Attachment M Administrative Review Manual

Attachment M. Administrative Review Manual

This information is being collected from State agencies, school food authorities, schools. This is a revision of a
currently approved information collection. The Richard B. Russell National School Lunch Act (NSLA) 42
U.S.C. § 1758, as amended, authorizes the National School Lunch Program (NSLP). This information is
required to administer and operate this program in accordance with the NSLA. Under the Privacy Act of 1974,
any personally identifying information obtained will be kept private to the extent of the law. According to the
Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless it displays a valid OMB control number. The valid OMB control
number for this information collection is 0584-0006. The time required to complete this information
collection is estimated to average 47.5 hours per response. The burden consists of the time it takes for the State
agency to conduct the off-site portion of the review which includes scheduling of the review and the
completion of the Off-site Assessment, Resource Management Risk Indicator, and Site Selection Tools. Send
comments regarding this burden estimate or any other aspect of this collection of information, including
suggestions for reducing this burden, to: U.S. Department of Agriculture, Food and Nutrition Services, Office
of Policy Support, 3101 Park Center Drive, Room 1014, Alexandria, VA 22302, ATTN: PRA (0584-0006). Do
not return the completed form to this address.

OMB
#0584-0006
Expiration
Date
xx/xx/20xx

Administrative Review Manual

For monitoring of program requirements under the
National School Lunch Program, School Breakfast Program,
and other Federal school nutrition programs

U.S. Department of Agriculture
Food and Nutrition Service
School Meal Programs
Effective School Year 2018-2019

In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and
policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA
programs are prohibited from discriminating based on race, color, national origin, religion, sex, gender identity
(including gender expression), sexual orientation, disability, age, marital status, family/parental status, income
derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civil rights activity, in
any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and
complaint filing deadlines vary by program or incident. Persons with disabilities who require alternative means of
communication for program information (e.g., Braille, large print, audiotape, American Sign Language, etc.) should
contact the responsible Agency or USDA’s TARGET Center at (202) 720-2600 (voice and TTY) or contact USDA
through the Federal Relay Service at (800) 877-8339. Additionally, program information may be made available in
languages other than English.
To file a program discrimination complaint, complete the USDA Program Discrimination Complaint Form, AD-3027,
found online at http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or write a letter
addressed to USDA and provide in the letter all of the information requested in the form. To request a copy of the
complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by: (1) mail: U.S. Department
of Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue, SW, Washington, D.C.
20250-9410; (2) fax: (202) 690-7442; or (3) email: [email protected].
USDA is an equal opportunity provider, employer, and lender.

2

Table of Contents
Introduction to the Administrative Review .................................................................................. 7
Overview of the Administrative Review Manual .............................................................. 8
Overview of the Administrative Review Process ............................................................ 11
Section I: Pre-visit Procedures .................................................................................................. 20
Section II: Meal Access and Reimbursement ............................................................................ 27
Module: Certification and Benefit Issuance ................................................................... 28
Module: Verification ....................................................................................................... 49
Module: Meal Counting and Claiming ............................................................................ 57
Section III: Meal Pattern and Nutritional Quality ...................................................................... 66
Module: Meal Components and Quantities ................................................................... 67
Module: Offer versus Serve ............................................................................................ 83
Module: Dietary Specifications and Nutrient Analysis .................................................. 91
Addendum: Certifying a School Food Authority for Performance-Based
Reimbursement During an Administrative Review .......................................... 108
Section IV: Resource Management .......................................................................................... 111
Module: Risk Assessment for Resource Management ................................................ 112
Module: Comprehensive Review – Maintenance of the Nonprofit School Food
Service Account ........................................................Error! Bookmark not defined.
Module: Comprehensive Review — Paid Lunch Equity .....Error! Bookmark not defined.
Module: Comprehensive Review — Revenue from Nonprogram FoodsError! Bookmark not defined.
Module: Comprehensive Review — Indirect Costs ............Error! Bookmark not defined.
Section V: General Program Compliance................................................................................ 145
Module: General Area — Civil Rights ........................................................................... 146
Module: General Area — SFA On-site Monitoring....................................................... 156
Module: General Area — Local School Wellness Policy and School Meal
Environment ....................................................................................................... 159
Module: Smart Snacks in School (All Foods and Beverages Sold in School) ............... 165
Module: General Area — Professional Standards ....................................................... 169
Module: General Area —Water Availability ................................................................ 175
Module: General Area — Food Safety, Storage, and Buy American ........................... 178
Module: General Area — Reporting and Recordkeeping ............................................ 190
3

Module: General Area — SBP and SFSP Outreach ....................................................... 193
Section VI: Other Federal Program Reviews ........................................................................... 196
Module: The NSLP Afterschool Snack Service .............................................................. 197
Module: Seamless Summer Option .............................................................................. 202
Module: Fresh Fruit and Vegetable Program ............................................................... 211
Module: Special Milk Program...................................................................................... 217
Section VII: Post-Review Procedures ........................................................................................ 220
Module: Administrative Review Exit Conference ........................................................ 221
Module: Administrative Review Report ....................................................................... 223
Module: Documented Corrective Action...................................................................... 226
Section VIII: Fiscal Action .......................................................................................................... 228
Module: Overview of Fiscal Action .............................................................................. 229
Module: Fiscal Action Formula .................................................................................... 240
Module: Withholding Payments .................................................................................. 255
Module: Overpayment Disregard ................................................................................ 258
Module: Letter of Claim Adjustment and/or Withholding of Payment Including
Notice of Appeal ................................................................................................. 259
Section IX: Special Provision Options ........................................................................................ 260
Module: Special Provision Options 1, 2, and 3 ............................................................ 261
Module: Community Eligibility Provision…………………………………………………………………………….275

Section X:

Resources ............................................................................................................... 285

Glossary of Terms ....................................................................................................................... 289
Authorities .................................................................................................................................. 304

4

Administrative Review Manual – Forms, Tools, Worksheets
1. Off-site Assessment Tool
2. On-site Assessment Tool
3. Site Selection Worksheet
4. Statistical Sample Generator
5. Meal Compliance Risk Assessment Tool
6. Dietary Specifications Assessment Tool
7. Nutrient Analysis and Validation Checklist
8. Nutrient Analysis Protocols
9. Resource Management Comprehensive Review Form
10. Resource Management Risk Indicator Tool
11. Fiscal Action Workbook
12. Non-reimbursable Meal Allocation Form
13. School Data and Meal Pattern Error Form (S-1)
14. Other Meal Claim Errors (S-2)
15. Eligibility Certification and Benefit Issuance Error Worksheet (SFA-1)
16. Other Eligibility Certification and Benefit Issuance Errors Worksheet (SFA-2)
17. SFA Data Summary Form (SFA-3)
18. Special Provisions Non-Base Year and CEP Claiming Percentage/Funding Level Summary
Form (SFA-1A)
19. Community Eligibility Provision ISP and Claiming Percentage Validation Worksheet (SFA-2A)
20. Seamless Summer Option School Data and Meal Pattern Error Form (SSO S-1)
21. Seamless Summer Option Eligibility Certification Form (SSO S-2)
22. Supplemental Seamless Summer Option Administrative Review Form
23. Supplemental Afterschool Snacks Administrative Review Form
24. Supplemental Special Milk Program Administrative Review Form
25. Infant and Pre-K Meal Pattern On-Site Validation Checklist

5

Acknowledgments

We would like to acknowledge the dedication and effort of the School Meals Administrative
Review Reinvention Team and the Administrative Review Forms and Tools Workgroup,
comprised of USDA and State agency staff, for their assistance in preparing this manual and the
accompanying forms and tools, as well as all additional USDA and State agency staff members
for their assistance.

6

Introduction to the Administrative Review
The Richard B. Russell National School Lunch Act, as amended by the Healthy Hunger-Free Kids Act
of 2010 (HHFKA), requires a unified accountability system designed to ensure that participating
school food authorities (SFAs) comply with National School Lunch Program (NSLP) and School
Breakfast Program (SBP) requirements. The Act also requires an accountability system that
conducts Administrative Reviews to evaluate Program requirements for NSLP and SBP during a
three-year cycle.
The Administrative Review described in this manual provides a comprehensive evaluation of school
meals programs by State Agencies (SAs) of SFAs participating in the NSLP and SBP, and includes both
Critical and General Areas of Review. The Food and Nutrition Service (FNS) has expanded the scope
of review for both the Critical and General Areas to provide for a more robust review of program
operations. This includes the implementation of the HHFKA program requirements and other
Federal programs. FNS provides forms, instructions, and guidance to standardize the review
process.
FNS intends this process to underscore the importance of ensuring all aspects of the Administrative
Review process are meaningful and address program requirements. Given the complexity of the
procurement process at the SFA level and the need for ongoing technical assistance in procurement,
FNS has provided a separate procurement review instrument that SAs may use to monitor SFA
compliance with Federal procurement regulations and policies. State agencies are encourage to
conduct procurement reviews during the same three year review cycle as the administrative review,
however, they are not required to do so. State agencies have the discretion to conduct
procurement reviews on an alternate cycle. The alternate cycle may be longer than the current
three-year cycle requirement. The three-year review requirement at 7 CFR 210.19 (a)(5) for SFAs
that contract with food service management companies, must be maintained even if the State
agency has an Administrative Review waiver and is operating under a four or five-year cycle for
Administrative Reviews.
State agencies should note that this manual uses the term “SFA” to refer to the governing body
responsible for school food service operations, and the term “LEA” (local educational agency) to
refer to the governing body responsible for activities related to, but not directly under, the school
food service. In addition, the terms “school” and “site” are used interchangeably to mean a physical
location where Program meals are offered to children.

Administrative Review Manual Page 7

When program responsibilities fall to entities outside of the school food service, the SA must assess
how unit(s) of the LEA or entities other than the school food service implement their
responsibilities, as applicable. The most notable of these areas are the certification and benefit
issuance process (Section II), Resource Management (Section IV), Smart Snacks in School, and Local
Wellness Policy (Section V).
Overview of the Administrative Review Manual
The Administrative Review Manual is comprised of the following sections:













Section I:
Pre-visit Procedures
Section II:
Meal Access and Reimbursement
Section III:
Meal Pattern and Nutritional Quality
Section IV:
Resource Management
Section V:
General Program Compliance
Section VI:
Other Federal Program Reviews
Section VII: Post-Review Procedures
Section VIII: Fiscal Action
Section IX:
Special Provision Options
Section X:
Resources
Authorities
Glossary of Terms

The regulations governing the Administrative Review (7 CFR 210.18) reference two Critical Areas of
performance, Performance Standard 1 and Performance Standard 2, as well as a number of General
Areas of Review. These references do not signify a higher priority of one area of review over
another. While the regulations use the term “Critical Areas” to describe Performance Standards 1
and 2, compliance standards in the General Areas of Review are equally important. The regulations
require fiscal action for the Critical Areas and provide the framework to allow SAs to take fiscal
action or withhold payments for program noncompliance in the General Areas.
In this manual, Performance Standard 1 corresponds with Section II: Meal Access and
Reimbursement, and Performance Standard 2 corresponds with Section III: Meal Pattern and
Nutritional Quality. Section IV: Resource Management, Section V: General Program Compliance and
Section VI: Other Federal Program Reviews cover the General Areas of Review. Sections II through
VI contain modules addressing the scope of review. Each module includes:
 Intent/Scope of Monitoring
 Review Procedures
• Pre-visit Review Procedures
• On-site Review Procedures
 Technical Assistance/Corrective Action
 Fiscal Action
Administrative Review Manual Page 8

Administrative Review Numbering System
This manual assigns each Administrative Review monitoring area a unique series of numbers (e.g.,
Certification and Benefit Issuance – 100s). The numbers are identified on all associated questions,
forms, and related material to ensure continuity between the manual and review documents.

Administrative Review Manual Page 9

Number Series

Monitoring Area

Section II: Meal Access and Reimbursement (Critical Area – Performance Standard 1)
100

Certification and Benefit Issuance

200

Verification

300

Meal Counting and Claiming

Section III: Meal Pattern and Nutritional Quality (Critical Area – Performance Standard 2)
400

Meal Components and Quantities

500

Offer versus Serve

600

Dietary Specifications and Nutrient Analysis

Section IV: Resource Management (General Areas)
700

Resource Management

Section V: General Program Compliance (General Areas)
800

Civil Rights

900

SFA On-site Monitoring

1000

Local School Wellness Policy and School Meal Environment

1100

Smart Snacks in School

1200

Professional Standards

1300

Water

1400

Food Safety, Storage, and Buy American

1500

Reporting and Recordkeeping

1600

School Breakfast Program and Summer Food Service Program Outreach

Section VI: Other Federal Program Reviews (Critical and General Areas)
1700

The NSLP Afterschool Snack Service

1800

Seamless Summer Option

1900

Fresh Fruit and Vegetable Program

2000

Special Milk Program

Section VII: Post-Review Procedures
No related forms
Section VIII: Fiscal Action
Forms have separate numbering system
Section IX: Special Provision Options
2100

Special Provision Options

Administrative Review Manual Page 10

Overview of the Administrative Review Process
The Administrative Review is the SA assessment of the SFA’s administration of the NSLP, SBP, and
other school nutrition programs. The objectives of the Administrative Review are to:
•

Determine whether the SFA meets program requirements

•

Provide technical assistance

•

Secure any needed corrective action

•

Assess fiscal action and, when applicable, recover improperly paid funds

Review Frequency
SAs must conduct Administrative Reviews of all SFAs participating in the NSLP and/or SBP at least
once during each three-year review cycle, provided that each SFA is reviewed at least once every
four years. SAs have flexibility in scheduling reviews within the review cycle since FNS does not
require a yearly minimum number of Administrative Reviews. For each SA, the first three-year
review cycle was School Year (SY) 2013-2014 through SY 2015-2016. The second three-year review
cycle began SY 2016-2017 and will end with SY 2018-2019. FNS may, on an individual SFA basis,
approve written requests for one-year extensions to the three-year review cycle if FNS determines
the three-year cycle requirement conflicts with efficient SA management of the Program. (7 CFR
210.18(c))
Any SFA entering the NSLP and/or SBP at any point during the three-year review cycle must be
reviewed prior to the end of the review cycle. SAs are encouraged to conduct more frequent
Administrative Reviews of large SFAs and any SFAs that may benefit from a more frequent interval.
Note: SAs are required to notify FNS of scheduled Administrative Reviews, upon FNS request. (7 CFR
210.18(d)(1))

Administrative Review Manual Page 11

Scope of Review
General
The scope of the Administrative Review focuses on two primary review components: Critical Areas
of Review and General Areas of Review. The Critical Areas of Review are Performance Standard 1
and Performance Standard 2. Performance Standard 1 focuses on the certification and benefit
issuance process and the accuracy of meal counting and claiming. Performance Standard 2 focuses
on whether meals claimed for reimbursement meet meal pattern and nutritional quality
requirements. The General Areas of Review are Resource Management and other areas of general
program compliance. Resource Management addresses the Maintenance of the Nonprofit School
Food Service Account, Paid Lunch Equity, Revenue from Non-program Foods, and Indirect Costs.
General program compliance includes Civil Rights, SFA On-site Monitoring, Local School Wellness
Policy, Smart Snacks in School, Professional Standards, Water, Food Safety, Storage, and Buy
American, Reporting and Recordkeeping, and SBP and SFSP Outreach.
The Administrative Review Process is designed to allow the SA to conduct specified aspects of the
review off-site and other aspects on-site. SAs record information in the Off-site Assessment Tool by
collecting information available at the SA level or from the SFA. The SA may work with the SFA to
answer the questions when information is needed. The Off-site Assessment Tool allows the SA to
gain a better understanding of SFA operations prior to the on-site review, thus providing for a more
robust review while decreasing the SA’s on-site review time. The SA’s analysis of this information
informs the scope of the on-site portion of the Administrative Review. While SAs are encouraged to
conduct specified aspects of the review off-site, the SA may conduct any off-site portion of the
review on-site, at their discretion (with the exception of the Resource Management off-site review).
The SA’s on-site portion of the Administrative Review is intended to validate the information
collected on the Off-site Assessment Tool and provide an opportunity for the SA to observe the
operation of the school nutrition programs at the SFA and in selected schools. The SA documents its
findings on the On-site Assessment Tool. Additional space has been provided on the On-site
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Assessment Tool to record areas requiring technical assistance and/or corrective action identified
from the Off-site Assessment Tool. SAs are not required to document off-site findings in this
manner; however, FNS recommends that SAs utilize this space to record errors documented on the
Off-Site Assessment Tool in order to facilitate the completion of the Administrative Review Report.
Pre-visit Procedures and the Off-site Assessment
The first step in the Administrative Review process is to contact the Food Service Director and the
SFA’s Superintendent (or equivalent in a non-public SFA) or authorized representative and send a
confirmation/introductory letter. The letter must advise the SFA of the upcoming review.
Next the SA should complete the Off-site Assessment Tool prior to the on-site portion of the
Administrative Review. The completion of the Off-site Assessment Tool will require collaboration
with SFA staff and possibly other departments within the LEA. Some of the information collected on
the Off-site Assessment Tool can be obtained by reviewing the SFA’s annual update to the
permanent agreement, through calls to the SFA or other means. The data collected must be
current, i.e., collected during the year scheduled for review and reflective of the current school year
unless otherwise specified in this manual.
The Resource Management portion of the Off-site Assessment Tool must be completed prior to the
SA’s on-site or off-site Resource Management review. The SA is encouraged to provide and collect
information for the Off-site Assessment Tool from each SFA as far in advance of the SFA’s Resource
Management review as possible to learn if the SFA must receive a comprehensive review of any
Resource Management area. This helps to ensure that the SA is able to provide sufficient notice to
the SFA of the Resource Management documentation that the SA will need to review either on or
off-site. If the Resource Management Risk Indicator Tool is not completed off-site prior to the
review of Resource Management a comprehensive review of all four Resource Management areas
will take place.
For more information on pre-visit procedures, see Section I: Pre-visit Procedures.
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Site Selection Procedures
When selecting schools for the Administrative Review, the SA must use the procedures described in
Section I: Pre-visit Procedures under “Site Selection Procedures”. Site selection may occur prior to or
on the day of review.
On-site Review Procedures
Entrance Conference
FNS encourages SAs to begin the on-site portion of the Administrative Review by conducting an
entrance conference with the relevant SFA staff (e.g., Food Service Director, Business Manager, and
Superintendent). At the conference, the SA should discuss the results of the Off-site Assessment
Tool, explain what the SA covers during the on-site review, and inform the SFA of which schools it
will review. While conducting an entrance conference is not a requirement in program regulations,
a formal entrance conference helps establish the tone for the review — an important step, as the
Administrative Review process is intended to provide technical assistance balanced with an
assessment of program compliance.
Scope of the On-site Review
To fully evaluate the SFA’s compliance with all program requirements, all modules of the On-site
Assessment Tool must be completed. This includes an examination of:
•

The SFA’s free and reduced price certification — from certification to benefit issuance — to
ensure the SFA process complies with program requirements

•

The meal service — to ensure the school(s) and SFA procedures yield accurate meal counts
and Claims for Reimbursement, and to ensure the school’s meal service complies with
requirements

•

The General Areas — to ensure all other program areas comply with program requirements

Administrative Review Manual Page 14

Exit Conference
At the conclusion of the on-site portion of the Administrative Review, the SA must conduct an exit
conference to notify SFA staff of any program findings identified, the extent of the findings, and a
preliminary assessment of the actions needed to correct the findings. The SA must address
appropriate deadlines for completion of corrective action.
The exit conference is an opportunity to establish an agreed-upon Corrective Action Plan that
identifies the needed corrective action and the timeframes for those actions. The Corrective Action
Plan must identify:
•

Administrative Review finding(s)

•

The corrective action(s) required

•

The timeframe(s) by which the corrective action(s) must be completed

•

Any documentation the SA expects the SFA to provide to demonstrate corrective action was
completed

The SA should make every effort to provide the SFA with a summary of the noted compliance areas
to facilitate the immediate development of corrective action.
The SA may accept documented corrective action at the time of the Administrative Review or the
documented corrective action may be submitted as described below.
Administrative Review Report/Corrective Action Plan
Once the on-site portion and, if applicable, an off-site Resource Management portion of the review
is complete, the SA is responsible for incorporating all of the review results into an Administrative
Review Report. The SA must provide the Administrative Review Report to:
•

the SFA’s Superintendent (or equivalent in a non-public SFA) or authorized representative;
and

•

the Food Service Director.

Administrative Review Manual Page 15

The report must include the review findings, a Corrective Action Plan that summarizes the agreedupon corrective actions and associated timeframes for corrective action, and any potential fiscal
action.
The report must also include:
•

a statement indicating that the SFA may submit a written appeal of the denial of all or part of
a Claim for Reimbursement or withholding of payment, and

•

instructions on how to submit the written appeal, including any required timeframes of
which the SFA should be aware and the name and address of the office to which the SFA
must send the appeal.

The SA should issue the Administrative Review Report within 30 calendar days of the date the exit
conference was conducted. In rare situations, when an SFA is found to be significantly out of
compliance with multiple program areas and/or the SA or SFA runs into extenuating circumstances,
the report may take up to 60 calendar days.
The SA is responsible for ensuring that information regarding Administrative Reviews is made easily
accessible to all members of the public. SAs must publicly post a summary of the Administrative
Review Report for each SFA on the SA’s publicly available website. A summary of the report must
be posted no later than 30 days after the SA provides the final Administrative Review Report to the
SFA. The SA must also make a copy of the final Administrative Review Report available to the public
upon request.
Technical Assistance/Corrective Action
FNS requires that the SA provide SFAs with any needed technical assistance. The SA must document
thoroughly any technical assistance it provides to the SFA during the pre-visit phase as well as
during the off-site and on-site portions (as applicable) of the Administrative Review. This includes,

Administrative Review Manual Page 16

but is not limited to, any resources, policy clarifications, and formal or informal training provided to
the SFA and LEA.
The SFA must provide documentation of corrective action for any Administrative Review finding(s)
identified by the SA in the Corrective Action Plan. As mentioned above, documented corrective
action can be provided at the time of the Administrative Review; however, it must be postmarked or
submitted to the SA no later than 30 calendar days from the deadline for completion of each
required corrective action. In rare situations, the SA may approve extensions of timeframes if
corrective actions are expected to take longer or require follow-up with the SFA for more
information.
Upon receipt of the SFA’s documented corrective action, the SA should determine whether the
documentation is complete and resolves the finding(s) identified. Once the SA approves corrective
action, the SA should send a closure letter to the SFA closing the review within 30 calendar days of
receipt of the documented corrective action.
The exit conference, Corrective Action Plan, and documented corrective action are discussed further
in Section VII, Post-Review Procedures.
FNS does not require SAs to conduct follow-up reviews. However, SAs should consider conducting a
follow-up review if the SA determines further review/intervention is needed.
Timeframes Covered by the Review
The timeframe for the Administrative Review will encompass, at a minimum, the review period and
day of review as defined in this manual.

Administrative Review Manual Page 17

Review Period
The review period is the most recent month for which a Claim for Reimbursement was submitted,
provided that it covers at least ten (10) operating days. The Claim for Reimbursement is considered
submitted once it has been mailed or provided to the SA.
Day of Review
The day of review is the day(s) on which the on-site review of the individual sites selected for review
occurs.
Special Circumstances
•

Early in the School Year, Prior to Claim Submission
Subject to FNS approval, Administrative Reviews may be conducted early in the school year,
prior to the submission of a Claim for Reimbursement. However, the review period must be
the prior month of operation in the current school year and include at least ten (10)
operating days.

•

Multi-track Year-Round Schools
In multi-track year-round schools, SAs should make every effort to select the same track for
both the review period and the day of review.

•

Nutrient Analysis Outside of the Review Period
In some cases, a nutrient analysis may need to be conducted for a week outside the review
period. For example, a SFA may not have menu documentation for the weeks in the review
period.

•

Resource Management
The Resource Management risk assessment and comprehensive review assess financial
information from the most recently completed school year or last audited school year
(Resource Management (RM) review period). The State agency may choose to assess an
Administrative Review Manual Page 18

SFA’s financial data for the current school year when reviewing the Paid Lunch Equity and/or
Revenue from Nonprogram Foods. The State agency must indicate in each of the Resource
Management review forms which review period the SFA is monitoring for each of the
Resource Management review areas.
Follow-up Reviews
While the Administrative Review process does not require follow-up reviews, FNS strongly
encourages SAs to conduct a follow-up review when they find significant and/or repeated Critical or
General Area violations. If the SA conducts a follow-up review, the follow-up should occur as soon
as possible after the SFA provides documented corrective action, to validate the corrective action
and ensure prompt and permanent corrective action is taken.
Forms, Tools, Worksheets
FNS has developed forms, tools, and worksheets to facilitate the Administrative Review. SAs are
required to use the FNS-developed Administrative Review forms.
Should an SA decide to add State-specific questions to any of the forms, the SA must first obtain
approval from its respective FNS Regional Office.

Administrative Review Manual Page 19

Section I: Pre-visit Procedures

Administrative Review Manual Page 20

Intent/Scope of Monitoring
Preparing for an Administrative Review is an integral part of the overall review process, whether
selecting the correct number of schools to visit, examining Claims for Reimbursement, or scheduling
a time for an entrance conference.
Being prepared prior to the on-site visit allows SAs to use the time on-site more efficiently. This
section provides guidance and the procedures necessary for completing the pre-visit process.

Review Procedures
Pre-visit Review Procedures
The SA must review documentation available at the SA pertaining to the SFA receiving the
Administrative Review. The SA should use available information to complete the Off-site
Assessment Tool, including:
•

SFA agreement

•

Free and reduced price policy statement

•

Renewal applications

•

Claims for Reimbursement

•

Other miscellaneous reports (e.g., Verification Collection Report, (FNS-742) ), annual SFA
financial data collected by the SA, etc.)

•

Review findings from prior years, Corrective Action Plans, and documented corrective action,
as applicable

•

Audits

Determine the school(s) that will receive an Administrative Review using the site selection
procedures described under Site Selection Procedures (below). See the Resources Section for a
prototype site selection tool.

Administrative Review Manual Page 21

Obtain the names of the Food Service Director and the SFA’s Superintendent (or equivalent in a nonpublic SFA) or authorized representative, and send a confirmation/introductory letter notifying
them of the upcoming Administrative Review. The letter may include a checklist of documentation
that the SFA should prepare prior to the on-site visit.
Contact the SFA prior to the Administrative Review to:
•

Establish the terminology used by the SFA and school personnel (e.g., names of forms used
for local edit checks and claims consolidation)

•

Become familiar with procedures through discussion with the SFA on systems in place for
meal counting, recording, and reporting; claims consolidation; application processing;
verification; and benefit issuance. Obtain any information needed to complete the Off-site
Assessment Tool. FNS recommends that SAs begin the process of completing the Off-site
Assessment Tool at least 4-6 weeks prior to the on-site visit.

Site Selection Procedures
NSLP Site Selection Procedures
To determine the minimum number of schools subject to review, the SA must obtain data from the
SFA for all participating schools. This data must include:
•

the school name

•

type of school (elementary, combination, or secondary)

•

which LEA the school is a part of if multiple LEAs make up the SFA

•

the number of serving days

•

the number of students eligible for free meals in NSLP

•

the number of free meals claimed for a month in NSLP

While it is recommended that the selection occur prior to the first day of the on-site portion of the
review, SAs may complete site selection after the entrance conference. SAs may use the

Administrative Review Manual Page 22

Administrative Review Site Selection Worksheet Template found with the Administrative Review
Forms and Tools. This template is not required.
To determine the minimum number of schools to review for NSLP, use the table below. For
purposes of this manual, the term “reviewed schools” refers to the schools selected for review
based on these site selection procedures.
Number of Schools
in the SFA

Minimum Number
of Schools
to Review for NSLP
1 to 5 .................................................1

Number of Schools
in the SFA

Minimum Number
of Schools
to Review for NSLP
41 to 60............................................6

6 to 10................................................2

61 to 80............................................8

11 to 20..............................................3

81 to 100........................................10

21 to 40..............................................4

101 or More...................................12*

* 12 plus 5 percent of the number of schools over 100. Fractions must be rounded to the nearest whole
number using standard rounding procedures (i.e. if less than 5 round down, if 5 or more round up).

All schools with a free average daily participation (ADP) of 100 or more and a free participation
factor of 100 percent or more must be reviewed, with the exception of Residential Child Care
Institutions (RCCI) (without day students). For SFAs that consist of more than one LEA, the SA must
review at least one school from each LEA.
Selection of additional schools to meet the minimum number of schools to review must be based
on the following criteria:
•

Elementary schools with a free ADP of 100 or more and a free participation factor of 97
percent or more

•

Combination schools with a free ADP of 100 or more and a free participation factor of 87
percent or more

•

Secondary schools with a free ADP of 100 or more and a free participation factor of 77
percent or more

The following school information is needed to conduct school selection:
Administrative Review Manual Page 23

•

names and types of all schools in the SFA participating in the NSLP;

•

which LEA the school is a part of if multiple LEAs make up the SFA;

•

number of serving days for each school for the month selected;

•

highest number of free eligible for the month selected for each school; and

•

number of free lunches claimed for the month selected.

Calculate the Free Participation
Calculate the free ADP by dividing the number free claimed by the number of serving days. Round
the ADP to the nearest whole number, using standard rounding procedures (i.e. if less than 5 round
down, if 5 or more round up).
Calculate the percent free participation by dividing the free ADP by the highest number of free
eligible. Round to three (3) decimal places and multiply the result by 100.
Note: It is recommended that the information used in school selection be obtained for the month of
October; however, any month for which a Claim for Reimbursement has been filed and which best
represents each school's participation by free eligibles may be used. Record the month used for the
school selection.
When the number of schools selected using the criteria described above does not meet the required
number of schools to review or a school from each LEA is not selected, the SA must select additional
schools using SA criteria. The SA must document the reason(s) for selecting the schools for review.
SA criteria may include, in no prescribed order:
•

Low participation schools

•

High participation schools

•

Schools that have less than 100 free ADP but greater than 100 percent free participation

•

Recommendations from a food service director

•

Findings from the on-site visits or the claims review process

•

Any school in which the daily meal counts appear questionable
Administrative Review Manual Page 24

•

Identical or very similar claiming patterns (e.g., identical breakfast/lunch meal counts for
each day of the week)

•

Large changes in the free meal counts (e.g., a significant increase/decrease in the amount of
free meals reported without reason)

•

Schools with a new school food service manager

•

Manager or school never reviewed by SA

•

New or unusual accountability system

•

Proportional mix of the different counting systems employed by the SFA

•

Schools with a significant number of Office of Inspector General Hotline and/or parent
complaints

•

Schools with alternate points of service

•

Schools with a mix of age/grade groups (e.g., Pre-K-12 schools)

•

Schools participating in Fresh Fruit and Vegetable Program, The NSLP Afterschool Snack
Service, Seamless Summer Option, and Special Milk Program

Other Site Selection Criteria
SBP Site Selection Procedures
SAs must review the SBP at 50 percent of the schools that were selected for a NSLP review, with a
minimum of one (1) school receiving an SBP review. SBP review sites are based on the number of
schools selected for NSLP review operating the SBP. If 10 NSLP schools are selected for review and
all 10 operate SBP, then 5 SBP schools are required to be reviewed. If SBP is only in operation in 5
schools, then 3 would be required (round up). As long as a minimum of 1 school operates SBP from
the schools selected for review, no additional action is needed.
However, if none of the schools selected for review operates SBP then the SA has the discretion to
replace one of the non-SBP schools with a school that does operate SBP or select an additional SBP
school. If an additional school is selected, only SBP need be reviewed; no reviews of additional
programs are required.

Administrative Review Manual Page 25

Note: If the school selected for the targeted menu review (as described in Section III: Meal Pattern
and Nutritional Quality, Module, Dietary Specifications and Nutrient Analysis) operates the SBP, the
SA must also include that school as one of the schools selected for a SBP review. Using the Meal
Compliance Risk Assessment Tool, the SA must select the highest scoring site that participates in
both NSLP and SBP.
Special Provision Option with Standard Meal Counting and Claiming SFAs
Some SFAs have a combination of Special Provision Option sites and standard meal counting and
claiming sites. In these situations, if all of the sites selected for review are Special Provision Option
sites, the SA must replace at least one Special Provision Option site with a standard meal counting
and claiming site. If the SFA operates a combination of Special Provision Option sites and standard
meal counting and claiming sites, and only one site must be reviewed, the SA must conduct an
Administrative Review for the standard meal counting and claiming site. An abbreviated review will
still be required to be conducted at each type of Special Provision Option sites. See abbreviated
review procedures listed in Section IX Special Provision Options.
Certification for Performance-based Reimbursement During an Administrative Review
SAs may use Administrative Review activities to certify SFAs to receive the performance-based
reimbursement. SAs must select schools for review that represent all the menu types offered in the
SFA. Refer to Addendum: Certifying a School Food Authority for Performance-Based Reimbursement
During an Administrative Review.
Other Site Selection Procedures
Review requirements for Resource Management and other Federal Programs vary. A more detailed
site selection procedure for these areas is found in the corresponding modules under Section IV:
Resource Management and Section VI: Other Federal Program Reviews.

Administrative Review Manual Page 26

Section II: Meal Access and Reimbursement

Modules contained within this Section include:
• Certification and Benefit Issuance (including eligibility determinations
and the issuance of benefits)
• Verification
• Meal Counting and Claiming

Administrative Review Manual Page 27

Module: Certification and Benefit Issuance
Intent/Scope of Monitoring

Performance Standard 1
All free, reduced price, and paid

This Module covers the entire certification and benefit issuance
process. This activity typically occurs at the SFA (district) level, but

meals claimed for reimbursement
are served only to children eligible
for free, reduced price, and paid

may also occur at the school level or a combination of the two

meals, respectively, and are

levels.

counted, recorded, consolidated and
reported through a system that

The certification and benefit issuance process covers the SFA’s

consistently yields correct claims.

certification of a student’s eligibility for free or reduced price meals and the link to the SFA’s meal
counting and claiming system. The SA’s examination of certification and benefit issuance is essential
to ensure eligible children receive meals to which they are entitled, and that Claims for
Reimbursement are valid.
Certification and benefit issuance is a Critical Area of the Administrative Review and falls under
Performance Standard 1. For further information on the certification process, refer to the Eligibility
Manual for School Meals.

Review Procedures
Pre-visit Review Procedures
The Off-site Assessment Tool should be completed prior to the on-site portion of the review to
inform the SA about the SFA’s certification and benefit issuance procedures.
Off-site Assessment Tool
Administrative Review Manual Page 28

The Off-site Assessment Tool includes a series of questions related to certification and benefit
issuance. Questions 100-121 address the SFA’s procedures regarding: eligibility determinations
based on household applications, eligibility determinations specific to direct certification, and
benefit issuance.
Supporting Documentation
Benefit issuance documents, including rosters or master lists; lists to distribute tickets, tokens, or
student identification cards; and any other medium that is used by the school to identify the
eligibility categories of students.
Analysis of Off-site Assessment Tool and Supporting Documentation
The SA must review the information in the Off-site Assessment Tool and supporting documentation
to evaluate the SFA’s risk for noncompliance with certification and benefit issuance requirements.
This includes ensuring that the information provided mirrors the SFA’s current free and reduced
price policy statement.
Note: The scope of monitoring may also require the SA to assess how unit(s) of the LEA, beyond the
school food service, implement their certification and benefit issuance responsibilities, as applicable.
If the SA determines the information contained in the Off-site Assessment Tool adequately
summarizes the SFA’s certification and benefit issuance process, the SA may conduct portions of the
review off-site. For example, if the SFA can provide supporting materials, the SA may choose to
examine the accuracy of the certification document (e.g., application, direct certification, or other
categorical eligibility determinations) and the transfer of benefits to the point-of-service benefit
issuance document(s) off-site. The SA should not remove original supporting documents from the
SFA; however, photocopies are permissible.
In the steps below, any items not completed off-site must be completed during the on-site portion
of the Administrative Review.
Administrative Review Manual Page 29

Step 1: Obtaining the Benefit Issuance Document
The SA must obtain the benefit issuance document(s) for each school under the jurisdiction of the
SFA, not just the selected schools for the Administrative Review. The list of students may be from
any day during the review period or the first day of the on-site review (if the SA elects to conduct
this portion on-site). If the SFA utilizes an electronic certification and benefit issuance system, the
SA should also notify the SFA that the SA will need access to all applications and certification
documents for all schools within the SFA during the Administrative Review.
The benefit issuance document must:
•

Contain the name and benefit status for all students certified as free or reduced price in the
SFA.

•

Be generated from the point-of-service system used in each of the schools. For schools that
use different points-of-service at breakfast and lunch, it is NOT necessary to send duplicative
lists (from both meal services). Point-of-service benefit issuance documents are those
documents directly used in the meal count system to deliver the benefits to children (e.g.,
rosters, master lists).

•

Not have duplicate names on the list — each certified student should only be listed one time.
Note: This does not alleviate SA responsibility for assessing the SFA’s procedures for
managing transfers and mid-year changes in eligibility status.

To facilitate completing the Administrative Review forms, the benefit issuance document (or other
documentation) should:
•

Include the following:
•

school name;

•

method of certification (application, direct certification, other);

•

signature or initial of determining official and date of certification; and

•

total number of students certified for free or reduced price meals in the SFA.
Administrative Review Manual Page 30

•

Not group students by benefit status. The student names may be listed in any order (e.g.,
alphabetically, by building, by ID number), but it is preferable that they are not grouped by
benefit status.

The determining official must sign (or initial) and date each application, or sign (or initial) and date a
cover sheet attached to a batch of applications. Recording this information will depend on the LEA’s
application method:
•

The FNS prototype application may be modified to collect this information, or it can be
recorded in the margins on a separate piece of paper attached to the application.

•

A notation for the date of approval can be made to an electronic file.

•

A computer system can capture the original date of approval, the basis for the determination
(the household size and income used), and update the status of applications to account for
transfers, withdrawals, benefit terminations, and other changes.

If one benefit issuance document is maintained at the SFA with the names of students certified for
free or reduced price benefits, and a second benefit issuance document is used at the point-ofservice to check names of students receiving meals, the SA must use the point-of-service benefit
issuance document. In instances in which the benefit issuance document(s) is maintained
separately for different groups of students (e.g., kindergarten students are listed on a classroom
roster and the remaining grades are listed on a master list maintained by the cashier), both the
classroom and master lists must be used.
The benefit issuance document(s) may be from the day of review or a day during the review period.
Step 2: Selecting Student Certifications for Review
From the point-of-service benefit issuance document(s), the SA must select the names of students
certified for free and reduced price meals for review. The SA may elect to review either:

Administrative Review Manual Page 31

•

All students certified for free and reduced price meals on the point-of-service benefit
issuance documents for all schools in the SFA; or

•

A statistically valid sample of all students certified for free and reduced price meals on the
point-of-service benefit issuance document for all schools in the SFA.

