V2-A_Supporting_Statement_0584-0055

A1. Circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information.

This is a revision of the currently approved information collection, which addresses a material change proposed in the rule, Increasing Flexibility for Verification of For-Profit Center Eligibility in the Child and Adult Care Food Program (CACFP) (RIN 0584-AE59). This proposed rule is a deregulatory action that would modify CACFP regulations at 7 CFR 226.10(c) requiring for-profit child and adult care centers to monthly verify that the eligibility requirements under section 17(a)(2)(B) and (D) of the Richard B. Russell National School Lunch Act, 42 U.S.C. 1766, are met. This regulatory change addresses a recommendation from the Paperwork Reduction Work Group that was included in the 2015 report to Congress, Reducing Paperwork in the Child and Adult Care Food Program, to reduce the paperwork that for-profit centers serving a high percentage of eligible children or adult participants from low-income households must file.

To be eligible to claim reimbursement for meals and snacks served in CACFP, for-profit centers must document that they meet specified criteria, which demonstrates that at least 25 percent of children or adult participants in care are from low-income households. This rulemaking would simplify the requirement for some for-profit child and adult care centers and sponsoring organizations of for-profit centers to verify that the 25 percent standard is met. It would allow a less frequent verification cycle, reducing the number of times eligibility must be verified, from monthly to annually, in those centers where low-income children or adult participants make up a large proportion of the enrollment.

The U.S. Department of Agriculture (USDA), through the Food and Nutrition Service (FNS), has established application, monitoring, recordkeeping, and reporting requirements to effectively manage CACFP, and ensure that the legislative intent of this mandate is implemented responsibly. The information collected is necessary to enable for-profit institutions to submit applications to administering State agencies, execute agreements with those agencies, and claim the reimbursement to which they are entitled by law. The information collected also ensures that for-profit institutions accept, as mandated by Congress, their responsibilities and liabilities in connection with the CACFP, and provide the legal basis for their participation.

A2. Purpose and use of the information. Indicate how, by whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.

For-profit institutions report information to State agencies, which they must submit to account and record information to FNS reflecting their efforts to comply with statutory and regulatory requirements. CACFP regulations under 7 CFR Part 226 establish policies and procedures for use by State agencies and for-profit institutions to ensure that the standards for participation are met.

Application procedures, under 7 CFR 226.6(b) require for-profit child and adult care institutions to submit information to the State agency to determine their eligibility to participate in CACFP. Program payment procedures at 7 CFR 226.10(c) require all for-profit institutions to submit information to the State agency to verify their eligibility, for each month in which a for-profit center claims reimbursement. Child care institutions must provide the number and percentage of children in care that documents that at least 25 percent of their enrollment or licensed capacity, whichever is less, is eligible for free and reduced-price meals or receive benefits, for which the center receives compensation, under title XX of the Social Security Act. Adult day care institutions must provide the percentage of enrolled adult participants that documents that at least 25 percent receive benefits, for which the center receives compensation, under title XIX or title XX of the Social Security Act.

This information is reported electronically on the monthly claim for reimbursement form. The State agency uses this information only to determine the eligibility of for-profit centers to receive reimbursement for the meals and snacks they serve each month. It is not used by or shared with any other organization, inside or outside USDA or the government.

This rule would modify regulatory requirements at 7 CFR 226.10(c) for for-profit institutions to provide information verifying their eligibility to submit claims for reimbursement each month. Under this proposed rule for-profit centers, institutions that annually demonstrate that at least 50 percent of children or adult participants in care are from low-income households would be exempt from monthly verification For-profit child or adult care centers would be exempt from re-verifying their eligibility each month, if the information they report annually under 7 CFR 226.6(f), demonstrates that at least 50 percent of children or adult participants enrolled for care are from low-income households. In those centers where low-income children or adult participants make up a large proportion of the enrollment, the number of times eligibility must be verified would be reduced from monthly to annually.

