to be turned back on – as long as the SFA has provided sufficient documentation that they are now in compliance

Noncompliance It is important to note that when non-compliance with the new meal pattern is found during a SY validation review, the SFA must re-apply for certification When non-compliance is found during an administrative review, the 6 cents reimbursement is turned off but the SFA need not go through the entire certification process again they only must demonstrate when they come back into compliance It is important to note that when non-compliance with the new meal pattern is found during a validation review and immediate corrective action is not possible, the SFA must re-apply for certification When non-compliance is found during an administrative review and immediate corrective action is not possible, the 6 cents reimbursement is turned off but the SFA need not go through the entire certification process again -they need only demonstrate when they come back into compliance and the 6 cents can be turned back on

Ongoing Compliance Persistent or repeated failure to meet standards should be dealt with on a case-by-case basis Could result in withholding of reimbursement until compliance is achieved The State agency should assess the reasons for non-compliance on a case by case basis. State agencies have a number of tools to deal with non-compliance ranging from technical assistance, corrective action, follow up reviews, and fiscal action resulting from administrative review activity, to withholding reimbursement and ultimately termination.

Appeals SFAs cannot appeal the State agency’s denial of certification
SFAs can appeal the State agency turn off of the 6 cents reimbursement An SFA cannot appeal a State agency denial of certification since the SFA has not been deemed eligible to receive the additional reimbursement. While the SFA does not have appeal rights in this situation, the State agency should provide technical assistance to the SFA to assist them getting certified An SFA can appeal the State agency turn off of the 6 cents reimbursement. In this scenario the State agency has made payments to the SFA and therefore the SFA can appeal the decision. Standard appeal procedures must be followed.

Reporting Requirements

Reporting Requirement
State agencies must: include meal counts earning 6 cents reimbursement on the FNS-10 include 6 cent reimbursement on FNS-777 quarterly report submit an additional quarterly report detailing the disbursement of 6 cents reimbursement including: Total number of SFAs in the State Names and locations of certified SFAs For each SFA, total number of lunches earning the 6 cents reimbursement for each month The 6 cents interim rule does include a reporting requirement State agencies must: include meal counts earning 6 cent reimbursement on the FNS-10 include 6 cents reimbursement on FNS-777 quarterly report (report is not changing) submit an additional quarterly report detailing the disbursement of 6 cent reimbursement including: Total number of SFAs in the State Names and locations of certified SFAs For each SFA, total number of lunches earning the 6 cent reimbursement for each month

Reporting Requirement
FNS-10 is currently being updated Prototype reporting template is being created for quarterly report The FNS-10 is currently being updated and will include a column, similar to the column for reporting meals earning the 2 cent for serve need, for State agencies to report meals earning the 6 cents Look for a Federal Notice very soon for the updated FNS-10 FNS is also creating a prototype reporting template for the other information that is required on a quarterly basis. State agencies should keep in mind that because funds are not available until October 1, 2012, the first reporting on the FNS-10 will occur in November 2012. The first required quarterly report would not be due until January 2013

Implementation Funding
Finally, I’m going to talk about Implementation Funding….

Implementation Funding
The HHFKA provides $47 million in each of fiscal years and 2013 for State agencies to support implementation activities for the new meal pattern These funds may be used for the following activities associated with the implementation of the new meal pattern and the 6 cents reimbursement: Training for SFAs Technical Assistance Certification activities Oversight activities The HHFKA provided $47 million to assist State agencies with State-level costs associated with certification and training activities associated with implementing the updated meal patterns and providing the 6 cents per lunch reimbursement to certified SFAs. FNS expects State agencies to use these funds to support training, certification, and oversight activities. State agencies can refer to policy memo SP issued on December 29, 2011 for more information

Certification Contractor
State agencies may use these funds to procure a contractor to conduct certification activities on behalf of the State agency The contractor could also be used to conduct validation reviews on behalf of the State agency FNS is working to finalize a prototype request for proposal for State agencies to use to procure a contractor to provide certification services Last thing to mention: State agencies may use these implementation funds to procure a contractor to conduct certification activities on behalf of the State agency In addition to certification, the contractor could also be used to conduct validation reviews on behalf of the State agency FNS is working to finalize a prototype request for proposal for State agencies to use to procure a contractor to provide certification services

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Certification of Compliance with New Meal Pattern Requirements

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