Note: Denied applications are reviewed in Step 5 of the On-site Review Procedures below.
If the SA chooses to review a statistically valid sample of students, the SA must follow the
methodology outlined below in Statistically Valid Sampling. Under this methodology, SAs select a
statistically valid sample of students certified for free and reduced price meals from the point-ofservice benefit issuance documents for all schools in the SFA. FNS encourages the SA to use a
statistically valid sample as it will result in reviewing fewer students’ certification and benefit
issuance documents, and, if properly selected, the review will yield results representative of the
certification and benefit issuance activity in the SFA.
Statistically Valid Sampling
Statistical sampling provides valid results only when the universe sampled is large and the sample is
obtained using valid procedures. For this reason, SAs may not use statistical sampling in SFAs with
100 or fewer students certified for free or reduced price meal benefits. In these situations, the SA
must review every student’s certification and benefit issuance documentation within the SFA.
The Sample Size Chart found in the following pages provides two sets of confidence levels. The
first set of numbers provides the sample size needed for a confidence level of 95 percent. The
second set of numbers provides the sample size needed for a 99 percent confidence level.
The sample producing a 99 percent confidence level must be used if:
•

the SFA uses a manual certification and benefit issuance system,

•

the SFA uses a combination of a manual and electronic certification and benefit issuance
system, or
Administrative Review Manual Page 32

•

the SA identified potential areas of systemic errors of noncompliance based on the SFA’s
responses to the benefit issuance portion of the Off-site Assessment Tool (e.g., the system
is using the wrong income eligibility guidelines).

If the SFA entirely utilizes an electronic benefit issuance and certification system and the SA did
not identify any potential areas of systemic errors of noncompliance based on the SFA’s responses
to the benefit issuance portion of the Off-site Assessment Tool, the SA may select a sample based
on either a 99 percent or 95 percent confidence level of accuracy.
•

An electronic certification and benefit issuance system means that the certification of
benefits (i.e., household application or direct certification) and the transfer of a student’s
benefits to the point-of-service document(s) are completed through a computerized system.
For example, the household applications are certified through a web-based or scanned
approval system and all direct certification matches are completed by the SFA with a
computer match. An electronic system is limited to virtually no manual data entry by the
SFA. However, updates to benefits may be made manually in the electronic system.
Certification documents (i.e., household application or direct certification) and benefit
issuance document(s) are kept electronically.

•

A manual certification and benefit issuance system means that the certification of benefits
(i.e., household application or direct certification) and the transfer of a student’s benefits to
the point-of-service document(s) are completed manually by the SFA. For example, the SFA
completes the certification of benefits by manually approving the household application or
direct certification matches and enters the data into their system manually. Written records
of the certification documents (i.e., household application or direct certification) and benefit
issuance document(s) are kept on file.

•

A combination certification and benefit issuance system means some aspect of the SFA’s
certification of benefits (i.e., household application or direct certification) or the transfer of a
student’s benefits to the point-of-service document(s) is not entirely completed
Administrative Review Manual Page 33

electronically or manually. For example, the SFA accepts household applications via an
electronic system but also accepts paper applications that must be certified manually or, as
another example, the SFA enters the information submitted by the household on a paper
application into the SFA’s electronic system for certification.

Sample Size Chart
Total # of students
certified for free or
reduced price benefits

SAMPLE SIZE

SAMPLE SIZE

Total # of students
certified for free or
reduced price benefits

95%

99%

95%

99%

All

All

1251-1500

300

450

101-250

60%

75%

1501-1750

310

475

251-500

50%

60%

1751-2000

320

490

501-750

40%

50%

2001-3000

335

525

751-1000

270

380

3001-4000

350

560

1001-1250

290

420

4001-5000

355

580

5000+

360

590

1-100

SAs may select the sample using statistical sampling software. Sampling software is practical when
SFAs have the capability of importing the names of students from the point-of-service benefit
issuance document to the SA in a format specified by the SA.
Using Sampling Software
If the SA elects to use sampling software, the SA format should reflect the following parameters:
•

One consolidated list of all students certified for free and reduced price meals at all
schools within the SFA;

•

Student names may be provided in any order (e.g., alphabetically, by student number, or
by school), but there can be no duplication of students on the list for any reason;

•

School name should be a field next to the student name within the spreadsheet (to help
identify/locate certification documentation for the selected students);

•

No headers separating schools or benefit category (no headings at all other than first line).
Administrative Review Manual Page 34

Manually Selecting the Sample
FNS has developed a Statistical Sample Generator that allows the SA to input the total number of
students certified for free or reduced price meals. The Generator will automatically calculate the
sample size, the sample interval, and the random starting point for each of two sets of confidence
levels (95% and 99%).
SAs may calculate the sample size, the sample interval, and the random starting point manually
following the instructions below. Using the Sample Size Chart (above) and the following
procedures:
A. Total # of students
certified for benefits
(Universe)

B. Sample Size
(from table above)

C. Sample Interval
(A / B)

D. Random Starting Point
(First Student)

A. Enter the total number of students approved for free or reduced price meal benefits from the
point-of-service benefit issuance document in Column A. This is the combined total for all free
and reduced price eligible students at all schools within the SFA.
B. Use the instructions and Sample Size Chart (above) to determine the sample size that must be
obtained and record in Column B.
C. Divide A by B to determine the sampling interval (C). For determining your sampling interval,
round all fractions down to the nearest whole number (e.g., 3.99 = 3), except when less than 1,
then round up to 1. This procedure does not follow standard rounding procedures and is used
to ensure that the appropriate number of students will be selected.
D. Denote the random starting point the SA will use when beginning the selection of students from
the point-of-service benefit issuance document(s).

Administrative Review Manual Page 35

A manual approach to identifying a random starting point follows:
1. Write down, on pieces of paper, the numbers in the sample interval (Column C above),
beginning with the number one (1).
2. Put the pieces of paper in a container and mix the container.
3. Select one piece of paper; the number on the paper represents the random starting point.
Record the selected number in Column D of the chart above.
4. Use the sample interval from Column C above and select subsequent students.
o For example: If the start point (or Column D) is five and the interval (or Column C) is
ten,, begin with the fifth student from the point-of-service benefit issuance document
for students certified for free and reduced price meals. Select.S subsequent students
at intervals of ten, for example: 5, 15, 25, 35, etc.
5. Once all of the students have been selected, compare the number of students selected to
the appropriate sample size using the Sample Size Chart (above or Column B) to ensure the
required number of students was selected in the sample.
Step 3: Obtaining Certification Documents
Once the names of the students subject to review have been identified, the SA must obtain the
following documents from the SFA for each student under review:
•

The certification document (i.e., household application or direct certification) to determine
whether or not the document was correctly certified; and

•

Any verification conducted for the selected student, if applicable, including whether or not
the verification was properly conducted.

The SA will use this documentation to complete the On-site Review Procedures described in Step
2 below.

Administrative Review Manual Page 36

On-site Review Procedures
The on-site portion of the Administrative Review consists of the SA conducting interviews with SFA
staff, reviewing certification and verification documents, and determining whether the SFA is in
compliance with all certification and benefit issuance requirements.
On-site Assessment Tool
The On-site Assessment Tool includes questions pertinent to this Module; see Questions 124-142
(Certification and Benefit Issuance).
On-site Procedures
The SA must follow the steps below:
Step 1: Validating the SFA’s Procedures using the Off-site Assessment Tool
The SA must determine whether the information in the Off-site Assessment Tool is current and
accurately represents the SFA’s practices for issuing benefits. The SA must also determine whether
the SFA-provided information is satisfactory and reflects current practice.
To assess the SFA’s procedures for processing applications, the SA must ensure the SFA is in
compliance with 7 CFR 245.6(a). Areas of review include, but are not limited to: the use of proper
income conversion factors and income guidelines; the carryover of prior year eligibility; compliance
with required timeframes for household notification(s); and compliance with the independent
review of applications, if applicable.
To assess the SFA’s procedures for direct certification, the SA must ensure the SFA is in compliance
with 7 CFR 245.6(b). Areas of review include, but are not limited to: whether the direct certification
list came from the appropriate agency and contained all required elements; and whether direct
certification was performed the appropriate number of times.

Administrative Review Manual Page 37

Additional information on household applications and direct certification is found in the Eligibility
Manual for School Meals.
Step 2: Validating Student Certifications
Household Applications
For each student selected for review, the SA must examine the following:
•

The eligibility determination (by reviewing the free and reduced price application), or other
categorical eligibility determinations to ensure the SFA certification was completed properly.

•

•

If annual income is reported on the household application, that the SFA has contacted the
household to ensure the reporting of annual income is consistent with the Special Situations
listed in the Eligibility Manual for School Meals.
Documentation to establish whether households were notified of benefit eligibility, in
accordance with regulatory timeframes.

•

Any verification activity related to the selected student to ensure the verification was
properly conducted and any changes in the eligibility status were properly made.
Note: The SA should make note of any student verified since this student verification may
count towards the sample of verified applications required under the Module: Verification.

•

Documentation to establish whether households were notified of changes in eligibility status
due to verification within required timeframes.

All errors relating to the students selected for review are recorded on the Eligibility Certification and
Benefit Issuance Error Worksheet, Form SFA-1. Any other students listed on an erroneous household
application should be listed on the SFA-2, Other Eligibility Certification and Benefit Issuance Errors
Worksheet. These errors include:
•

Errors Due to Missing Information on Free and Reduced Price Applications — Missing:


Signature of an adult household member



Last four digits of a required social security number (Note: Applications that indicate
Administrative Review Manual Page 38

“none” for the adult household member are not considered an error)


Names of all household members, including children who are requesting benefits



SNAP, TANF, or FDPIR case number for each child, as applicable.
Note: Effective SY 2015-2016, applications must still request that applicants write a zero
when there is no income to report, but failure of an applicant to indicate no income will
no longer be considered missing information on free and reduced price applications.
Applications must include a clear and easy to understand instruction that communicates
to applicants that any income field left blank is a positive indication of no income and
certifies that there is no income to report. As such, applications with blank income fields
should be processed by the school district as complete as long as required information is
provided on the application. However, should local officials have known or available
information that the household has intentionally misreported its income, they must
verify any such application for cause.

•

Errors Due to Verification — the SFA incorrectly changed eligibility status as a result of
verification.

Direct Certifications
For each student reviewed, the SA must ensure the student is on the direct certification list. Direct
certification errors are recorded on the Eligibility Certification and Benefit Issuance Error Worksheet,
Form SFA-1.
Step 3: Recording Eligibility Status
For each student reviewed and found to be in error, the SA must record the student’s correct
eligibility status. The correct eligibility status is recorded on the Eligibility Certification and Benefit
Issuance Error Worksheet, Form SFA-1. In addition, the SA will record both the SFA count of
Administrative Review Manual Page 39

reviewed students and the SA count of reviewed students on the SFA-1.
Note: Reviewed students are students selected for review. An example: the SA selected a sample of
450 student certifications for review. The SFA’s determinations for those 450 students were 377
free and 73 reduced price eligible. The SA’s validated determinations of the sample of students
were 371 free and 72 reduced price eligible. The reviewer will enter the results of the certification
and benefit issuance review on the SFA-1 and then transfer the totals to the SFA-3 Sections 4D and 4
E. These are the numbers that will be entered into the Fiscal Action Workbook.
Step 4: Validating the Benefit Issuance Document
For each student selected for review, the SA must validate the point-of-service benefit issuance
document to ensure the student’s eligibility was properly transferred and updated, if needed, to the
document.
•

Errors Resulting from Benefit Issuance — Applications that contain all required information,
but have been approved for the wrong benefit level on the benefit issuance document, are
benefit issuance errors. For example:


Student incorrectly listed on the benefit issuance document; or



Student on the benefit issuance document without a current application or direct
certification documentation on file.

•

Benefit issuance errors can lead to:


Meals claimed as free that should be claimed at the reduced price



Meals claimed as free that should be paid



Meals claimed as reduced price that should be claimed free



Meals claimed as reduced price that should be paid



Meals claimed as paid that should be free or reduced price

All errors relating to the students selected for review are recorded on the Eligibility Certification and
Benefit Issuance Error Worksheet, Form SFA-1. Any other students listed on an erroneous household
Administrative Review Manual Page 40

application should be listed on the SFA-2, Other Eligibility Certification and Benefit Issuance Errors
Worksheet.
SAs must also determine whether free and reduced price benefits are provided to students in a
manner that assures confidentiality and prevents overt identification during meal service or at any
other time, in accordance with FNS Memorandum SP 45-2012, Preventing Overt Identification of
Children Certified for Free or Reduced Price School Meals, (see FNS PartnerWeb for the most up to
date policy memorandums). Any problems should be recorded in the comment section for Question
136 on the On-site Assessment Tool.
Step 5: Reviewing Denied Applications
The SA must review at least 10 denied applications on file for all schools under the SFA. If there are
10 or less denied applications on file the SA must review all denied applications.
The SA must determine whether denied households were notified of:
•

Reason for denial of benefits

•

Right to appeal

•

Instructions on how to appeal

•

Instructions on how to re-apply for free and reduced price benefits at any time during the
school year

Denied applications found to be denied incorrectly must be recorded on Other Eligibility
Certification and Benefit Issuance Errors Worksheet, SFA-2. These errors will not be included when
calculating fiscal action. If 20 percent or more of the reviewed denied applications are denied
incorrectly, as part of the required corrective action, the SFA must re-examine their initial
determination of ALL denied applications. The results of the re-examination must be provided to
the SA in the SFA’s response of documented corrective action. For any benefit issuance changes in
the SFA’s re-examination of denied applications, the SFA — by the deadline in the Corrective Action
Plan — must provide the SA:
Administrative Review Manual Page 41

•

the student’s name;

•

the updated benefit issuance category (i.e., free, reduced price); and

•

the date corrective action was applied.

Step 6: Independent Review of Applications
All errors relating to the students selected for review are recorded on the Eligibility Certification and
Benefit Issuance Error Worksheet, Form SFA-1. The SA will record the total number of reviewed
students in error and the total number of reviewed students in Block C of the SFA-1. The SA will
then divide the number of reviewed students in error by the total number of reviewed students.
The number is then multiplied by 100 to determine the percentage of students in error. If the SFA’s
percentage in error is 10% or more; the SFA will be required to conduct an Independent Review of
Applications during the subsequent school year.
Special Considerations
Under certain circumstances, the SA may follow a different review process for this Module than is
detailed above. These variations include:
•

Residential Child Care Institutions (RCCIs)
Depending on the circumstances, an RCCI may have children residing or not residing at their
institution.
For children residing in RCCIs, the institution may document the children’s eligibility using
free and reduced price applications or by completing an eligibility documentation sheet for
all children residing in the RCCI. The SA must examine the RCCI’s documentation sheet or
other certification documentation (e.g., household application). If a documentation sheet is
used, it must include information indicating the child’s name and personal income received
by the child, the child’s date of birth, date of admission, and date of release. The
documentation sheet must be signed by an appropriate official and provide the official’s title
and contact information.
Administrative Review Manual Page 42

Children attending but not residing (i.e., day students) in an RCCI are considered members of
their household and their eligibility is determined using a household application or through
direct certification. For RCCIs with day students, the SA must follow the review process for
this Module. Refer to the Eligibility Manual for School Meals for more information.
•

Provision 1, Provision 2, Provision 3, and the Community Eligibility Provision
SAs must follow the Administrative Review procedures specified in Section IX when
reviewing SFAs with Provision 1, 2, or 3 schools that are establishing their base year.
Additional procedures are required when reviewing Provisions 1, 2, and 3 in their non-base
years and when reviewing schools participating in the Community Eligibility Provision. Refer
to Section IX, Special Provision Options for more information.

Technical Assistance/Corrective Action
The SA must require corrective action and provide technical assistance for all benefit issuance areas
resulting in errors, as described above. Corrective action must be applied system-wide for benefit
issuance and certification errors, including at non-reviewed schools, if applicable.
The SA should discuss the SFA’s annual training, provide the SFA with examples of different benefit
issuance methods and point-of-service systems, and work with the SFA to set up a system to track
changes on the benefit issuance document(s), as appropriate.
When the SFA has not properly followed up on the reporting of annual income on household
applications, the SA must require the SFA to contact the household and ensure the reporting of
annual income is consistent with the Special Situations listed in the Eligibility Manual for School
Meals. If the follow-up results in the household having no change to the benefit issuance
determination these errors will not be recorded on the SFA-1 or SFA-2 and no fiscal action is
Administrative Review Manual Page 43

required. However, if the follow-up results in a reduction in benefits for either the reviewed
student or other household members, the reviewed student would be recorded on the SFA-1 and
any other household member would be recorded on the SFA-2.
Any technical assistance provided to the SFA must be documented in the comments section of the
On-site Assessment Tool.

Fiscal Action
Fiscal action is taken for errors resulting from the following:
•Applications with missing information as these applications are considered incomplete. This
does not include applications that do not report zero income (either with a “0” or checked
the “no income” box).*
•

Miscategorized certifications

•

Benefit issuance errors

•

Failure to update a change in status resulting from verification

* Effective SY 2015-2016, applications must still request that applicants write a zero when there is
no income to report, but failure of an applicant to indicate no income will no longer be considered
missing information on free and reduced price applications.
Applications must include a clear and easy to understand instruction that communicates to
applicants that any income field left blank is a positive indication of no income and certifies that
there is no income to report. As such, applications with blank income fields should be processed by
the school district as complete as long as required information is provided on the application.
However, should local officials have known or available information that the household has
intentionally misreported its income, they must verify any such application for cause.
In the case of applications missing the last four digits of the Social Security number (or an indication
there is “none”) or missing the signature of an adult household member, the SA is not required to
Administrative Review Manual Page 44

take fiscal action if corrective action occurs within the specified timeframe. If these types of errors
are not corrected within the specified timeframe, then the SA must take fiscal action for those
errors.
Consistent with 7 CFR 210.18(l)(1) fiscal action, when part of corrective action, is applied SFA-wide.
This is because the certification and benefit issuance review assesses compliance at the SFA level
and not just at the reviewed schools. This ensures program integrity by assessing fiscal action for
certification errors at all sites, as well as for systemic errors within the entire SFA. The memorandum
Additional Guidance for the Implementation of the Administrative Reviews in School Nutrition
Programs Final Rule (SP 56-2016) outlines the different ways that the State agencies can use the
Administrative Review Fiscal Action Workbook to assess fiscal action SFA-wide. FNS has allowed
State agencies flexibility in their approach to system-wide fiscal action. Information related to fiscal
action and the flexibility offered is found in Section VIII, Fiscal Action, of this manual.
The Eligibility Certification and Benefit Issuance Error Worksheet, Form SFA-1 captures the errors
and identifies the correct eligibility status for each reviewed student. Any other students listed on
an erroneous household application should be listed on the SFA-2, Other Eligibility Certification and
Benefit Issuance Errors Worksheet.
Information related to fiscal action is found in Section VIII, Fiscal Action, of this manual.
Base Year Review of Special Provision 2 and 3:
SAs are required to conduct a base year certification and benefit issuance documentation review for
any SFA that is requesting approval to participate in the NSLP or SBP using Provision 2 or 3, or for
any sites that do not have documentation showing that a SA reviewed base year certification
documents prior to SYSY2013-2014. If the SFA is scheduled for an Administrative Review during that
year the SA must use the Administrative Review to ensure the accuracy of the base year
certifications.

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Since base year claims form the basis of subsequent year claiming, it is essential that base year
certifications, meal counts, and funding levels are accurate.
When conducting a base year review of a site, any errors to the original base year percentages or
funding levels for free, reduced price, and paid reimbursements, must be corrected. ). Any
corrections to the Free, Reduced, and/or Paid percentages/funding levels are required to be applied
to all closed Claims for Reimbursement going back to the beginning of the school year. While the
base year review may be conducted in conjunction with the Administrative Review, the base year
review corrects previous SFA/site meal counts. The $600 disregard does not apply to closed claims
for sites in the base year when fiscal action is required to fix the meal counts.
When the base year review does not occur in the year that the base year claiming percentages or
funding levels are established and errors are identified, the SA should work with its FNS Regional
Office to determine how to proceed with fiscal action. After the base year review, the SFA uses the
corrected certifications and benefit issuance information in order to determine Claims for
Reimbursement in future months.
Information related to Base Year Review of Special Provision 2 and 3 fiscal action is found in Section
VIII, Fiscal Action, of this manual.

Administrative Review Manual Page 46

Module: Verification
Intent/Scope of Monitoring

Verification is a process used by SFAs to confirm selected students’ eligibility for free and
reduced price meals in the NSLP and SBP. Verification is only required for a sample of students
whose eligibility is certified using a household application submitted with income information
or a case number for the Supplemental Nutrition Assistance Program (SNAP), Food Distribution
Program on Indian Reservations (FDPIR), or Temporary Assistance for Needy Families (TANF).
Students certified for free meal benefits via direct certification through documented
participation in an eligible Assistance Program or through a documented Other Source
Categorical Eligibility designation are not subject to verification.
The goal of this Module is to ensure the SFA properly implements the verification process as
part of the free and reduced price eligibility requirements. The SA must determine if the SFA is
implementing the verification process in accordance with Federal regulations (7 CFR 245.6a).
This Module is considered a General Area of Review. However, the scope of review is closely
aligned with benefit issuance and, for this reason, is included in the scope of review for Section
II, Meal Access and Reimbursement.

Review Procedures
Pre-visit Review Procedures
The Verification section of the Off-site Assessment Tool is completed prior to the on-site portion
of the Administrative Review. The information from the Off-site Assessment Tool will assist the
SA in identifying the SFA’s verification process, as well as identifying any potential areas of
Administrative Review Manual Page 47

noncompliance or technical assistance needs in advance of the on-site portion of the
Administrative Review.
Off-site Assessment Tool
The Off-site Assessment Tool has a series of questions related to verification. Questions 200204 explore whether the SFA met all verification requirements, e.g., the SFA’s submission of the
Verification Collection Report (FNS-742), and/or notification of verification procedures.
Note: Verification materials must be at the SFA’s central office for the on-site portion of the
review for further examination of the materials.
Analysis of Off-site Assessment Tool
The SA must examine the Off-site Assessment Tool to ensure that the SFA is conducting
verification in line with requirements outlined in 7 CFR 245.6a. The Off-site Assessment Tool
provides a complete overview of the SFA’s verification process, and the SA should be able to
conclude that the SFA:
•

Selected the correct verification sample size

•

Conducted verification appropriately (including verification for cause, if applicable)

•

Completed the Verification Collection Report (FNS-742) correctly and in a timely manner

•

Appropriately identified a verification official and confirming official, if applicable

•

Meets FNS regulatory requirements

•

If applicable, has an electronic system that accurately pulls the correct verification
sample size and application type

On-site Review Procedures
The on-site portion of the Administrative Review consists of the SA interviewing SFA staff and
determining whether the SFA is in compliance with all verification requirements. It is essential
that, through observation and interviews with SFA staff, the SA is able to validate the
information gathered in the Off-site Assessment Tool.
Administrative Review Manual Page 48

On-site Assessment Tool
The On-site Assessment Tool includes Questions 207-215, which focus on the SFA’s Verification
Collection Report (FNS-742) data submission and the SFA’s verification procedures, including
confirmation reviews, notification requirements, and procedures to effect changes to eligibility
status.
On-site Procedures
The SA must follow the steps below:
Step 1: Validating the Off-site Assessment Tool
The SA must validate the information on the Off-site Assessment Tool, confirming the
information is still current and represents the SFA’s practices for verification according to
regulations. The SA also must determine the SFA-provided information is satisfactory. If the SA
chooses not to complete the Off-site Assessment Tool prior to the on-site portion of the
Administrative Review, the SA must obtain the information from the SFA while on-site.
Step 2: Determining Compliance with Verification Requirements
The SA must request that the SFA gather all verified applications for the current school year
into one central location for review by the SA. If the SFA has an electronic system for collecting
verification, the SA must obtain either access to the system or printed copies of all verification
materials.
Based on the information compiled during the Off-site Assessment Tool and interviews with the
appropriate staff, the SA must confirm whether the SFA:
• Verified the same number of applications as reported on the most recent Verification
Collection Report (FNS-742), as confirmed on-site
• Verified the required number of free and reduced price applications, i.e., 3% or 1.5% of
the approved applications on file as of October 1 annually, as required by 7 CFR 245.6a
Administrative Review Manual Page 49

• Selected the correct number of applications based on the calculated sample size
• Replaced no more than five (5) percent of the applications selected and confirmed for
verification based on knowledge that the household would be unable to satisfactorily
respond to the verification request
The verification process has specific required timeframes that must be followed by the SFA in
order to be in compliance with FNS regulations. The verification timeframes may require the SA
to review the previous school year’s verification materials in order to assess the SFA’s
verification process for the Administrative Review. For example, if a SA chooses to conduct an
Administrative Review during the month of October, the SFA’s verification process will not yet
be complete for the current school year and the SA must review the previous school year’s
verification process.
Below is a chart that provides details on how the SA must review verification if the verification
process is either not complete or partially complete at the time of the Administrative Review.
Review is Scheduled For…
(All timeframes should be adjusted to State
timelines and reporting requirements)
A timeframe prior to the completion of
verification and the submission of the Verification
Collection Report (FNS 742) for the current school
year.

How to Complete Verification Review

A timeframe that falls before the Verification
Collection Report (FNS 742) for the current school
year has been submitted to the SASA but after
verification has been completed by the SFA.

•

•
•
•

•

•

A timeframe after the current school year
Verification Collection Report (FNS 742) has been
submitted.

•
•

Use previous year’s Verification Collection Report (FNS
742)
Use previous year’s verified applications.
Verified students selected in the Benefit Issuance sample
will not count toward the verification review requirements
(i.e., 10% sample of verified applications).
Use previous year’s Verification Collection Report (FNS
742)
Count verified applications from previous school year to
validate previous year’s Verification Collection Report (FNS
742).
Use current year verified applications for review. Verified
students selected in the Benefit Issuance sample can count
toward the verification review requirements. (i.e., 10%
sample of verified applications).
Use current school year’s Verification Collection Report
(FNS 742) (i.e., 10% sample of verified applications).
Use current year verified applications for review. Verified
students selected in the Benefit Issuance sample can count
toward the verification review requirements (i.e., 10%
sample of verified applications).

Step 3: Selecting Verified Applications for Additional Evaluation

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The SA must randomly select 10 percent of the verified applications. This sample of verified
applications must be examined to ensure that the entire verification process was completed
according to FNS requirements.
In order to select a sample of 10 percent of verified applications, the SA must use the following
guidelines:
•

If the total number of verified applications on file at the SFA is fewer than 3 applications,
then the SA must review ALL available verified applications.
•

For example, if the SFA has 2 applications on file, the SFA must review both
verified applications.

•

A minimum of 3 verified applications must be reviewed, so if the total number of
verified applications is 30 or less, the SA must select 3 applications to review.
•

For example, if the SFA has a total of 5 verified applications, the SA must select 3
verified applications.

•

In order for the SA not to spend an inordinate amount of time reviewing verification, a
maximum of 30 verified applications will be reviewed. So, if the total number of verified
applications exceeds 300, the SA will select 30 verified applications to review.

•

For example, if the SFA has a total of 350 verified applications, the SA would select 30
verified applications to review, not the full 10% (or 35) of verified applications.

The SA must use the chart below to determine the appropriate number of verified applications
to select for review at the SFA:

1-2

Number of Verified Applications
on File at the SFA:

All

Number of Verified Applications
Required for Review*

3-30

3 applications

31-300

10% of applications

301 or more

30 applications

*Use standard rounding procedures to the nearest whole number (i.e. less than 5 round
down, more than 5 round up) to determine the required number of verified applications
to review.

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Using the selected verified applications, the SA must verify compliance with the following:
•

Did the SFA appropriately conduct confirmation reviews or does the SFA have a
software program appropriate for fulfilling this requirement?

•

Did the SFA’s verification notification letter meet all Federal requirements?

•

Did the SFA appropriately attempt to follow-up with unresponsive households selected
for verification?

•

Did the SFA’s notice of adverse action contain all required information?

•

Were changes in eligibility status due to verification made within prescribed
timeframes?

•

Did the SFA complete the verification process by November 15 or request and receive
an extension until December 15 from the SA?

•

Were applications selected for verification verified correctly, and was the resulting
eligibility status determined accurately?

If the SA determines that the SFA accurately completed the verification process, the verification
portion of the review is complete. If the SA finds errors, the SA must provide technical
assistance and require corrective action for those findings. If the SA finds errors in the
verification sample and cannot be sure that eligibility determinations were made appropriately,
the SA may choose to expand the sample of verified applications.
Note: If the sample of students selected for review from the Module: Certification and Benefit
Issuance contains a student(s) with a verified household application on file, the review of the
verified application will contribute toward the 10 percent sample of verified applications under
this Module. Refer to the Module: Certification and Benefit Issuance for more information.
Step 4: Recording Findings
All review findings are recorded on Questions 207-215 of the On-site Assessment Tool and the
Other Eligibility Certification and Benefit Issuance Errors Worksheet, SFA-2.
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Note: Do not record errors for students who were selected for verification review under
Module: Certification and Benefit Issuance on the SFA-2. These errors must be recorded on the
Eligibility Certification and Benefit Issuance Error Worksheet, Form SFA-1.

Technical Assistance/Corrective Action
SAs must require corrective action and provide technical assistance for areas of verification
resulting in errors.
Identified errors related to issues in the SFA’s verification process cited during the pre-visit or
on-site portions of the Administrative Review will require the SFA to take corrective action.
Corrective actions may include:
•

Changing the benefit status of students on any applications verified under this Module
that results in a change in application status. The SFA must notify the household and
follow all required procedures;

•

Requiring the SFA to attend SA verification training;

•

Developing a technical assistance check-in plan with the SA annually to improve
verification comprehension through email/phone discussions for relevant verification
deadlines.

Any technical assistance provided to the SFA must be recorded in the comments section of the
On-site Assessment Tool. During the process of evaluating the SFA’s compliance with
verification requirements, some considerations for technical assistance may include:
•

Assisting the SFA in understanding how to select the correct verification sample size;

•

Sending the SFA reminders about when verification reports are due to the SA;

•

Providing new SFA staff with additional support and training on verification and/or

•

Discussing and encouraging SFA participation in verification training offered by the SA.
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If a SA finds that a SFA systemically has difficulty with verification reporting, the SA must
explore why the problem exists and consider requiring mandatory participation in SA
verification training.

Fiscal Action
This is a General Area, thus fiscal action is not required. Fiscal action is applied for those
students reviewed under the Module: Certification and Benefit Issuance in cases where
certification or changes in benefit status was in error as a result of verification. Refer to the
Module: Certification and Benefit Issuance in this Section for more information.
FNS encourages the SA to consider withholding program payments, in whole or in part, to any
SFA for repeated or egregious violations that are not corrected. Withholding program
payments is not included in the specific regulatory definition for fiscal action. For additional
information, please refer to Section VIII, Fiscal Action, Module: Withholding Payments.

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Module: Meal Counting and Claiming
Intent/Scope of Monitoring
The SFA must have a meal counting and claiming system that

Performance Standard 1

accurately counts, records, consolidates, and reports the number

All free, reduced price, and paid
meals claimed for reimbursement
are served only to children
eligible for free, reduced price,
and paid meals, respectively, and
are counted, recorded,
consolidated, and reported
through a system that
consistently yields correct claims.

of reimbursable meals claimed, by category (i.e., free, reduced
price, or paid). The meal counting and claiming process must
include a mechanism, whether manual or electronic, for counting
meals and consolidating meal totals at each school within the SFA.
The mechanism must include an internal control system that
validates the total meal counts prior to the submission of the
Claim for Reimbursement to the SA.

The goal for monitoring meal counting and claiming is to assure the processes the SFA uses to
count, consolidate, and claim meals for the SBP and NSLP are in compliance with Program
requirements. For example:
•

Counting and claiming system(s) in use for the SBP and NSLP provide accurate counts of
reimbursable meals, by category

•

Reimbursable meals are correctly counted, consolidated, and recorded at each school
and at the SFA

•

Counting and claiming system yields an accurate Claim for Reimbursement

This module also covers the requirement of SFAs to have a local meal charge policy. As of July
1, 2017, all SFAs operating the NSLP and/or SBP must have in place a written local meal charge
policy to address situations when children participating at the reduced price or paid rate do not
have funds to pay for their meal at the time of the meal service. The policy must be
communicated to all households with children attending the SFA and all school or SFA-level
Administrative Review Manual Page 55

staff members responsible for the local meal charge policy’s enforcement. State agencies and
SFAs retain the authority to establish the specifics of their policies based on local conditions.
For additional information, see Unpaid Meal Charges: Local Charge Policy Requirement (SP 462016) and Unpaid Meal Charges: Guidance and Q&A (SP 23-2017).
The requirement to have a local meal charge policy falls under the General Areas of the
Administrative Review.

Review Procedures
This Module examines the process the SFA uses to count, consolidate, and report a Claim for
Reimbursement of meals provided to eligible students. This Module will focus on the day of
review and review period at the school and SFA levels for the SBP and NSLP.
Pre-visit Review Procedures
The Off-site Assessment Tool will help the SA identify the steps in the SFA’s meal counting and
claiming process and identify any potential areas of noncompliance or technical assistance
needs prior to the on-site portion of the Administrative Review.
Off-site Assessment Tool
The Off-site Assessment Tool has a series of questions related to meal counting and claiming.
Questions 301-311 address standard meal counting and claiming procedures, including internal
controls and training.
Analysis of Off-site Assessment Tool and Supporting Documentation
The Off-site Assessment Tool will provide the SA with an understanding of how the SFA counts
and claims meals on a daily basis. The information gathered in the Off-site Assessment Tool for
meal counting and claiming will provide the SA with an understanding of the SFA’s:
• Meal counting and claiming system and whether their system is electronic or manual
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• Point-of-service system
• Back-up system for counting and claiming reimbursable meals served
• Training provided to staff on meal counting and claiming procedures
• Standard operating procedures for meal counting and claiming system
• Procedures for consolidation of the meal counts for the Claim for Reimbursement
• SAs are expected to assess the local meal charge policy requirement compliance off-site
through the Off-site Assessment Tool. SAs are expected to:
•

Review a copy of the SFA’s current local meal charge policy

•

Review documentation demonstrating the local meal charge policy was
communicated to all households at the start of the school year, and to all
households that transfer into the SFA during the school year

•

Review documentation demonstrating the local meal charge policy was
communicated to all school or SFA-level staff responsible for policy enforcement.

Note: SAs are not responsible for evaluating the content or quality of the SFA’s local
meal charge policy. The SA is only responsible for confirming that the SFA has a written
charge policy in place, and that the SFA meets the policy communication requirements
outlined above. FNS will assist SFAs in the transition to meeting this new requirement by
focusing on technical assistance during the Administrative Review during the first year
that the local meal charge policy requirements are in place.
On-site Review Procedures
The SA’s on-site portion of the Administrative Review consists of conducting interviews with
SFA staff, observing the meal service, examining documentation that supports the Claim for
Reimbursement, and determining whether the school and SFA procedures yield an accurate
Claim for Reimbursement and are in compliance with all Federal meal counting and claiming
requirements. Documentation to support the Claim for Reimbursement includes internal edit
checks and (as necessary) signed documentation from a State licensed healthcare professional
to support meal modifications for children with disabilities, when the modified meal does not
Administrative Review Manual Page 57

meet the Program meal pattern. See the Memorandum, Policy Memorandum on Modifications
to Accommodate Disabilities in the School Meal Programs (SP 59-2016) for more information.
The on-site portion of the Administrative Review examines both the day of review and the
review period at the school and SFA levels for the SBP and NSLP.
On-site Assessment Tool
Questions 314-316 (SFA level), 317-321 (school level, day of review), and 322-325 (school level,
review period) in the On-site Assessment Tool assess the validity of the reviewed school(s) and
the SFA’s meal counts for the day of review and the review period.
On-site Procedures
The SA must follow the steps below:
Step 1: Validating the Off-site Assessment Tool
The SA must validate that the information on the Off-site Assessment Tool is current and
represents the SFA’s practices for implementing meal counting and claiming requirements
according to regulations. The SA must also determine whether the SFA’s responses were
satisfactory.
If the SA does not complete the Off-site Assessment Tool prior to the on-site portion of the
Administrative Review, the SA must obtain the information from the SFA while on-site.

Step 2: Validating the Counting and Claiming Process
The SA must review the procedures for SBP and NSLP at the school and SFA level for both the
day of review and the review period.
For the school level review, the SA must:
Administrative Review Manual Page 58

•

interview staff to determine whether the meal counting, consolidation, and claiming
procedures at the school level reflect the SFA’s procedures (this interview should
preferably occur before meal service begins so SA is aware of procedures while
observing the meal service);

•

observe meal service at the point-of-service to ensure the counting system yields an
accurate count of reimbursable meals on the day of review and whether the meal
counting system prevents overt identification of students receiving free and reduced
price benefits;

•

review the meal count documentation on the day of review to ensure the meal counts
are counted, consolidated, and recorded for SFA’s use and yield an accurate result;

•

review the meal counts for the review period to ensure meal counts yield an accurate
result, are comparable to the day of review meal counts, and do not exceed the number
of eligible students by category (i.e., free, reduced price, and paid).

For the SFA level review, the SA must:
•

interview staff to determine whether the meal consolidating and claiming procedure
reflect the information gathered from the Off-site Assessment Tool and meets FNS
regulations;

•

review the meal counts for the review period to determine whether the meal counts
from each school within the SFA were consolidated and claimed correctly according to
FNS regulations.

The SA may accept documented corrective action to address erroneous practices during the onsite portion of the Administrative Review, or the documented corrective action may be
submitted, as described below. However, all uncorrected meal counts identified during the onsite portion of the review must be recorded for fiscal action.
If errors exist on the day of review and/or the review period, the SA must determine whether
the errors were a result of a non-systemic or systemic counting and claiming process either at
Administrative Review Manual Page 59

the school and/or SFA level. The SA must document all areas identified that support the
conclusion of a non-systemic or systemic meal counting finding. Detailed definitions of “nonsystemic” and “systemic” findings are provided below:
•

Non-systemic: If the contributing factors are unusual, not part of the normal operating
procedure, and the system does not require changes to achieve accurate results, then
the error is non-systemic. An example of a non-systemic counting error is when the
cashier punches the wrong button. Additionally, if it is determined by the SA that an
error occurred because the cashier was intimidated by the review process, the error is
non-systemic. Document all findings that support the conclusion of a non-systemic
meal counting problem in the comments section.
Systemic: If any of the contributing factors are built into the process and would likely
recur if the process is not changed, the error is systemic. Systemic errors are serious in
nature. The SA must determine the scope of the error by deciding if the same meal
count procedures were in place for the review period and/or previous periods.
Document all findings that support the conclusion of a systemic meal counting problem
in the comments section.

Step 3: Recording Errors
Meal counting and claiming errors are recorded on the On-site Assessment Tool, School Data
and Meal Pattern Error ( Form S-1), the Fiscal Action Workbook, and the Other Meal Claim
Errors (S-2), as described below in Section VIII: Fiscal Action.
Special Considerations
Under certain circumstances, the SA may follow a different review process for this Module than
is detailed herein. These variations may include:
•

Provision 2, Provision 3, and Community Eligibility Provision

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The Administrative Review procedures for schools participating in Provision 2, Provision
3, and the Community Eligibility Provision are discussed in Section IX, Special Provision
Options.