FNS estimates 9,770 for-profit institutions must submit documentation to verify for-profit center eligibility. A subset of 1,850 for-profit institutions will each continue to provide 12 reports annually. However, a larger subset of 7,920 for-profit institutions, which serve a high number of low-income children or adult participants, would each provide only one report annually. This proposed rule would decrease the sponsor/institutions reporting burden. This rule would not affect State agency, facilities, or household reporting burden. This rule would also not affect any of the recordkeeping burden. For further information concerning the information requirements in this collection, please refer to the burden narrative (Appendix B, Narrative Grid).

A3. Use of information technology and burden reduction. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses and the basis for the decision for adopting this means of collection. Also, describe any consideration of using information technology to reduce burden.

FNS is committed to complying with the E-Government Act of 2002, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes. However, FNS has no authority to regulate automation at the local level. To the extent possible, FNS encourages States to support the use of automated data systems to collect this information, where it is feasible. FNS estimates that 100 percent of responses will be collected electronically.

A4. Efforts to identify duplication. Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purpose described in item 2 above.

This rulemaking is intended to eliminate duplication of effort for eligible for-profit institutions. CACFP stakeholders have expressed concern that for many for-profit centers, which do not experience large variability in the percentage of enrollment or licensed capacity, submitting monthly documentation results in a disproportional amount of work for any center that serves a high number of low-income children or adult participants. Implementation of this rule would allow a less frequent verification cycle, reducing the number of times eligibility must be verified, from monthly to annually, in those centers where low-income children or adult participants make up a large proportion of the enrollment. By reducing the frequency of verification, this rule would modestly reduce the reporting burden in the current CACFP information collection for eligible for-profit centers and sponsoring organizations of for-profit centers.

A5. Impacts on small businesses or other small entities. If the collection of information impacts small businesses or other small entities (Item 5 of OMB Form 83-I), describe any methods used to minimize burden.

This rule is a deregulatory action that would exempt some for-profit centers, where low-income children or adult participants make up a large proportion of the enrollment, from re-verifying their eligibility to submit claims each month. When implemented, this rule would modestly reduce burden for about 7,920 for-profit centers and sponsoring organizations of for-profit centers participating in CACFP. Out of the 3,030,006 total respondents for this collection, FNS estimates that 100 percent of the 7,920 affected by this rule will be small entities.

A6. Consequences of collecting the information less frequently. Describe the consequence to Federal program or policy activities if the collection is not conducted or is conducted less frequently as well as any technical or legal obstacles to reducing burden.

The information is collected for the purpose of administering CACFP. This rule proposes to decrease the collection of information for claims for reimbursement from monthly to annually for eligible for-profit institutions. Collecting this information less frequently would not allow FNS to properly monitor CACFP funding, statutory and regulatory compliance, and program trends.

A7. Special circumstances relating to the Guidelines of 5 CFR 1320.5. Explain any special circumstances that would cause an information collection to be conducted in a manner

Requiring respondents to report information to the agency more often than quarterly.

The only special circumstance that would apply to this information collection is the requirement for respondents to report information more often than quarterly. The following sections of CACFP regulation require respondents to report information to the State agency more often than quarterly. For-profit institutions receive payments for participating in the CACFP on a monthly basis. Therefore, quarterly collections alone are not adequate. However, this rule would reduce the monthly reporting requirements to once a year for those for-profit institutions where low-income children or adult participants make up a large proportion of enrollment.

Reporting More Often Than Quarterly
Section of Regulation	Title	Annual Responses per Respondent
226.6(f)(1)(iii)	Institutions submit current eligibility information on enrolled children or adult participants to be used to calculate reimbursement rate	12
226.10 and 226.15(i)	Institutions report to the State agency the number of meals claimed for reimbursement	12

Requiring respondents to prepare a written response to a collection of information in fewer than 30 days after receipt of it;
Requiring respondents to submit more than an original and two copies of any document;
Requiring respondents to retain records, other than health, medical, government contract, grant-in-aid, or tax records for more than three years;
In connection with a statistical survey, that is not designed to produce valid and reliable results that can be generalized to the universe of study;
Requiring the use of a statistical data classification that has not been reviewed and approved by OMB;
That includes a pledge of confidentiality that is not supported by authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or which unnecessarily impedes sharing of data with other agencies for compatible confidential use; or
Requiring respondents to submit proprietary trade secret, or other confidential information unless the agency can demonstrate that it has instituted procedures to protect the information's confidentiality to the extent permitted by law.

