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

2. 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
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3. 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
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4. 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
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5. Administrative Review Process
Pre HHFKA 2010
Once every 5 years
CRE – Coordinated Review Effort
SMI – School Meals Initiative
5/30/2019
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6. 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
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7. Why now? They didn’t look at all this the last time… The Big Question
5/30/2019
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8. What to Expect Meal Access and Reimbursement
Meal Pattern and Nutritional Quality
General Program Compliance
Other Federal Program Review
5/30/2019
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9. 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
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10. 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
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11. Perform Risk Assessment Review Documentation
Assess Compliance with Regulation
Provide Technical Assistance
5/30/2019
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12. Communicate Review Report Finding Corrective Action
Technical Assistance
5/30/2019
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13. Close-out
5/30/2019
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14. Resource Management Review Areas
Maintenance of the NSFSA
Indirect Costs
Paid Lunch Equity
Nonprogram Food Revenue
5/30/2019
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15. Maintenance of the NSFSA
Financial System
Net Cash Resource
Allowable Costs
3 Components:
5/30/2019
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16. Uniform Financial Accounting and Reporting Standards
Financial System
Uniform Financial Accounting and Reporting Standards
Fund 02
Program 770
5/30/2019
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17. Fund Balance Net Cash Resources Net Cash Resource Nonspendable
Restricted
5/30/2019
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18. Allowable Costs Federal Regulation Program Regulation State Statute
2 CFR
7 CFR
State Statute
Federal Regulation
Program Regulation
State Statute
5/30/2019
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19. 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
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20. 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
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21. Adequate Documentation
5/30/2019
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22. Chargeback equals Direct Charge
Chargebacks
Chargeback equals Direct Charge
Necessary
Reasonable
Allocable
Documented
5/30/2019
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23. Indirect Cost Rate Method
Approved Indirect Cost Rate
Modified Direct Cost Base
Maximum Indirect Costs
5/30/2019
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24. 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
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25. 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
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26. 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
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27. Consistency
5/30/2019
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28. Paid Lunch Equity Provision
Section 205 Healthy Hungry Free Kids Act (HHFKA)
Federal Reimbursements from previous school year
SY $2.92
5/30/2019
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29. 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
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30. Assessing Compliance through Proper Allocation
5/30/2019
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31. USDA Nonprogram Food Revenue Calculator
5/30/2019
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32. Thank you! Minnesota Department of Education
Nutrition, Health and Youth Development
Toll Free: or Local:
5/30/2019
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