Technical Assistance/Corrective Action
Technical assistance and corrective action are required for all meal counting, claiming, and
reimbursement areas resulting in errors. Corrective action must be applied to the SFA and all
schools, as appropriate; to ensure that previously deficient practices and procedures are
revised system-wide. Needed corrective action is recorded in the comments section of the Onsite Assessment Tool.
Corrective action must result if:
•

The SFA’s system does not properly count students’ eligibility by category;

•

The SFA does not have a backup system for counting and claiming, or the backup system
cannot render accurate meal counts for eligible meals;

•

The SFA’s system does not have appropriate edit checks;

•

The SFA’s policies for incomplete meals, second meals, visiting student meals, adult and
non-student meals, student worker meals, modified meals that do not meet the meal
pattern for students with disabilities, a la carte items, field trip meals, or pre-paid meals
are not in-line with FNS policy and regulations or require additional information to be
appropriate;

•

The SFA’s alternate point-of-service does not yield accurate counts;

•

The cashiers are not appropriately trained.

The SA must determine the appropriate technical assistance to provide to the SFA if any of the
issues listed above arises. Other situations may also require the SA to provide technical
assistance in order to ensure the SFA remains in compliance with regulations. The SA must
Administrative Review Manual Page 61

document any technical assistance provided to the SFA at any point during the Administrative
Review. Technical assistance is recorded in the comments section of the On-site Assessment
Tool.
The SA must require corrective action for and document all identified findings.

Fiscal Action
Fiscal action must be assessed for inaccurate meal counting and claiming for the day of review
or review period occurring at the school and/or SFA level. For additional information on fiscal
action, see Section VIII, Fiscal Action, of this manual.
The SFA is allowed to correct any erroneous practices identified by the SA on the day of review.
However, any error identified and any SA technical assistance provided on the day of review is
still recorded on the On-site Assessment Tool. In addition, the SA must calculate fiscal action for
any violations identified prior to the correction of the erroneous practice. In these situations,
the SFA should not correct their proposed Claim for Reimbursement based on the violations
identified by the SA (see Section VIII, Fiscal Action, Module: Fiscal Action Formula). The SA will
provide the SFA with the maximum allowable reimbursable meals based on all errors prior to
the corrective action. The meals requiring fiscal action for the day of review at the school level
are identified in Questions 318 and 321. The meals requiring fiscal action for the review period
at the school level are identified in Questions 322 – 324. Meals in error are recorded on the S-1,
Lines 10 and 14 respectively.
School-level Consolidation Errors
Meal count consolidation errors are mathematical mistakes that result in the school reporting
incorrect meal counts to the SFA. Fiscal action is taken on the difference between the incorrect
and the correct meal counts. The meals requiring fiscal action for the day of review and review
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period at the school level are identified in Questions 320 and 325 of the On-site Assessment
Tool. Meals in error are recorded on the S-1, Lines 13 and 17, respectively. When calculating
fiscal action in the Fiscal Action Workbook the SA only assesses the consolidation error once,
either at the site level or at the SFA level, whichever is most appropriate.
SFA-level Consolidation Errors
Meal count consolidation errors can also occur at the SFA level when compiling the Claim for
Reimbursement. This information is recorded on the Other Meal Claim Errors, Form S-2.
Counting Errors
Three types of meal counting errors may occur:
•

Meal counts do not equal the number of reimbursable meals served to eligible children;

•

Meal counts exceed the number of eligible students by category (i.e., free, reduced
price, or paid); or

•

Second and/or other ineligible meals (e.g., adult meals or a la carte) were counted.

Second/Other Ineligible Meals Counted
Fiscal action is taken on all meals that were counted as reimbursable meals, but were ineligible
for reimbursement, such as second meals and adult meals. This error does not include meals
that failed to contain the minimum number of required menu items/food items as described in
Section III: Meal Pattern and Nutritional Quality.
Note: SFAs may not claim second meals in the NSLP; however, the SFA may claim second
meals in the SBP as long as the SFA does not plan and produce meals with the intention of
claiming second meals.

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Section III: Meal Pattern and Nutritional
Quality

Modules contained within this Section include:
• Meal Components and Quantities
• Offer versus Serve
• Dietary Specifications and Nutrient Analysis
• Addendum: Certifying a School Food Authority for PerformanceBased Reimbursement During an Administrative Review

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Module: Meal Components and Quantities
SFAs operating the NSLP and/or the SBP must follow meal pattern requirements for each
age/grade group within all reimbursable meal service lines. (7 CFR
210.10 and 220.8)

Performance Standard 2

The meal pattern is the foundation of Federal school nutrition
programs, and SA staff must ensure SFAs are offering reimbursable
meals at breakfast and lunch according to the regulations.

Intent/Scope of Monitoring

Reimbursable lunches must meet
the meal requirements in 210.10,
as applicable to the age/grade
group reviewed. Reimbursable
breakfasts must meet the meal
requirements in 220.8 and
220.23, as applicable to the
age/grade group reviewed.

The scope of review for this Module is to establish that meals claimed for reimbursement
contain the appropriate meal components (also referred to as food components) and quantities
for the SBP and the NSLP.
SA staff must ensure schools operating the NSLP and/or the SBP prepare, offer, and serve meals
to students that meet the meal pattern requirements for the appropriate age/grade groups on
all reimbursable meal service lines.
Additionally, SA staff must ensure that every reimbursable meal service line meets the daily and
weekly meal pattern requirements for the appropriate age/grade group served. This includes
verifying how an SFA is meeting the meal pattern requirements if serving multiple age/grade
groups, including infants and preschoolers, in a single location, and if school age children are
using self-service stations.

Review Procedures
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Pre-visit Review Procedures
The SA or the SFA must complete the Menu Worksheet portion of a USDA-approved Menu
Planning Tool for Certification for Six Cent Reimbursement (referred to as Menu Worksheet
from here on) for each school selected for review for a week from the review period. The
worksheet should be completed either pre-visit (recommended) or during the on-site visit using
production records, menus, recipes, food receipts, and any other documentation that shows
meals contained the required components/quantities. The SA should grant the SFA sufficient
time to gather and return the requested documentation to the SA for review prior to the
scheduled on-site visit. For efficiency, the SA should review the same menus, production
records, and standardized recipes for both the Meal Components and Quantities and Dietary
Specifications and Nutrient Analysis as part of the Administrative Review. If the SA feels it
needs more information to better understand usual practices at the school, it may choose to
examine additional weeks within the review period.
The SA or SFA is not required to complete the Simplified Nutrient Assessment portion of the
Menu Planning Tool.
The USDA Menu Planning Worksheet is available on the USDA website. A list of commercially
available, USDA-approved alternatives to the USDA Menu Planning Worksheet is available on
the USDA website. The SA may also use a USDA-approved, State-developed Menu Worksheet.
Because the Menu Worksheet does not assess offerings by meal service line, the SA also must
review menus and production records to ensure that all required meal components are
available on each reimbursable meal service line.
Supporting Documentation
SAs must obtain documentation from the SFA, including menus, production records, USDA
Foods Information Sheets, and related materials (e.g., CN Labels, standardized recipes,
manufacturer’s Product Formulation Statement (PFS)) for the school week under review. SFAs
must also provide supporting documentation for modified meals served to students with
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disabilities when the modifications do not meet the Program meal pattern requirements. Such
meals are only eligible for Federal reimbursement when supported by a medical statement
signed by a State licensed healthcare professional. The requirements for the medical statement
are outlined in Memorandum, Policy Memorandum on Modifications to Accommodate
Disabilities in the School Meal Programs (SP 59-2016) and Statements Supporting
Accommodations for Children with Disabilities in the Child Nutrition Programs (SP 32 CACFP 13
SFSP 15-2015).
Reviewing Documentation
The completion of the Menu Worksheet and review of documentation is intended to establish
the SFA’s compliance with meal component and food quantity requirements for each age/grade
group served. This documentation review is in addition to the meal observation procedures
conducted on the day of review (see On-site Review Procedures).
When conducting a review of documentation for a school week under review, the minimum
number of school days in the week reviewed is three (3), and the maximum is seven (7). All
must be consecutive days. The SA may examine any food crediting documentation that is
provided to the SA,— including, but not limited to, food labels, USDA Foods Information Sheets,
manufacturer’s product formulation statements, CN labels, and bid documentation — to ensure
meal pattern compliance.
The SA may also consult the Food Buying Guide (FBG). Foods listed in the Food Buying Guide
are not required to have a CN Label or a manufacturer’s product formulation statement. The
information in the FBG may be used to document how a food item credits. The SFA should
document and provide the SA a copy of the FBG information that was used to determine the
crediting.
If an SFA provides a CN label for crediting of meal components and quantities the SA must not
request additional crediting information such as a manufacturer’s product formulation
statement. However, a CN Label may only provide information on how the product contributes
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towards meal pattern requirements, but may not provide nutrient information. Therefore,
State agencies may need to request nutrient information, separately from a CN label, for the
nutrient analysis in other areas of the review.
Note: CN Labels copied with a watermark may also be used to document meal components
and quantities. The watermarked CN Label must be attached to the Bill of Lading or invoice to
show proof of purchase. For additional guidance please refer to Memorandum, Administrative
Review Process Regarding the Child Nutrition (CN) Label, Watermarked CN Label and
Manufacturer’s Product Formulation Statement (SP27-2015; CACFP09-2015; SFSP12-2015).
SFAs are required to document how foods offered credit toward meal pattern requirements. If
the SA finds foods that do not have a CN label, USDA Foods Information Sheets, or a
manufacturer’s product formulation statements, the SA should use their best judgment to
determine if a required component is missing or present in insufficient quantity. For example, a
school may not have documentation for a ham sandwich pocket, but the SA may be able to
discern that the food item contains meat and grains. In this case, the meat and grains
components are offered (i.e. not missing), but the quantities are unknown and therefore could
result in insufficient quantities. If documentation is not available the SA must provide technical
assistance and require corrective action, which may include ensuring that documentation
requirements are met in order to confirm that all items are creditable.
There is a distinct Menu Worksheet for each age/grade group, and there are separate menus
for breakfast and lunch. Therefore, the SA must complete a Menu Worksheet (or require the
SFA to submit a completed Menu Worksheet) and review menus and production records for
each menu type and age/grade group in each reviewed school, for both breakfast and lunch.
For example, if a K-8 school serves two lunch menus (one for grades K-5, and one for grades 68) and two breakfast menus (again, one for each age/grade group), the SA or SFA would need
to complete four Menu Worksheets for that school.
The SA must evaluate production records to ensure the following:
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•

Records include all information necessary to support the claiming of reimbursable meals
and any additional SA requirements (i.e., all menu items are listed and all required meal
components are offered);

•

Records are used for proper planning (e.g., evaluate for consumption and leftovers);

•

Records document food prepared is creditable for the total number of reimbursable
meals offered and served;

• Records document a la carte, adult, and/or other non-reimbursable meals, including
number of portions for each of these food items; Records document that milk, whole
grain-rich, and vegetable sub-group requirements are met;
•

Records document weekly quantity requirements for grains, meat/meat alternates,
vegetables, fruit, and milk;

•

Records align with standardized recipes (e.g., if chicken salad sandwich is on the menu
but mayonnaise is not listed on the production records, the SA may examine
standardized recipes for additional information); and

•

As needed, records to support meal modifications outside the Program meal pattern for
students with disabilities. Such meals are only eligible for reimbursement when
supported by a medical statement signed by a State licensed healthcare professional.

If reviewing documentation or completing the Menu Worksheet reveals problems with meal
components or quantities, the SA should determine if the issue is systemic, or just a one-time
occurrence. A systemic problem is a serious problem resulting from factors that are built into
the SFA’s processes and would likely recur if the processes are not changed. If the contributing
factors are unusual, not part of the normal operating procedures, and the SFA’s processes do
not require changes to achieve accurate results, then the problem is non-systemic. If the issue
is systemic, the SA must expand the review of production records to, at a minimum, the entire
review period for the site(s) where systemic issues were identified.

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On-site Review Procedures
The SA must conduct an on-site assessment of the SFA’s meal service for breakfast and lunch to
determine whether meals claimed for reimbursement contain the required components and
quantities. The SA must:
•

conduct a visual observation of meal service lines and review menu documentation on
the day of review;

•

if not completed off-site, complete a Menu Worksheet and review menus and
production records for each school selected for review for a school week during the
review period;

•

ensure that signage is posted and students know how to select a reimbursable meal;and

•

if the school reviewed has a preschool and /or infant meal program and they are not comingled (not being served in the same service area as K-5 students), complete the Infant
and Pre-K Meal Pattern On Site Validation Checklist included with this manual. If they
are co-mingled (served in the same service area) there is no need to complete the
checklist. The Pre-K and Infant meal pattern updates are part of the Child and Adult
Care Food Program: Meal Pattern Revisions Related to the Healthy, Hunger-Free Kids
Act of 2010.

On-site Assessment Tool
Questions 400-412 on the On-site Assessment Tool focus on whether meals contain the
required components and quantities.
Supporting Documentation
If conducting the documentation review on-site, the SA must obtain and examine menus,
production records, USDA Foods Information Sheets, and related materials (e.g., CN Labels,
standardized recipes, manufacturer’s Product Formulation Statement) for the school week
under review and complete the Menu Worksheet (or require the SFA to complete the Menu
Worksheet). SAs must also examine supporting documentation for modified meals served to
children with disabilities when the modifications do not meet Program meal pattern
requirements. Such meals are only eligible for Federal reimbursement when supported by a
medical statement signed by a State licensed healthcare professional. The requirements for the
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medical statement are outlined in Memorandums, Policy Memorandum on Modifications to
Accommodate Disabilities in the School Meal Programs (SP 59-2016) and Statements
Supporting Accommodations for Children with Disabilities in the Child Nutrition Programs (SP 32
CACFP 13 SFSP 15-2015).

Step 1: Reviewing Documentation (if not conducted off-site)
Refer to “Reviewing Documentation” under Off-site Review Procedures above.
Step 2: Observing the Meal Service
Prior to the beginning of the meal service, the SA will ensure, through on-site observation and a
review of documentation, that all reimbursable meal service lines offer all of the required meal
components and food quantities for the age/grade groups being served. If multiple age/grade
groups including Pre-K are being served in the same service area, the SA must determine how
the meal service is structured to meet meal pattern requirements for each age/grade group.
When preschoolers are being served in the same service area as K-5 students, the SA may use
the flexibility to offer a single menu for those co-mingled grades, refer to Flexibility for CoMingled Preschool Meals: Questions and Answers (SP 37-2017). Additionally, if visual
observation suggests that quantities offered are insufficient, the SA must require the reviewed
schools to provide documentation demonstrating that the required amounts of each
component were available for service for each day of the review period. The SA must also
ensure that signage is posted so students understand how to select a reimbursable meal.
Regulations in 7 CFR 210.10(a)(2) require schools to identify reimbursable meals to students;
this aims to reduce the unintended purchase of a la carte items and help students make healthy
food choices. Findings are recorded in the comments section of the On-site Assessment Tool.
To the extent possible, the SA must also observe the majority of meal preparation for breakfast
and lunch to ensure that standardized recipes are followed (e.g., ingredients are added in
amounts specified in the recipe, measurements are being taken appropriately).

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During the meal service, the SA must observe a significant number of program meals (breakfast
and lunch) at the point-of-service system on every reimbursable meal service line. SAs should
observe 5 to 25 percent of meals served (this range takes into consideration differing types of
meal services found in SFAs) on each reimbursable meal service line. The intent is for all
reimbursable meal service lines in all meal periods to be reviewed if possible. SAs must observe
meals at the beginning, middle, and end of the meal service.
During observation, the SA must determine whether the meals selected by students contain the
required components or items, and the food quantities required for the age/grade group being
served as the students exit the meal service line at the point-of-service. If using service
stations, the SA must verify that students have access to all required meal components, offered
in the appropriate food quantities, for the appropriate age/grade groups. When reviewing selfservice stations, the SA should observe students as they move through the self-service stations
and ensure that they demonstrate knowledge of how to access all required meal components
in the meal service area. For the purpose of this Module, if multiple lines are serving the same
menu, only one line must be validated. However, the SA should spot check all lines for
consistency.
When observing meals served in alternate locations (e.g., classroom, in-school suspension,
multiple cottages within a RCCI), the SA should select an appropriate number of meals to
observe to sufficiently assess the program meals served. To determine the sufficient number of
meals to observe, the SA must consider several factors, such as the number of alternate meal
service areas; number of SA reviewers; number of meals served; and length of time needed to
properly observe the meal service. If an SA observes egregious violations at one alternate
location, the SA must review additional alternate locations.
Please note that students with disabilities may require meal components and quantities that
differ from the Program meal patterns. These meals are only eligible for reimbursement when
the modification is supported by a medical statement signed by a State licensed healthcare

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professional. For more information, see Memorandum, Policy Memorandum on Modifications
to Accommodate Disabilities in the School Meal Programs (SP 59-2016).
If the SA identifies missing meal components or inadequate quantities prior to the beginning of
the meal service, the SA should inform the SFA staff of the violation and provide an
opportunity to make corrections. The priority is always to ensure students receive a
nutritionally-balanced, reimbursable meal. Even if corrected prior to meal service, the SA must
document the problem in the comments section of the On-site Assessment Tool and list it in the
Administrative Review Report to the SFA. The SA should also report the violation at the exit
conference.
Note: SAs should refer to information regarding the meal pattern flexibilities that are allowed
for and found in the Memorandum School Meal Flexibilities for School Year 2017-2018 (SP-322017) and to the Updated Preschool Meal Pattern in 7 CFR 220.26 when reviewing this area.
Milk Requirements
The SA must ensure that at least two choices of fluid milk from the following list are offered
throughout the meal service on all reimbursable meal service lines: flavored or unflavored fatfree milk, low-fat (1%) milk, fat-free or low-fat lactose-reduced milk, fat-free or low-fat lactosefree milk, fat-free or low-fat buttermilk, and fat-free or low-fat acidified milk. Students must be
allowed to choose milk from at least two milk varieties, even in alternate meal service
locations.
Note: For SY 2018-2019, flavored or unflavored fat-free/low-fat milk is allowed without the
need to demonstrate hardship.
If any milk substitutions are made for non-disability reasons, in order for the meals to be
eligible for Federal reimbursement, the SA must ensure the substitutions
meetsubstitutionsmeet FNS nutrient requirements, as outlined at 7 CFR 210.10(d)(3). Because
the Nutrition Facts Label may not list all of the required nutrients, the school food service may
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need to request documentation from the product manufacturer to confirm the presence of all
required nutrients at the proper levels, and must maintain this documentation for review. For
additional information, refer to 7 CFR 210.10(d) and 7 CFR 210.10(m); FNS Instructions 783-7,
Milk Requirement-Child Nutrition Programs (revised, issued January 24, 1995); and FNS
Memorandum SP 07-2010, Q and As: Milk Substitutions for Children with Medical or Special
Dietary Needs (Non-Disability), issued November 12, 2009.
The nutrient requirements for fluid milk substitutions do not apply to cases of disability. SFAs
will receive reimbursement for meals that substitute fluid milk products that do not meet the
nutrient requirements, provided the substitution is supported by a written medical statement
signed by a State licensed healthcare professional. See FNS Memorandum SP 59-2016, Policy
Memorandum on Modifications to Accommodate Disabilities in the School Meal Programs and
FNS Memorandum SP 32-2015, Statements Supporting Accommodations for Children with
Disabilities in the Child Nutrition Programs.
Note: Program operators are not to promote or offer water or any other beverage as an
alternative selection to fluid milk throughout the food service area. Signs describing the
reimbursable meal must convey that milk is offered as a food component in a reimbursable
meal and not as a beverage choice.
Fruit or Vegetable Juice Requirement
Fruit and/or vegetable juice may be used to meet up to half of the fruit or vegetable
requirement. For additional information, see FNS Memorandum SP 10-2012 v. 9, Questions
and Answers on Final Rule “Nutrition Standards in the National School Lunch and Breakfast
Programs”, see FNS PartnerWeb for policy memorandums.
Vegetable Subgroup and Whole Grain-rich Requirements
The SA must ensure that, over the course of the school week, meals offered to students meet
the vegetable subgroup and whole grain-rich requirements specified in 7 CFR 210.10. This
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includes ensuring that required amounts of whole grain-rich foods are offered and determining
that grain-based desserts are limited to no more than 2 oz. eq. per week.
For additional information on whole grain-rich requirements, the SA should reference FNS
Memorandum SP 30-2012, Grain Requirements for the National School Lunch Program and
School Breakfast Program and the Whole Grain Resource for the National School Lunch and
School Breakfast Programs, available on FNS PartnerWeb.

Note: Based on Section 747(a) of the Appropriations Act, for SY 2017-2018, SAs may offer
exemptions from the whole grain-rich requirements in the NSLP and SBP if an SFA can
demonstrate hardship(s) in procuring, preparing, or serving compliant whole grain-rich
products that are accepted by students.
SFAs that receive an exemption are considered compliant with the whole grain-rich
requirements during an Administrative Review if the grain offerings are consistent with the
exemption granted by the SA and at least half of the grains offered weekly are whole grain-rich.
However, at a minimum, SFAs must comply with the SY 2013-2014 requirement to offer at least
half of the grains which meet the whole grain-rich criteria. For additional information, see SP 322017, School Meal Flexibilities for School Year 2017-2018.

Menu Substitutions
SFAs are encouraged to consider cultural, religious, and ethical preferences when planning and
preparing meals. Accommodating student preferences helps to maintain participation in the
NSLP and SBP. Variations, whether on an experimental or continuing basis, must be consistent
with the food and nutrition requirements specified in Program regulations (7 CFR 210.10 and 7
CFR 220.8) in order for the meals to be eligible for reimbursement. If any substitutions are
made from the planned menu for the day of review or the school week during the review
period, the SA must validate whether the daily/weekly meal pattern requirements are met.
While FNS strongly encourages “like” substitutions (such as spinach for romaine lettuce)) meals
are compliant as long as the daily and weekly requirements are met.

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Accommodations for Children with Disabilities
SFAs must comply with USDA regulations regarding nondiscrimination at 7 CFR Parts 15, 15a,
and 15b. This includes ensuring children with disabilities have an equal opportunity to benefit
from the NSLP and SBP. Certain physical or mental impairments require meal modifications that
do not follow the required Program meal pattern. Meal modifications outside the meal pattern
are reimbursable, provided the request is supported by a medical statement signed by a State
licensed healthcare professional. If a meal modification for a child’s disability can be made
within the meal pattern requirements, FNS does not require a medical statement. See FNS
Memorandum SP 59-2016, Policy Memorandum on Modifications to Accommodate Disabilities
in the School Meal Programs and FNS memorandum SP 32-2015, Statements Supporting
Accommodations for Children with Disabilities in the Child Nutrition Programs for more
information.
Family Style Meal Service
When reviewing a family style meal service, the SA should refer to procedures outlined in FNS
Memorandum SP 35-2011, Clarification on the Use of Offer versus Serve(OVS) and Family Style
Meal Service and FNS Instruction 783-9, rev 2, Family Style Meal Service in the
Child and Adult Care Food Program. When reviewing a preschool, please note that FNS does
not allow OVS for preschoolers, rather it encourages Family Style Meal Service.

Field Trips
The SA should review and evaluate field trip meals served on the day of review and the school
week during the review period. Field trip menus must meet daily and weekly meal component
and quantity requirements. Refer to FNS Instruction 786-8, rev 1, Reimbursement for Off-Site
Meal Consumption.
Traditional Foods

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The SA may encounter the service of traditional foods during an Administrative Review, such as
native whole blue corn kernel, bison, venison or sheep. If a food is served as part of a
reimbursable meal, but not listed in the Food Buying Guide, the yield information of a similar
food or in-house yield may be used to determine the contribution towards meal pattern
requirements. When this is the case, traditional foods may credit similar to products found in
the FBG. FNS Memorandum TA 01-2015, Child Nutrition Programs and Traditional Foods,
provides guidance to the reviewer on how to credit traditional foods towards meal pattern
requirements.
Step 3: Recording Errors
The SA must record meals missing components and meals that do not meet quantity
requirements.

Missing Meal Components:
Errors related to missing meal components are recorded on the On-site Assessment Tool,
Questions 400 – 401 (day of review) and Questions 409 and 411 (review period). The SA must
also record the number of meals missing meal components on the School Data and Meal
Pattern Error Form, S-1, Lines 11 and 15, respectively.
Insufficient Quantities/Incomplete Meals:
Meals that do not meet quantity requirements are recorded on the On-site Assessment Tool,
Questions 402 – 403 and 407 (day of review) and Question 410 (review period). Meals that
contain insufficient quantities of meal components are incomplete. Incomplete meals claimed
for reimbursement that will be subject to fiscal action (for repeated violations) must be
recorded on the School Data and Meal Pattern Error Form S-1, Lines 12 and 16.
When multiple meal pattern violations are identified for a meal, list all violations in the
appropriate comments section. Record meals with multiple violations on the S-1 under only
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one meal violation category to ensure that fiscal action is applied only once. If multiple
violations include meals that are offered that are missing meal components, record the meal
under the missing meal component category. For all other multiple meal pattern error
violations, record repeated vegetable subgroup or milk type violations before all other
violations. For all other multiple meal pattern violations, use discretion and record the most
egregious violation for fiscal action.

Technical Assistance/Corrective Action
When the SA conducts an Administrative Review and finds that the SFA is not meeting meal
pattern requirements, technical assistance and corrective action are the first steps that must be
taken. SAs and SFAs should develop a Corrective Action Plan with specific steps and reasonable
timelines for bringing the SFA into compliance. The Corrective Action Plan will vary depending
on the nature of the changes necessary.

The SA must require immediate corrective action for any missing meal components found
during an on-site observation on the day of review, or found while examining the Menu
Worksheet and/or reviewing menu documentation for the school week during the review
period.
The school must immediately add the missing meal component(s) before any additional meals
are claimed for reimbursement on: 1) the day of review, or 2) on future days on which the
deficient menu is offered. In addition to immediate corrective action, the SA must require
written corrective action to ensure such violations do not occur in the future.
For missing meal components identified from examining the Menu Worksheet and/or reviewing
menu documentation, the SA may allow the SFA to provide documentation (e.g., invoices, food
inventory tracking) to demonstrate that the missing meal component was actually offered.
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In addition, SAs must require corrective action for violations related to vegetable subgroups,
milk types, whole grain-rich foods, and food quantities to help bring the SFA into compliance
with the meal pattern requirements. This includes both violations observed on the day of
review and those identified from the review of production records and completing the Menu
worksheet.
When production records are incomplete, the SA should provide targeted technical assistance
to emphasize the importance of complete and accurate production records. The SA and SFA
should ensure that the school food service manager understands the deficiencies and steps that
should be taken to make sure that production records are complete and accurate.
When errors are found in SFAs with central/satellite kitchens and/or district-wide menus the SA
must provide technical assistance to ensure the SFA corrects the problem at all affected sites.
The rationale for this is that, even though meals were prepared in a single location, the nonreimbursable meals were served throughout the SFA. This same rationale would apply to
menus implemented district-wide.

Fiscal Action
Fiscal action requirements are described below. For additional information refer to Section VIII,
Fiscal Action and FNS Memorandum SP 54-2014, Administrative Reviews and Certification for
Performance-Based Reimbursement in SY 2014-2015 available on FNS PartnerWeb. When errors
are found in SFAs with central/satellite kitchens and/or district-wide menus, the SA must assess
fiscal action for all sites, reviewed and non-reviewed, in which the non-reimbursable meals
were served. The rationale for this is that, even though meals were prepared in a single
location, the non-reimbursable meals were served throughout the SFA. Missing Meal
Components
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The SA must take fiscal action when a meal component is missing.
Missing Production Records
SFAs are required to maintain documentation that demonstrates how meals offered to
students meet meal pattern requirements. SFAs are required to document that reimbursable
meals are offered. If production records are missing, or missing for a certain time period, meals
served during that time must be disallowed/reclaimed unless the SFA is able to demonstrate to
the satisfaction of the SA that reimbursable meals were offered and served. FNS encourages
SAs to accept documentation such as invoices and/or food inventory tracking records as
acceptable documentation in recreating missing production records. SAs should, however,
provide training and technical assistance for noncompliant SFAs in proper production
recordkeeping practices. This approach should ensure that missing production records are not
a recurring issue.
Vegetable Subgroups and/or Milk Type Findings
For repeated violations involving vegetable subgroups and/or milk type cited in 7 CFR 210.18 (g)
(2), the SA must take fiscal action.
•

If only one type of milk is offered (i.e., milk variety requirement not met) or an
unallowable milk type is offered, meals must be disallowed and/or reclaimed for the
duration that only one milk type was offered. Any meals selected with an unallowable
milk type must also be disallowed/reclaimed. This only applies to the K-5 6-8, and 9-12
meal patterns since preschools implementing the updated Pre-K meal pattern are
following new requirements. If an unallowable milk type is offered in preschool, they
must be provided technical assistance (rather than fiscal action).

•

If one vegetable subgroup is not offered over the course of the week reviewed, the
reviewer should evaluate the cause(s) of the error to determine the appropriate fiscal
action. All meals served in the deficient week may be disallowed/reclaimed.

Quantities and/or Whole Grain-rich Findings
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For repeated violations involving food quantities and/or whole grain-rich foods cited in 7 CFR
210.18 (g)(2), the SA has discretion to apply fiscal action. The reviewer should evaluate the
cause(s) of the error to determine the extent of fiscal action.
•

The SA has discretion to disallow/reclaim meals containing insufficient quantities of
required meal components.

•

If grain foods containing more than 2% non-creditable grains are offered, the SA may
disallow/reclaim meals for one day during the week under review. The SA has discretion
to select which day’s meals are disallowed/reclaimed. Additional meals may be
disallowed/reclaimed at the SA’s discretion.

•

If whole grain-rich foods are not offered over the course of the week reviewed, all meals
served in the deficient week may be disallowed/reclaimed.

•

If a vegetable subgroup is offered in insufficient quantity to meet the minimum weekly
requirement, meals may be disallowed/reclaimed for one day that week. The SA has
discretion to select which day’s meals are disallowed/reclaimed.

•

If the amount of fruit or vegetable juice offered exceeds 50 percent of the total weekly
fruits or vegetables offered, meals may be disallowed/reclaimed for one day that week.
The SA has discretion to select which day’s meals are disallowed/reclaimed. Additional
meals may be disallowed/reclaimed at the SA’s discretion.
Note: Whole grain-rich errors will only be cited as a missing meal component if no grain
components were offered at all during the period of time being reviewed.

Repeated Violations
Fiscal action may only be taken for repeated violations specified in the previous paragraphs if:
•

The SA has provided technical assistance

•

The SA has previously required and monitored corrective action

•

The SFA remains noncompliant with the meal requirements established in 7 CFR 210 or
220

Administrative Review Manual Page 81

Performance-based Certification Funding (6 cents)
If the Administrative Review finds that significant noncompliance exists, requiring the SFA to
develop and implement a Corrective Action Plan over an extended period of time (i.e.,
problems cannot be fixed immediately), the SA must use their best judgment to assess the
longevity and severity of the problems. If the SA determines that the performance-based
reimbursement should be terminated, it should be terminated beginning the month following
the on-site Administrative Review and, at State discretion, for the month of review. Previously
paid performance-based reimbursement would only be recovered in circumstances of clearly
egregious or willful noncompliance by a SFA.
Performance-based reimbursement may resume beginning in the first full month the SFA
demonstrates to the satisfaction of the SA that corrective action has taken place.
For additional guidance on technical assistance and corrective action, see FNS Memorandum,
SP 54-2014, Administrative Reviews and Certification for Performance-Based Reimbursement in
SY 2014-2015 available on FNS PartnerWeb.
When the performance-based reimbursement is terminated, and the SFA operates both NSLP
and the Seamless Summer Option, refer to Section VIII, Fiscal Action, Module: Overview of
Fiscal Action, Duration of Fiscal Action, Performance-based Reimbursement.

Administrative Review Manual Page 82

Module: Offer versus Serve
Intent/Scope of Monitoring
“Offer versus Serve” is a provision in the NSLP and SBP that allows students to decline some of
the food components/items offered. Offer versus Serve gives students more control over the
foods they consume, and may help SFAs reduce plate waste and improve student’s perceptions
of the NSLP and SBP. . At the high school level, Offer versus Serve is required in the NSLP and
optional in the SBP. At the elementary and middle school levels, Offer versus Serve is optional
in both the NSLP and SBP. Offer versus Serve is encouraged for any site/meal service where it
can be accommodated. Offer versus Serve is not appropriate for snack service or preschool age
students. The review of Offer versus Serve is a Performance Standard 2 review element.
In SFAs that implement Offer versus Serve, menu planners must ensure they prepare and offer
enough food to meet meal pattern requirements, and point-of-service staff must ensure
students select enough components/items to make a reimbursable meal.
When determining Offer versus Serve compliance, the SA must consider whether:
•

The school offers the appropriate food components/items on all reimbursable meal
service lines;
o Five food components (milk, fruits, vegetables, grains, and meats/meat
alternates) in the NSLP.
o Four food items from three food components (milk, fruits, and grains) in the SBP.

•

Signage is posted on the service line to assist students in selecting a reimbursable meal;

•

Students are selecting at least three food components (in NSLP) or three food items (in
SBP) in the proper quantities to make a reimbursable meal;
Administrative Review Manual Page 83

•

Students select - at least a ½ cup of fruit and/or vegetable as part of their food
components/items; and

•

Food service staff members at the point-of-service are trained and accurately recognize
a reimbursable meal, including appropriate quantities.

It is essential that food service staff understand the importance of offering all of the food
required by the meal patterns to all students. As it is not enough to have the food available to
students stored away in a cooler, for example, as a strategy to reduce plate waste, in the event
a student asks for the meal components or food items. Not offering all of the components to
each child directly conflicts with the Offer versus Serve requirements.
It is important for the SA to understand the Offer versus Serve procedures in place at the school
being reviewed prior to observation of the meal service.
Alternate Meal Service Locations
USDA does not require a SFA to alter their meal service system(s) to accommodate Offer versus
Serve in situations where Offer versus Serve implementation is difficult (e.g., pre-packaged
lunches in high schools, and alternate meal service locations). When implementation of the
Offer versus Serve requirement becomes difficult in high schools such as on field trips, the SA
must approve the alternate service method. SAs and SFAs are strongly encouraged to work
together to develop creative ways to implement Offer versus Serve in alternate meal service
locations, even if that means offering choices only for
certain meal components (e.g., fruit, milk).

Review Procedures
Pre-visit Review Procedures
Supporting Documentation
•

Production records

Off-site Review Procedures

Offer versus Serve Edit Check
The number of servings of
components/items = 1900
Milk = 400
Juice = 150
Apples = 125
Oranges = 125
Burger/Bun = 100 + 100
Broccoli = 300
Chicken nuggets = 300 + 300
The number of meals served = 400
1900/400 = 4.75 components/items per
child

Administrative Review Manual Page 84

Prior to the Administrative Review, the SA should review the SFA’s or school’s Offer versus
Serve policy.
Step 1: Performing an Edit Check (optional)
The SA has the option to perform an Offer versus Serve edit check prior to conducting the onsite Administrative Review and/or while on-site to determine if the school is preparing enough
food. The Offer versus Serve edit check can alert the SA to possible noncompliance in Offer
versus Serve implementation.
To perform the edit check, the SA should review production records to determine what has
been offered. The SA should then divide the total number of servings of food components or
food items by the total number of meals served.
Optional Edit Check:

Total Number of Servings of Food Components (NSLP) or Food Items (as credited for SBP)
Total Number of Meals Served

If the result is greater than or equal to three, then the school is preparing enough food
components/items for each student to select at least three components/items as required. If
the result is less than three, the school may not be producing enough food. This will require
further discussion with food service staff to determine how food components/items contribute
to meal pattern requirements, as a single food item may contribute to multiple food
components.
If the result is less than three, the SA should proceed with the review being mindful of possible
noncompliance in this area.

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On-site Review Procedures
On-site Assessment Tool
The SA must record review findings on Questions 401-402 and Questions 500-502 of the On-site
Assessment Tool.
On-site Review
Step 1: Evaluate Prior to Meal Service
Prior to the beginning of the meal service, the SA should determine whether or not the school
is implementing Offer versus Serve. To evaluate compliance with the Offer versus Serve
requirements, the SA must interview food service staff to assess whether:
•
•
•
•
•

•

•
•

Staff training has been conducted
Staff understand what constitutes a reimbursable meal
Staff understand the number of meal components/food items required for a
reimbursable meal
Staff properly distinguish reimbursable meals from a la carte purchases
Students understand how to select a reimbursable meal, and understand they can select
more than the minimum number of food components and items required for a
reimbursable meal (i.e., students can select all five food components that are offered at
lunch)
Signage has been posted explaining Offer versus Serve to students. Regulations in 7 CFR
210.10(a)(2) require schools to identify reimbursable meals to students; this aims to
reduce the unintended purchase of a la carte items and help students select a balanced
meal.
SFAs that participate in Offer versus Serve ensure all required food components/items
are made available to all children.
SFAs cannot accommodate a child’s disability by simply asking the child to exclude a
food component/item from their selection. Children with disabilities must have the
same opportunity to select all required food components/items

Step 2: Observe During the Meal Service
During the meal service observation, the SA must:
Administrative Review Manual Page 86

•

Determine whether the school offers the appropriate food components/items on all
reimbursable meal service lines:
o Five food components (milk, fruits, vegetables, grains, and meats/meat
alternates) in the NSLP
o Four food items from three food components (milk, fruits, and grains) in the SBP

•

Determine whether the meals selected by students contain a minimum of three food
components (in the NSLP) or a minimum of three food items (in the SBP) as the students
exit the meal service line

•

Determine whether each reimbursable meal contains at least ½ cup of fruits and/or
vegetables

•

Verify that food service staff members are accurately judging quantities when the
school uses service stations, theme bars, or self-serve bars

•

Observe students as they move through the service lines and ensure that students
know how to select a reimbursable meal under Offer versus Serve

•

Determine whether food service
staff/cashiers understand what
constitutes a reimbursable meal in Offer
versus Serve and that water does not
count as one of the required
components/food items

Fruit and Vegetable Requirements
Students must select at least a ½ cup of either
the fruit or the vegetable component, or a ½ cup
combination of both components (e.g., ¼ cup
fruits and ¼ cup vegetables) for a meal to be
reimbursable under Offer versus Serve.
If a student’s selection only has three
components/items, and one component/item is
the fruit and one component/item is the

NSLP Example:
Jane Smith, student at Stellar High School
5 Full Components Offered:
• Milk (8 oz.)
• Grilled Chicken (2 oz.)
• Biscuit (2oz.)
• Broccoli (1/2 cup) and Carrots (1/2 cup)
• Applesauce (1/2 cup) and Mandarin Oranges
(1/2 cup)
Jane must select at least 3 components for her meal
to be reimbursable.
Jane selects the meat, fruit, and vegetable as her 3
components.
If for her vegetable selection she selects only one
vegetable (either ½ cup of broccoli or ½ cup of
carrots), she must take the full fruit component
offered (½ cup of applesauce and ½ cup of mandarin
oranges).
Similarly, if for her fruit selection, she selects only one
Review
Manual
Page 87
of theAdministrative
fruits (either ½ cup
applesauce
or ½ cup
mandarin oranges), she must take the full vegetable
component offered (½ cup of broccoli and ½ cup of
carrots).

vegetable, the student must select the full amount (1 cup total) of at least one of the
components (fruit or vegetable). An example is included in the text box to the right.
More details can be found in FNS Memorandum SP 10-2012 v. 9 Questions & Answers on the
Final Rule, “Nutrition Standards in the National School Lunch and School Breakfast Programs”,
and the USDA Offer versus Serve Manual, effective SY 2015-16.