There are no other special circumstances. The collection of information is conducted in a manner consistent with the guidelines under 5 CFR 1320.5.

A8. Comments to the Federal Register Notice and efforts for consultation. If applicable, provide a copy and identify the date and page number of publication in the Federal Register of the agency's notice, required by 5 CFR 1320.8 (d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received in response to that notice and describe actions taken by the agency in response to these comments. Specifically address comments received on cost and hour burden.

Describe efforts to consult with persons outside the agency to obtain their views on the availability of data, frequency of collection, the clarity of instructions and recordkeeping, disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or reported.

Consultation with representatives of those from whom information is to be obtained or those who must compile records should occur at least once every 3 years even if the collection of information activity is the same as in prior years. There may be circumstances that may preclude consultation in a specific situation. These circumstances should be explained.

A 60-day notice is included as part of the proposed rule, Increasing Flexibility for Verification of For-Profit Center Eligibility in the Child and Adult Care Food Program. FNS will collect public comments during a 60-day comment period. In the final stage of rulemaking, FNS will include a summary of responses in the information collection package. FNS has formal and informal discussions with CACFP stakeholders, including members of the Paperwork Reduction Work Group, National CACFP Sponsors Association, CACFP National Professionals Association, and representatives of Indian Tribal Organizations, on an ongoing basis regarding CACFP requirements and operation. This provides FNS with the opportunity to receive regular input from State administrators and local CACFP operators, which contributes to the development of feasible requirements.

A9. Explain any decisions to provide any payment or gift to respondents. Explain any decision to provide any payment or gift to respondents, other than remuneration of contractors or grantees.

No payment or gifts are provided to respondents.

A10. Assurances of confidentiality provided to respondents. Describe any assurance of confidentiality provided to respondents and the basis for the assurance in statute, regulation, or agency policy.

The Department complies with the Privacy Act of 1974. No confidential information is associated with the burden related to the analysis, implementation, records maintenance, and reporting by the State agency to FNS. This ICR does not request any personally identifiable information. A privacy act statement is not required.

A11. Justification for any questions of a sensitive nature. Provide additional justification for any questions of a sensitive nature, such as sexual behavior or attitudes, religious beliefs, and other matters that are commonly considered private. This justification should include the reasons why the agency considers the questions necessary, the specific uses to be made of the information, the explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent.

There are no questions of a sensitive nature included in this information collection.

A12. Estimates of the hour burden of the collection of information. Provide estimates of the hour burden of the information collection.

A. Indicate the number of respondents, frequency of response, annual hour burden, and an explanation of how the burden was estimated. If this request for approval covers more than one form, provide separate hour burden estimates for each form and aggregate the hour burdens in Item 13 of OMB Form 83-I.

The CACFP information collection, approved with a nonsubstantive change on August 31, 2018, includes a reporting requirement under 7 CFR 226.10(c) for sponsoring organizations and other institutions to submit documentation to verify the eligibility of for-profit centers. FNS estimates that 9,770 for-profit institutions each provide 12 reports annually, for a total of 117,240 responses. The estimated average number of burden hours per response is 0.50, resulting in an estimated total of 58,620 burden hours.

FNS proposes a rule that would modify CACFP regulations at 7 CFR 226.10(c), by reducing the frequency of verification for eligible for-profit centers and sponsoring organizations of for-profit centers. This program change would only impact for-profit institutions that annually demonstrate that at least 50 percent of children or adult participants in care are from low-income households. These institutions would experience a modest reduction of 43,559 hours, from 58,620 to 15,061, in administrative burden under this rule.

FNS estimates a subset of 1,850 for-profit institutions, or about 20 percent of the 9,770 institution respondents, would not be affected by this change. They would each continue to provide 12 reports annually for a total of 22,203 responses. Their reporting burden would not change. The estimated average number of burden hours per response is 0.50, resulting in an estimated total of 11,101 burden hours.