Alternate Meal Service Locations
Meals served at alternate meal service locations must meet Offer versus Serve requirements, if
applicable.
Lunches Consumed Off-site
In high schools, Offer versus Serve can be omitted for lunches consumed off-site, such as on
field trips, with approval from the SA. Meals served off-site must meet regular Program meal
pattern requirements, outlined at 7 CFR 210.10(m) and 7 CFR 220.8(m). See FNS Instruction
786-8, Reimbursement for Off-Site Meal Consumption, for additional guidance.

Non-reimbursable meals
Meals that contain fewer than three different food components (in the NSLP) or three food
items (in the SBP) are not reimbursable under Offer versus Serve.
Under Offer versus Serve, meals with less than ½ cup of fruits and/or vegetables are not
reimbursable. The SA must disallow/reclaim meals with less than ½ cup of fruits and/or
vegetables.
Step 3: Recording Errors
Review findings related to Offer versus Serve implementation are recorded on the On-site
Assessment Tool, Questions 500-502.

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Additionally, errors related to non-reimbursable meals are recorded on the On-site Assessment
Tool, Questions 401-402.
•

Meals that contain fewer than three components/food items, or meals that do not
include a ½ cup of fruit and/or vegetable, are recorded on Question 401.

•

Meals that contain a fruit and/or vegetable, but less than the required ½ cup, are
recorded on Question 402.

Technical Assistance/Corrective Action
The SA must provide technical assistance to bring meals into compliance and ensure that the
SFA only claims reimbursable meals, containing at least three food components (in the NSLP) or
at least three food items (in the SBP), in the required quantities, including at least ½ cup of a
fruit and/or vegetable...
If areas of noncompliance are identified, the SA must record the findings in the comment
section for Questions 500-502 of the On-site Assessment Tool. For example, if a student selects
three meal components (in the NSLP) or three food items (in the SBP) (including ½ cup of fruit
and/or vegetable) but declines milk, and the cashier sends the student back to get milk, the
cashier’s action should be cited as an opportunity for technical assistance . Students are not
required to select milk in Offer versus Serve.
The SA should pay particular attention to any errors suggestive of systemic problems. For
example, if the cashier counts a meal as reimbursable that is missing the required number of
Offer versus Serve food components (in the NSLP) or food items (in the SBP), the SA must
determine whether this is a one-time occurrence or representative of a systemic issue.
If this error is not a one-time error, and determined systemic, training the SFA in Offer versus
Serve should be included in the Corrective Action Plan. The SA must provide technical

Administrative Review Manual Page 89

assistance to the SFA for food component/item and/or quantity errors involving Offer versus
Serve in order to bring the SFA into compliance.

Fiscal Action
Refer to the Meal Components and Quantities module in this section to better understand the
fiscal action requirements that apply to Offer versus Serve. The only error that applies
exclusively under Offer versus Serve is disallowance of meals that have less than ½ cup of fruits
and/or vegetables. Other meal pattern errors are captured under the Meal Components and
Quantities module. Meals that contain less than ½ cup fruits and/or vegetables are recorded on
Questions 401 and 500 of the On-site Assessment Tool.

Administrative Review Manual Page 90

Module: Dietary Specifications and Nutrient Analysis
Intent/Scope of Monitoring
The Dietary Specifications and Nutrient Analysis Module details procedures to assess whether
meals offered to children through the school meal programs are consistent with Federal
standards for calories, saturated fat, sodium, and trans fat (7 CFR 210.10 (f) and 7 CFR 220.8(f)).
To reduce childhood obesity and minimize students’ risk of chronic disease, SA staff must
ensure SFAs are offering meals that meet regulatory requirements.

Review Procedures
The SA must assess compliance with the Module: Meal Components and Quantities before
assessing compliance with this Module.
Note: The procedures outlined below (except fiscal action) will not be followed when certifying
a SFA for the additional 6 cents reimbursement during an Administrative Review. For additional
information, see Addendum: Certifying a School Food Authority for Performance-based
Reimbursement during an Administrative Review.

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Pre-visit Review Procedures
Off-site Assessment Tool
The SA will need to address Questions 600-602 of the Off-site Assessment Tool based on the
information obtained from completing the Meal Compliance Risk Assessment Tool and the
Dietary Specifications Assessment Tool, if applicable.
Step 1: Selecting which Reviewed School is Most At Risk
The SA must determine which of the reviewed schools (as identified in Section I: Pre-visit
Procedures, Site Selection, of this manual) is at highest risk for
meal compliance violations. Working with the SFA, the SA
must complete the Meal Compliance Risk Assessment Tool for
each reviewed school. This screening tool assesses errorprone areas (e.g., multiple meal service lines, multiple age-

The Meal Compliance Risk
Assessment Tool
Assesses error-prone areas and
scores the reviewed site’s risk
for violations

grade groups, alternate meal service locations) and scores the
reviewed school’s risk for violations.
Supporting Documentation
Supporting documentation is not needed to complete the Meal Compliance Risk Assessment
Tool. However, supporting documentation is required to complete the targeted menu review
(see options under Step 3 below).
Step 2: Selecting the School Subject to a Targeted Menu Review
Based on the results of the Meal Compliance Risk Assessment Tool in Step 1, the SA must select
the school with the highest score, indicating the highest risk for meal compliance violations.
This school is subject to the targeted menu review as described in Step 3.
If two schools have the same Meal Compliance Risk Assessment Tool score, the SA may use the
following criteria to select the school for in-depth menu review (in order):
1. Previous Performance Standard 2 noncompliance (based on historical review findings)
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2. No past Administrative Review for the school
3. Request of the School Food Service Director
Either SA must conduct a targeted menu review, in accordance with one of the options
described in Step 3, for the school determined to be at the highest risk. If the school selected
for the targeted menu review only operates the SBP, the SA must select the highest scoring
school that participates in both NSLP and SBP. The school operating the SBP only must be
included as one of the schools selected for a SBP review (refer to Section I: Pre-visit Procedures,
Site Selection Procedures).
Step 3: Determining the SA’s Targeted Menu Review Approach and Conducting the Review
The SA has discretion to select one of four options for the targeted menu review of the one atrisk school identified in Step 2 above.
Each option described below is distinct and the SA must adopt one option in its entirety (i.e.,
the SA cannot combine facets of different options to complete the review). Noncompliance
with meal pattern requirements at the targeted menu review school may indicate high-risk for
noncompliance with Dietary Specifications. Please note that infant and pre-k meals following
the CACFP meal pattern are not included in the Dietary Specifications and a nutrient analysis is
not required. In case of noncompliance they should be oferred technical assistance. For
others, SAs should determine if findings are systemic or non-systemic. Systemic findings
indicate high risk for noncompliance and the SA must conduct a nutrient analysis. For nonsystemic findings, SAs have discretion to conduct a nutrient analysis or continue following the
low risk path. The nutrient analysis would be conducted after the SFA implements corrective
action to come into compliance with the meal component and quantity requirements.
However, non-systemic findings may still require technical assistance, corrective action, and/or
fiscal action.

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The SA may select one of the following for the Targeted Menu Review Options:
Summary of Targeted Menu Review Options
Option:

1.

Complete Dietary
Specifications Assessment
Tool
2. Validate Existing Nutrient
Analysis
(performed by SFA or contractor)
3. Conduct Nutrient Analysis
(performed by SA)
4. Use FNS-Approved Process
Utilizing Menu Planning
Tools for Certification for
Six Cent Reimbursement

Requires
Off-site
Review
Activities

Nutrient Analysis
May Not Be
Required
(Possible LOWRISK status)

X

X

Nutrient Analysis
Required
(HIGH-RISK status)

On-site Review Required
Using Dietary Specifications
Assessment Tool

Only for high-risk
schools

X

X

X

X

X

State must submit methodology to FNS for approval
Approvals are granted to SAs

Dietary Specifications Assessment Tool
The Dietary Specifications Assessment Tool captures information
about operational and menu planning practices and enables the SA
to further examine the school’s compliance with the meal pattern
requirements for the SBP and NSLP.
The Dietary Specifications Assessment Tool contains off-site and
on-site review elements. SAs that elect the risk-based approach

The Dietary Specifications
Assessment Tool
Analyzes food service
practices for breakfast and
lunch to determine whether
the meals are at risk for not
meeting the required dietary
specifications

(Option 1 below) to assess compliance with Dietary Specifications must complete the Tool offsite; however, the on-site portion of the Tool must be completed for all Targeted Menu Review
options. The Tool is intended to evaluate specific food service practices for breakfast and lunch
to determine the level of risk for not meeting the Dietary Specifications regulatory
requirements. When electing to validate or conduct a nutrient analysis, the SA may disregard
the risk determination indicated by the tool and continue to follow the procedures for
Administrative Review Manual Page 94

validating or conducting a nutrient analysis. However, the SA should provide technical
assistance to address any areas of concern identified by the Tool. It is important to note that
not all of the questions associated with the Tool are intended to imply that the related activity
is prohibited; rather, they reflect the possibility of a need for further review.
The following pages outline the four options that the SA may select for the targeted menu
review:
Option 1: Complete the Dietary Specifications Assessment Tool
Responses to the off-site portion of the Dietary Specifications Assessment Tool determine
whether the school selected for a targeted menu review is low-risk or high-risk for
noncompliance with Dietary Specifications regulatory requirements.
The SA will follow on-site procedures that correspond with the low-risk or high-risk
determination. If the school selected for a targeted menu review is low-risk, the SA must verify
compliance during the on-site review using the on-site portion of the Dietary Specifications
Assessment Tool and follow the appropriate on-site procedures based on the risk determination
indicated. A nutrient analysis may not be required. If the targeted menu review school is highrisk, the SA must complete a nutrient analysis for both breakfast and lunch (if applicable) using
USDA-approved software and complete the high risk on-site review procedures.
Off-site Review Procedures
To determine risk, the SA must complete the off-site portion of the Dietary Specifications
Assessment Tool, which requires that the SA:
•

Request at least one week of menu documentation from the review period for breakfast
and lunch, including but not limited to:
•

Menus

•

Production records
Administrative Review Manual Page 95

•

Standardized recipes

•

USDA Foods Information Sheets

•

Nutrition Information

•

How the products contribute toward meal pattern requirements (often in the
form of a CN Label or a product formulation statement, but not both)

Review the menu documentation from the review period to examine the school’s
compliance with the meal pattern requirements for SBP and NSLP. For efficiency, the SA
should review the same menus, production records, and standardized recipes for the
week used to review the Module on Meal Components and Quantities. If the SA feels it
needs more information to better understand usual practices at the school, it may
choose to review additional weeks within the review period. However, the week
selected for review must be in compliance with meal component requirements at a
minimum, and noted noncompliance must be addressed prior to conducting a nutrient
analysis. This may result in the SA being required to conduct a nutrient analysis on a
week outside of the review period. If fiscal action is required for a week outside the
review period, see Fiscal Action (below) for additional information.
•

Interview the SFA prior to the on-site review to complete the off-site portion of the
Dietary Specifications Assessment Tool. Completion of the Dietary Specifications
Assessment Tool requires information about food service practices that may not be
included in menu documentation.

The SA should grant the SFA sufficient time to gather and return the requested documentation
to the SA for review prior to the scheduled on-site visit.

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On-site Review Procedures
Procedures for Low-risk Schools
If the off-site portion of the Dietary Specifications Assessment Tool indicates the school is lowrisk, the SA must validate the low-risk status through:
•

Observation of the meal preparation and meal service, and completion of the on-site
portion of the Dietary Specifications Assessment Tool (this will help identify areas where
the SA can provide targeted technical assistance) and respond to Questions 603-605 of
the On-site Assessment Tool.

•

Review of food storage on the day of the review to check labels.

•

Evaluation of menus, production records, recipes, and any other documentation that
supports the meals offered.

When validating low-risk status through on-site review, the SA may encounter the following
situations:
•

On-site Observation Supports Low-risk Status
A nutrient analysis is not required. However, even low-risk schools will likely be able to
improve menu practices and meal quality. SAs must provide technical assistance to
address any areas of concern identified by the Tool. Any technical assistance provided
must be recorded on Question 603 of the On-site Assessment Tool. SAs also have
discretion to request corrective action. When technical assistance and corrective action
(if applicable) are complete, the targeted menu review is also complete.
NOTE: The SA has the discretion to conduct a nutrient analysis and is encouraged to do
so if it has concerns about the SFA’s food service practices.

•

On-site Observation Does Not Support Low-risk Status
If the on-site portion of the Dietary Specifications Assessment Tool is determined highrisk based on observation and supporting documentation, the SA must conduct a
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weighted nutrient analysis for breakfast and lunch following the High-risk On-site
Review Procedures described below.
•

On-site Observation Does Not Support Low-risk Status and Severe Noncompliance
Identified
If the SA identifies severe noncompliance, the school will automatically be categorized
as high-risk. The SA may use discretion when determining “severe noncompliance”
based on their observations. Severe noncompliance could be, but is not limited to, any
of the following findings:
•
•
•
•
•

Missing meal components
Missing vegetable subgroups
Missing production records
Inadequate quantities (systemic issue, as determined by expanded review)
Minimum quantity requirements not met for grains and or meats/meat
alternates (systemic issue)

Severe noncompliance includes one or more practices observed on-site that could
indicate violations of the Dietary Specifications. Reviewers must determine the severity
of noncompliance. If those practices put the school at risk for violating Dietary
Specifications requirements, the SA must conduct a weighted nutrient analysis for
breakfast and lunch following the High-risk On-site Review Procedures described below.
Procedures for High-Risk Schools
For sites determined to be at high-risk, the SA must conduct or validate a weighted nutrient
analysis for one week from the review period for breakfast and lunch. To conduct a weighted
nutrient analysis on meals offered for each age/grade group and menu type at breakfast and
lunch, the SA must request breakfast and lunch documentation, including menus, production
records, standardized recipes, Nutrition Facts Labels, crediting documentation, and
manufacturer specification sheets.

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The SA will proceed to the Nutrient Analysis and Validation Checklist, complete the on-site
portion of the Dietary Specifications Assessment Tool (which will help identify areas where the
SA can provide targeted technical assistance), and respond to Questions 603-605 of the On-site
Assessment Tool. The SA must request corrective action and/or assess fiscal action as
appropriate.
During the on-site portion of the Administrative Review, the SA will have the opportunity to
examine menu documentation with the SFA and clarify any questions. In addition, the SA will
provide targeted technical assistance for the areas contributing to high-risk status and request
corrective action as needed.
The nutrient analysis must be completed in order for the SA to close the Administrative Review.
If the nutrient analysis is not completed before the SA sends the Administrative Review Report
to the SFA, the SA must advise the SFA that the review remains open until the nutrient analysis
is complete.
For detailed instructions on conducting a weighted nutrient analysis using USDA-approved
software, refer to FNS’s Nutrient Analysis Protocols: How to Analyze Menus for USDA's School
Meals Programs.
The Nutrient Analysis and
Validation Checklist

Option 2: Validate Existing Nutrient Analysis
Off-site Review Procedures
The SA may validate an existing nutrient analysis conducted by
the SFA (or contractor) using USDA-approved nutrient analysis
software for the school selected for a targeted menu review.

Compiles information needed to
conduct or validate a nutrient
analysis. It includes a list of
necessary menu documentation,
important considerations, and
space for reviewers to note
comments

The SA is encouraged to begin activities to validate the nutrient analysis (e.g., collecting menu
documentation, data entry) prior to the on-site review, but it is not required. Completing some
Administrative Review Manual Page 99

or all of this work in advance allows for more time on-site to provide targeted technical
assistance.
The SA will proceed to the Nutrient Analysis and Validation Checklist, which provides a detailed
checklist for validating a nutrient analysis. The SFA must provide to the SA a copy of the
nutrient analysis (for breakfast and lunch) for the week of review and corresponding backup
documentation for validation. Supporting documentation should include, but is not limited to:
•
•
•
•
•
•

•

Menus
Production Records (detailing what was offered to students)
Standardized recipes
USDA Foods Information Sheets
Nutrition Information
Information about how the products contribute toward meal pattern
requirements (often in the form of a CN Label, CN Label copied with a watermark
along with the Bill of Lading, or a manufacturer’s Product Formulation
Statement, but not all three documents)
As needed, medical statements (signed by a State licensed healthcare
professional) supporting meal modifications for children with disabilities, when
modifications do not meet the Program meal pattern requirements ((Policy
Memorandum on Modifications to Accommodate Disabilities in the School Meal
Programs (SP 59-2016) and Statements Supporting Accommodations for Children
with Disabilities in the Child Nutrition Programs (SP 32 CACFP 13 SFSP 15-2015)).

The SA should grant the SFA sufficient time to gather and return the requested documentation
to the SA for review prior to the scheduled on-site visit.
The nutrient analysis must be conducted on each offered menu type for each age/grade group
for a week from the review period for the targeted menu review school only; an aggregated,
district-wide analysis cannot be accurately validated. The SA must verify the nutrient analysis
protocols are followed as detailed in FNS’s Nutrient Analysis Protocols: How to Analyze Menus
for USDA's School Meals Programs.

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On-site Review Procedures
During the on-site portion of the Administrative Review, the SA will have the opportunity to
examine menu documentation with the SFA and clarify any questions.
The SA must use the Dietary Specifications Assessment Tool on-site as this will help identify
areas where the SA can provide targeted technical assistance and respond to Questions 603605 of the On-site Assessment Tool. The SA must request corrective action and/or assess fiscal
action as appropriate.
The nutrient analysis must be validated in order for the SA to close the Administrative Review.
If the SA is unable to validate the nutrient analysis before the SA sends the Administrative
Review Report to the SFA, the SA must advise the SFA that the review remains open until the
nutrient analysis can be validated.
Option 3: Conduct Nutrient Analysis
Off-site Review Procedures
If the SA chooses Option 3, the SA must conduct a nutrient analysis using USDA-approved
nutrient analysis software. The SA is encouraged to begin conducting nutrient analysis activities
(e.g., collecting menu documentation, data entry) prior to the on-site review, but it is not
required. Completing some, or all, of this work in advance allows for more time on-site to
provide targeted technical assistance.
The SA will proceed to the Nutrient Analysis and Validation Checklist, which provides a detailed
checklist for conducting a nutrient analysis. The SA must request at least one week of menu
documentation for breakfast and lunch to conduct the nutrient analysis, including, but not
limited to:

Administrative Review Manual Page 101

•

Menus

•

Production records (detailing what was offered to students)

•

Standardized recipes

•

Nutrition information

•

Information about how the products contribute toward meal pattern requirements
(often in the form of a CN Label or a product formulation statement, but not both.)

•

As needed, medical statements (signed by a State licensed healthcare professional)
supporting meal modifications for students with disabilities, when modifications do not
meet the Program meal pattern requirements (Policy Memorandum on Modifications to
Accommodate Disabilities in the School Meal Programs (SP 59-2016) and Statements
Supporting Accommodations for Children with Disabilities in the Child Nutrition
Programs (SP 32 CACFP 13 SFSP 15-2015)).

The SA should grant the SFA sufficient time to gather and return the requested documentation
to the SA for review prior to the scheduled on-site visit.
The nutrient analyses for breakfast and lunch must be conducted on each menu type offered to
each age/grade group in the targeted menu review school only. The SA must follow the
nutrient analysis protocols as detailed in FNS’s Nutrient Analysis Protocols: How to Analyze
Menus for USDA's School Meals Programs.
On-site Review Procedures
During the on-site portion of the Administrative Review, the SA will have the opportunity to
examine menu documentation with the SFA and clarify any questions.
The SA must complete the Dietary Specifications Assessment Tool on-site as this will help
identify areas where the SA can provide targeted technical assistance and respond to questions
603-605 of the On-site Assessment Tool. The SA must request corrective action and/or assess
fiscal action as appropriate.
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The nutrient analysis must be complete in order for the SA to close the Administrative Review.
If the SA is unable to complete the nutrient analysis before the SA sends the Administrative
Review Report to the SFA, the SA must advise the SFA that the review will remain open until the
nutrient analysis is complete.
For detailed instructions on conducting a weighted nutrient analysis using USDA-approved
software, refer to the FNS’s Nutrient Analysis Protocols: How to Analyze Menus for USDA's
School Meals Programs.
Option 4: Use FNS-approved Process Utilizing FNS-Approved Menu Planning Tools
The SA may propose an alternate method of assessing whether meals are compliant with the
Dietary Specifications using the USDA-approved Menu Planning Tools for Certification for Six
Cent Reimbursement. The proposed methodology must include a review of food purchasing,
menu planning, meal preparation, and the meal service, and must incorporate the regulatory
requirement to conduct a nutrient analysis. FNS approval of any alternate method is required
prior to its use during an Administrative Review. For additional information, please see FNS
Memorandum, SP 46-2013, School Nutrition Program Administrative Reviews: Assessing
Compliance with Dietary Specifications Using a USDA-Approved Menu Planning Tool for
Certification for Six Cent Reimbursement, available on FNS PartnerWeb.
Note: Under Section 747(b) of the Appropriations Act, Sodium Target 1 (as defined in 7 CFR
210.10(f)(3) and 220.9(f)(3)) remains in place for SY 2017-2018. Schools that meet Sodium
Target 1 are in compliance with the regulatory sodium limits. For additional information, see SP
32-2017, School Meal Flexibilities for School Year 2017-2018.

NOTE: Assessing Compliance with Zero Trans Fat Requirement
During the on-site review, the SA must review manufacturers’ food labels and packaging to
ensure that foods offered in reimbursable school meals contain zero grams of trans fat per
Administrative Review Manual Page 103

serving. A minimal amount of naturally occurring trans fat — found in products such as beef,
lamb, and dairy products made with whole milk — permitted. If there is trans fat listed on the
Nutrition Facts Label of a product containing meat or dairy, the SFA should request
documentation from the manufacturer that reports the source of the trans fat in the product.

Technical Assistance/Corrective Action
When the SA conducts an Administrative Review and finds that the school is not meeting the
Dietary Specifications requirements for calories, saturated fat,
sodium, or trans fat (as specified in 7 CFR 210.10 (f) and 7 CFR

Example:

220.8(f)), technical assistance is provided and corrective action

Review period: March

is required. SAs and SFAs must develop a Corrective Action

Day of Review: April

Plan with specific steps and reasonable timelines to bring the

Non-compliance with the meal
pattern requirements is identified for
March. The SFA implements
corrective action in May.

SFA into compliance (as required in 7 CFR 210.10(h) and 7 CFR
220.8(h)). The Corrective Action Plan will vary depending on
the nature of the changes necessary.
The SA may accept corrective action during the review, or — if
the school cannot immediately implement the corrective action
— the SA can require it as part of a Corrective Action Plan.

The reviewer conducts a nutrient
analysis for a menu week in May, and
finds repeated Dietary Specifications
violations. Fiscal action may be
assessed as follows:
•

If the SA implements and verifies immediate corrective action
during the on-site portion of the Administrative Review, the
new practice should be included in the nutrient analysis. For
example, if the SA identifies high sodium items on the salad
bar, and then the SFA eliminates those items immediately, the

•

If May is a closed claim for
reimbursement, fiscal action will
be assessed with the review
period (i.e., March claim).
If May is an open claim for
reimbursement, fiscal action will
be assessed with the Day of
Review (i.e., April claim).

SA would not include the high sodium salad bar items in the
nutrient analysis.

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If no immediate corrective action takes place, the SA must include current practices in the
nutrient analysis. For example, if the SFA cannot immediately eliminate high sodium items on
the salad bar, but will work with their vendor in order to correct this in the future, the SA must
include the high sodium items in the nutrient analysis.
Recording Errors
Errors related to the Dietary Specifications are recorded on Questions 603 and 605 of the Onsite Assessment Tool.
SFA Fails to Submit Documentation Necessary to Complete Review
If the SFA fails to submit the menu documentation required to complete this section of the
Administrative Review, and program compliance cannot be satisfactorily verified by the SA,
withholding of program payments would be appropriate (7 CFR 210.24). Refer to Section VIII,
Overview of Fiscal Action, Module: Withholding Payments, Discretionary Withholding.
However, for this specific scenario, SAs are required to consult their respective Regional
Office.

Fiscal Action
7 CFR 210.18(l)(2) gives SAs discretion to apply fiscal action for repeated violations involving
calories, saturated fat, sodium, and/or trans fat, provided that:
•

The SA has given technical assistance

•

The SA has previously required and monitored corrective action

•

The SFA remains noncompliant with the meal requirements established in 7 CFR parts
210 or 220

If, upon repeated violations, the SA exercises discretion to take fiscal action for Dietary
Specifications violations, all meals for the entire week may be disallowed/reclaimed, if
applicable. Fiscal action is limited to the school selected for the targeted menu review. A
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nutrient analysis using USDA-approved software is required to justify any fiscal action that may
be required due to noncompliance with Dietary Specifications requirements. Errors should be
recorded under the “Other (Repeat Only)” section of the School Data and Meal Pattern Error
Form, S-1, Line 16A.
If, upon repeated violations, the week subjected to fiscal action is outside the review period,
proceed as follows:
•

If the nutrient analysis week for which fiscal action is being assessed is from a closed
Claim for Reimbursement, record all data for each month on the appropriate forms and
workbooks (e.g., S-1, fiscal action workbook) under Review Period.

•

If the nutrient analysis week for which fiscal action is being assessed is from an open
Claim for Reimbursement, record all data for each month on the appropriate forms and
workbooks (e.g., S-1, fiscal action workbook) under Day of Review.

Performance-based Certification Funding (6 cents)
If the Administrative Review finds that significant noncompliance exists that requires the SFA to
develop and implement a Corrective Action Plan over an extended period of time (e.g.,
problems that cannot be fixed immediately), the SA must use its best judgment to assess the
longevity and severity of the problems. If the SA determines that the performance-based
reimbursement should be terminated, it should be terminated beginning the month following
the on-site Administrative Review and, at SA discretion, for the month of review. Previously
paid performance-based reimbursement would only be recovered in circumstances of clearly
egregious or willful noncompliance by an SFA.
Performance-based reimbursement may resume beginning in the first full month the SFA
demonstrates to the satisfaction of the SA that corrective action has taken place.

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When the performance-based reimbursement is terminated, and the SFA operates both NSLP
and the Seamless Summer Option, refer to Section VIII, Overview of Fiscal Action, Module:
Duration of Fiscal Action, Performance-based Reimbursement.

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Addendum: Certifying a School Food Authority for
Performance-Based Reimbursement During an
Administrative Review
Intent/Scope of Monitoring
SFAs that are not certified to receive the performance-based reimbursement must be assessed
for certification during an Administrative Review. This method of certification permits State
agencies to conduct menu review activities that satisfy both performance-based certification
and Administrative Review requirements.

Review Procedures
Certifying a SFA for performance-based reimbursement during an Administrative Review
requires the SA to:
(1) Select schools for review representing all menu types in the SFA, and
(2) Conduct a weighted nutrient analysis for each menu type offered in the SFA (breakfast
and lunch) to ensure that meals offered comply with dietary specifications
requirements.
Aside from these two requirements, the Administrative Review activities outlined in this
manual are sufficient to certify an SFA as eligible to receive the performance-based
reimbursement.
Site Selection
To select review schools, SAs conducting certification during an Administrative Review must:

Administrative Review Manual Page 108

1. Determine and select the minimum number of schools in the SFA based on the school
selection procedures under 7 CFR 210.18(e)(1) and (2);
2. Identify the different menu types offered in the schools selected for review;
3. Categorize the schools by menu type (e.g., Pre-K, K-5, 6-8, 9-12); and
4. Ensure the selected schools for review cover each menu type in the SFA.
If the site selection steps above do not result in the selection of each of the menu types offered
by the SFA, the SA must repeat the school selection process outlined above until all menu types
are represented in the schools selected for review. When SAs are required to repeat the school
selection process, the minimum number of schools to review may be maintained by replacing a
school with one that meets the school selection criteria. However, the SA must ensure all the
menu types are represented correctly (i.e., the required selection criteria in 7 CFR 210.18(e)(2)
and all menu types must be represented in the schools selected for review).
Weighted Nutrient Analysis
On-site certification requires the SA to conduct a weighted nutrient analysis for each menu type
offered in the SFA (breakfast and lunch). For more information concerning the procedures for
certifying a SFA during an Administrative Review, refer to FNS Memorandum, SP 26-2014, New
Questions and Answers Related to the Certification of Compliance with Meal Requirements for
the National School Lunch Program, available on the FNS PartnerWeb.
Note: The procedures outlined in the Dietary Specifications and Nutrient Analysis module
(except fiscal action) will not be followed when certifying a SFA during an Administrative
Review.

Technical Assistance/Corrective Action
When the SA conducts certification activities during an Administrative Review and finds that the
SFA is not meeting meal pattern and/or dietary specifications requirements, technical
assistance and corrective action are the first steps that must be taken. SAs and SFAs should
develop a Corrective Action Plan with specific steps and reasonable timelines for bringing the
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SFA into compliance. The Corrective Action Plan will vary depending on the nature of the
changes necessary.

Notifying the SFA of Certification Status
If the SA determines the SFA is eligible to receive the performance-based reimbursement, the
SA must notify the SFA of its certification status and when the performance-based
reimbursement will be initiated.
If the SA is unable to certify the SFA due to noncompliance, the SA must provide technical
assistance and require corrective action. The SFA may be certified when corrective action is
completed. At the exit conference, the SA must ensure the SFA understands future steps that
must be taken to become certified to receive the performance-based reimbursement.

Fiscal Action
Fiscal action must be assessed for any noncompliance found during certification and
Administrative Review activities. See the Meal Components and Quantities and Dietary
Specifications and Nutrient Analysis modules for additional details on how to assess fiscal
action.

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Section IV: Resource Management

Modules contained within this Section include:
 Risk Assessment for Resource Management
 Maintenance of the Nonprofit School Food Service Account
 Paid Lunch Equity
 Revenue from Nonprogram Foods
 Indirect Costs

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Module: Risk Assessment for Resource Management
The intent and scope of monitoring in this section is to apply a systematic approach to ensuring
the overall financial health of an SFA’s nonprofit school food service. This Section consists of a
review of four areas integral to the financial health of the SFA’s school food service. The SA
may always supplement the review activity to include additional areas. The monitoring areas
are:
•

Maintenance of the Nonprofit School Food Service Account
The SA must ensure that revenues and expenses* under the nonprofit school food
service account are in accordance with 7 CFR 210.14. The nonprofit school food service
expenses must be allowable — used only for the operation and improvement of the
school food service — and net cash resources may not exceed three months' average
operating expenses. (7 CFR 210.14)
*Note: In assessing compliance with the Net Cash Resource’s provision FNS has
chosen to use the word “expenditure” for consistency with Federal regulations.
In all other areas of the Resource Management (RM) Section FNS has chosen to
use the word “expenses”.

•

Paid Lunch Equity
The SA must ensure that SFAs comply with the requirements for pricing paid lunches. (7
CFR 210.14(e))

•

Revenue from Nonprogram Foods
The SA must ensure that SFAs comply with the requirement that revenues from the sale
of nonprogram foods generate at least the same proportion of total school food service
account revenues that expenses from the purchase of nonprogram foods contribute to
total school food service account food costs. (7 CFR 210.14(f))
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In addition, the SFA must price adult meals so that adult payments are sufficient to
cover the overall cost of meals, including the value of any USDA Foods used in the
production of adult meals. (FNS Instruction 782-5 REV. 1)

•

Indirect Costs
The SA must ensure that SFAs follow fair and

Why use a Risk Indicator Tool?

consistent methodologies to identify and allocate
allowable indirect costs to school food service
accounts. (2 CFR 200)

The purpose of the Resource
Management Risk Indicator Tool is to
forecast and/or assess, through the use
of known indicators, situations that may
result in noncompliance.

Using a balanced review approach to monitor a SFA’s resource management (RM) practices
ensures that potential problems are identified while limited resources can be focused on those
SFAs most at risk of noncompliance. The Off-site Assessment Tool’s resource management
section and the Resource Management Risk Indicator Tool are designed to help SAs target a
more in-depth review of specific resource management areas via the Resource Management
(RM) Comprehensive Review Form to those SFAs that demonstrate an increased risk of potential
noncompliance and/or noncompliance with resource management requirements.

Review Procedures
Using the Off-site Assessment Tool
Questions 700-712 in the Off-site Assessment Tool focus on the following areas: maintenance of
the nonprofit school food service account, paid lunch equity, revenue from nonprogram foods,
and indirect costs. The SA must indicate in the Off-site Assessment Tool if the SFA should
answer Q700-712 based on its financial management practices during the previous school year
or the last audited school year (Resource Management (RM) Review Period). If sufficient
financial data is available, the State agency may choose to examine financial documentation
from the current school year when assessing an SFA’s compliance with the Paid Lunch Equity
and/or Revenue from Nonprogram Foods rather than data from the previous or last audited
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school year. State agencies have the discretion to establish deadlines with their SFAs for the
collection of the resource management information in the Off-site Assessment Tool so that the
SFA may receive a risk assessment in a timely manner. As a best practice, SAs should collect
the information for the Off-site Assessment Tool from the SFA as part of an interactive
discussion to ensure that the SFA fully understands the questions so that it can provide
accurate information. In addition to securing SFA answers to Q700-712 in the Off-site
Assessment Tool, the State agency may require SFAs to provide detailed comments in the Tool
and/or documentation supporting its answers. If at any time the SA is concerned that any of the
information provided by the SFA in the Off-site Assessment Tool is inaccurate, the SA must
follow up with the SFA to ensure that the SFA understands the questions correctly and provides
accurate answers.
The information derived from the Off-site Assessment Tool will be added into the Resource
Management Risk Indicator Tool by the SA.
Using the Resource Management Risk Indicator Tool
The Resource Management Risk Indicator Tool
identifies which SFAs need further review or are at risk
for noncompliance in the resource management areas.

Reviewer Tip
As early as possible in the program year (e.g., July
– September) send the Resource Management
portion of the Off-site Assessment Tool to all SFAs
scheduled for review in the coming school year.

The Tool includes four Resource Management areas
integral to the financial health of the SFA school food
service: Maintenance of the Nonprofit School Food Service Account, Paid Lunch Equity,
Revenue from Nonprogram Foods, and Indirect Costs. At least one question is asked under
each Resource Management area; some areas contain multiple questions that may indicate risk
(risk indicators). The Tool is expected to lead to a more targeted review that will ultimately
provide for streamlined, consistent, and effective management of program resources at the SFA
level. After the SFA completes the Off-site Assessment Tool and provides its information to the
SA, the SA must indicate on the Resource Management Risk Indicator Tool the review periods it
is assessing for each resource management area and transfer the SFA’s answers into the
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Resource Management Risk Indicator Tool by selecting the appropriate answer in the drop
down menu provided with each question to determine if a further comprehensive review is
necessary in any of the RM areas. If a comprehensive review of a RM area is needed, the
Resource Management Risk Indicator Tool will assess a “risk indicator” based on the SFA’s
answer to the RM question. It is important to note that not all of the questions associated with
the risk indicators are intended to imply that the related activity is prohibited; rather, they
merely reflect the possibility of a need for further review. While the Resource Management
Risk Indicator Tool is designed to assess potential risk, it is not intended to be a comprehensive
evaluation. Additional evaluation may be required to determine whether problems actually
exist. As a best practice, State agencies are encouraged to utilize SFA comments included in the
Off-site Assessment Tool, additional SFA financial data that may be collected, FNS or State
agency tools the SFA may complete (PLE Tool, Nonprogram Foods Revenue Tool), and/or other
financial documentation to validate the SFA’s answers in the Off-site Assessment Tool prior to
the SA completing the Resource Management Risk Indicator Tool on behalf of SFAs receiving an
Administrative Review. Follow up and validation is also strongly encouraged for SFAs that have
a history of financial mismanagement and/or for SFAs whose answer(s) changed significantly
from their last Resource Management review to the current review. For instance, a State
agency should ensure that an SFA receiving an Administrative Review understood Q706-708 if
the SFA charged far below the target weighted average paid lunch price during its previous AR
but indicates in the Off-site Assessment Tool for its current review that it charged the target
weighted average paid lunch price at all sites. Similarly, for question 709 follow up by the State
agency should occur if, for instance, the SFA sold a wide array of nonprogram food items during
its previous administrative review but indicates in the Off-site Assessment Tool that it doesn’t
sell any nonprogram foods during a subsequent administrative review. Further, if the SA has
concerns that the SFA may not have answered the RM questions in the Off-site Assessment Tool
accurately or if an on-site administrative reviewer observes that answers provided by the SFA
were inaccurate (e.g, the SFA indicated in its Off-site Assessment Tool that it didn’t sell adult
meals but an on-site reviewer observing the SFA’s meal service sees adult meals being served to
teachers), the State agency should follow up with the SFA to determine why the questions
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weren’t answered appropriately. The SA should not carry over the SFA’s incorrect answer(s)
into the Resource Management Risk Indicator Tool but instead include the correct answer(s) in
the Tool, note why the SA’s answer differs from the SFA’s in the comments section(s) and
assess the need for a RM comprehensive review accordingly. The SA has the discretion to
conduct a comprehensive resource management review of any or all RM areas even if no risk
indicators were triggered during the off-site assessment. If a SA has concerns about an SFA’s
financial management practices, FNS strongly encourages the SA to conduct a comprehensive
review of one or more resource management areas.
Risk Assessment Procedures for On-site vs. Off-site Comprehensive Reviews
When resource management comprehensive reviews are conducted on-site, all resource
management risk assessments must occur off-site prior to the SA’s on-site review of resource
management. The State agency has the discretion to determine how far in advance of an SFA’s
on-site review the SA reviewer must conduct the off-site resource management risk
assessment.
The resource management risk assessment procedures are generally the same as above for SAs
that conduct required RM comprehensive reviews off-site and those that conduct the reviews
separately from the rest of the on-site Administrative Review. In these instances, however, the
on-site Administrative Review does not include a comprehensive RM review since the review of
this area is taking place at another time or off-site so it is not necessary to conduct the off-site
RM risk assessment prior to the on-site review of the other Administrative Review areas. SAs
must still gather information electronically, via hard copy or verbally from the SFA off-site to
ensure they have the data they need to complete the Resource Management Risk Indicator Tool
and determine if a comprehensive RM review of one or more of the four areas is necessary. If a
comprehensive review of any area(s) is required, the State agency may conduct the review offsite.

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All documentation, including invoices and other materials needed to conduct a comprehensive
review of allowable costs, may be gathered and reviewed off-site. However, SAs must assess
their ability to secure the documentation they need to thoroughly conduct a comprehensive
review of all areas receiving risk indicators. If the SFA is unable to provide all necessary
resource management documentation in a timely manner to the State agency, the State agency
must conduct an on-site comprehensive resource management review of any RM areas that
received a risk indicator and for which efforts to obtain sufficient documentation to conduct an
off-site review were unsuccessful.
Review Procedures for SFAs receiving risk indicators in one or more resource management
areas: If an SFA receives one or more risk indicators in one of the four resource management
areas, the State agency must conduct a comprehensive review of the RM area in which the risk
indicator(s) was received. If an SFA receives one or more risk indicators in more than one
resource management area, the SA must conduct a comprehensive RM review of each RM area
in which a risk indicator was assessed. For instance, if an SFA receives one risk indicator under
the Maintenance of the Nonprofit School Food Service RM area and one risk indicator under
the Revenue from Nonprogram Foods RM area, the SA must conduct a comprehensive review
of the Maintenance of the Nonprofit School Food Service RM area and a comprehensive review
of the Revenue from Nonprogram Foods RM area. The SA must only perform a comprehensive
review of all four resource management areas if the SFA receives one or more risk indicators in
all of the four RM areas or if the Resource Management Risk Indicator Tool was not completed
off-site by the SFA prior to the resource management review.
Using the Resource Management Comprehensive Review Form
The Resource Management (RM) Comprehensive Review Form should be used when conducting
a comprehensive review of SFAs that receive one or more risk indicators within one of the four
resource management areas. As previously noted, SAs may add questions to the Resource
Management Comprehensive Review Form to take a closer look at specific SFA financial
activities and to assess compliance with state laws and regulations pertaining to financial
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management. The scope of the resource management comprehensive review is described in
greater detail for each resource management area in the modules in this section. As indicated
previously, any findings identified during the course of the resource management review, even
if corrected by the SFA during the course of the RM review, must be followed up with corrective
action and technical assistance for the entire RM review period (previous school year or last
audited school year unless otherwise indicated) and current school year, if necessary. If
needed, corrective action must include the SFA’s adoption of internal controls to ensure
noncompliance does not occur in the future. If noncompliance is identified during the RM
review period, State agencies have discretion to examine financial documents from the current
school year to determine if additional corrective action is necessary. Refer to the modules that
follow for more information.
Comprehensive resource management reviews for all four RM areas may occur on-site or offsite. If the State agency reviewer wishes to conduct an off-site comprehensive review, the
reviewer must be able to secure all financial documents needed to sufficiently assess the SFA’s
compliance with the RM requirements. Some RM areas, such as the Maintenance of the
Nonprofit School Food Service Account and Revenue from Nonprogram Foods areas, require a
review of invoices and other documentation which may take some time for the SFA to gather.
For this reason, State agencies are strongly encouraged to secure the SFA’s Off-site Assessment
Tool and complete the Resource Management Risk Indicator Tool at the beginning of the school
year (e.g., July-September) in which an SFA’s Administrative Review AR will occur. This should
provide sufficient time to the SFA to gather and provide any needed financial documentation
the SA may need to conduct some or all of the RM review off-site.
FNS strongly encourages SAs to include the SA financial management staff in the analysis of the
completed Resource Management portion of the Off-site Assessment Tool and the Resource
Management Risk Indicator Tool. If necessary, SA financial management staff should also be
included during the course of any resource management comprehensive review.

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Technical Assistance/Corrective Action
FNS requires technical assistance and corrective action in all instances where the SA identifies
violations of the resource management regulations or guidance. During the resource
management assessment and review process, reviewers should refer to the Resource
Management Comprehensive Review Tool for further guidance and instructions for how to
assess a SFA’s compliance and need for technical assistance concerning Federal resource
management requirements.
FNS encourages the SA to conduct a follow-up review for repeated instances of resource
management noncompliance. Required corrective action and/or technical assistance must be
recorded in the applicable comments sections in the Off-site Assessment Tool, On-site
Assessment Tool, or Resource Management Comprehensive Review Form.

Fiscal Action
This is a General Area, thus fiscal action is not required. In some instances, such as the
expenditure of nonprofit school food service monies on unallowable costs or “double dipping”
when indirect costs are charged, the SA must withhold funds or the LEA must otherwise
reimburse the nonprofit school food service account in full to cover the amount of funds
misspent and/or overcharged to the account. FNS encourages the SA to consider withholding
program payments, in whole or in part, to any SFA for repeated or egregious violations that are
not corrected. While withholding program payments is not included in the specific regulatory
definition for fiscal action, additional information can be found in Section VIII, Fiscal Action,
Module: Withholding Payments.

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Module: Comprehensive Review – Maintenance of the
Nonprofit School Food Service Account
Intent/Scope of Monitoring
This Module must be used to conduct a comprehensive review of the SFA’s resource
management practices and may be used in whole or in part to assess compliance and/or the
need for technical assistance concerning individual risk indicators triggered during a SFA’s
Resource Management risk assessment. When conducting a review of the maintenance of the
nonprofit school food service account, the SA must assess an SFA’s risk of noncompliance with
the provisions of 7 CFR 210.2, 210.14(a), 210.14(b), and 210.19(a)(1), which address the
maintenance of the nonprofit school food service account and 2 CFR 200.302, 2 CFR 200.303
and 2 CFR 200 Subpart E which pertain to internal controls and allowable costs.
This Module focuses on ensuring the SFA is maintaining and using its nonprofit school food
service account according to regulatory requirements, which include observing the limitation
on the use of the nonprofit school food service account revenues set forth in 7 CFR 210.14, and
ensuring related costs are necessary, reasonable, and allocable set forth in 2 CFR 200 Subpart E.
SA monitoring of this area is intended to ensure that SFAs:
•

Use all nonprofit school food service revenue solely for the operation or improvement
of the school food service:


Revenues may be used for food, equipment, and labor to operate the meal
program; and



Revenues must not be used to purchase land and/or buildings, or to construct
buildings, unless approved by FNS.

•

Limit net cash resources to three months’ average expenditures, or have a process or SA
approved plan for spending the amount in excess of 3 months. Limiting the size of a

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SFA’s food service net cash resources ensures that funds in the nonprofit school food
service account are expended to improve program operations and meal quality.
•

Comply with allowable cost restrictions, limiting expenses of nonprofit school food
service funds to those costs that are necessary, reasonable, and allocable.

This section of review falls under the General Areas.

Review Procedures
The SA has the flexibility to review all aspects of the maintenance of the nonprofit school food
service account off-site if the SA is able to secure all of the financial documentation needed to
assess the SFA’s compliance in this area. The Maintenance of the Nonprofit School Food Service
Account section of the Resource Management Comprehensive Review Form is used when
conducting a comprehensive review of this Module. To answer the questions on the review
form, the SA must obtain documentation that may include, but is not limited to, the SFA’s
Statement of Revenues and Expenses, a balance sheet, general ledger, and/or other similar
documents. The SA must assess the information in accordance with the guidance below.
Documents for the Resource Management comprehensive review should be taken from the
Resource Management review period unless otherwise noted by the State agency
Nonprofit School Food Service Account and the Year End Available Balance:
The SFA must follow and document an annual process to identify revenue excess or shortfall .
To monitor compliance, the SA should use the SFA’s Statement of Revenues and Expenses (may
also be called an Income Statement, P&L, etc.) for the RM Review Period to identify the
following:
Fund Balance or Carryover + Total Revenues – Total Expenses = Revenue Shortfall or Excess

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•

Step 1 — Total Nonprofit Food Service Revenues: Determine the SFA’s available
revenues for the RM review period. The SA must identify all monies received by or
accruing to the nonprofit school food service account, including but not limited to meal
payments, earnings on investments, other local revenues, State revenues (i.e.,
reimbursements and State match), and Federal cash reimbursements. This information
should be available on the Statement of Revenues and Expenses, the general ledger, or
other similar documentation. SFAs that commingle their nonprofit school food service
account with other school accounts must provide the SA with sufficient information to
identify all revenue available to the school food service.

•

Step 2 — Total Expenses: Determine the SFA’s total operating and nonoperating
expenses incurred in the operation or improvement of the nonprofit food service during
the RM review period. Operating expenses may include administrative expenses such
as salaries, fringe benefits, professional services, cleaning, repairs, maintenance and
depreciation. SFAs that commingle their nonprofit school food service account with
other school accounts must provide the SA with sufficient information to identify all
expenses charged to the school food service.

•

Step 3 — Year End Balance: Calculate the SFA’s year end balance using the values from
Step 1 and Step 2:

Total Current Revenue (Step 1) - Total Current Expenses (Step 2) = Year End Balance (Step 3)

Once the State agency reviewer has calculated the SFA’s year end balance, the State agency
will determine if the SFA operated at a deficit, requiring a transfer of funds into the nonprofit
school food service account. A transfer of funds to cover a revenue shortfall is allowable but
could indicate the need for the SFA to better assess its food costs, identify ways to reduce
food costs and/or labor, improve efforts to solicit student meal preferences to increase

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participation, or other activities to generate more revenues and/or reduce costs for the food
service.
Nonprofit School Food Service Account and Net Cash Resources
Net cash resources are defined under 7 CFR 210.2 as consisting of all monies, as determined
in accordance with the State agency’s accounting system, that are available to or have
accrued to an SFA’s nonprofit school food service at any given time, less cash payable. Net
cash resources may include, but are not limited to, cash on hand, cash receivable, earnings on
investments, cash on deposit and the value of stocks, bonds or other negotiable securities. 7
CFR 210.14(b) requires SFAs to limit their net cash resources in its nonprofit school food
service account to no more than three months’ average expenditures.
In order to calculate the SFA’s net cash resources, the reviewer should take the
following steps:
Step 1a — Calculate net cash resources:
Using the SFA’s year-end Balance Sheet (or comparable documentation) for the RM review
period, subtract the SFA’s current liabilities from its current assets (excluding inventories) to
obtain the SFA’s net cash resources.
Step 2a – Calculate net adjusted total operating expenses:
Using the SFA’s Statement of Revenues and Expenses (or comparable documentation) for the
RM review period, determine the SFA’s total operating expenses (minus depreciation).
Step 3a – Calculate average monthly expenses:
Divide the total operating expenses (calculated in Step 2a) by the number of the SFA’s
operating months (typically 9 or 10 months) to obtain the SFA’s average monthly expenses.

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Step 4a: Calculate average expenses for 3 month period:
Multiply the SFA’s average monthly expense amount by 3 to obtain the SFA’s 3 month average
monthly expenses.
Step 5a — Determine the SFA’s Compliance with Net Cash Resources Requirements:
If the annual net cash resources amount in Step 1a is less than the three months’ average
expenditure amount as determined in Step 4a, the SFA is in compliance. If the annual net cash
resources amount is higher than three months’ average expenditures, then the SFA is not in
compliance unless approval has been given by the SA to the SFA to carry an excess balance
temporarily.
State agencies should document its calculations in the Resource Management Comprehensive
Review Form and answer the corresponding questions for this section.
Internal Controls
Federal requirements under 2 CFR 200.303 require non-Federal entities, such as states and
SFAs, to establish and maintain effective internal control over the Federal funds they receive
that provides reasonable assurance that they are in compliance with Federal statutes,
regulations and the terms and conditions of the Federal award. Internal controls may include
processes that help ensure, for instance, that financial transactions are properly recorded and
accounted for, in order to permit the preparation of reliable financial statements and Federal
reports, maintain accountability over assets and demonstrate compliance with Federal statutes,
regulations, and the terms and conditions of the Federal award.
Questions are included in the Resource Management Comprehensive Review Form to assess the
types of internal controls that SFAs have implemented and to help identify additional
safeguards that SFAs should consider adopting. Because Federal regulations do not mandate
which internal controls are necessary at the SFA level, technical assistance rather than
corrective action should be provided, as needed, for this section of the RM review. However,
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State agency reviewers may determine when reviewing other sections within the resource
management review module that noncompliance identified at the SFA level may be a result of
insufficient internal controls, such as a lack of training or oversight, and that stronger internal
controls must be implemented as part of the SFA’s corrective action. For instance, if the State
agency reviewer finds that an SFA spent food service monies on unallowable costs, corrective
action must include reimbursement of the unallowable costs to the nonprofit school food
service account and the adoption of more rigorous internal controls, such as requiring annual
allowable cost training for staff authorized to submit food service receipts for payment.
In addition to implementing sufficient internal controls, State agencies are required under 7
CFR 210.19(a)(1) to ensure that school food authorities account for all revenues and
expenditures of their nonprofit school food service. SFAs that provide nonreimbursable meals
to students free of charge should be able to accurately track the number of nonreimbursable
meals they serve to ensure that the nonprofit school food service account is reimbursed for the
total cost of these meals per FNS Policy Memo SP 23-2017. Questions are included under the
Internal Controls section of the Maintenance of the Nonprofit School Food Service review area
to help State agencies determine if SFAs have procedures in place to track nonreimbursable
meals provided for free to students. SFAs that do not track nonreimbursable meals sufficiently
and/or have a process to reimburse the nonprofit school food service for the cost of the meals
should receive corrective action and technical assistance.
Allowable Costs
Overview
Federal regulations under 7 CFR 210.14(a) require all SFA food service operations to principally
benefit schoolchildren and all of the revenue in the SFA’s nonprofit school food service account
must be used solely for the operation or improvement of the food services. For this reason,
State agencies must ensure that only allowable costs are charged to the nonprofit school food
service account. 2 CFR 200 Subpart E provides more details about how to assess costs and their
allowability. In general, charges to the nonprofit school food service account must be:
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•

Reasonable: A reasonable cost must follow State and Federal regulations and
must follow restraints imposed by generally accepted sound business practices.
For example, as a best practice, reasonable costs should follow an “arms-length”
standard, meaning programs costs should be in line with the price that the item
or service would cost on the open market.

•

Necessary: Costs that are not necessary for program purposes or that do not
otherwise satisfy Federal cost principles and program regulations are
unallowable.

•

Allocable: Costs must be assigned to the programs, functions, and activities that
benefited from the SFA having incurred the cost.

In addition, costs that would otherwise be allowable may be made unallowable by the action or
inaction of the SFA. For example, if a SFA purchases kitchen equipment without following a
competitive procurement process or prior approval from the State agency, then that cost
becomes unallowable because the SFA failed to follow required procurement procedures. No
portion of an unallowable cost may be charged to the program. Certain expenses, such as
capital expenditures for improvements to land, buildings or equipment which materially
increases their value or useful life are unallowable. The SA must evaluate the SFA’s compliance
with allowable cost restrictions during the Maintenance of the Nonprofit School Food Service
comprehensive review by examining the SFA’s practices surrounding bad debt, equipment
purchases and by reviewing a sample of expenditures to ensure the SFA did not spend
nonprofit food service account funds on unallowable costs.
Bad Debt
FNS Policy Memos SP 23-2017 and SP 29-2017 provide guidance to State agencies and SFAs
concerning the problem of unpaid meal charges at school districts and best practices for
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resolving the challenges. SFAs may not use or provide nonprofit school food service account
funds to reduce or “zero out” outstanding food service balances. During a comprehensive
review of allowable costs, State agencies should ensure that SFAs encumbered with bad debt
have a process to ensure that nonprofit school food service account revenues are not used to
pay off bad debt.
Equipment Purchase Review
In addition, under certain circumstances, prior approval from the State agency is needed before
costs may be incurred. 2 CFR 200.439 requires non-Federal entities, such as SFAs, to obtain
approval from the State agency for equipment purchases of $5,000 or more. State agencies
may impose a capitalization level more restrictive than $5,000, in which case the State’s lower
threshold applies and their SFAs must receive prior approval before purchasing equipment
costing above the State’s capitalization level. States may implement pre-approved equipment
lists, with FNS approval, that allow their SFAs to purchase equipment included on the lists
without seeking further prior approval. For additional information, see FNS Policy Memo SP 312014, “State Agency Prior Approval Process for School Food Authority (SFA) Equipment
Purchases.” State agencies conducting an unallowable cost review of their SFAs will review
whether or not equipment purchases made by the SFAs with funds from their nonprofit school
food service account met the allowable cost requirements.
Allowable Costs Review
In addition to examining certain equipment purchases, the State agency must evaluate the
SFA’s compliance with allowable cost restrictions by:
•

Reviewing a sample of expenses by selecting expenses from the detailed general ledger
report for the RM review period to determine whether the recorded expenses represent
an activity or function recognized as reasonable and necessary for the operations of the
programs. If the detailed general ledger fails to provide sufficient information needed
to identify expenses, a review of invoices and receipts for the selected year may provide

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this information. To conduct a sample of the SFA’s expenses, the SA must perform the
following steps:
•

Conduct an assessment of approximately 10% of the expenses in the detailed
general ledger. The sample may be conducted as follows:


Review a minimum of 10% of salaries and benefits for the year or all
salaries from a selected full month; ensure all employees paid are
involved in the school meal programs and that they are only paid from
the nonprofit school food service account for the hours they worked in
the school food service.



Review a minimum of 10% of food, supplies and equipment for the year
or all food, supplies, and equipment from a selected full month;



Review a minimum of 10% of other expenses such as utilities (electric,
water, gas, etc.), travel costs and/ or rental space (storage) for the year
or all expenses from a selected full month.

While reviewing the sample of expenses, the SA reviewer should identify any expenses that
appear to be unnecessary or incompatible with the operations of the school food service and
examine invoices for those charges that may be unallowable. For instance, if the reviewer
identifies that an SFA was pre-approved to use nonprofit school food service account funds to
purchase equipment but also purchased items not included on the State agency’s pre-approved
equipment list or used nonprofit school food service funds to make improvements to the school
building that should have been covered by the school district, the State agency would assess a
finding and required corrective action, such as repaying the nonprofit school food service
account for the unallowable costs. Other examples of unallowable cost could include using
nonprofit school food service account funds to pay bad debt associated with uncollectable
unpaid meal charges. The reviewer must interview SFA staff about any questionable items
identified and request additional information, such as invoices to substantiate the expenses,
and require corrective action, as needed.

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Rather than limiting the review of expenses to one full month or 10 percent of expenses, State
agencies have the discretion to expand the size of their review to additional months during the
RM review period. Further, as noted, the 10% sample of a variety of expenses for the RM
review period is a minimum; State agencies may choose to sample a larger percentage of
expenses to better ensure that reviewed SFAs are limiting their nonprofit school food service
account expenditures to allowable costs. State agencies that conduct procurement reviews of
their SFAs in the same year as they conduct Administrative Reviews of the same SFAs will
gather a “vendor paid list” or detailed general ledger from the SFA for the previous school year.
SAs have discretion to evaluate charges on the vendor paid list for a longer period of time than
one month. As a best practice, SFAs conducting procurement reviews should streamline their
request for review documents from the SFA to ensure different reviewers, such as an RM
reviewer and a procurement reviewer, aren’t asking for the same documents. SAs should also
ensure that findings identified as part of procurement reviews are communicated to the SA’s
resource management reviewer(s) and vice versa as there may be overlap of findings in the
area of allowable costs. For instance, if a procurement review conducted before the RM
allowable cost review identifies that equipment was secured by the SFA noncompetitively, the
purchase may be unallowable and the SFA may be required to repay the nonprofit school food
service account for the cost of the equipment, the SA may be able to determine during an RM
comprehensive review that the nonprofit school food service account was repaid.

Technical Assistance/Corrective Action
When documenting corrective action, the reviewer must include information about the SFA’s
violation of Federal law, regulations, or applicable policy guidance, as well as information on
the adjustments needed for the SFA to become compliant. Needed corrective action and/or
technical assistance must be recorded in Resource Management Comprehensive Review Form
when a Resource Management comprehensive review is conducted.

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Corrective action and technical assistance should be taken for the entire RM review period
(previous or last audited school year) and for the current school year, if necessary.
For example, if the SA finds that the SFA inappropriately spent nonprofit school food service
funds on unallowable costs during the RM review period, corrective action will require a
transfer of funds from the LEA’s general fund into the nonprofit school food service account or
require the LEA to otherwise reimburse the school food service for the unallowable expenses.
The reviewer should ensure that the LEA reimburses the nonprofit school food service account
if the same unallowable costs were charged to the nonprofit school food service account during
the current school year. Corrective action should also include the adoption of internal controls
to ensure noncompliance does not occur in the future.

Fiscal Action
This is a General Area, thus fiscal action is not required. FNS encourages the SA to consider
withholding program payments, in whole or in part, to any SFA for repeated or egregious
violations that are not corrected. While withholding program payments is not included in the
specific regulatory definition for fiscal action, additional information can be found in Section
VIII, Fiscal Action, Module: Withholding Payments.

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Module: Comprehensive Review — Paid Lunch Equity
Intent/Scope of Monitoring
This Module must be used to conduct a comprehensive review of the SFA’s resource
management practices in the Paid Lunch Equity (PLE) Resource Management area. The intent
in monitoring this provision is to ensure support for paid lunches is in compliance with section
205 of the Healthy, Hunger-Free Kids Act (HHFKA) of 2010 (Public Law 111-296). The HHFKA
required SFAs that, on average, charge for paid lunches less than the difference between the
federal reimbursements for free and paid lunch to either gradually adjust paid lunch prices
upward or provide non-Federal funds to cover the difference. This requirement is intended to
ensure that SFAs provide sufficient funds to the nonprofit school food service account for paid
lunches. Additional details are provided in 7 CFR 210.14(e). When conducting a review of paid
lunch equity when the RM review period selected by the SA is either the previous school year
or last audited school year, the SA must evaluate the prices the SFA charged for paid lunches in
relation to the Federal paid and free reimbursement rates. To do so, SFAs must determine:
•

the weighted minimum average paid lunch price charged for paid lunches in the
previous school year

•

the difference between the free lunch per meal reimbursement rate and the paid lunch
per meal reimbursement rate in effect for the previous school year; this is also called
the ‘‘reimbursement difference’’

If an SFA’s weighted minimum average paid lunch price is equal to or greater than the
reimbursement difference, the SFA is not required to make any adjustments in lunch prices or
to add revenue to the nonprofit school food service account as long as it continues to charge a
weighted minimum average paid lunch price that is not less than the amount of the
reimbursement difference.
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If an SFA’s weighted minimum average paid lunch price is less than the reimbursement
difference, the SFA must increase prices for paid lunches or add financial support from nonFederal sources to the school food service account.
If, however, the State agency chooses to review the current school year for the PLE rather than
the previous or last audited school year, the SA must only determine, when conducting
comprehensive reviews under the PLE, if its SFAs had zero or positive nonprofit school food
service account balance as of January 31, 2018. This shortened comprehensive review process
for PLE reviews using current school year data is due to the passage of the FY 2018
Consolidated Appropriations Act (Public Law 115-141) which only requires SFAs with a negative
balance in their nonprofit school food service account to raise their paid lunch prices in
accordance with 7 CFR 210.14(e) provisions. This flexibility is only provided for SY 2018-2019.
More details are provided in FNS Policy Memo SP 12-2018.
This area falls within the General Areas of the Administrative Review.

Review Procedures
The Paid Lunch Equity section of the Resource Management Comprehensive Review Form
contains questions to assess the information in accordance with the guidance below. The SA
has the flexibility to cover this area either off-site or on-site.
Review procedures for State agencies reviewing the SFA’s current school year:
If a State agency chooses to review its SFAs’ implementation of the PLE for the current school
year, the State agency must obtain a balance sheet or comparable documentation that the SFA
used to determine if its nonprofit school food service account had a negative balance as of
January 31, 2018 and validate that the SFA was exempt from raising its paid lunch price(s). If
the SFA did not use the Paid Lunch Equity Tool or a comparable mechanism to determine if it
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needed to raise its paid lunch price(s) for SY 2018-2019 despite having a negative balance as of
January 31, 2018, the SA must require corrective action and technical assistance. Corrective
action may consist of requiring the SFA to complete the PLE Tool for SY 2018-2019 and raise its
paid lunch prices during the school year, if necessary, and/or transfer non-Federal funds into
the nonprofit school food service account to support paid lunch prices. The SA may also require
the SFA to provide documentation to the SA validating that the SFA transferred the necessary
non-Federal funds into the nonprofit school food service account and/or raised its paid lunch
prices.
If the SFA receiving a comprehensive PLE review had a negative balance in its nonprofit school
food service account as of January 31, 2018 and used the PLE Tool or a comparable mechanism
to assess its need to raise its paid lunch prices, the State agency reviewer should use the review
procedures below for the previous or last audited school year to determine if the SFA
completed its assessment correctly and added non-Federal funds to its nonprofit school food
service account and/or raised prices, as needed, to comply with the PLE requirements.
Review procedures for State agencies reviewing the SFA’s previous or last audited school year
(RM review period):
The State agency must first determine if the SFA used the PLE Tool or a comparable mechanism
in the year prior to the RM review period to determine if the SFA needed to raise its paid lunch
price and/or provide non-Federal funds to the nonprofit school food service account for the RM
review period. If the SFA did not use the Paid Lunch Equity Tool or a comparable mechanism to
determine if it needed to raise its paid lunch price(s) during the RM review period, the SA must
require corrective action and technical assistance. Corrective action may consist of determining
if the SFA had a positive or zero balance in its nonprofit school food service account as of
January 31, 2018. If so, no further corrective action would be necessary, but technical
assistance should be provided to ensure that the SFA understands the PLE requirements. If the
SFA had a negative balance as of January 31, 2018, the State agency may require the SFA to
complete the PLE Tool for SY 2018-2019 and raise its paid lunch prices during the school year, if
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necessary, and/or transfer non-Federal funds into the nonprofit school food service account to
support paid lunch prices. The SA may also require the SFA to provide documentation to the SA
validating that the SFA transferred the necessary non-Federal funds into the nonprofit school
food service account and/or raised its paid lunch prices. State agencies should contact their
FNS Regional Office if further guidance is needed in light of the current PLE flexibilities included
in Public Law 115-141.
If the SFA has completed the PLE Tool or a comparable mechanism for the RM review period,
the SA must validate the SFA’s completed Paid Lunch Equity Tool as follows:
Step 1: Obtain the SFA’s completed Paid Lunch Equity Tool or alternate documentation for
the previous school year. Validate the SFA’s Paid Lunch Equity calculations by crosschecking the data gathered with data used by the SFA.
Results:
a) If the SFA’s Paid Lunch Equity Tool can be validated by the SA, skip to step four
below.
b) If the SFA’s Paid Lunch Equity Tool cannot be validated by the SA, complete steps
two and three below.
Step 2 (if necessary): Complete a separate Paid Lunch Equity Tool using the following
information gathered from source documents from the SFA:
•

The SFA’s calculations for the RM review period used to determine if the SFA needed
to increase its paid lunch price. This could be a SFA-completed Paid Lunch Equity
Tool or alternative documentation

•

All paid lunch prices and the respective number of paid lunches served for October
of the School Year prior to the RM Review Period.

•

Total paid lunches claimed in the second preceding school year (needed if using nonfederal funds)

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Step 3 (if necessary): Enter the SFA’s data into a separate Paid Lunch Equity Tool to
determine whether or not a paid lunch increase was necessary.
Step 4: Determine if and how the SFA raised its paid lunch prices, if a price increase was
required. If paid lunch prices were not raised, determine whether the SFA used nonFederal sources to support its paid lunch prices. If non-Federal funds were used to
support paid lunch prices, the SA should determine whether the sources are allowable
and appropriately recorded in the nonprofit school food service account.
For a detailed list of allowable and unallowable non-Federal sources, see 7 CFR 210.14(e).

Technical Assistance/Corrective Action
The SA must require the SFA to take corrective action if the SA finds that the SFA:
•

incorrectly calculated the appropriate paid lunch price

•

did not raise its paid lunch price if such an increase was necessary

•

used unallowable non-Federal sources to support its paid lunch price

•

did not transfer a sufficient amount of non-Federal funds into the SFA’s nonprofit school
food service account if the SFA did not raise its paid lunch prices

Given the complexity of this issue, FNS encourages SAs to provide on-site technical assistance.
Needed corrective action and/or technical assistance must be recorded in the comments
section of the Off-site Assessment Tool when a reviewer is assessing compliance outside of a
Resource Management comprehensive review or in the Resource Management Comprehensive
Review Form when a Resource Management comprehensive review is conducted. Corrective
action must occur for the Resource Management review period and, if necessary, for the
current school year. The SFA should also adopt internal controls to ensure that noncompliance
does not occur in the future.
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Fiscal Action
This is a General Area, thus fiscal action is not required. FNS encourages the SA to consider
withholding program payments, in whole or in part, to any SFA for repeated or egregious
violations that are not corrected. While withholding program payments is not included in the
specific regulatory definition for fiscal action, additional information can be found in Section
VIII, Fiscal Action, Module: Withholding Payments.

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Module: Comprehensive Review — Revenue from
Nonprogram Foods
Intent/Scope of Monitoring
This Module must be used to conduct a comprehensive review of the SFA’s resource
management practices. When conducting a review of revenue from nonprogram foods, the SA
must assess whether the SFA took steps to ensure the revenues from the sale of nonprogram
foods generate at least the same proportion of SFA revenues as expenses from the purchase of
nonprogram foods contribute to the SFA’s food costs. (7 CFR 210.14(f))

Nonprogram food revenue
Total program + nonprogram revenue

>

Total nonprogram food cost
Total program + nonprogram food cost

FNS defines “nonprogram foods” as those foods and beverages sold in a participating school
other than reimbursable meals and meal supplements that are purchased using funds from the
nonprofit school food service account. Nonprogram foods include a la carte items and adult
meals. They also include items purchased with nonprofit school food service account funds for
vending machines, fundraisers, school stores, and catered and vended meals.

Review Procedures
The Revenue of Nonprogram Foods section of the Resource Management Comprehensive
Review Form provides review questions to assess the SFA’s compliance with the nonprogram
revenue requirements. The SA must assess the information in accordance with the guidance
below. The SA has the flexibility to cover this area either off-site or on-site and to review the
previous school year or last audited school year (RM review period) or the current school year.
The review procedures are the same if the SA is reviewing the previous school year, last audited
school year or the current school year.
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To review the SFA’s compliance with the Revenue from Nonprogram Foods requirements, the
SA must:
1. Identify the categories of nonprogram food and beverages provided by the SFA.
2. Ensure that the SFA was reimbursed for food and beverages it may have purchased for
internal or external entities (catering)
3. Review the price the SFA charges for adult meals to ensure that meals served to adults
are priced sufficiently to cover the overall cost of the meals. The overall cost of the
meals must include the value of any USDA Foods (entitlement and bonus). Note: For
more information, refer to FNS Instruction 782-5 REV. 1, Pricing of Adult Meals in the
National School Lunch and School Breakfast Programs. Further, the SA will assess if
adult meals are provided free of charge to teachers, parents, etc. if the SFA had a
sufficient process in place to recover the full cost of the adult meals. For CEP schools
that serve adult meals and do not collect cash at the point of service and/or otherwise
do not identify at the point of service the number of adult meals taken (if the general
fund reimburses the nonprofit school food service account for the full cost of the
meals), the State agency reviewer must determine if the nonprofit school food service
account is being reimbursed sufficiently for those meals. For example, a CEP school that
serves meals to adults but does not collect cash at the point of service and tells the
adults taking meals to simply “settle up their bill at the office” without a way to capture
the names of the adults served would not have sufficient internal controls to ensure
that adult meal payments are provided to the nonprofit school food service account and
corrective action would be necessary.
4. Determine how the SFA assessed its compliance with the revenue from nonprogram
food requirements in 7 CFR 210.14(f).
5. Determine if and how the SFA adequately addressed any shortfalls necessary due to
insufficient revenues generated by the sale of nonprogram foods.
6. Determine if the SFA may be in compliance with the Revenue from Nonprogram Foods
requirements despite not meeting the nonprogram food revenues/expenses ratio. This
could occur if the SFA only sold a limited number of nonprogram foods (i.e., milk) that
had an identifiable per-serving cost.
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Technical Assistance/Corrective Action
Any violations of program requirements require corrective action. Corrective action and/or
technical assistance are necessary if the SFA:
•

Did not include all nonprogram food revenues and costs in its assessment calculation;

•

Did not ensure specific nonprogram food revenues were transferred into its nonprofit
school food service account;

•

Priced adult meals below the cost of producing those meals or did not collect payment
for them in a reliable manner;

•

Did not assess its compliance with the Revenue from Nonprogram Foods requirements
via either the Nonprogram Foods Tool or 5-Day Reference Period as described in FNS
Policy Memo SP 20-2016;

•

Did not take steps to adequately increase its nonprogram food revenues and/or secure
general funds if out of compliance with the Revenue from Nonprogram Foods
requirements.

Corrective action must occur for the Resource Management review period and, if necessary, for
the current school year. The SA should also require the SFA to adopt internal controls to ensure
that noncompliance does not occur in the future. Needed corrective action and/or technical
assistance must be recorded in the Resource Management Comprehensive Review Form when a
resource management comprehensive review is conducted.
FNS recognizes there is wide variation in the capabilities of systems and mechanisms SFAs
employ to maintain and monitor their compliance with the revenue from nonprogram foods
requirements. In recognition of these potential difficulties and variations in system capabilities,
FNS released FNS Policy Memorandum SP 06-2016, Nonprofit School Food Service Account
Nonprogram Food Revenue Requirements to help SFAs and SAs better assess compliance with
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this requirement. Given the complexity of this issue, FNS encourages SAs to provide technical
assistance in this area. Technical assistance may include identifying opportunities at the SFA
level to increase the SFA’s revenue from the sale of nonprogram foods.

Fiscal Action
This is a General Area, thus fiscal action is not required. FNS encourages the SA to consider
withholding program payments, in whole or in part, to any SFA for repeated or egregious
violations that are not corrected. While withholding program payments is not included in the
specific regulatory definition for fiscal action, additional information can be found in Section
VIII, Fiscal Action, Module: Withholding Payments.

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Module: Comprehensive Review — Indirect Costs
Intent/Scope of Monitoring
This Module must be used to conduct a comprehensive review of the SFA’s resource
management practices. When conducting a review of indirect costs, the SA must evaluate
charges to the nonprofit school food service account, including allowable direct and indirect
costs.
Indirect costs are incurred for the benefit of multiple programs, functions, or other cost
objectives, and therefore cannot be identified readily and specifically with a particular program
or other cost objective. They typically support administrative overhead functions, such as
fringe benefits, accounting, payroll, purchasing, facilities management, and utilities.
Charges for indirect costs are based on two factors:
•

The indirect cost rate established for a specific fiscal year, and the corresponding
direct cost base;

•

A documented methodology that accurately allocates indirect costs.

In most cases, the indirect cost rate is in the indirect cost rate agreement negotiated and
approved by the associated State Educational Agency. Indirect cost rate agreements expire
annually and it is imperative that SFAs use the most current approved rate for each fiscal year.
The direct cost base is the sum of allowable and unallowable costs that receives a benefit from
the costs in the pool.
SAs must ensure that SFAs use the correct indirect cost rate and that the correct rate is applied
to the correct direct cost base. For further information on indirect costs, the SA should refer to
FNS’ Indirect Cost Guidance (SP 41-2011, with attachments).
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Note: The scope of monitoring may require the SA to assess how unit(s) of the LEA other than
the school food service implement their indirect cost responsibilities, as applicable.
This section of review falls under the General Areas.

Review Procedures
The Indirect Cost section of the Resource
Management Comprehensive Review Form
contains questions to assess the
information in accordance with the
guidance below. The SA has the flexibility
to cover this area either off-site or on-site.
The SA must review the following
information during the Administrative
Review:
1. Indirect Cost Rate Agreement:
Ensure that the SFA is using the
approved indirect cost rate from
the State Education Agency.
2. Use Correct Rate/Base: Ensure the indirect cost charged to the nonprofit school food
service account is consistent with the approved indirect cost rate to the direct cost
base found in the approved indirect cost rate agreement. See example above.
3. Accounting Consistency: Handling of indirect costs must be consistent in all activities of
the SFA unless otherwise exempted. For example, if the nonprofit school food service
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account is charged for electricity costs based on square footage, all other activities of
the SFA must be similarly charged, as applicable.
4. Prior Year’s Retroactive Billing: Confirm that the nonprofit school food service account
was not charged for indirect costs that were previously paid from the general fund. It is
unallowable to bill the school food service account for indirect costs unless an
agreement exists to show that the SFA had been “loaned” the nonprofit school food
service account funds to cover the indirect costs in one or more prior years with the
expectation of repayment. In such cases, accounting records should support
implementation of the loan agreement. For example, a transfer of funds from the
general fund to the food service account might be recorded as a receivable (e.g., “Due
from Food Service Fund”).
5. Proper Classification of Costs (Direct/Indirect): Costs must be consistently treated as
direct or indirect. Confirm that school food service accounts are not charged directly
for expenses that are included in the indirect cost pool (double dipping).
6. Support Documents for Indirect Cost Billing: Verify the documentation that supports
actual indirect costs charged to the school food service account. Check for
mathematical errors and confirm that indirect costs were calculated based on the
correct rate and the correct base.

Technical Assistance/Corrective Action
Needed corrective action and/or technical assistance must be recorded or in the Resource
Management Comprehensive Review Form when a resource management comprehensive
review is conducted. The SA must require the SFA to take corrective action if the SFA is out of
compliance with any aspect of the RM review of indirect costs, including:
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•

the nonprofit school food service account was charged costs in excess of the approved
indirect cost rate;

•

the correct rate was applied to an incorrect direct cost base;

•

indirect costs were not applied consistently;

•

the nonprofit school food service account was charged directly for expenses that were
included in the indirect cost pool (double dipping);

•

sufficient documentation could not be provided to support the indirect costs charged to
the nonprofit school food service account.

Corrective action must occur for the Resource Management review period and, if necessary, for
the current school year. The SFA should also adopt internal controls to ensure that
noncompliance does not occur in the future.
Needed corrective action and/or technical assistance must be recorded in the comments
section of the Resource Management Comprehensive Review Form.

Fiscal Action
This is a General Area, thus fiscal action is not required. FNS encourages the SA to consider
withholding program payments, in whole or in part, to any SFA for repeated or egregious
violations that are not corrected. While withholding program payments is not included in the
specific regulatory definition for fiscal action, additional information can be found in Section
VIII, Fiscal Action, Module: Withholding Payments.

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Section V: General Program Compliance

Modules contained within this Section include:
• Civil Rights
• SFA On-site Monitoring
• Local School Wellness Policy and School Meal Environment
• Smart Snacks in School
• Professional Standards
• Water Availability
• Food Safety
• Reporting and Recordkeeping
• School Breakfast and Summer Food Service Programs Outreach

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Module: General Area — Civil Rights
Intent/Scope of Monitoring
FNS requires SFAs to administer program services and benefits in accordance with all laws,
regulations, instructions, policies, and guidance related to nondiscrimination in program
delivery.
This monitoring area falls under the General Areas of the Administrative Review.

Review Procedures
The SA must assess whether the SFA is complying with civil rights requirements as applicable to
the Child Nutrition Programs, i.e., NSLP (including the Fresh Fruit and Vegetable Program,
Seamless Summer Option, and The NSLP Afterschool Snack Program), the SBP, and the SMP.
SAs are encouraged to complete the civil rights compliance evaluation off-site unless on-site
validation is required as described below.
Pre-visit Review Procedures
Off-site Assessment Tool
Questions 800-807 of the Off-site Assessment Tool focus on civil rights compliance. If this
portion of the Tool is not completed prior to the on-site review, applicable documentation must
be available for the SA to review at the start of the on-site portion of the review.
Supporting Documentation
•

a copy of the SFA’s public release

•

a description of procedures for receiving and handling Civil Rights complaints
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•

information on the number and description of complaints alleging discrimination in the
current and prior school year

•

information about the SFA’s most recent civil rights training for staff

•

a description of the SFA’s procedures for collecting racial/ethnic data

Off-site Review Procedures
To evaluate civil rights compliance, the SA will:
•

Ensure that the SFA’s procedures, as described in the Off-site Assessment Tool, meet
civil rights requirements

If the Off-site Assessment Tool identifies any potential problems or requires additional
documentation, the SA should make an attempt to obtain clarification and/or the necessary
documents before categorizing a response as unsatisfactory. However, a response to a pre-visit
question may still be unsatisfactory even after obtaining clarification or additional
documentation.
Off-site Review Questions
800)

What non-discrimination statement is used for Program materials?