However, a larger subset of 7,920 for-profit institutions, or about 80 percent of the 9,770 institution respondents, would meet the 50 percent standard. Each respondent would be exempt from monthly verification and would provide only one report annually for a total of 7,920 responses. The number of estimated responses from each eligible institution would decrease from 12 responses to only one per year. The estimated average number of burden hours per response is 0.50, resulting in an estimated total of 3,960 burden hours.

Although this rule would also ease administrative burden for institutions that may have to submit additional documentation requested by the State agency to support the eligibility determination, the collection of information under the Paperwork Reduction Act only addresses estimates of federally-imposed reporting or recordkeeping requirements. The proposed program change would not affect State agency reporting or recordkeeping requirements.

To estimate the change in reporting burden for this submission, we analyzed the number of respondents and frequency of responses. We then identified the frequency with which a “typical” for-profit institution submits eligibility information on enrolled children and adult participants each month. Our estimates represent the aggregate work generated by approximately 9,770 independent centers and sponsoring organizations, including a subset of 7,920 or about 80 percent of for-profit institutions that would experience a modest reduction of 43,559 hours in administrative burden under this rule. We also estimated that this rule would have no impact on 1,850 or about 20 percent of for-profit institutions, and prorated the currently approved burden of 117,240 responses and 58,620 hours to correspond with both percentages.

We have attempted to make reasonable generalizations about the entire universe on the basis of the information available. In making this analysis, we considered information about CACFP operations drawn from our files and past experiences. Some of the estimates may not match to totals because of rounding. Our estimates are based on unrounded amounts, which are then either rounded to whole numbers (respondents) or hundredths (responses and hours). Here is a summary of our analysis:

Estimates of the Hour Burden

Respondents: For-Profit Institutions

Estimated Number of Respondents: 7,920

Estimated Number of Responses per Respondent: 1

Estimated Total Annual Responses: 7,920

Estimated Time per Response: 0.50

Estimated Total Annual Burden: 3,960

Current OMB Inventory (Reporting): 1,870,411.75

Current OMB Inventory (Reporting and Recordkeeping): 2,481,135.75

OMB Inventory with Proposed Rule (Reporting and Recordkeeping): 2,437,577.06

Difference in Burden Resulting from the Proposed Rule: -43,558.70

7 CFR Part 226 Child and Adult Food Care Program
Sponsors and Institutions (Currently Approved)
Requirement	Estimated number of respondents	Number of responses per respondent	Total annual responses	Estimated total hours per response	Estimated total burden
226.10(c): All for-profit institutions submit documentation to verify for-profit center eligibility	9,770.00	12.00	117,240.00	0.50	58,620.00
Total Sponsor/Institution reporting burden	21,052.00	31.88	671,048.00	0.92	616,697.18
Total reporting burden for 0584-0055	2,828,158.00	2.57	7,276,600.84	0.26	1,870,411.75

*Some totals may not add due to rounding.

7 CFR Part 226 Child and Adult Food Care Program
Sponsors and Institutions (With Proposed Changes)
Requirement	Estimated number of respondents	Number of responses per respondent	Total annual responses	Estimated total hours per response	Estimated total burden
226.10(c): For-profit institutions that would not be exempt from monthly verification submit documentation to verify for-profit eligibility	1,850.24	12.00	22,202.86	0.50	11,101.43
226.10(c): For-profit institutions that would be exempt from monthly verification	7,919.76	1.00	7,919.76	0.50	3,959.88
Total Sponsor/Institutionreporting burden	21,052.00	27.74	583,930.62	0.98	573,138.49

*Some totals may not add due to rounding. Please note that this chart does not list all of the information requirements for the Sponsors/Institutions; it only lists the existing requirement that is being adjusted by the proposed rule. The total annual responses and estimated total burden for the Sponsors/Institutions includes other information requirements in addition to the ones shown in the chart. The total annual responses and estimated total burden shown for the total reporting burden includes reporting burden for additional respondent groups in addition to the Sponsors/Institutions. Please refer to Appendix A for additional information.