State or local agencies, and their subrecipients, must post the following Nondiscrimination
Statement. The nondiscrimination statement must accompany any new printed materials and
any web-based materials referencing FNS programs:
“In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil
rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions
participating in or administering USDA programs are prohibited from discriminating based on
race, color, national origin, sex, disability, age, or reprisal or retaliation for prior civil rights
activity in any program or activity conducted or funded by USDA.
Persons with disabilities who require alternative means of communication for program
information (e.g. Braille, large print, audiotape, American Sign Language, etc.), should contact
Administrative Review Manual Page 147

the Agency (State or local) where they applied for benefits. Individuals who are deaf, hard of
hearing or have speech disabilities may contact USDA through the Federal Relay Service at (800)
877-8339. Additionally, program information may be made available in languages other than
English.
To file a program complaint of discrimination, complete the USDA Program Discrimination
Complaint Form, (AD-3027) found online at:
http://www.ascr.usda.gov/complaint_filing_cust.html, and at any USDA office, or write a letter
addressed to USDA and provide in the letter all of the information requested in the form. To
request a copy of the complaint form, call (866) 632-9992. Submit your completed form or
letter to USDA by:
1) mail: U.S. Department of Agriculture
Office of the Assistant Secretary for Civil
Rights 1400 Independence Avenue, SW
Washington, D.C. 20250-9410;
2) fax: (202) 690-7442; or
3) email: [email protected]
This institution is an equal opportunity provider.”
If the material is too small to contain the full statement, the material at minimum must include
the following statement: “This institution is an equal opportunity provider.”
The full statement must be included on outreach material when notifying potentially-eligible
participants how to apply for benefits or when informing participants about their right to file a
complaint.
These statements must be included on any document that references FNS programs.
Documents that do not reference FNS programs are exempt.
801)

Obtain a copy of the SFA’s public release.
The SA must obtain a copy of the SFA’s public release. The release must contain the
same information supplied in the letter to households except that the public release

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must contain both the free and reduced price Income Eligibility Guidelines. The public
release must also explain that:
•

When known to the LEA, households will be notified of their children’s eligibility for
free meals if they are members of households receiving assistance from:


The Supplemental Nutrition Assistance Program (SNAP);;



Theta Food Distribution Program on Indian Reservations (FDPIR);



Temporary Assistance for Needy Families (TANF), if the State program meets
Federal standards; or



When known to the LEA, households will be notified of any child’s eligibility
for free meals based on the individual child designation as Other Source
Categorically Eligible,

•

No further application is required for free meal benefits, if the household was
notified by the LEA that all children in the household were directly certified;

•

A child or other household member’s receipt of benefits from an Assistance Program
(SNAP, FDIPR, or TANF) extends eligibility for free benefits to all children who are
members of the household. If any child in a household receiving Assistance Program
benefits was not listed on the eligibility notice, the household should contact the
LEA or school to have benefits extended to that child.

The SA may prepare the public release on behalf of its SFAs. In this case, the release
must specify the responsibilities the SA will assume and must reference the schools
covered by the public release.
Note: RCCIs are not required to submit a public release unless their enrollment includes
day students.
802)

What services does the SFA provide to households comprised of persons with Limited
English Proficiency (LEP)?

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SFAs are required to take reasonable steps to ensure meaningful access to FNS program
information and services to persons with LEP. See FNS Memorandum SP 37-2016,
Meaningful Access for Persons with Limited English Proficiency in the School Meal
Programs: Guidance and Q&As; the Eligibility Manual for School Meals; and Section VII
of FNS Instruction 113-1, Civil Rights Compliance and Enforcement – Nutrition Programs
and Activities.
803)

What are the SFA’s procedures for receiving and processing complaints alleging civil
rights discrimination within FNS school meal programs? If procedures are written,
please provide a copy.
The SFA’s methods of receiving and processing complaints are largely at the SFA’s
discretion. However, the methods must meet the following requirements:
•

The SFA’s procedures must note whether an allegation is made verbally or in
person;;

•

The SFA staff member receiving the allegation must transcribe the complaint;

•

The SFA’s procedures for receiving a complaint cannot prevent a complaint from
being accepted; and

•

The SFA’s procedures must identify the outside agency to which complaints are
forwarded (i.e., SA, FNSRO, FNS Office of Civil Rights, or USDA Office of Civil
Rights).

Additionally, the SFA’s procedures must not indicate that they attempt to resolve the
complaint themselves, nor can the SFA’s complaint process be a prerequisite for
accepting a complaint.
804)

Has the SFA received any written or verbal complaints alleging discrimination in FNS
Programs in the current or prior school year?

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If complaints were received, the SA must ensure that they were forwarded to the SA,
FNSRO, FNS Office of Civil Rights, or the USDA Office of Civil Rights.
805)

What procedures are in place for accommodating students with disabilities?
SFAs must make substitutions to NSLP and SBP meals to accommodate students with
disabilities that restrict their diet. SFAs will receive reimbursement for accommodations
outside the Program meal pattern, provided the accommodation request is supported
by a medical statement signed by a State licensed healthcare professional. The SFA’s
response should indicate an understanding of requirements under 7 CFR 210.10(m)(1), 7
CFR 210.10(m)(2), 7 CFR 220.8(m);); FNS Memorandum SP 59-2016, Policy
Memorandum on Modifications to Accommodate Disabilities in the School Meal
Programs; and FNS Memorandum SP 32 CACFP 13 SFSP 15-2015, Statements Supporting
Accommodations for Children with Disabilities in the Child Nutrition Programs.

806)

When was the SFA’s most recent civil rights training for staff who interact with program
applicants or participants (i.e., cafeteria staff, determining officials) and their
supervisors? Who attended these trainings? What topics were covered by the training?
Provide supporting documentation for the responses.
The SFA must provide documentation indicating that the civil rights training occurred
and that required participants attended. Documentation must indicate that the
following subjects were covered: Collection and Use of Data, Effective Public
Notification Systems, Complaint Procedures, Compliance Review Techniques, Resolution
of Noncompliance, Requirements for Reasonable Accommodations of Persons with
Disabilities, Requirements for Language Assistance, Conflict Resolution, and Customer
Service. For example, the SFA may provide a copy of the agenda for the relevant
training and a corresponding sign-in sheet.

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807)

How does the SFA collect racial/ethnic data? How often is this information collected?
Provide documentation to support the response.
The SFA must collect racial/ethnic data on an annual basis through a mechanism of their
choosing. If responses to the Off-site Assessment Tool indicate potential problems, the
SFA will be considered noncompliant and the SA must require appropriate corrective
action.

On-site Review Procedures
On-site Assessment Tool
SA findings are recorded on Questions 811-812 of the On-site Assessment Tool.
On-site Review
To evaluate civil rights compliance, the SA will:
•

Determine whether the “And Justice for All” Poster is on display, as described below

•

Determine whether the non-discrimination statement appears on pertinent materials

•

Review denied applications to determine if a disproportionate number of these
applications were submitted by minority households. Refer to Section II: Meal Access
and Reimbursement, Module: Certification and Benefit Issuance for more information.

•

Observe the meal service to ensure all children are receiving equal benefits without
discrimination

•

Validate corrective action on-site, if necessary, if non-compliance is detected by the Offsite Assessment Tool

“And Justice for All” Poster
FNS Instruction 113-1 requires that participating schools prominently display the USDA
nondiscrimination poster “And Justice for All”. All posters must be 11” x 17”. The poster must
be placed in a location that enables program participants to read the text of the poster without

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obstruction. For example, the poster could be placed next to the cashier, at the beginning of
the serving line, over the milk cooler, or at the entrance/exit to the cafeteria.
The SA must ensure that each site selected for review has displayed the poster in an
appropriate location. The SA must require corrective action if the poster is not posted or
cannot be found. The SA must provide technical assistance if the poster is posted but in an
inappropriate location.
An SFA will be compliant with this review element if the “And Justice for All” poster is posted in
an appropriate location at each school selected for review.
Use of Correct Non-discrimination Statement
The SA must determine whether program materials contain the correct non-discrimination
statement (see Question 800). Through the course of the review, examine relevant documents
(e.g., Meal Benefit applications, public release) to ensure that each contains the correct nondiscrimination statement.
An SFA will be compliant with this review element if all program materials contain the correct
non-discrimination statement.
Composition of Denied Applications
When reviewing denied applications (see Section II: Meal Access and Reimbursement, Module:
Certification and Benefit Issuance), the SA must determine whether a disproportionate number
of these applications were submitted by minority households. If this has occurred, the SA must
determine whether these applications were denied for any reason other than the applications
being incomplete or the household being ineligible based on income or other program
requirements.
Civil Rights Meal Observation Responsibilities
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The SA must determine whether the SFA provides children equal benefits without
discrimination regardless of their race, color, national origin, sex, age, or disability on the day of
review at each reviewed school during the lunch and breakfast meal services. Meal service
observations must indicate no discrimination occurs regarding the protected classes of Child
Nutrition Programs.
An SFA will be compliant with this review element if lunch and breakfast meal service
observations on the day of review indicate that all children have equal access to the applicable
programs.
Corrective Action Validation
Corrective action validation is only applicable if the Civil Rights portion of the Off-site
Assessment Tool identifies noncompliance with civil rights requirements. Under these
circumstances, the SA must address deficiencies by requiring corrective action and verifying onsite that the SFA has implemented, or is in the process of implementing, the corrective action as
specified by the SA. The specific actions of the SA will vary on a case-by-case basis and depend
upon the deficiency and the determined corrective action. If the SA determines that the
approved corrective action has not been implemented or did not effectively resolve the
problem, the SA must prescribe further corrective action as part of the on-site review process.
Note: Satisfactory responses to the Off-site Assessment Tool must not preclude the SA from
correcting a civil rights deficiency found through the course of their other on-site
Administrative Review responsibilities.

Technical Assistance/Corrective Action
An SFA will be compliant with this Module if it meets the requirements of each review element
as described above. Deficiencies the SA identifies within any of the module’s review elements
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must result in a noncompliant civil rights evaluation. The SA must address deficiencies by
requiring corrective action and must bring the SFA into compliance with this Module’s
requirements.
All deficiencies are recorded on the On-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided to the SFA at the exit conference.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area — SFA On-site Monitoring
Intent/Scope of Monitoring
The SA must determine that each SFA with more than one school operating the NSLP performs
at least one on-site review. This on-site review must evaluate the lunch counting and claiming
system used by the school and must observe the general areas of review that are readily
observable in each school under its jurisdiction.
The SA must also ensure that each SFA with more than one school operating the SBP performs
at least one on-site review. The on-site review must evaluate the breakfast counting and
claiming system used by the school and must observe the readily-observable general areas of
review. A minimum of 50 percent of the schools operating the SBP under the SFA’s jurisdiction
must be monitored at least once every two years.
The on-site reviews must occur by February 1 of each year.
SFA On-site Monitoring is a component of the General Areas of review.
Note: Refer to FNS Memorandum SP 14-2011, Prototype Checklist for SFAs for Conducting
Annual On-site Reviews.

Review Procedures
To assess compliance, on-site monitoring requirements are evaluated at the schools selected
for review.
Pre-Visit Review Procedures
Off-site Assessment Tool
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The section of the Off-site Assessment Tool pertaining to this module contains Question 900.
Question 900 of the Off-site Assessment Tool assesses the procedures the SFA uses to ensure
that all schools are meeting program requirements. For further information, see On-site
Review Procedures below.
On-site Review Procedures
The SA must conduct an on-site review to determine whether the SFA completed on-site
monitoring according to requirements at the reviewed schools. The SA should interview SFA
staff to determine whether the SFA monitoring requirements are fully understood and whether
the SFA is in compliance with those requirements. The SA should review any documentation
available on-site.
If an Administrative Review of the SFA is conducted prior to February 1, and the SFA has not
completed on-site monitoring reviews, review the timeline to determine whether or not the
requirement will be met. If it is determined that it will not, the SA should review monitoring
activity from the prior SY to determine whether the SFA effectively schedules on-site
monitoring to meet the February 1st completion date, or whether the problem is a trend.
If the Administrative Review is conducted after the February 1 deadline, examine only the
documentation for the current program year’s activities. If the SFA did not complete the
reviews by February 1 or the extended deadline, examine the prior year’s documentation to
determine whether this is a trend or one-time occurrence.
On-site Assessment Tool
Questions 901-903 of the On-site Assessment Tool focus on SFA compliance with on-site
monitoring requirements. These questions address whether the on-site monitoring visit
occurred by February 1, whether corrective action was necessary and whether corrective action
was successful in resolving the problem(s).

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Technical Assistance/Corrective Action
All deficiencies must be recorded on the Off-site and On-site Assessment Tool, as applicable, in
the applicable comments section. Technical assistance and corrective action to correct
identified deficiencies must be included in the Corrective Action Plan provided to the SFA at the
exit conference.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area — Local School Wellness Policy
and School Meal Environment
Intent/Scope of Monitoring
Schools play a critical role in promoting children’s health, preventing childhood obesity, and
preventing diet-related chronic diseases. To help foster a healthy school environment, Section
204 of the Healthy, Hunger Free-Kids Act added a Section 9A to the Richard B. Russell National
School Lunch Act (NSLA) to expand the scope of wellness policies.

Note: The scope of monitoring may require the SA to assess how unit(s) of the LEA, other than
the school food service, implement(s) their respective local school wellness policy
responsibilities..
This monitoring area falls under the General Areas of the Administrative Review.
Currently there are no additional review procedures for the School Meal Environment.

Review Procedures
SAs are expected to assess local school wellness policy compliance off-site through the Off-site
Assessment Tool.
Off-site Assessment Tool
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Questions 1000-1006 in the local school wellness policy portion of the Off-site Assessment Tool
assess compliance with local school wellness policy requirements.
Supporting Documentation
•

a copy of the current local school wellness policy

•

documentation demonstrating the local school wellness policy has been made available
to the public

•

documentation of efforts to review and update the local school wellness policy,
including an indication of who is involved in the update and of methods the SFA uses to
make stakeholders aware of their ability to participate

•

a copy of the most recent triennial assessment on the implementation of the local
school wellness policy; and

•

how the policy compares to model policies..

Off-site Assessment Procedures
SAs are not responsible for evaluating the quality of the local school wellness policy goals or
policies. The SA’s responsibilities are to assess whether the:
•

local school wellness policy contains the required elements

•

required steps have been taken regarding local school wellness policy implementation,
transparency, public input, and public availability

Below is a list of the local school wellness policy Off-site Assessment Tool questions.
Off-site Assessment Tool Questions
1000) Please provide a copy of the current local school wellness policy or appropriate web
address.
The SA must obtain a copy of the current local school wellness policy. The SA must
examine the document and determine whether the policy includes:

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•

Goals for nutrition education, physical activity, nutrition promotion, and other
school-based activities to promote student wellness. Examples of other schoolbased activities, may include (but are not limited to) improving the dining
environment, giving students more time to consume their meals, and/or ensuring
food is not used as a reward.

•

Nutrition guidelines for all foods available on the school campus

•

A plan for measuring local school wellness policy implementation

•

Designation of one or more officials in charge of the local school wellness policy

1001) How does the public know about the local school wellness policy?
The local school wellness policy must be made available to the public. The SA must
determine how the local school wellness policy is made available to the public. For
example, the local school wellness policy could be posted on the school’s public website
or distributed with other important information at the beginning of the school year.
Regardless of the means, the SA must obtain documentation to support compliance
(e.g., the website link, copy of distribution packet).
1002) When and how does the review and update of the local school wellness policy occur?
The local school wellness policy must be reviewed and updated on a periodic basis. The
frequency of updates to the local school wellness policy local school wellness policy is
not specified by FNS, as the need to update will vary based on the content and structure
of the plan. The SA must obtain documentation demonstrating how this requirement is
met. For example, if the local school wellness policy is updated at an annual
stakeholder meeting, documentation indicating that the meeting occurred (e.g., an
agenda, attendance sheet) would be appropriate.

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1003) Who is involved in reviewing and updating the local school wellness policy? What is their
relationship with the SFA?
Parents and guardians, students, physical education teachers, school health
professionals, school administrators, the school board, representatives of the SFA, and
the general public must be permitted to contribute to the development,
implementation, periodic review, and update of the local school wellness policy. The SA
must determine who is involved with reviewing and updating the local school wellness
policy and whether their participation meets requirements.
1004) How are potential stakeholders made aware of their ability to participate in the
development, review, update, and implementation of the local school wellness policy?
Provide documentation to support the response (or appropriate Web site URL).
The SA must determine how participation from the permitted stakeholders is solicited.
Documentation demonstrating outreach should be assessed. For example, the district
might send out a district-wide email or post flyers in various locations to notify potential
stakeholders about the opportunity.
1005) Please provide a copy of the most recent assessment on the implementation of the local
school wellness policy.
The SA must obtain a copy of the most recent assessment. The SA must examine the
document and determine whether the assessment includes information regarding:
•

The extent to which schools are in compliance with the local school wellness policy

•

The progress made toward attaining the goals of the local school wellness policy

•

The extent to which the local school wellness policy compares to a model Local
School Wellness Policy. Model policies can be found at
http://teamnutrition.usda.gov/healthy/wellnesspolicy.html
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1006) How does the public know about the results of the most recent assessment on the
implementation of the local school wellness policy? Please provide a copy of the
documentation necessary to support your response or appropriate Web site URL.
The assessment must be made available to the public. How the assessment is made
available is at local discretion. The SA must determine the manner in which the public is
made aware of the most recent assessment on the implementation of the local school
wellness policy.

Technical Assistance/Corrective Action
The SA must deem an SFA compliant with the local school wellness policy Module if the
requirements of the review are met, as described above. Deficiencies identified within the
Module’s review element must result in a noncompliant local school wellness policy evaluation.
Deficiencies must be addressed through documented corrective action. Corrective action is
considered appropriate and sufficient when the action permanently corrects the deficiencies
and brings the local school wellness policy into compliance with the Module’s requirements.
Note: FNS will assist LEAs in the transition to these new requirements by focusing on
technical assistance during Administrative Reviews to facilitate implementation of the local
school wellness policy requirements.
The only exceptions are the absence of a local school wellness policy or the absence of
required content (previously required in 2004), which must be addressed through corrective
action.

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The SA must record all deficiencies on the On-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided at the exit conference.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: Smart Snacks in School (All Foods and
Beverages Sold in School)
Intent/Scope of Monitoring
Schools must meet the minimum requirements in 7 CFR 210.11 for all foods and beverages sold
in school (also known as Smart Snacks in School) to increase consumption of healthful foods
during the school day and support a healthy school environment. The SA’s responsibility is to
understand the entities responsible for selling foods/beverages to students, and to ensure that
food and beverages sold meet the minimum requirements established in 7 CFR 210.11.

This Module is a General Area of Review.
Schools that receive a HealthierUS Schools Challenge (HUSSC) Award (any level) by meeting the
HUSSC criteria effective August 31, 2014 have been certified compliant with these
requirements and are, therefore, exempt from this part of the review. A print out from the
Team Nutrition Web site listing the school as an awardee, a copy of the award announcement
email, or a copy of the award certificate should be kept on file to verify HUSSC award status
during the review.
There is no fiscal action if a SFA/LEA is found out of compliance with Smart Snacks
requirements.

Review Procedures
The SA must assess compliance with Smart Snacks requirements at all the schools selected for
review. The requirements apply to all entities selling foods and beverages to students on the
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school campus during the school day, including entities operating independently from the
school food service.
Note: While free potable water must be made available to students during the meal service and
other sources may sell water to students, program operators are not to promote or offer water
or any other beverage as an alternative selection to fluid milk in the reimbursable meal
throughout the food service area.
The timeframe for this assessment is the school year in which the Administrative Review takes
place, the review period, and the day of review.
To evaluate compliance, the SA must ensure that:
•

All foods and beverages sold on the school campus (excluding reimbursable meals),
during the school day (defined as 12 am on a day of instruction to 30 minutes after the
end of the official school day), meet regulatory requirements. This includes a la carte
items sold during meals, and foods/beverages sold in vending machines, school stores,
and any other venue; and

•

State-set fundraising limits for exempt fundraisers are observed.

Off-site Review
SAs have discretion to complete this portion of the review off-site, prior to the on-site review,
or during the on-site review.
To evaluate compliance, reviewers must:
•

Examine one week of menu documentation from the review period to ensure that foods
and beverages sold a la carte during meal services are compliant with requirements.
Examples of acceptable documentation may include, but are not limited to: menus,
production records, USDA Foods Information Sheets and related materials (e.g., CN
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labels, food item specifications, standardized recipes) for the school week under review.
For efficiency, reviewers are encouraged to review the same week selected for the Meal
Components/Quantities review.
•

Interview school district staff (e.g., superintendent, principals, or other administrative
designees) and school food service staff to understand the scope of food and beverage
sales at the reviewed school(s), including the number of exempt fundraisers and sales of
foods and beverages in the cafeteria, school stores, snack bars, coffee bars, vending
machines, and any other food or beverage points of sale available to students.

•

Review nutrition documentation for a minimum of 10% of foods and beverages items
sold in schools (reimbursable meals excluded) to ensure that Smart Snacks requirements
are met. Reviewers must obtain the nutrition documentation from the entities
responsible for each point of sale, which may include entities outside the school food
service. The 10% sample selected for documentation review must represent all locations
where foods and beverages are sold to students. Any documentation that contains the
necessary information is acceptable. Examples include, but are not limited to: Alliance
for a Healthier Generation Smart Snacks Calculator print outs, recipes, product
specifications, purchase orders, receipts, or other documentation.

On-site Review
During the on-site review, the SA must observe all locations where students are able to
purchase foods and beverages to ensure that:
•

The nutrition documentation provided for review is consistent with the foods and
beverages offered to students for sale, including foods sold a la carte during meal
services;

•

School food service staff and school administrators are familiar with requirements; and

•

NSLP/SBP entrees (exempt from standards) are only sold to students the same day, or
the day after, the entrees are initially offered in the NSLP/SBP.

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Reviewers are encouraged to observe the points-of-sale-at the time operation, i.e., when
foods/beverages are sold to students.
Recording Findings
The SA must record review findings on the Off-site Assessment Tool Questions 1100-1103 and
On-site Assessment Tool Questions 1104- 1107.

Technical Assistance/Corrective Action
A SFA/LEA is compliant with this Module if the SA determines that each school selected for
review only sells foods and beverages to students that are compliant with standards.
When non-compliance is identified, the SA, in conjunction with the SFA/LEA must develop a
corrective action plan with specific steps, which may include required training and/or technical
assistance. The plan must include reasonable timeframes for the SFA/LEA to achieve and
maintain compliance with Smart Snacks requirements. The timeframes and other details of the
corrective action plan will vary, depending on the nature of the findings.
The SA must record all findings on the On-site Assessment Tool in the applicable comments
sections.
As a reminder, there is no fiscal action if a SFA/LEA is found out of compliance with Smart
Snacks requirements.

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Module: General Area — Professional Standards
Intent/Scope of Monitoring
The Professional Standards regulations in 7 CFR 210.30 establish hiring standards for new
school nutrition program directors at the SFA level. In addition, the regulations establish annual
training standards for all school nutrition program directors, managers, and staff. The required
annual training hours vary according to the employee’s role in the management and operation
of the school nutrition program.
Hiring Standards
The SA is expected to examine SFA records documenting that applicable hiring actions for new
program directors completed on or after July 1, 2015, are consistent with hiring standards. This
includes internal hiring promotions. Prior food safety training is also required for new program
directors that are hired (training must have occurred either within 5 years prior to the starting
date, or must occur within 30 calendar days of the start date). Documents that are reviewed
may include, but are not limited to, job postings, college transcripts, education information,
and resumes for new hires.
Training Requirements
The SA is also expected to examine SFA records that document the completion of annual
training standards by all personnel (program directors, managers, and staff). Training
certificates, training sign-in sheets, and training agendas are all examples of documents that a
SFA may submit to demonstrate compliance with the training standards. Reports from the
USDA Training Tracking Tool (or similar alternative training tracking tool) that demonstrate
compliance with the training standards are also examples of possible documentation.
The timeframe for this assessment is the school year in which the Administrative Review takes
place; however, the SA has discretion to review documentation from a prior school year, if the
State agency has allowed for SFA personnel to complete the required annual training hours
over a two- year period.
This monitoring area falls under the General Areas of the Administrative Review.

Review Procedures
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The SA must assess compliance with following Professional Standards requirements for the SFA:
•

Hiring standards apply to school nutrition program directors hired on or after July 1,
2015.

•

Annual training requirements apply to all school nutrition program personnel beginning
July 1, 2015.

The SFA must be prepared to provide information requested that includes at minimum, a
current list of school nutrition staff personnel and individual documentation for each of those
individuals showing the following:
•

Name of staff person

•

Date hired

•

Title/Position

•

A brief list of core duties/responsibilities

•

Employment Status (Full Time, Part Time, Acting, Substitute), including the average
hours/week for each Part Time employee

•

Professional Standards Employee Category/Position (Nutrition Program Director,
Manager or Staff)

Hiring Standards (Program Directors hired on or after July 1, 2015 ONLY)
•

Highest level of education achieved

•

Years of school nutrition program experience

•

Prior food safety training (8 hours of food safety training must be completed within 5
years prior to the starting date, or within 30 calendar days of the starting date)

NOTE: When applicable, documentation showing that the State agency granted exceptions for
LEAs with a student enrollment of less than 500 should be reviewed. For LEA enrollments less
than 500, the SA may approve the hire of a candidate with high school diploma (or GED) and
less than required years of experience, if the best qualified candidate.
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Annual Training Standards
Training must be job-specific and intended to help employees perform their duties well.
Training needs are best assessed by an employee in consultation with their manager, director,
or State agency. Training may be obtained in many ways, such as in-person, online, through
local meetings, webinars, conferences, etc. A variety of free and low-cost training resources and
formats are available. Compliant training sessions may consist of annual training that is offered
or required every year by the State agency. USDA does not approve nor require specific training
programs.
•

Annual Training Records
o USDA Training Tracking Tooling has been provided as a resource to assist SFAs to
track and record the annual training hours completed by each school nutrition
program employee.
o Alternative training tracking tools may be developed by SAs and/or SFAs but
must include at minimum the required fields listed in the USDA Professional
Standards Training Tracking Tool. These fields would include Key Areas, Training
Topics and Learning Objectives as listed in the Professional Standards Learning
Objectives and Topics with Codes which can be found on the USDA Professional
Standards Website. (See tool for required fields.)
o Supporting documentation for all completed trainings, i.e., agendas, sign-in
sheets, certificates of completion, etc. must be maintained on file.

While FNS is not prescribing an exact format for alternative tracking tools, SFAs should clearly
document all required information and keep it consolidated in one place. This should include
any hands-on, informal training that takes place such as 15 minute training on how to use new
food service equipment.

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Please see below for a suggested format:
Employee
First Name

Employee
Last Name

Hiring
Date

Employee
Position:
i.e.
Director/
Manager/
Staff

Required
Hours of
Training

Training
Title/
Subject

Training
Date(s)

Length of
Training
(creditable
time)

School Year
Training
Applied To

Completed
Training
Hours
Year to
Date

Pre-Visit Review Procedures
Off-site Assessment Tool
The SA will need to address Questions 1200-120909 in the Off-site Assessment Tool. The SA has
the discretion to complete the Off-site Assessment Tool questions either off-site (prior to the
on-site review) or during the on-site review. The Off-Site Assessment Tool contains a series of
questions related to professional standards, many of which can be answered using the tools or
methods described above. These questions explore whether or not the SFA has met the
required hiring and training standards.
Analysis of Off-site Assessment Tool
The SA must examine the Off-site Assessment Tool to ensure the SFA is meeting professional
standards requirements outlined in (7 CFR 210.30). The Off-site Assessment Tool informs the
reviewer of the SFA’s training and hiring practices and will be verified during the on-site review
through documentation.
NOTE: In any school year, employees hired on or after January 1 must complete only half of the
required annual training hours.

On-Site Review Procedures
The on-site portion of the Administrative Review consists of the SA interviewing appropriate
SFA personnel and determining whether the SFA is in compliance with all Professional
Standards requirements. It is essential that through on-site review of documentation and
interviews with SFA personnel the SA is able to validate the information gathered on the OffAdministrative Review Manual Page 172

site Assessment Tool and answer the question on the On-site Assessment Tool (Questions 12121219).
On-site documentation review could include, but is not limited to:
•

Nutrition program employee lists

•

Training sign-in sheets and attendance rosters

•

Certificates of completion for applicable trainings

•

Training agendas

•

Planned or scheduled trainings

•

Education achievement certificates (i.e. diplomas)

Technical Assistance/Corrective Action
All deficiencies must be recorded on the Off-site and On-site Assessment Tools, as applicable, in
the appropriate/corresponding comments section. Technical assistance and corrective action
to correct identified deficiencies must be included in the Corrective Action Plan provided to the
SFA at the exit conference.
•

A SFA is compliant with the Professional Standards requirements if the SA determines
that documentation demonstrates that all school nutrition program personnel have met
or will meet annual training requirements and that all new directors (hired on or after
July 1, 2015) have met the hiring requirement as listed in the regulations.

When non-compliance is identified, the SA, will provide technical assistance and must develop,
in conjunction with the SFA, a Corrective Action Plan that outlines the required actions to bring
the SFA into compliance, which may include required training and/or educational courses. The
plan must also include reasonable timeframes for the SFA to achieve and maintain compliance
with Professional Standards requirements. The timeframes and other details of the Corrective
Action Plan will vary, depending on the nature of the findings.
For any findings associated with non-compliance of hiring standards, the SA should consult with
their respective FNS Regional Office before finalizing a Corrective Action Plan. Although the
Regional Office is not responsible for approving the CAPs, staff is available for consultation. FNS
National Office approval is not required; however, the National Office is also available for
consultation, if requested.
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The SA must record all findings on the On-site Assessment Tool in the applicable comments
sections.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area —
Water Availability
Intent/Scope of Monitoring
The goal of the water review is to ensure that children have access to water during the lunch
and breakfast meal services. During the on-site visit, the SA must observe and assess whether
the school makes free water available to students as required. This monitoring area falls under
the General Areas of the Administrative Review.
Note: While water must be made available to students during meal service, program operators
are not to promote or offer water or any other beverage as an alternative selection to fluid milk
throughout the food service area.

Review Procedures
The SA’s responsibility is to determine whether free potable water is available at each school
selected for review during the lunch and breakfast meal services on the day of review. The
water requirement for breakfast only applies when breakfast is served in the cafeteria. Refer to
FNS Memorandum SP 28-2011, Child Nutrition Reauthorization 2010: Water Availability During
National School Lunch Program Meal Service and National School Lunch Program and School
Breakfast Program: Nutrition Standards for All Foods Sold in School as Required by the Healthy,
Hunger-Free Kids Act of 2010; Interim Final Rule (78 CFR 39068, published June 28, 2013).
The SA must determine compliance on-site by observing the lunch and breakfast meal services.
The SA should be able to easily incorporate these expectations alongside other lunch and
breakfast meal service observation responsibilities.
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On-site Review Procedures
On-site Assessment Tool
The SA must record findings on Question 1300 of the On-site Assessment Tool.
On-site Review
The SA’s responsibility regarding water compliance is limited to the day of review at each
school selected for review. The SA must assess compliance in any location where lunches are
served (during the meal service) and when breakfast is served in the cafeteria.
During the lunch and breakfast meal service observations, the SA must ensure that free water is
available for consumption by program participants.
Schools can provide free water in a variety of ways. For example, schools can offer water
pitchers and cups on lunch tables, a water fountain, or a faucet that allows students to fill their
own bottles or cups with drinking water. Any school that does not make free water available or
restricts access during the lunch and breakfast meal periods is out of compliance. The SA must
provide technical assistance and require the SFA to take corrective action.

Technical Assistance/Corrective Action
The SA must deem an SFA compliant with the water Module if the SFA meets the requirements
of the review element as described above at each of the reviewed schools. If the SA identifies
deficiencies at any of the reviewed schools, the SA must deem that SFA noncompliant with the
water evaluation. The SFA must address deficiencies through corrective action. Corrective
action is considered appropriate and sufficient when the action permanently corrects the
deficiency and brings the SFA into compliance with the Module’s requirements.
The SA must record all deficiencies on the On-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided to the SFA at the exit conference.
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Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area — Food Safety, Storage, and Buy
American
Intent/Scope of Monitoring
FNS recognizes SA staff are not licensed health inspectors, and therefore the intent of this
review is not to conduct a review equal to a health inspection. However, it is the SA’s
responsibility to ensure that all selected schools meet the food safety and storage requirements
and the regulations referenced in this Module. This includes any facility where food is stored,
prepared, or served for the purposes of the NSLP, SBP, or other FNS programs. The SA must also
ensure that all selected schools comply with the Buy American provision and policy referenced
in this Module.
This monitoring area falls under the General Areas of the Administrative Review.

Review Procedures
To evaluate compliance, the SA must:
•

Review the written food safety plan for compliance with Hazard Analysis Critical Control
Point (HACCP) program criteria found in 7 CFR 210.13(c)

•

Determine whether the SFA has any contracted or self-operated warehouses and, if so,
determine whether all foods (commercial and USDA) are being stored properly (see
Optional Off-site Storage Review, if applicable)

•

Determine whether two food safety inspections have been obtained

•

Confirm the posting of the most recent food safety inspection report

•

Verify compliance with HACCP principles and local and State health standards

•

Check temperature logs to ensure proper recordkeeping
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•

Examine on-site food storage in reviewed schools and off-site food storage facilities, as
applicable, for dates, condition of foods, and origin of agricultural food components

•

Review a variety of foods by component category to assess if the food is produced or
processed domestically, and if domestically processed, done so substantially using
domestic agricultural commodities

•

Communicate the results of the compliance with the Buy American provision and review
elements to the SA staff conducting procurement reviews of that SFA. The staff
conducting procurement reviews will then, on their procurement review, need to
closely review whether solicitation and contract documents include requirements for
domestic foods. However, the review of compliance with Buy American on the AR can
be completed as a separate review from the procurement review and is not contingent
upon the procurement review. Please see findings and corrective action sections.

SAs are expected to assess food compliance off-site and on-site.
Note: Food Safety inspection report formats may vary, and in some cases be too large in size to
post. SA reviewers should ensure that the posted portion reflects the inspection dates and
approval/disapproval status and allow that other supporting documents contained in the report
be maintained on siteavailable upon request.
Pre-visit Review Procedures
Food Safety Program
The SA should conduct an off-site review of the SFA’s written food safety program based on
either the traditional or process approach to HACCP principles (7 CFR 210.13(c)). Regardless of
the HACCP approach used, the SA must review the written food safety plan to ensure that it
contains the required elements of the selected approach.

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The process approach requirements are explained in further detail in Guidance for School Food
Authorities: Developing a School Food Safety Program Based on the Process Approach to HACCP
Principles. SA staff should be knowledgeable about this guidance and utilize it to determine
compliance of a process approach food safety program.
While FNS recommends that the SFA use the process approach to HACCP to construct a food
safety program, the SA should be prepared to assess compliance with either the traditional or
process approach. If the SFA bases the written food safety program on the traditional approach
to HACCP, SA staff must compare the plan against the requirements listed under 7 CFR
210.13(c)(1). If the SFA bases the written food safety program on the process approach to
HACCP, SA staff must compare the plan against the requirements listed under 7 CFR
210.13(c)(2).
Note: SFAs are required to update HACCP-based food safety programs to cover any facility
where food is stored, prepared, or served for the purposes of the NSLP, SBP, or other FNS
programs. This means the food safety program should contain standard operating procedures
for safe food handling on school buses, in hallways, school courtyards, kiosks, classrooms, or
other locations outside the cafeteria, as applicable.
On-site Review Procedures
On-site Assessment Tool
The SA must record findings in Questions 1400 – 14111 on the On-site Assessment Tool.
On-site Review
The SA must observe meal preparation and service on the day of review at the selected schools
to determine whether the SFA follows the food safety program and HACCP principles.
To make this determination, the SA should use the statements below as a guide:

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•

Proper personal hygiene is evident (e.g., hairnets, gloved hands, appropriate hand
washing)

•

Cross-contamination is prevented

•

Food temperatures are monitored and recorded

•

Refrigerator and freezer temperatures are monitored and recorded

•

Food preparation and service areas are clean

•

Clean utensils and equipment are used for food preparation and meal service

•

No obvious evidence of pests is present

Note: These statements are not exhaustive, and the SA should use discretion regarding other
potentially harmful observations related to proper food handling. For example, if the SFA Onsite Monitoring form for a selected school noted a particular food safety violation, then the SA
should ensure that the same violation does not occur during the day of review. Furthermore,
the SA should ensure that a copy of the food safety program is available and easily accessible to
food service staff at each selected school.
The SA must deem an SFA compliant with this review element if the written food safety
program meets these requirements and the SA observations correspond to the statements
above and/or any additional discretionary criteria. If the SFA does not meet either of these
criteria, the SA must deem the SFA noncompliant with this review element and the SA must
require appropriate corrective action.
Food Safety Inspections
FNS requires each SFA to ensure each participating school receives at least two food safety
inspections each school year from the State or local agency responsible for these inspections.
Typically, such inspections are conducted by the local health department (7 CFR 210.13 (b)).
The SA should notate the date of the inspections based on the relevant food safety inspection
reports. (See Review Procedures, above.) Additionally, FNS requires each school to post the
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most recent food safety inspection report in a publicly visible location for all participants of the
school meals program to view. SAs should use a common sense approach when assessing
whether the most recent food safety inspection report is visible to the public. For example,
posting the report by the entrance to the cafeteria is sufficient, while posting the report by the
employee-only entrance to the cafeteria is not.
If, at the time of the on-site visit, the school has received zero or one food safety inspections,
the SA must notate the date for the two most recent food safety inspections. Additionally, the
SA must ensure that the school received two food safety inspections in the previous school
year. If the school did not receive two inspections in the previous year, the SA must ensure that
the SFA or school requested two food safety inspections from the responsible agency.
Sufficient written documentation could be an email, letter, or fax to the appropriate authority
requesting an inspection.
The SA must deem a school compliant with this review element if the school meets the
following criteria:
•

The SFA has received two food safety inspections in the current year OR

•

The SFA received two food safety inspections in the previous school year OR

•

The SFA has made a documented request to the responsible agency for food safety
inspections
AND

•

The most recent food safety inspection report is posted in a location visible to the public

If the SFA does not meet any of these criteria, the SA must deem the SFA noncompliant with
this review element and the SA must issue appropriate corrective action.
Recordkeeping
FNS requires each school in the SFA to maintain temperature logs for a period of six months (7
CFR 210.15(b)(5)).
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During the on-site visit to each selected school, the SA must ensure that the SFA maintains
these documents for the prescribed period. To determine compliance at each selected school,
the SA must ask the school food service personnel to provide temperature logs for one day
within the past six months.
The SA must deem a school compliant with this review element if the SFA provides the
aforementioned document to the SA. If this criterion is not met, the SA must deem the school
noncompliant with this review element and the SA must require appropriate corrective action.
Food Storage
Each SFA is required to ensure that facilities for the handling, storage, and distribution of
purchased and donated foods are properly safeguarded against theft, spoilage, and other loss
(7 CFR 210.13(d)).
To determine compliance, the SA must observe the conditions in the on-site, and off-site if
applicable, storage facilities of the reviewed schools/SFA. On-site storage facilities may include
freezers, refrigerators, dry good storage rooms, and other areas. Off-site storage facilities
would include SFA contracted or self-operated warehouses. When examining the applicable
storage facilities, the SA must be mindful of the following rules regarding proper storage
practices. These statements are not exhaustive and the SA should use discretion regarding
other potentially harmful observations related to proper food storage:
•

Temperature is appropriate for the applicable equipment (e.g., freezer, refrigerator,
milk cooler)

•

Food is stored 6 inches from the ceiling and 6 inches off the floor

•

The food storage facility is clean and neat

•

Canned goods are free from bulges, leaks, and dents

•

Chemicals are clearly labeled and stored away from food and food-related supplies

•

Open bags of food are stored in containers with tight fitting lids

•

The FIFO (First In, First Out) method of inventory management is used
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•

No obvious evidence of pests is present

The SA must deem a school compliant with this review element if the SA’s observations
correspond with the statements above. If the SA’s observations contradict the above
statements or their own discretionary criteria, the SA must deem the school noncompliant with
this review element and the SA must issue appropriate corrective action.
Buy American
See SP 38-2017, Compliance with and Enforcement of the Buy American Provision in the
National School Lunch Program.
Each SFA is required to purchase food that is produced or processed domestically, and if
domestically processed, done so substantially using domestic agricultural commodities (7 CFR
210.21(d)). Substantially means over 51 percent, by weight or volume, of the final processed
product consists of domestic agricultural commodities. For products procured by SFAs for use
in the Child Nutrition Programs, the food component of the product would be the agricultural
commodity. Therefore, any product processed by a responsive vendor must have over 51
percent of the agricultural food component of the product, by weight or volume, be domestic.
Water is not a food component or agricultural commodity under the Child Nutrition Programs.
Often labels fail to reflect information to determine compliance. To ensure contractor
compliance, SFAs, in their solicitations and contracts are encouraged to obtain a certification
statement for vendors/manufacturers which may include: “We certify that (insert product
name) is processed in the United States and contains at least ( X%) of its agricultural food
component, by weight or volume, from the United States." SFAs must include space for the
supplier to fill in the name of the product and its percentage of the domestic agricultural food
component contained therein.