7 CFR Part 226 Increasing Flexibility for Verification of For-Profit Center Eligibility in the Child and Adult Care Food Program
Total Reporting
Affected public		Estimated number of respondents	Number of responses per respondent		Total annual responses	Estimated total hours per response		Estimated total burden
State Agency		56.00	552.16		30,921.00	0.14		4,200.92
Sponsor/Institution		21,052.00	27.74		583,930.62	0.98		573,138.49
Facilities		180,740.00	12.00		2,168,880.00	0.41		883,761.00
Household		2,626,310.00	1.68		4,405,751.84	0.08		365,752.64
Total reporting burden for 0584-0055		2,828,158.00	2.54		7,189,483.46	0.25		1,826,853.06
Total Recordkeeping
State Agency		56.00	27.00		1,512.00	1.37		2,072.00
Sponsor/Institution		21,052.00	9.22		194,196.00	0.34		66,432.00
Facilities		180,740.00	3.00		542,220.00	1.00		542,222.00
Total recordkeeping burden for 0584-0055		201,848.00	3.66		737,928.00	0.83		610,724.00
Total of Reporting and Recordkeeping
Reporting	2,828,158.00		2.54	7,189,483.46			0.25		1,826,853.06
Recordkeeping	201,848.00		3.66	737,928.00			0.83		610,724.00
Total	3,030,006.00		2.62	7,927,411.46			0.31		2,437,577.06

*Some totals may not add due to rounding. Please note that this chart does not list all of the information requirements for Sponsors/Institutions; it only lists the existing requirement that is being adjusted by the proposed rule. The total annual responses and estimated total burden for Sponsors/Institutions includes other information requirements in addition to the ones shown in the chart. The total annual responses and estimated total burden shown for the total reporting burden includes reporting burden for additional respondent groups in addition to Sponsors/Institutions. Please refer to Appendix A for additional information.

B. Provide estimates of annualized cost to respondents for the hour burdens for collections of information, identifying and using appropriate wage rate categories.

This rulemaking would decrease the frequency of certain for-profit responses from 12 to one, which, at 30 minutes per response, would decrease the estimated annual staff time required to do the reporting by 5.5 hours per year per center. It would decrease the total reporting burden at the sponsor-level by 43,559 hours, from 616,697 to 573,138 hours. FNS does not estimate that there would be any change in center participation, or any changes to any other costs associated with CACFP, resulting from this proposed rule. However, there would be increases in total public costs resulting from higher hourly wages in the State, sponsor, and facility categories.

To estimate public cost, we applied the mean hourly wage data for State government, excluding schools and hospitals (NAICS 999200), and various levels of food service staff that are listed in the May 2017 Occupation Employment Statistics published by the U.S. Department of Labor, Bureau of Labor Statistics at https://www.bls.gov/oes/home.htm. We used occupation code 13-1111, management analysts, to estimate the State salary rate at $30.19 per hour. We used occupation code 35-1010, supervisors of food preparation and serving workers, to estimate the sponsor/institution salary rate at $17.89 per hour. Our estimate of the facility salary rate, at $17.05 per hour, was drawn from occupation code 35-1012, first-line supervisors of food preparation and serving workers. To calculate reporting costs for households, FNS applied the current Federal minimum wage rate of $7.25 per hour as reported by the U.S. Department of Labor. The following information shows the estimate of burden for reporting and recordkeeping:

Total Reporting
Affected public	Hours	Mean Hourly Wage (in dollars)	Estimated Costs (in dollars)
State	4,201	30.19	126,828.19
Sponsor/Institution	573,138	17.89	10,253,438.82
Facility	883,761	17.05	15,068,125.05
Household	365,753	7.25	2,651,709.25
TOTAL			$28,100,101.31
Total Recordkeeping
Affected public	Hours	Mean Hourly Wage (in dollars)	Estimated Costs (in dollars)
State	2,072	30.19	62,553.68
Sponsor/Institution	66,432	17.89	1,188,468.48
Facility	542,220	17.05	9,244,851.00
TOTAL			10,495,873.16
TOTAL COST TO PUBLIC			$38,595,974.47

*Some totals may not add due to rounding.