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Products from Guam, American Samoa, Virgin Islands, Puerto Rico, and the Northern Mariana
Islands are allowed under the Buy American provision as these products are from the territories
of the United States. Although Hawaii is exempt from the Buy American provision, recipient
agencies in Hawaii are required to purchase food products grown in Hawaii in sufficient
quantities to meet school meal program needs (7 CFR 210.21 (d)(3)). The same applies to
Puerto Rico under 42 USC 1760(n)(4).
There are limited exceptions to the Buy American provision which allow for the purchase of
products not meeting the domestic standard (i.e., are non-domestic) in circumstances when use
of domestic products is truly not practicable. An alternative or exception may be utilized as long
as documentation justifying an exception is maintained. Exceptions must be documented and
must be done so before utilizing an exception. Examples of ways to document communications
between SFAs and their food supplier regarding exceptions include emails, documentation of
telephone communications, etc. However, alternatives to purchasing non-domestic food
commodities or products should be considered first. Documentation must be maintained for
three years as required in 7 CFR 210.23(d).
In addition to considering alternatives, reasons for any exceptions must be provided as to why
the domestic product is being substituted with a non-domestic commodity or product. One
resource SFAs and State agencies may use when considering alternatives is the market news
reports available from the Agricultural Marketing Service (AMS). AMS provides free, unbiased
price and sales information on agricultural commodities.
To determine compliance with the Buy American provision, the SA must select a variety of
agricultural food components in various on and off-site storage facilities at the reviewed
SFA/schools, as applicable, to assess if the foods received by the SFA are over 51% domestic.
On-site storage facilities may include school freezers, refrigerators, dry good storage rooms,
and other areas. Off-site storage facilities would include SFA-contracted or self-operated
warehouses. When examining the applicable storage facilities, the SA will review a number of
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agriculture food components per the categories identified below. To determine the number of
foods for review, the SA will determine if the SFA stores food on-site in individual schools only,
uses off-site storage facilities only, or stores food using a combination of on-site and off-site
storage options.
The number of agricultural food components to review will be determined based on the SFA
storage facility practices used:
•

If the majority of agricultural food components used are located at individual schools
only, the SA will review at each reviewed school 2-3 items in each agricultural food
component category below;

•

If the majority of agricultural food components used are located at an SFA’s off-site
storage facility only, the SA will review at the SFA’s off-site storage facility 2-3 items in
each agricultural food component category below; or

•

If agricultural food components used are located at a combination of places both on-site
at schools and at the SFA’s off-site storage facilities, the SA will review 1-2 items in each
agricultural food components category below for each school reviewed and 1-2 items in
each agricultural food component category below at the SFA’s off-site storage facilities.

Food Component Categories:
• Bakery, pasta, and other miscellaneous components, such as:


grain components delivered ready to serve; and



wheat flour, cornmeal, or other grain flours, used to prepare grain components such as
pasta, bread etc.;

• Canned fruit and fruit juice;
• Canned vegetables and vegetable juice;
• Frozen fruit and fruit juice;
• Frozen vegetables and vegetables juice;
• Frozen meat/entrée items;
• Refrigerated foods, including but not limited to:
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

produce;



Dairy such as cheese, yogurt, and milk; and



food components that may be thawing for future meal service;

The SA should deem a school compliant with this review element if the SA’s review of
agriculture food components does not identify any non-domestic produced food or processed
food products received by the SFA, or if non-domestic agricultural foods are identified,
documentation exists to support exceptions to the Buy American requirements. SFAs should
consider and document alternatives that were considered. If the SFA has non-domestic
agricultural food components and lacks documentation to support any exceptions, the SA must
deem the school noncompliant with this review element. Non-domestic food components
must be documented in the comments section of the On- Site Assessment Tool and
communicated to the SA staff conducting the procurement review. The SA must provide
technical assistance, establish a finding, and issue appropriate required corrective action.
Where appropriate, corrective action may include reviewing food deliveries for contractor
compliance; monitoring to ensure the correct domestic food components contracted for are
delivered; and prior to accepting foods, ensuring that an alternative domestic food component,
or an exception to purchase non-domestic foods, has been approved for delivery. Further
corrective action includes developing policies and procedures for monitoring and ensuring
compliance.
Note: For example, the reviewer should determine if the agricultural food components selected
for review include information about whether the food is domestic. If the food package does
not identify its origin at all or in the case of processed foods that its agricultural food
components is over 51% domestic by weight or volume, the SFA may be out of compliance if an
exception for non-domestic agricultural commodity or product was not first approved and
documented by the SFA. Corrective action would include requiring monitoring by the SFA to
ensure the correct domestic food components contracted for are delivered and prior to

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accepting foods, ensuring that an alternative domestic food component, or an exception to
purchase non-domestic foods, has been approved for delivery.
Note: SAs should communicate any findings to the SA staff conducting the procurement review.
The staff doing procurement reviews will then need to closely review whether solicitation and
contract documents include specifications for domestic foods, certifications of domestic
content, and whether the SFA monitors contracts to ensure contractor compliance. Please note
further that a finding in this area of the AR will not mean an automatic finding on the
procurement review as the reviews are separate; however, there will be a finding in the
procurement review if food solicitation and contract documents did not specify domestic foods,
or certification of domesticity, etc., especially if such was a corrective action required by the AR.
Note: Documented USDA Foods are presumed to be domestic; however, processed end
products that contain USDA Foods must meet the over 51% domestic, by weight or volume,
requirement.
Off-site Storage Review, as applicable:
If applicable, the SA will visit SFA off-site food storage facilities as part of the Administrative
Review when the SA determines the SFA uses an off-site storage facility. The SA must
determine compliance using the same criteria and procedures in each review element as
described above. Please note, however, that for State Administering Agencies’ oversight must
encompass compliance with requirements related to donated foods in 7 CFR Part 210 and Part
250.

Technical Assistance/Corrective Action
The SA must deem an SFA compliant with the Food Safety, Storage, and Buy American Module
if the SFA meets the requirements of each review element as described above. The SA must
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deem the SFA noncompliant if the SA identifies deficiencies within any of the Module’s review
elements. The SFA must address deficiencies through corrective action that brings the SFA into
compliance with the Module’s requirements.
All deficiencies are recorded on the On-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided to the SFA at the exit conference.
For the Buy American portion of this module, corrective action may include:
•

Requiring the review of food deliveries for contractor compliance;

•

Monitoring to ensure the correct domestic food components contracted for are
delivered;

•

Prior to accepting foods, ensuring that an alternative domestic food component, or an
exception to purchase non-domestic foods, has been approved for delivery; and/or

•

Developing policies and procedures for monitoring and ensuring compliance with the
Buy American provision.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area — Reporting and Recordkeeping
Intent/Scope of Monitoring
The SA must determine whether reports are submitted as required by the State agency, and
maintained with other Program records for a period of three years after submission of the final
Claim for Reimbursement for the fiscal year. If audit findings have not been resolved, the threeyear period is extended as long as required for resolution of audit issues. Additionally, the
record retention period required by a State may exceed the three-year period. (7 CFR 210.23(c))
These reports and records include, but are not limited to:
•

agreements and free and reduced price policy statements;

•

approved and denied free and reduced price meal applications;

•

procedures and documentation for direct certification for free meals, if applicable;

•

procedures for alternate point-of-service meal counts, if applicable;

•

verification records, including:

•



description of verification efforts,



documentation of verification,



results of verification, and



verification reports;

Claims for Reimbursement (including supporting documentation, such as point-ofservice benefit issuance rosters);

•

meal count participation data by school;

•

documentation of edit checks, on-site reviews, internal controls,, October
enrollment, free and reduced price eligible data;

•

menu and food production records and, if applicable, nutrient analysis records;

•

all documentation provided in support of the Resource Management Section
(including appropriate records to document compliance with the paid lunch equity
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and revenue from nonprogram foods requirements);
•

documentation associated with the local school wellness policy;

•

number of food safety inspections obtained per school year by each school;

•

records from the food safety program for a period of 6 months following a month’s
temperature records;

•

records from the most recent food safety inspection;

•

documents demonstrating compliance with Civil Rights requirements;

•

audit reports and written responses; and

•

any related corrective action.

For SFAs with a Special Provision Option school, refer to Section IX: Special Provision Options for
more information on recordkeeping requirements.
Electronic recordkeeping is an allowed form of record storage.

Review Procedures
On-site Review Procedures
On-site Assessment Tool
Questions 1500-15022 on the On-site Assessment Tool assess compliance with reporting and
recordkeeping requirements.
As the SA is reviewing other areas, it should assess compliance with the applicable reporting
and recordkeeping requirements in order to answer Questions 1500-1502 of the On-site
Assessment Tool.

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Technical Assistance/Corrective Action
The SA must deem an SFA noncompliant with this review element if it does not meet the above
requirements. The SA must provide technical assistance and require corrective action to bring
the SFA into compliance with the requirements. The SA must document any technical
assistance provided to the SFA and ensure required corrective action is timely and adequate.
The SA must record all deficiencies in the comment sections of the On-site Assessment Tool.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Module: General Area — School Breakfast and Summer
Food Service Programs Outreach
Intent/Scope of Monitoring
SFAs must inform families of the availability of breakfasts offered under the SBP and meals
offered through the Summer Food Service Program (SFSP).
A the beginning of each school year, when free and reduced price meal applications are sent to
households, the SFA must notify families of the availability of the SBP. In addition, schools
should send reminders regarding the availability of the SBP multiple times throughout the
school year.
FNS also requires schools to conduct SFSP outreach before the end of the academic school year
to ensure that eligible families are informed of the availability and location of SFSP meals.
The goal for monitoring this area is to determine whether the SFA conducts the required
outreach activities to increase participation in the SBP and SFSP.
The SA conducts a review of the SBP and SFSP outreach as part of the General Areas within the
Administrative Review.

Review Procedures
SAs are expected to assess SBP and SFSP outreach activities off-site through the Off-site
Assessment Tool.
Off-site Assessment Tool
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The SA must record findings on Questions 1600-1601 of the Off-site Assessment Tool.
Off-site Review
The SA must review materials from and documentation of the SFA’s SBP and SFSP outreach
activities for the current school year to determine whether the SFA’ s efforts are consistent
with outreach requirements. The SA may monitor this area off-site with no additional on-site
field work, unless identified issues warrant further attention on-site.
SBP
The SA must determine whether the information provided through the Tool and supporting
documentation establishes that the SFA conducted the required SBP outreach.
Schools participating in the SBP must notify families of the availability of school breakfasts at
the beginning of the school year, when free and reduced price meal applications are sent to
households. In addition, schools should send reminders regarding the availability of the SBP
multiple times throughout the school year (e.g. at the beginning of each semester or quarter).
SFSP
The SA must determine whether the information provided through the Tool and supporting
documentation establishes that the SFA conducted the required SFSP outreach.
FNS requires schools to conduct SFSP outreach before the end of the academic school year to
ensure that eligible families are informed of the availability and location of SFSP meals.
If the SFSP is administered by a different SA, the two SAs must work cooperatively to inform
eligible families of the availability and location of SFSP meals.

Technical Assistance/Corrective Action
The SA must deem an SFA noncompliant with this review element if it does not meet the above
requirements. The SA must provide technical assistance and require corrective action to bring
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the SFA into compliance with the outreach requirements. The SA must document any technical
assistance provided to the SFA and ensure required corrective action is timely and adequate.
The SA must record all deficiencies on the Off-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided to the SFA at the exit conference.

Fiscal Action
This is a General Area, thus fiscal action is not required; however, FNS encourages the SA to
consider withholding program payments, in whole or in part, to any SFA for repeated or
egregious violations that are not corrected. For additional information, refer to Section VIII,
Fiscal Action, Module: Withholding Payments.

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Section VI: Other Federal Program
Reviews

Modules contained within this Section include:
• The NSLP Afterschool Snack Service
• Seamless Summer Option
• Fresh Fruit and Vegetable Program
• Special Milk Program

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Module: The NSLP Afterschool Snack Service
Intent/Scope of Monitoring
The SA’s review of the NSLP Afterschool Snack Service is intended to ensure participating sites
serve students nutritionally-balanced snacks, provide appropriate educational or enrichment
activities, and count and claim snacks accurately. The SA must examine documentation for
each site selected for the Administrative Review that operates the NSLP Afterschool Snack
Service. On-site observation of the afterschool snack service is at the SA’s discretion.
The SA determines the NSLP Afterschool Snack Service compliance by collecting information
about the operation of the snack service and comparing findings to Performance Standard 1,
Performance Standard 2, and the General Areas, as applicable.
If a site selected for an Administrative Review does not operate the NSLP Afterschool Snack
Service, the SA does not conduct this review.

Review Procedures
The SA review of the NSLP Afterschool Snack Service may be conducted off-site or on-site, at SA
discretion, using the Supplemental Afterschool Snacks Administrative Review Form.
To evaluate compliance, the SA must:
•

Verify site eligibility

•

Ensure an accurate counting and claiming system is in place

•

Ensure snacks meet snack service and nutritional requirements (7 CFR 210.10(o))

•

Confirm the SFA conducts self-monitoring activities twice per year (7 CFR 210.9(c)(7))

•

Make certain food safety and civil rights requirements are met (7 CFR 210.13(c) and
210.23(b), respectively)
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Site Eligibility
The SA must ensure that:
•

Sites serve snacks in an approved afterschool care program that offers educational or
enrichment activities.

•

At area eligible sites, the SFA maintains documentation that the school is located within
the geographical boundaries of a school in which
50% or more of the enrolled students are certified
as eligible for free or reduced price meals. See SP
08 CACFP 04 SFSP 03-2017, Area Eligibility in Child

Afterschool Snacks may be offered at two
types of sites through the NSLP:
•

Nutrition Programs for more information.
•

Area Eligible Sites: The site is at a
school or located within the

Schools serve snacks only after the end of the

attendance area of a school in which

regular school day, unless the school operates an

at least 50% of enrolled students are
certified for free or reduced price

Expanded Learning Time Program. Refer to FNS

meals. Snacks are served at no charge

Memorandum SP 04-2011, Eligibility of Expanded

to all children, and reimbursed at the

Learning Time Programs for Afterschool Snack
Service in the National School Lunch Program
(NSLP) and Child and Adult Care Food Program
(CACFP) for additional information.

free rate.
•

Non Area Eligible Sites: Snacks are
served at free, reduced price, and paid
rates based on approved eligibility
documentation.

Counting & Claiming
The SA must ensure that:
•

The site maintains documentation to support the number of snacks it serves daily and
maintains Claims for Reimbursement

•

The sites has safeguards in place to ensure that it claims only one snack per child per
day for reimbursement. Additional snacks may be provided, but may not be claimed for
reimbursement.

•

The site’s snack orders, delivery records, and production records support the number of
snacks it claims for reimbursement
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•

The site’s counts adult snacks (including snacks served to students ineligible due to age
limitations) separately from student snacks, as adult snacks are not eligible for
reimbursement

•

The site monitors age eligibility requirements for students receiving snacks to ensure
compliance. Students. are eligible to participate through age 18 or until the end of the
school year if their 19th birthday occurs during the school year. Students determined to
have a mental or physical disability are not subject to age limitations

•

The SFA provides to the SA an accurate count of snacks served each month at each site
by the established due date for the monthly reimbursement claim

•

For sites that are not area eligible, the SFA transfers the eligibility status of each student
accurately to the roster. The SA could compare, for example, the point-of-service meal
counts to the benefit issuance roster to ensure compliance

•

The SFA keeps snack counts on file for three years

Snack Service and Nutrition Requirements
In accordance with 7 CFR 210.9(c), the SA must ensure that:
•

Snack menus comply with meal pattern requirements

•

SFAs plan/prepare snacks consistently with the one snack per child rule. Sites should
consider participation trends in an effort to provide one reimbursable snack for each
child each school day (7 CFR 210.10(a)(2))

•

Production records reflect that menus meet serving size requirements. For more
information on quantity requirements, see t the Food Buying Guide for Child Nutrition
Programs

•

Sites complete production records each day

•

Sites price each snack as one unit

•

Sites charge no more than $0.15 for a reduced price snack

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SFA Afterschool Snack Service Review
The SA must ensure that:
•

The SFA conducts a self-review of each NSLP Afterschool Snack operation twice per
school year:


The SFA conducts the first self-review during the first four weeks of NSLP
Afterschool Snack Service operations each school year; and



SFA conducts the second self-review of the NSLP Afterschool Snack Service prior
to the end of each school year.

Note: This requirement is distinct from the SFA On-site Monitoring requirements described in
Section V: General Program Compliance, Module: SFA On-site Monitoring.
Food Safety and Civil Rights
The SA must ensure that food safety and civil rights standards are met. Refer to Section V:
General Program Compliance, Module: Civil Rights and Module: Food Safety, for additional
details.
On-site Review Procedures (optional)
On-site observation of the afterschool snack service is at the SA’s discretion.
On-site Afterschool Snack Service Observation
When observing the snack service, the SA must verify information obtained during the
documentation review. In addition, the SA must observe that the afterschool snack service is
following all Program requirements in the following areas:
•

Site Eligibility

•

Counting and Claiming

•

Snack Service and Nutrition Requirements

•

Food Safety and Civil Rights
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Recording Errors
SAs must record errors identified during the review on the Supplemental Afterschool Snacks
Administrative Review Form and the On-site Assessment Tool (Question 1700). These may
include errors that occur outside of the claiming period or errors for other affected schools
outside of the Administrative Review.

Technical Assistance/Corrective Action
The SA must provide technical assistance and require corrective action for all problems it
identifies to bring the afterschool snack operation into compliance.
The SA must note technical assistance provided and any findings on the Supplemental
Afterschool Snacks Administrative Review Form regardless of when the school corrects the
problem.

Fiscal Action
SAs must take fiscal action for any Claim for Reimbursement that is not properly payable. FNS
requires fiscal action if:
•

The school claims snacks for adults or ineligible students (e.g., students who do not
meet age limitations)

•

The school claims snacks that are missing a component (e.g., only graham crackers are
served)

Fiscal action is recorded on the Other Meal Claim Errors, Form S-2 and the Fiscal Action
Workbook.
FNS does not require, but encourages SAs to take fiscal action for schools with repeated milk
type violations (e.g., higher fat content milk, flavoring) as described under Review Procedures,
“Snack Service and Nutrition Requirements” in this Module. Refer to Section VIII: Fiscal Action,
for details on what constitutes a repeat violation.
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Module: Seamless Summer Option
Intent/Scope of Monitoring
The Seamless Summer Option (SSO) permits SFAs participating in the NSLP and/or SBP to serve
meals during summer, during a scheduled break of 10 or more school days (or shorter periods
for year-round schools, if approved by the State agency), and/or during unanticipated school
closures using the same meal service rules and claiming procedures they use during the regular
school year. See FNS Policy Memorandum SP 09-2017: 2017 Edition of Questions and Answers
for the National School Lunch Program’s Seamless Summer Option, for more information.
The SA determines SSO compliance in the same manner it assesses NSLP and SBP compliance,
i.e., the SA collects information about program operations and compares its findings to
Performance Standard 1, Performance Standard 2, and the General Areas. During the review,
SA staff must ensure that the SFA and its participating sites are compliant with meal counting
and claiming, menu planning, and food safety requirements established in 7 CFR 210 and 220.

Review Procedures
This module contains certain activities that must be completed on-site. Some activities may be
completed off-site, at SA discretion.
Pre-Visit Review Procedures
Scheduling
If an SFA operates one or more SSO sites, the SA must select and review at least one SSO site as
part of the Administrative Review. The site selected for SSO review may be any SSO site in the
SFA, and does not have to be a site selected for the regular Administrative Review.

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The review period for SSO is the last completed claim from the current or previous school year.
The review may be conducted in the summer prior to or following the scheduled Administrative
Review, although FNS encourages SAs to monitor the SSO site the summer after the
Administrative Review. Monitoring the SSO site the summer after the Administrative Review
allows the SA to benefit from the context of the SFA’s Administrative Review, which may
streamline SSO monitoring. Note that this may involve a second visit to the SFA to evaluate the
SSO in operation. Below are scheduling examples:
Administrative Review Schedule
SY 2016/2017
SY 2017/2018

SSO site review
Summer of 2016 or 2017
Summer of 2017 or 2018

SAs are not required to conduct annual reviews of SFAs that operate under the SSO or to
conduct any special reviews for these SFAs beyond the normal Administrative Review
requirements of reviewing all SFAs during a 3-year cycle and reviewing at least one SSO site as a
part of the review. However, State agencies are encouraged to review SSO sites even if an
Administrative Review is not scheduled for that SFA, especially if there are significant
operational problems.
Early planning and communication between the SA and SFA is crucial in scheduling a SSO visit.
As soon as possible, the SA must contact the SFA to determine if any SSO sites are in operation,
and if so, obtain the operating schedule. It is important to schedule the site review early
because SFAs typically operate the SSO for limited periods.
If the school is operating the NSLP on a year-round basis and both NSLP schools and SSO
schools will be operating at the time of the review, then an Administrative Review may be
scheduled during the summer to avoid making the second visit to the SSO site.
Assessment Form
•

Supplemental Seamless Summer Option Administrative Review Form

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Off-site Review Procedures
The SA may utilize any pertinent information derived from Administrative Review activities
during the SSO monitoring visit. For example, a SA may evaluate Food Safety and Civil Rights
compliance during the Administrative Review. Elements of these areas may apply to the SSO
operation, and therefore, the SA would not need to reassess these areas separately during a
SSO monitoring visit. The SA may also review
menus and production records off-site prior to

What types of sites can operate the Seamless Summer
Option?

the on-site visit.

FNS allows the following types of sites to operate the SSO:
•

Open site: A school or non-school site located within
the geographical boundaries of a school where at least
50% of enrolled students are eligible for free and
reduced price school meals. SAs may also approve open
sites based on census data. All meals are served and
reimbursed at the free rate at open sites.

•

Restricted open site: A site that meets the open site
criteria explained above, but is restricted for reasons of
safety, control, or . All A meals are served and
reimbursed at the free rate at restricted open sites.

•

Closed enrolled site: A site that meets the 50% criteria,
explained above, but serves only children in a specific
program or activity. All meals are served and
reimbursed at the free rate. Academic summer school
programs may not participate as closed enrolled sites.

•

Migrant site: A site that serves children of migrant
families, as certified by a migrant.coordinator. All meals
are served and reimbursed at the free rate

•

Camps: A residential or non-residential day camp that
offers regularly scheduled food service as part of an
organized program for enrolled children. Eligibility.E
must be established for each child enrolled based on
information from their schools, household income
applications, or direct certification..Meals are served
and reimbursed at the free rate for students eligible for
free or reduced price meals; paid meals are not
reimbursed.

Site Eligibility
A variety of sites may serve children meals
under the SSO (see Text Box).
When applying to operate the SSO, SFAs must
provide data to the SA to establish site
eligibility. The SA must ensure that the SFA
maintains this documentation. For sites that
serve free meals based on area eligibility, the
SA must ensure that the SFA maintains
documentation that the site is located within
the geographical boundaries of a school in
which 50% or more of the enrolled students
are certified eligible for free or reduced price
meals, based on income eligibility applications
or other documentation of categorical
eligibility. SFAs may also use census data to
establish eligibility for SSO sites. FNS must
approve other sources of data SAs may use to
determine eligibility. See SP 08 CACFP 04 SFSP

Note: Meals at all approved SSO sites, except for camps,
must be served free of charge to all children. SFAs that
sponsor camps may charge for the meals served to children
who are not eligible to receive free or reduced price meals.

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03-2017, Area Eligibility in Child Nutrition Programs, for more information.
At sites where eligibility is based on household income applications or direct certification (e.g.,
camps), the SFA must collect and maintain appropriate documentation of individual children’s
eligibility. The SFA may receive reimbursement only for meals served to children through age 18
who are eligible for free or reduced price meals. SFAs will receive reimbursement at the free
rate for meals served to children certified as eligible for free or reduced price meals. No
reimbursement is provided for meals served to children who are eligible for paid meals at these
sites.
Age/Grade Groups
SFAs offering the SSO should make every effort to follow age/grade group meal pattern
requirements. However, SFAs operating open and restricted open sites having difficulty
implementing the age grade/group requirements may work with their SASA to make
accommodations, which may include the use of a single age/grade group meeting the minimum
meal pattern requirements for the most common age/grade group attending the site. This
holds true for both school and non-school sites. All accommodations must possess a reasonable
justification for the need to deviate from age/grade group requirements. Modifications to
age/grade group requirements must be included as an addendum to the agreement between
the SFA and SASA.
These accommodations only apply to open and restricted open sites where meals are served to
all children in the community on a first come, first serve basis. All sites that serve an identified
group of students, including closed enrolled sites and camps, must follow the age/grade group
requirements outlined in 7 CFR 210.10 and 7 CFR 220.8.
While SSO closed enrolled and camp site operators that serve multiple age/grade groups may
not offer meals under a single age/grade group, these sites do have some flexibility. SSO sites

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can meet the requirements of breakfast for grades K-12 by offering food quantities that fit all
grade groups.
At lunch, meal requirements for grades K-8 can be combined into a single menu with 8-9 oz.
equivalent of grains/week, 9-10 oz. equivalent of meat/meat alternates/week, average daily
calorie range 600-650, and average daily sodium limit less than 640 mg. Grades K-8 and 9-12
may use the same basic menu by adding slightly more grains and meat/meat alternates for the
older children. More detailed information on how to create menus that meet the requirements
of multiple age/grade groups can be found in SP 10-2012 (v.9).
Advertisement
The SA must ensure that the SFA makes a reasonable effort to advertise the availability of free
meals and the site location to children in the community, and that all advertising materials
contain the required non-discrimination statement. Refer to Section V: General Program
Compliance, Module: Civil Rights, for the most current version of the nondiscrimination
statement.
SFA Self-Monitoring
SFAs are required to review all SSO sites at least once per year, during operation of the SSO.
The SA must examine the SFA’s self-monitoring forms to ensure required self-monitoring takes
place.
On-site Review Procedures
Meal Counting & Claiming
When observing meal counting and claiming, SAs must:
•

Observe at least one meal service

•

Count the number of reimbursable meals served at the actual point-of-service; only
count complete meals served to children

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•

Assess the site’s procedures for counting and claiming by comparing meal counts on the
day of review to the last full week of operation from the review period

•

Ensure camps claim free reimbursement only for meals served to free or reduced priceeligible children

•

Determine whether the site transfers each child’s eligibility status accurately to the
roster. The SA could compare, for example, the point-of-service meal counts to the
benefit issuance roster to ensure compliance

If the SA identifies problems with counting and claiming, the SA must validate the site’s most
recent claim.
In year-round SSO sites, the school or site must differentiate between SSO meals and NSLP/SBP
meals.
Menu Planning & Meal Service
The SFA must plan meals using the same requirements as the NSLP/SBP.
When assessing the meal service, the SA must:
•

Complete the Meal Component Worksheet for one week of menus from the review
period or current operating year for all meals offered

•

Review menus and production records to determine how meals contribute to meal
pattern requirements (refer to Section III, Meal Pattern and Nutritional Quality, Module,
Meal Components and Quantities, for additional information)

•

Assess how the site differentiates between age/grade groups and provides ageappropriate meals

•

Ensure children eat meals on-site, except where otherwise permitted by the SA

•

Ensure the site serves all eligible children in attendance one meal before offering
children a second meal

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•

Verify the site has proper food safety measures in place (refer to Section V, General
Program Compliance, Module: Food Safety, for additional information)

•

Make sure the site serves meals during the meal service times approved by the SA

•

If applicable, make sure the site makes alternate arrangements for meal service in
inclement weather

Note: A nutrient analysis is not required for a SSO review; therefore SAs are not required to
complete the Dietary Specifications Assessment Tool.
SFAs may allow Offer versus Serve at SSO sites, but FNS does not require it. As in NSLP, second
lunches are not reimbursable. SFAs must plan for and prepare breakfasts on the basis of
participation trends, with the objective of providing one breakfast per child per day. However,
sites may serve any excess breakfasts as seconds to eligible children and Claim for
Reimbursement in accordance with 7 CFR 220.9.

Technical Assistance/Corrective Action
The SA must require corrective action and provide technical assistance for all problems it
identifies to bring the SSO operation into compliance. Effective technical assistance includes
helping the site manager identify deficiencies and necessary corrections to ensure the site does
not repeat errors.
For all findings, SAs must follow the same corrective action and technical assistance procedures
that apply to the NSLP and SBP.
SAs must provide technical assistance if a SA finds that the SSO site does not take steps to
differentiate between age/grade groups. For example, the site may post signs instructing
students in specific age/grade groups which meals and/or components to select.

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Fiscal Action
The SA must assess fiscal action for all critical violations identified during SSO monitoring. FNS
requires fiscal action as described below. For additional information, refer to Section VIII, Fiscal
Action.
Site Eligibility & Meal Counting/Claiming
For site eligibility and/or meal counting and claiming problems, the SA must evaluate the
specific problem and site requirements, and assess fiscal action. For example, if a SA finds that a
camp claims paid meals for reimbursement, the SA would reclaim or disallow the
reimbursement for paid meals.
Meal Components
A SA is required to take fiscal action when a meal component is missing. The SA must also
require the SFA and/or school reviewed to take corrective action for the missing component. If
corrective action occurs, the SA may limit fiscal action from the point corrective action begins
back through the beginning of the review period for errors identified in 7 CFR 210.18 (g)(2).
Performance-based Certification Funding (6 cents)
If the Administrative Review finds that significant noncompliance exists; the SA must use its
best judgment to assess the longevity and severity of the problem(s). If the problem(s) cannot
be fixed immediately, the SA must require the SFA to develop and implement a Corrective
Action Plan over an extended period of time. If the SA determines that the performance-based
reimbursement should be terminated, it should be terminated beginning the month following
the on-site Administrative Review and, at State discretion, for the month of review. Previously
paid performance-based reimbursement would only be recovered in circumstances of clearly
egregious or willful noncompliance by an SFA.
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Performance-based reimbursement may resume beginning in the first full month the SFA
demonstrates to the satisfaction of the State agency that corrective action has taken place.
When the performance-based reimbursement is terminated, and the SFA operates both NSLP
and the SSOSSO, refer to Section VIII, Overview of Fiscal Action, Module: Duration of Fiscal
Action, Performance-based Reimbursement.

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Module: Fresh Fruit and Vegetable Program
Intent/Scope of Monitoring
The Fresh Fruit and Vegetable Program (FFVP) aims to increase children’s exposure to and
consumption of a variety of fruits and vegetables. The review of the Programs to ensure
participating schools are proper stewards of Federal funds and operate the Program as
prescribed by FNS.
To evaluate compliance, the SA must:
•

Use the prescribed methodology to establish the FFVP school review sample size

•

Validate one Claim for Reimbursement for each FFVP school selected for review (e.g.,
review supporting documents such as invoices)

•

Observe the FFVP in each of the schools selected for review, if applicable

This monitoring area falls under the General Area of the Administrative Review.

Review Procedures
FFVP Site Selection Methodology
Of the schools selected for an Administrative Review, the SA must select FFVP schools for a
FFVP review based on the table below.
Number of Schools Selected for an NSLP
Minimum Number of FFVP Schools to be Reviewed
Administrative Review That Operate the FFVP
0 to 5
1
6 to 10
2
11 to 20
3
21 to 40
4
41 to 60
6
61 to 80
8
81 to 100
10
101 or more
12*
* Twelve plus 5 percent of the number of schools over 100. Fractions must be rounded to the nearest whole
number.

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For example:
Twenty schools within SFA are selected for an NSLP Administrative Review. Of the 20 schools
selected, 7 also operate the FFVP. Using that information in concert with the above chart, the
SA would review two of the seven FFVP schools also selected for an NSLP Administrative
Review.
Note: FFVP school selection is determined by the NSLP schools selected for review and occurs
after the NSLP school selection process has been completed. NSLP schools selected for review
are either: chosen automatically under the requirements of 7 CFR 210.18(e)(1) and (e)(2)(i);
chosen according to SA discretionary criteria under 7 CFR 210.18(e)(2)(ii); or chosen using a
combination of the two options. When none of the schools selected for an NSLP Administrative
Review operate the FFVP, but the FFVP operates at another school (or other schools) within the
SFA, the State agency must follow the procedures below to ensure that at least one FFVP school
is reviewed during an NSLP Administrative Review.
1. When the NSLP schools selected for review are comprised solely of schools chosen
automatically under the requirements of 7 CFR 210.18(e)(1) and (e)(2)(i), the SA will
have to review the FFVP at a school that is not receiving an Administrative Review.
FFVP is the only program that would need to be reviewed at this additional school.
2. When the NSLP schools selected for review are comprised solely of schools chosen
according to SA discretionary criteria under 7 CFR 210.18(e)(2)(ii), the SA will have to
replace one of the schools selected for an Administrative Review with a school that
has similar characteristics that operates the FFVP. If that is not possible, use the
process identified in number 1 above.
3. When the NSLP schools selected for review are comprised of schools chosen both
automatically under the requirements of 7 CFR 210.18(e)(1) and (e)(2)(i) and
according to SA discretionary criteria under 7 CFR 210.18(e)(2)(ii), the SA will have to
replace one of the schools selected for Administrative Review according to SA

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discretionary criteria with a school that has similar characteristics that operates the
FFVP. If that is not possible, use the process identified in number 1 above.

Off-site Review Procedures
Claim Validation
The SA must validate one Claim for Reimbursement for each FFVP school selected for review.
FNS strongly recommends that the SA complete the claim validation off-site. However, claim
validation can occur on-site as well. The SA may select any month in which a school has
submitted a claim in the current school year. The SA does not have to select the same claim
month for each of the FFVP schools selected for review. If a school has not submitted a claim
for the current school year, the SA must select a claim from the previous school year.
Once the SA receives this information, the SA proceeds to validate the school’s FFVP Claim for
Reimbursement for the selected month. The SA must compare the total cost claimed for
reimbursement against the total cost established by the supporting cost documentation.
If these two totals are the same and the reported costs are allowable, then the SA validates the
claim and the FFVP school is compliant with this review element. If these two totals are not the
same or contain unallowable costs, then the SA does not validate the claim and the FFVP school
is out of compliance with this review element.
While examining the supporting cost documentation during the claim validation process, the SA
must ensure the documentation indicates the following:
•

The school uses the majority of funds to purchase fresh produce

•

The school carefully reviews and prorates equipment purchases

•

Labor costs and all other non‐food costs are minimal

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The SA must provide technical assistance if the documentation is not consistent with the
requirements listed above.
Prior to completing the claim validation, the SA must examine payment system records for the
year-to-date administrative costs charged to each reviewed school’s total FFVP grant. The SA
must ensure that each school is on track to charge no more than 10% of the total grant to
administrative costs.
Note: If the SA validates FFVP claims when the FFVP claim is submitted for payment, further
claim validation during an Administrative Review is not required.
On-site Review Procedures
On-site Review Form
The SA must record findings in Questions 1900-1902 (review period) and 1903-1910 (day of
review) on the On-site Assessment Tool.
On-site Review
The SA must observe the FFVP operation in each of the selected schools. While the FFVP food
service may occur in multiple locations within a participating school, the SA is only required to
observe one location. Visits to additional classrooms or other service locations (e.g., kiosks,
vending machines, school hallways) are at the SA’s discretion. Through the course of the
observation, the SA must use the statements below to determine whether the school operates
the FFVP properly on the day of review.
•

The FFVP is available to all enrolled children

•

The FFVP is provided to students free of charge

•

The school offers FFVP within the school day, but outside the meal service times of the
NSLP and SBP

•

The school widely publicizes the FFVP

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•

The school does not allow frozen, canned, dried, and other types of processed fruits to
be served as part of the FFVP

•

The school does not allow the following products: fruit/vegetable juice; cottage cheese;
nuts or trail mix; fruit or vegetable pizza; fruit/vegetable smoothies; fruit strips, fruit
drops, or fruit leather (see the FNS FFVP Handbook for a more exhaustive list)

•

If the school provides dip, the dip is for vegetables only and is either low-fat or fat-free.
Schools may provide no more than two tablespoons of dip per child

•

The school does not provide fresh fruits and vegetables to adults except for teachers
who are in the classroom and participating with students during the FFVP food service.
See FNS Memorandum SP 08-2011, Teacher Modeling in the Fresh Fruit and Vegetable
Program (FFVP)

•

The school offers cooked vegetables no more than once per week and only when
included as part of a nutrition education lesson.

•

The FFVP food service follows HACCP principles and applicable sanitation and health
standards. Refer to Section V: General Program Compliance, Module: Food Safety for
further information.

The SFA is compliant with this review element if the SA’s observations on the day of review at
each of the FFVP schools selected for review correspond to the statements above. If the SA’s
observations at any of the FFVP schools contradict the statements above, the SA will deem the
SFA noncompliant with this review element and the SA must issue appropriate corrective
action.

Corrective Action
The SA will deem an SFA noncompliant if the SFA does not meet any of these requirements.
The SA must issue corrective and fiscal action to bring the SFA into compliance.

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The SA may suspend or terminate the FFVP in an SFA or school for repeated failure to meet
program requirements, as documented by the SA.
All deficiencies must be recorded on the On-site Assessment Tool in the applicable comments
section. Technical assistance and corrective action to correct identified deficiencies must be
included in the Corrective Action Plan provided to the SFA at the exit conference. FFVP errors
are recorded on the School Data and Meal Pattern Error, Form S-1, Line 21.

Fiscal Action
The SA must disallow any portion of a Claim for Reimbursement and recover any payment
made to an SFA that was not properly payable according to FFVP requirements. Unsupported
costs and/or unallowable costs must be recorded on the applicable Fiscal Action Workbook.