A13. Estimates of other total annual cost burden. Provide estimates of the total annual cost burden to respondents or record keepers resulting from the collection of information, (do not include the cost of any hour burden shown in items 12 and 14). The cost estimates should be split into two components: (a) a total capital and start-up cost component annualized over its expected useful life; and (b) a total operation and maintenance and purchase of services component.

There are no capital, start-up, or ongoing operation or maintenance costs associated with this information collection.

A14. Provide estimates of annualized cost to the Federal government. Provide estimates of annualized cost to the Federal government. Also, provide a description of the method used to estimate cost and any other expense that would not have been incurred without this collection of information.

We identified functions performed by FNS Regional Office (FNSRO) and Headquarters (HQ) staff related to the CACFP and obtained estimates of the number of staff hours spent performing these functions. For FNSRO staff, we obtained data on the total staff time (for all programs) spent on each function. We then allocated an appropriate portion of each of these functional burdens to CACFP. The estimated percentage of time spent performing duties involving CACFP matters are presented here:

Federal Costs of CACFP Personnel
Function (1)	Done by (2)	Total Staff Hours (3)	CACFP Allocation Percentage (4)	Portion of Staff Hours for CACFP (3)x(4)
Professional assistance to State agencies	FNSRO	216,842.00	.33	71,557.86
Drafting and clearing Regulations	HQ	8,320.00	.70	5,824.00
Policy guidance development	HQ	14,976.00	.45	6,739.20
TOTAL HOURS				84,121.06

*Some totals may not add due to rounding.

We applied the 2018 Federal Wage Salary Tables (General Schedule for the Rest of the United States) to estimate the salary rate at $37.08 per hour (the average hourly salary for a GS 11/12, which is the grade level of staff who performs these functions).

Computations
Salaries	84,121 hours x $37.08/hour	$3,119,208.91
10 percent for administrative overhead	$3,119,208.91 x 0.10	$311,920.89
TOTAL FEDERAL COST		$3,431,129.80

*Some totals may not add due to rounding.

A15. Explanation of program changes or adjustments. Explain the reasons for any program changes or adjustments reported in item 13 or 14 of the OMB 83-I.

This is a revision of a currently approved collection resulting from changes from the proposed rule, Increasing Flexibility for Verification of For-Profit Center Eligibility in the Child and Adult Care Food Program (RIN 0584-AE59). The proposed rule would revise reporting burden by allowing a less frequent verification cycle, reducing the number of times eligibility must be verified, from monthly to annually, in those for-profit centers where low-income children or adult participants make up a large proportion of the enrollment. There were 9,770 independent for-profit centers and sponsoring organizations of for-profit centers participating in CACFP in Fiscal Year 2017, according to USDA administrative data. FNS estimates about 80 percent of for-profit institutions would be impacted by this rule and would experience a reduction in burden. This percentage allows for some sponsoring organizations that do not have outlets meeting the proposed 50 percent standard. The frequency of estimated responses per center would decrease from 12 responses to only one per year.

The current OMB inventory for this collection is 2,481,136 burden hours and 8,014,529 responses. As a result of program changes, FNS estimates that the burden hours for this collection will decrease by 43,559 hours. FNS estimates a decrease of 87,118 responses for this collection as well. Upon approval of the information collection request and implementation of the rule, FNS estimates that this collection will have 2,437,577 burden hours and 7,927,411 responses.

A16. Plans for tabulation, and publication and project time schedule. For collections of information whose results are planned to be published, outline plans for tabulation and publication.

There are no plans to publish the results of this collection of information for statistical use. The collection does not employ statistical methods.

A17. Displaying the OMB Approval Expiration Date. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate.

We are not seeking approval concerning the display of the expiration date.

A18. Exceptions to the certification statement identified in Item 19. Explain each exception to the certification statement identified in Item 19, Certification for Paperwork Reduction Act.

The agency is able to certify compliance with all provisions under Item 19 of OMB Form 83-I.

File Type	application/vnd.openxmlformats-officedocument.wordprocessingml.document
File Title	Supporting Statements
Subject	For-Profit Institution Reporting
Author	usda fcs
File Modified	0000-00-00
File Created	2021-01-20