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Module: Special Milk Program
Intent/Scope of Monitoring
The Special Milk Program (SMP) provides milk to children in schools, residential child care
institutions, and eligible camps that do not participate in other Federal child nutrition meal
service programs. The Program reimburses schools and institutions for the milk served to
eligible children. Schools participating in the NSLP or SBP may also participate in the SMP to
provide milk to children in half‐day pre‐kindergarten and kindergarten programs where children
do not have access to the school meal programs.
The intent of monitoring the SMP is to determine whether the SFA is operating the program in
compliance with regulatory requirements and in accordance with the SA-approved agreement.
The SA must examine SMP documentation for each school selected for the Administrative
Review that operates the SMP. On-site observation of the SMP is only required if issues are
discovered during the documentation review or with meal counting and/or claiming of the NSLP
or SBP.
If a school selected for an Administrative Review does not operate the SMP, the SA does not
have to select another site for the purposes of reviewing the SMP.

Review Procedures
The SA must evaluate the pricing policy, counting and claiming, milk service procedures, and
recordkeeping in SMPs operating in the sites selected for the Administrative Review, if
applicable. The SA review of the SMP may be conducted off-site or on-site, at SA discretion.

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Assessment Form
The SA must complete the Supplemental Special Milk Program Administrative Review Form
either off-site, through telephone contact or e-mail, or on-site.
To evaluate compliance, the SA must:
•

Review the pricing policy

•

Confirm the SFA is operating its approved SMP option

•

Make sure counting and claiming procedures yield accurate claims

•

Determine that records are retained for three years or until resolution of audits

Pricing, Counting, and Claiming
The SA must ensure that:
•

The school prices milk in accordance with FNS policy

•

The school/SFA maintains documentation that supports the number of milks it serves
daily and claims for reimbursement

•

Milk orders and delivery records support the number of milks claimed for
reimbursement

•

The purchase price of milk on the most recent Claim for Reimbursement matches the
purchase price reflected on invoices

•

The SFA provides an accurate count of milks served each month at each school to the SA
by the established due date for the monthly reimbursement claim

•

The SFA transfers eligibility status of each student accurately to the roster; the SA may
do this by comparing the point-of-service milk counts by student/benefit category to the
benefit issuance roster to ensure that students receiving free milks are listed as eligible
on the benefit issuance roster

•

The SFA retains records for three years

Refer to Section II: Meal Access & Reimbursement, Module: Meal Counting and Claiming for
more in-depth guidance regarding counting and claiming.
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On-site Review Procedures
On-site observation of the SMP is only required if issues are discovered during the SMP
documentation review or with meal counting and/or claiming of the NSLP or SBP.
On-site Assessment Form
Special Milk Program Review Administrative Review Form
On-site Special Milk Program Service Observation
When observing the milk service, the SA must verify information obtained during the
documentation review. In addition, the SA must observe milk service to ensure that:
•

The school takes a point-of-service milk count and records milk correctly

•

Milk counts by category for the day of review do not vary unreasonably in comparison
to the previous five days

Technical Assistance/Corrective Action
The SA must provide technical assistance and require corrective action for all problems it
identifies to bring the SMP operation into compliance. Effective technical assistance includes
helping the SFA identify deficiencies and necessary corrections to ensure the school/SFA does
not repeat errors.
The SA must record errors on the Supplemental Special Milk Administrative Review Form and
the On-site Assessment Tool (Question 2000).

Fiscal Action
SAs must take fiscal action for any Claim for Reimbursement that is not properly payable. FNS
requires fiscal action for all certification and counting and claiming errors.
The SA must record counting and claiming errors on School Data and Meal Pattern Error, Form
S-1, Line 23.
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Section VII: Post-Review Procedures

The Modules in this Section are:
• Administrative Review Exit Conference
• Administrative Review Report
• Documented Corrective Action

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Module: Administrative Review Exit Conference
Intent/Scope
At the conclusion of the on-site portion of the Administrative Review, the SA must hold an exit
conference to notify SFA staff of any program violations identified, the extent of the violations,
and a preliminary assessment of the actions needed to correct the violations. The SA must
address appropriate deadlines for completion of corrective action.
Corrective Action Plan
The exit conference is an opportunity to establish an agreed-upon Corrective Action Plan
that identifies the needed corrective action and the timeframes for those actions. To
achieve the desired result, the SA must allow for SFA input on corrective action
approaches and must offer technical assistance for deficiencies cited.
The Corrective Action Plan must identify the following:
•

The identified finding(s)

•

The corrective action(s) required

•

The timeframe(s) by which the corrective action(s) must be completed

•

Any documentation the SA expects the SFA to provide to demonstrate corrective action
was completed

Documented Corrective Action
The SA must explain to the SFA that corrective action determines the extent of the fiscal action
taken, and stress the importance of implementing corrective action in a timely manner. The SA
should make every effort to provide the SFA with a summary of the noted compliance areas to
facilitate the immediate development of corrective action. The SA may accept documented
corrective action at the time of the Administrative Review, or the SFA may submit documented
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corrective action as described in the Module: Documented Corrective Action found later in this
Section.
Fiscal Action
The SA should explain how fiscal action is calculated. The SA has the option to discuss a
potential claim amount. The SA should explain that withholding of payments results if the SFA
does not take corrective action. If applicable, the SA should explain the SFA’s right of appeal.
(7 CFR 210.18(j))
If the SA will review the SFA’s SSO during the upcoming summer, the SA should remind the SFA
that there may be fiscal action resulting from the SSO review. If that is the case, the amount of
fiscal action for the NSLP and SSO reviews must be combined to determine whether the $600
disregard in 7 CFR 210.19(d) can be applied to any overclaim.
Performance-Based Reimbursement
If Administrative Review findings initiate, fail to initiate, or terminate the SFA’s receipt of the
performance-based reimbursement, the SA must notify the SFA at the exit conference and in
the Administrative Review Report. The SA must also tell the SFA when the performance-based
reimbursement will be initiated or terminated.
If findings fail to initiate, or result in termination of, the performance-based reimbursement,
the SA must provide technical assistance and ensure the SFA understands steps that must be
taken to initiate or reinstate the performance-based reimbursement.
Cooperative Effort
The SA should acknowledge the cooperation of all persons involved in the review process,
and inform the SFA as to when it can expect to receive the notification letter reporting review
results.

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Module: Administrative Review Report
Reporting

Review Results

Intent/Scope
After the review/exit conference, the SA must provide written notification of the review
findings (i.e., the Administrative Review Report) to:
•

the SFA’s Superintendent (or equivalent in a non-public SFA) or authorized
representative; and

•

the Food Service Director.

The SA has the option to combine the written notification with the letter of claim
adjustment/notice of appeal if the SFA has already completed corrective action.
Required Content
Required and suggested content items follow. An asterisk* indicates required items.
•

Team composition and leader

•

Appreciation and commendation to school personnel who participated in the review

•

Restatement of purpose of review and description of review process

•

Name and telephone number of SA contact person

•

Review findings (including those uncovered after the exit conference)*


FNS recommends that, if findings are identified after the exit conference, the SA
notify the SFA of the findings prior to issuing the Administrative Review report

•

Whether the performance-based reimbursement will be initiated, maintained, or
terminated based on review findings


If findings fail to initiate, or result in termination of, the performance-based
reimbursement, the SA must provide technical assistance and ensure the SFA
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understands steps that must be taken to initiate or reinstate the performancebased reimbursement
•

The Corrective Action Plan identifying corrective actions, timeframes for the completion
of corrective action, instructions to document corrective action taken by the SFA, and an
indication that findings must be corrected system-wide*

•

Timeframes for completion of the corrective action*

•

Potential for fiscal action provided in general or specific terms*

•

Date(s) of review and date of exit conference*

•

Description of the SFA’s right to appeal the denial of all or a part of the Claim for
Reimbursement or withholding of funds

•

Possibility of a follow-up review should corrective action not be completed or to verify
corrective action was completed system-wide, as appropriate

Timeframes
The SA should issue the Administrative Review Report within 30 calendar days of the date the
exit conference was conducted. In rare situations when an SFA is found to be significantly out of
compliance with multiple program areas and/or the SA or SFA runs into extenuating
circumstances, the report may take up to 60 calendar days.
Posting of the Administrative Review Report Summary
The SA is responsible for ensuring that information regarding Administrative Reviews is made
easily accessible to all members of the public. SAs must publicly post a summary of the
Administrative Review Report for each SFA on the SA’s publicly available website. A summary of
the report must be posted no later than 30 days after the SA provides the final results of the
Administrative Review to the SFA. The SA must also make a copy of the final Administrative
Review Report available to the public upon request. In addition, the SA has the discretion to
strongly encourage that SFAs post a summary of the report for each SFA and make the report
available to the public upon request. The review summary must cover access and
reimbursement (including eligibility and certification review results), an SFA’s compliance with
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the meal patterns and the nutritional quality of school meals, the results of the review of the
school nutrition environment (including food safety, local school wellness policy, and Smart
Snacks in Schools), compliance related to civil rights, and general program participation. At a
minimum, the public posting of the report would include the written notification of review
findings provided to the SFA as required above.

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Module: Documented Corrective Action
Intent/Scope
In order for the SA to close out the Administrative Review for an SFA, it must obtain
documented corrective action from the SFA for any degree of findings in either the Critical or
General Areas that the SA identifies during an Administrative Review. Documented corrective
action should also include any program violations identified outside the scope of an
Administrative Review.
Unless the SFA provides documented corrective action at the time of the Administrative
Review, the SFA must send written notification and supporting documentation to the SA
certifying that it has completed the corrective action required for each finding, as well as
corresponding dates of completion.
The SA makes the determination as to whether/when the SFA satisfactorily corrected a
problem.
Timeframes
The SFA must postmark or submit documented corrective action to the SA no later than 30
calendar days after the established deadline for completion of each required corrective action,
or as otherwise extended by the SA.
Extension of Corrective Action Timeframes
The SA may extend the timeframes established for corrective action upon written request
(either electronically or hard copy) of the SFA if extraordinary circumstances arise where a SFA
is unable to complete the required corrective action within the specified timeframes.

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Closing the Administrative Review
Upon receipt of the SFA’s documented corrective action, the SA should determine whether the
documentation is complete and resolves the finding(s) identified. Once the SA approves
corrective action, it should send a closure letter to the SFA closing the review within 30
calendar days of receipt of the documented corrective action.

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Section VIII: Fiscal Action

The Modules in this Section are:
• Overview of Fiscal Action
• Fiscal Action Formula
• Withholding Payments
• Overpayment Disregard
• Letter of Claim Adjustment and/or Withholding of Payment
Including Notice of Appeal

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Module: Overview of Fiscal Action
Intent/Scope
Claims for Reimbursement must accurately reflect the number of reimbursable meals served to
eligible children, by type, for any given day. When conducting an Administrative Review, SAs
must identify the SFA’s correct entitlement and take fiscal action when any SFA claims or
receives more Federal funds than earned under 7 CFR 210.7. SAs should contact their FNS
Regional Office if they need additional help or clarification with fiscal action.
Fiscal action means the recovery of overpayment through direct assessment or offset of
future claims, disallowance of overclaims as reflected in unpaid Claims for Reimbursement,
submission of a revised Claim for Reimbursement, and correction of records to ensure that
unfiled Claims for Reimbursement are corrected when filed. (7 CFR 210.19(c))
Each Section of the manual contains Module-specific information related to fiscal action, e.g.,
Section II: Meal Access and Reimbursement, Module: Certification and Benefit Issuance. The SA
must be familiar with the information included within those Modules in addition to the
information in this Section.

General Information
Timeframes Covered by Fiscal Action
Review Period
The review period is the most recent month for which a Claim for Reimbursement was
submitted, provided that it covers at least ten (10) operating days. The Claim for
Reimbursement is considered to be submitted once it has been mailed or provided to the SA.

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Day of Review
The day of review is the day(s) on which the on-site review of the individual sites selected for
review occurs. For purposes of fiscal action, the meal counts will come from the entire month
in which the day of review occurs.
Special Circumstances
•

Nutrient Analysis Outside of the Review Period
In some cases, a nutrient analysis may need to be conducted for a week outside the review
period. For example, a SFA may not have menu documentation for the weeks in the review
period. See Section III: Meal Pattern and Nutritional Quality, Module: Dietary Specifications
and Nutrient Analysis for additional information on assessing and recording fiscal action for
Dietary Specifications violations identified outside the review period.

Duration of Fiscal Action
Fiscal action must be extended back to the beginning of the school year or that point in time
during the current school year when the infraction first occurred for all violations of
Performance Standards 1 and 2. Based on the severity and longevity of the problem, the SA
may extend fiscal action back to previous school years, as applicable. (7 CFR 210.19(c)(2)(ii)).
Exceptions to the duration of fiscal action are described below:
Performance Standard 1:
• If corrective action occurs, the SA may limit fiscal action from the point
corrective action occurs back through the beginning of the review period. (7 CFR
210.18(m)) However, for purposes of fiscal action, the SA-established
certification and benefit issuance error rates must be applied to the review
period and month of on-site review regardless of when corrective action occurs
for these errors. Refer to Certification and Benefit Issuance errors, Section II:
Meal Access and Reimbursement, Module: Certification and Benefit Issuance for
more information. ***This exception does not apply to Special Provision

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Options. Refer to Fiscal Action, Section IX: Special Provision Options for more
information.
•

The SA need not take fiscal action for applications missing the name and
signature of an adult household member if corrective action occurs within
timeframes specified by the SA. (7 CFR 210.19(c)(6)).

Performance Standard 2:
• For food component violations under Performance Standard 2, the SA must take
fiscal action and require the SFA and/or reviewed school to take corrective
action for the missing component. If a Corrective Action Plan is in place, the SA
may limit fiscal action from the point corrective action occurs back through the
beginning of the review period.
If the SA finds any Performance Standard 2 lunch violations as described above, the SFA will not
be eligible for the 6 cents per lunch reimbursement, as adjusted, with the beginning of the
month following the on-site portion of the Administrative Review and, at SAs discretion, for the
day of review month. SA must assess the severity and egregiousness of the violations identified
in determining whether or not to terminate the 6 cent performance-based reimbursement.
Performance-based reimbursement may resume beginning in the first full month the SFA
demonstrates to the satisfaction of the SA that corrective action has taken place. (e.g. Review
Period is March, Day of Review takes place April 15; performance-based reimbursement must be
turned off beginning May 1 and may be turned off going back to April 1. Corrective Action occurs
May 18, performance-based reimbursement must be turned back on starting June 1).
Performance-based reimbursement is only earned for lunches; therefore, the performancebased reimbursement is only terminated for lunch violations.
Performance-Based Reimbursement
When the performance-based reimbursement is terminated for either the NSLP or SSOSSO, it
will remain turned off for both until corrective action occurs.
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Fiscal Action Approach
The fiscal action formula, described below, results in a comparison between:
•

the SA’s assessment of the reimbursement to which a school(s) is entitled in a closed
Claim for Reimbursement, based on production records, invoices, eligibility documents,
and observation; and

•

the Claim(s) for Reimbursement made by the school(s) for the same closed claim.

•

A “Closed Claim for Reimbursement” means any month for which a Claim for
Reimbursement was submitted. The review period is a Closed Claim for Reimbursement.

Fiscal action can also be calculated for an open Claim for Reimbursement using the same basic
formula approach. However, since meals observed by the SA during this time have not yet been
claimed, fiscal action cannot be calculated to recover funds. Instead, fiscal action is calculated
by adjusting the SFA’s uncorrected meal counts to ensure that the Claim for Reimbursement,
when submitted by the SFA, is adjusted to account for all errors identified by the SA.
•

An “Open Claim for Reimbursement” means any month for which a Claim for
Reimbursement has not been submitted. The day of review occurs during an Open Claim
for Reimbursement.

Calculating Fiscal Action for an Open Claim for Reimbursement
SAs, in conjunction with the SFA, must ensure that any Claim for Reimbursement is correct
when filed. This means that the open Claim for Reimbursement must correctly reflect any
adjustments resulting from the Administrative Review.
To ensure the Claim for Reimbursement is correct when filed, the SA must:
•

Obtain the site’s proposed total meal counts, by type, for the open Claim for
Reimbursement. These counts must include all days of operation from the Open Claim
for Reimbursement. All meal disallowances identified during the on-site portion of the
review must be recorded for fiscal action for the open Claim for Reimbursement.
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•

Apply the fiscal action formula, which takes into account adjustments for certification
and benefit issuance errors, consolidation errors and non-reimbursable meals; and
identify the site’s correct meal counts for the open Claim for Reimbursement.

•

Notify the SFA of the correct meal counts and require that the SFA’s Claim for
Reimbursement reflect the corrected meal counts. For example, the SFA proposed meal
counts are 1000 free, 500 reduced, and 200 paid. After completing the fiscal action
process the SA determines meal counts should be 950 free, 400 reduced, and 198 paid.

•

SFA’s assessed fiscal action under the open claim option must still be provided appeal
rights; however, any fiscal action assessed would not be considered for the $600
disregard. Since this approach corrects SFA/site meal counts prior to submission of the
final claim for reimbursement the application of the $600 disregard is not allowable.

Note: The approach (Closed and/or Open) used to assess fiscal action is up to SA discretion.
For example, the SA may choose to assess fiscal action for the review period and the
month of the on-site review following the closed claim for reimbursement approach.

Fiscal Action Formula
The Module: Fiscal Action Formula describes the method used to determine fiscal action for the
NSLP and SBP. The SA must calculate fiscal action separately for each program reviewed. The
Fiscal Action Workbook provides separate tabs for standard scenarios, special provision options,
and other errors for each program. The formula described below can be used to calculate fiscal
action to recover funds for one or more claim periods, or to correct claims before they are
submitted for reimbursement.
To apply the formula in standard situations, the SA must obtain the following information during
the off-site/on-site reviews:
•

The number of meals claimed by the site, by type (free, reduced price, and paid) (see S-1,
lines 19 and 20).

•

Upward or downward adjustments needed to the site’s meal counts for the reviewed
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schools, by type, due to counting or consolidation errors (see S-1, lines 13 and 17).
•

The total number of non-reimbursable meals claimed by the reviewed sites (see S-1, lines
10, 11, 12a., 12b., 14, 15, 16a., and16b.).

•

The total amount of undocumented or unallowable FFVP costs at the reviewed sites. (see
S-1, line 21).

•

The total amount of upward or downward adjustments to the NSLP Afterschool Snack
site’s claim for reimbursement (see S-1, line 22).

•

If reviewing SMP, the total amount of disallowances (see S-1, line 23).

•

The SFA’s count of reviewed students eligible for free and reduced price meals (see SFA1, line 4A).

•

The SA’s independent count of reviewed students eligible for free and reduced price
meals (see SFA-1, line 4B).

To apply the formula in Special Provision Option situations, the SA must obtain the following
information during the Administrative Review:
•

The total number of meals claimed by the site by type (see S-1, lines 19 and 20).

•

The total upward or downward adjustments needed to the site’s meal counts by type
due to counting or consolidation errors (see S-1 lines, 13 and 17).

•

The total number of non-reimbursable meals claimed by the site (see S-1, lines 10, 11,
12a., 12b., 14, 15, 16a., and 16b.).

•

The total amount of undocumented or unallowable FFVP costs at the reviewed sites (see
S-1, line 21).

•

The total amount of upward or downward adjustments to the NSLP Afterschool Snack
site’s claim for reimbursement (see S-1, line 22).

•

For Provision 2, the SFA’s applied and SA’s validated free, reduced, and paid claiming
percentages (see SFA-1A, lines B and C).

•

For Provision 3, the SFA’s applied and SA’s validated funding levels (see SFA-1A. lines D
and E).
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•

For the Community Eligibility Provision, the SFA’s and SA’s validated free and paid
claiming percentages (see SFA-1A, lines B and C). Please note that only the free and paid
fields will be entered.

NOTE: For eligibility determination errors identified that result in a household recieiving an
upward adjustment to their beneifit status, FNS strongly encourages that the SFA make every
effort to reimburse households the difference in the meal price originally paid to the SFA. The
rational for this, is that these errors result in an increase in reimbursement to the SFA, but the
household paid a higher amount than they should have for the same meal.

SFA-Wide Fiscal Action for Performance Standard 1, Certification and Benefit Issuance Review
Errors
Fiscal action, when part of corrective action, is applied SFA-wide, consistent with 7 CFR
210.18(l)(1), because the certification and benefit issuance review assesses compliance at the
SFA level and not just at the reviewed schools. This ensures program integrity by assessing fiscal
action for certification errors at all sites, as well as for systemic errors within the entire SFA.
However, FNS has allowed flexibility for situations where the certification and benefit issuance
review error threshold does not exceed 3%. If the 3% error threshold is not exceeded, SA’s have
the flexibility to not assess fiscal action at the SFA level and also have the discretion to not
apply fiscal action to the reviewed sites either. This discretion applies to certification and
benefit issuance review errors only and any other errors requiring fiscal action must still be
assessed at the reviewed sites and if appropriate, at the SFA level. If the certification and
benefit issuance review error threshold exceeds 3%, the SA must assess fiscal action SFA wide.
This can be accomplished by entering SFA level information into the Fiscal Action Workbook, or
SA’s utilizing site based claiming, by entering each individual site from the SFA, including nonreviewed sites, into the Fiscal Action Workbook.

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Consolidation Errors at SFA Level
SFA consolidation and meal claiming errors are recorded on the Fiscal Action Workbook. When
recording consolidation errors in the Fiscal Action Workbook the SA only assesses the
consolidation error once, either at the site level or at the SFA level, whichever is most
appropriate. Refer to Section II: Meal Access and Reimbursement, Module: Meal Counting and
Claiming for more information on the monitoring of meal counting and claiming.
Fiscal Action for SPOs: Special Provision Schools
•

For Provision 1 schools, Provision 2 and 3 schools establishing a Base Year, and for
schools using Provision 2 or 3 in the SBP only, the SA must follow the procedures
described in Section II: Meal Access and Reimbursement for evaluating certification and
benefit issuance in applying fiscal action. All free and reduced price eligible students in
the SFA will be included in the statistically valid sample or 100% certification and benefit
issuance review.

•

For Provision 2 and 3 schools operating in a Non-Base Year and/or SFAs or schools
operating Community Eligibility Provision, special accommodations are made for
evaluation certification and benefit issuance when applying fiscal action. These
accommodations and other requirements for reviewing these schools are described in
Section IX: Special Provision Options.

Other Errors
Each Fiscal Action Workbook contains formulas to calculate fiscal action for non-standard
situations and fields to record fiscal action for other program areas including FFVP and
Afterschool Snack Service.
Note: Fiscal Action is recorded for the Special Milk Program (SMP) separately on its own tab
included in the Fiscal Action Workbook.

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Recalculation
Claims for Reimbursement must accurately reflect the number of reimbursable meals, by type,
for any given day. If the SA identifies problems resulting in incorrect claims, the SA must identify
the SFA’s correct entitlement and apply fiscal action.
Generally, SAs have sufficient information to make appropriate adjustments to meal counts to
ensure the meal counts reflect only reimbursable meals served to eligible students. However,
there are situations in which SAs must recalculate meal counts based on additional or more
reliable information in order to assess fiscal action.
Recalculation procedures
Securing a meal counting and claiming system that yields correct claims and obtaining a
correct count of the number of reimbursable meals may pose challenges that require a partial
or full recalculation.
•

Partial recalculation — In situations in which a non-systemic problem is identified as
resulting in unreliable or incomplete meal counts, the SA may conduct a partial
recalculation. In this case, the SA may look at data from past serving days with similar
menu items to re-establish the meal count, by type and/or the total meal count for the
day of review. Once reliable data are obtained, the recalculated meal claims by
category are then subject to the fiscal action formula.

•

Full recalculation — In situations in which systemic problems exist and meal counts by
type and/or total meal counts are unreliable or incomplete, the SA must conduct a full
recalculation. In order to conduct a full recalculation, the SA must provide technical
assistance and require corrective action, SFA-wide, to ensure the SFA understands and
implements the corrective action, which results in an acceptable meal counting and
claiming system. Depending on the severity of the problem, the SA may want to
validate the corrective actions through a follow-up technical assistance visit.

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Once the SA is satisfied that the issues have been resolved, the SFA must provide meal
counts for 30 consecutive operating days* from the noncompliant site going forward.
The total meal counts, by category, then need to be normalized to adjust for
seasonal/monthly trends in participation by multiplying them by a normalization
factor based on nationwide historical daily participation data. The Fiscal Action
Workbook automatically calculates these recalculated and normalized claims based on
the number of serving days in the claim period being recalculated. The recalculated
meal claims by category are then subject to the standard fiscal action Formula.
*For situations where 30 consecutive operating days of corrected meal counts cannot
be obtained due to a lack of available operating days in the current school year, FNS
has allowed for a minimum of 15 days to be used. However, SAs must contact their
FNSRO prior to completing the Recalculation tabs of the Fiscal Action Workbook. The
current formulas use 30 days in the calculation of Fiscal Action and SA will be provided
specific instructions on how to proceed.
**If Full Recalculation cannot be completed in the current SY under review and carries
forward into a subsequent SY, and enrollment has either increased or decreased, FNS
has provided the following guidance: 1) If enrollment changes do not exceed 5%, the
SA can complete the Full Recalculation process with no further action necessary; 2) If
enrollment changes exceed 5%, the SA must contact their FNSRO for instructions on
how to proceed.
This process will be applied to every closed claim for reimbursement from the current
school year that is identified by the SA as being unreliable.
Note: When recalculation is required in the NSLP Afterschool Snack Service or the Special
Milk Program, the proper method of either full or partial recalculation should be used,
depending on the violations identified.
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Note: When recalculating and assessing fiscal action, the SA must not disallow more meals
than were originally claimed.

Fiscal Year Integrity
When calculating fiscal action, SAs must calculate fiscal action for each fiscal year separately.
The SA must maintain Federal fiscal year integrity when taking the claim (i.e., the claim must be
recovered from a period in the same fiscal year as the error(s) was identified).
60/90 Day Reporting
Fiscal action resulting from an Administrative Review does not have to comply with the 60/90
day claims reimbursement reporting requirements as defined in the 60/90 Guidance, as
amended.
Note:
•

Violations identified in the off-site assessment are eligible for fiscal action; however, if
not corrected by the completion of the on-site review, these violations will not be
considered repeat violations as they have occurred within a single Administrative
Review.

•

The State Agency may not impose Federal fiscal action for federally allowable actions
that are violations of State law. However, if a State opts to impose a State violation,
they may do so, but they must make clear to the SFA that the fiscal action associated
with the violations is State-imposed, not federally imposed. Any financial penalty
resulting from a State-imposed requirement that is otherwise compliant with Federal
standards must not be paid by the Non-Profit School Food Service Account.

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Module: Fiscal Action Formula
Intent/Scope
The fiscal action formula listed below applies to any Claim for Reimbursement with errors in the
following areas:
•

Reimbursable meals

•

Certification and benefit issuance

•

Meal counting, consolidation, and claiming

General Information
The following terms are used in the Fiscal Action formula.
“Reimbursable meals” means meals meeting Program requirements. Refer to Section II:
Meal Access and Reimbursement, and Section III: Meal Pattern and Nutritional Quality
for more information.
“Reviewed school” means the school(s) selected for review using the school selection
procedures identified in Section I: Pre-Visit Procedures.
“Reviewed students” are the students actually selected for the certification and benefit
issuance review under Section II: Meal Access and Reimbursement, Module:
Certification and Benefit Issuance. If the SA opted to review eligibility determinations
for 100 percent of the free and reduced price students on the SFA’s point-of-service
benefit issuance document(s) for all schools under its jurisdiction, “reviewed students”
would mean 100% of the free and reduced price students on the SFA’s benefit issuance
documents. If the SA opted to review a statistically valid sample of the free and
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reduced price students on the benefit issuance documents for all schools under the
SFA’s jurisdiction, “reviewed students” would be the students selected for the sample.
For example, the SA selected a sample of 450 student certifications for review, and
these would be considered the reviewed students.
Calculating Fiscal Action: NSLP Standard and SBP Standard
This formula is used to calculate fiscal action using the NSLP Standard and SBP tabs of the Fiscal
Action Workbook. This tab is used to calculate fiscal action for NSLP and SBP standard meal
counting and claiming sites, to include base year Provision 2 or 3 sites.
Note: SAs must select the “Period” option (Review Period, Day of Review, Other, or All) in the
NSLP Standard Tab for which fiscal action is being calculated. SAs have the option of completing
the appropriate tabs of the Fiscal Action Workbook for all periods separately or by selecting the
“All” option and entering all periods together.
Step 1: Establish SFA count of students eligible for free and reduced price meals
The purpose of Step 1 is to identify the number of students the SFA has certified for free and
reduced price meals, respectively. This count is derived from the number of students
reviewed for certification and benefit issuance. Refer to Section II: Meal Access and
Reimbursement, Module: Certification and Benefit Issuance.
a) The SA must record the SFA’s count of the number of reviewed students the SFA

certified for free and reduced price meals on the Fiscal Action Workbook, Block 1. (See
SFA-1, line 4A)
For Example:
The SA conducted a statistically valid sample of the universe (i.e., the point-of-service benefit issuance
document(s) for each school within the SFA). Therefore, of the 2,600 students receiving free or reduced
price meals within the SFA, the SA reviewed certification documentation for 335 eligible students (a 95
percent confidence level). (See Section II: Meal Access and Reimbursement, Module: Certification and
Benefit Issuance for more information on statistically valid samples.)
SFA count of certified free = 250
SFA count of certified reduced price = 85

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Step 2: Establish SA count of students eligible for free and reduced price meals
The purpose of Step 2 is for the SA to independently determine a count for the number of
students correctly certified as eligible for free and reduced price meals, based on the
certification and benefit issuance documentation under review (i.e., the reviewed students).
The SA must record its count for the number of students incorrectly certified for free and
reduced price meals on the Fiscal Action Workbook, Block 2. (See SFA-1, totals for line 3)
For Example:
SA count of incorrectly certified Free to Reduced = 3
SA count of incorrectly certified Free to Paid = 4
SA count of incorrectly certified Reduced to Free = 3
SA count of incorrectly certified Reduced to Paid = 4

Step 3: Establish the certification and benefit issuance error rates
The purpose of Step 3 is for the SA to determine the certification and benefit issuance error
rates for each type of error identified on the Eligibility Certification and Benefit Issuance Error
Worksheet, Form SFA-1. These error rates arer used to adjust the number of reimbursable
meals by benefit type to reflect the SA’s determination of the number of students that should
be certified as free or reduced price. Note: This takes into consideration both the
certification and benefit issuance process as outlined in Section II: Meal Access and
Reimbursement, Module: Certification and Benefit Issuance.
The certification and benefit issuance error rates are the ratio of the SA count of students
certified as eligible for free and reduced price meals and identified changes to student benefit
issuance status in each of the following categories: Free to Reduced, Free to Paid, Reduced to
Free, and Reduced to Paid, divided by the original SFA count of students certified as eligible
for free or reduced price meals, respectively. The resulting ratios represents the certification
and benefit issuance error rate for each of the following errors: Free to Reduced, Free to Paid,

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Reduced to Free, and Reduced to Paid. Note that the calculation of the errors rates do allow
for upward adjustments to credit the free and reduced price meal count totals.
(a) Error rate for Free to Reduced — The certification and benefit issuance error rate
for Free to Reduced is automatically calculated and recorded on the Fiscal Action
Workbook (Block 2).
Number of SA identified student errors resulting in Free to Reduced benefit issuance
status change
÷ Number of students certified by the SFA to be eligible for free meals
= Certification and benefit issuance error rate for Free to Reduced
For Example:
3 student errors identified by SA resulting in Free to Reduced status change
÷ 250 students certified by SFA for free meals
= 1.2% certification and benefit issuance error rate for Free to Reduced

**Note This process is repeated in the same manner for calculating the Free to Paid,
Reduced to Free, and Reduced to Paid certification and benefit issuance error rates.
Step 4: Determine the correct count of reimbursable meals at the reviewed school(s)
The purpose of Step 4 is to determine the total number of reimbursable meals at each site.
To obtain the total number of allowable reimbursable meals, the SA must enter the
uncorrected meal counts on the Fiscal Action Workbook, Block 4. (See S-1, lines 19 for day of
review and 20 for review period.) These counts are then adjusted, by type, to reflect errors in
consolidation. In addition, the SA must decrease the site’s total meal count to reflect the
number of non-reimbursable meals claimed for reimbursement, e.g., meals that do not meet
meal pattern requirements, meals served to adults or ineligible children, or second meals.
Note: SFAs may not claim second meals in the NSLP; however, the SFA may claim second
meals in the SBP as long as the SFA does not plan and produce meals with the intention of
claiming second meals. (7 CFR 220.9(a))

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Consolidation Errors— The SA must determine whether any consolidation errors occurred at
the reviewed school. Refer to Section II: Meal Access and Reimbursement, Module: Meal
Counting and Claiming, for more information. The SA must adjust the number of meals, by
type, claimed by the site to reflect the correct count of meals. This may result in increases or
decreases to the meal counts, by type. The SA must record the result of this calculation on
the Fiscal Action Workbook, Blocks 5A and 5B. (See S-1, line 13 for day of review and S-1, line
17 for review period)
For Example:
For NSLP, the site claimed 13,050 meals (claimed 7,050 free; 4,000 reduced price; and 2,000 paid) during
the closed Claim for Reimbursement. The SA determined that a consolidation error occurred resulting in
an error of 50 meals being overclaimed as free meals.
Therefore, 50 meals must be subtracted from the sites’ total free claim of 7,050.
7,050 total free meals claimed
- 50 free meals identified by the SA as a consolidation error
= 7,000 SA count of total free meals

Non-Reimbursable Meals— The SA must subtract the number of non-reimbursable meals
(e.g., meals not meeting the meal pattern requirements, meals served to adults or ineligible
children, and second meals claimed) from the total number of meals claimed by the site after
consolidation errors are corrected. The result of this calculation must be recorded on the
Fiscal Action Workbook, Block 7. (See S-1, lines 10, 11, 12a., and 12b. for day of review and S-1,
lines 14, 15, 16a.,and 16b. for review period)
For Example:
The total number of meals is 13,000 meals (7,000 free; 4,000 reduced price; and 2,000 paid) during the
closed Claim for Reimbursement. The SA determined that 1,000 meals were not reimbursable (e.g.,
meals not meeting the meal pattern requirements, meals served to adults or ineligible children, and
second meals claimed).
Therefore, 1,000 non-reimbursable meals subtracted from 13,000 total meals results in the SA
determining that 12,000 is the correct number of total reimbursable meals.
13,000 total meals claimed
- 1,000 non-reimbursable meals

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= 12,000 SA count of total reimbursable meals

Step 5: Determine the number of reimbursable meals by benefit type
The purpose of Step 5 is to determine how many of the SA’s corrected total number of
reimbursable meals (Step 4) are free, reduced price, and paid, respectively. The Nonreimbursable Meal Allocation Form can be used in this calculation, if needed.
(a)

Reimbursable Free Meals — To determine the total number of reimbursable free
meals, divide the number of free meals claimed by the total number of meals
claimed. Multiply the result by the SA count of the total number of reimbursable
meals from Step 4. The result of determining the SA count of reimbursable free
meals is calculated automatically by the Fiscal Action Workbook, Block 8.

_ Free meals claimed ____
Total number of meals claimed x SA count of total number of reimbursable meals
= SA count of reimbursable free meals

For Example:
(7,000 free meals claimed /13,000 total meals claimed) x 12,000 SA count of total reimbursable meals =
6,462 SA count of reimbursable free meals
This means of the 12,000 reimbursable meals, 6,462 should be considered free meals.

(b)

Reimbursable Reduced Price Meals — To determine the number of reimbursable
reduced price meals, divide the number of reduced price meals claimed by the total
number of meals claimed. Multiply the result by the SA count of the total number
of reimbursable meals from Step 4. The result of determining the SA count of
reimbursable reduced price meals is calculated automatically by the Fiscal Action
Workbook, Block 8.

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Reduced price meals claimed
Total number of meals claimed

x SA count of total number of reimbursable meals
= SA count of reimbursable reduced price meals

For Example:
(4,000 reduced price meals claimed /13,000 total meals claimed) x 12,000 SA count of total reimbursable
meals = 3,693 SA count of reimbursable reduced price meals
This means of the 12,000 reimbursable meals, 3,693 should be considered reduced price meals.

Step 6: Establish the SA reimbursable meal count, by category
The purpose of Step 6 is to determine the meal count for free, reduced price, and paid meals,
respectively, based on the certification and benefit issuance error rates (Step 1).
The SA must apply the certification and benefit issuance errror rates (Free to Reduced, Free
to Paid, Reduced to Free, Reduced to Paid) respectively (Step 1), to the SA count for the
number of reimbursable free, reduced price, and paid meals, respectively (Step 2), to adjust
the reimbursable meals for each benefit category for the review period. This calculation is
completed automatically by the Fiscal Action Workbook.
Note: The certification and benefit issuance error rates are required to be applied to all sites
(all sites selected for review and all non-reviewed sites) when the overall certification and
benefit issuance error rate exceeds 3%.
(a) Free Meal Count adjusted for all Free to Reduced student errrors— Multiply the
certification and benefit issuance error rate for Free to Reduced student errors,
Fiscal Action Workbook, Block 2, ) by the number of reimbursable meals as
determined by the SA for the free category, Fiscal Action Workbook, total for free
meals in Block 8. The product of this calculation is the total number of free meals
that need to be adjusted from free to reduced for all sites entered into the Fiscal
Action Workbook.
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The total number of free meals that must be adjusted to reduced price for all sites
listeded automatically calculated by the Fiscal Action Workbook, Block 11. The total
number of free meals adjusted to reduced price for each site individually is
calculated by dividing each individual site’s free meal counts by the total of free
meals for all site’s entered into the Fiscal Action Workbook (each tab is calculated
independent of each other) and then multiplied by the total number of meals being
adjusted from free to reduced price.
Certification and Benefit Issuancance error rate for Free to Reduced
x SA’s adjusted count of reimbursable free meals
= Total number of free meals needing to be adjusted to reduced price for all sites listed
Individual site’s free meal counts
÷ Total of all sites listed free meal counts
X The total number of free meals needing to be adjusted to reduced price
= Individual sites proportion of total free meals needing to be adjusted to reduced price

For Example:
1.2% certification and benefit issuance Free to Reduced Price error rate
x (6,642) SA’ s adjusted count for reimbursable free meals
= -77.54 free meals to be adjusted to reduced price
1.6% certification and benefit issuance Free to Paid error rate
x (6,642) SA’s adjusted total count for reimbursable free meals
= -103.39 free meals to be adjusted to paid
3.529% certification and benefit issuance Reduced to Free error rate
x (3,693) SA’s adjusted total count for reimbursable reduced price meals
= 173.79 reduced price meals to be adjusted to free
-7 (rounded down from 7.14) total number of free meals to be downward adjusted
x (6,642) Indv. sites adjusted free meal count total/(6,642) total adjusted free meal count of all sites listed
= 7 free meals being adjusted downward from the indv. site (This example uses a 1 site SFA scenario)
*The FA Workbook shows the rounded Certification and Benefit Issuance error rate percentage, however,
the automatic calculation that takes place in this step uses the unrounded percentage.

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**Any differences in rounding when calculating each site’s proportion of the total meals being adjusted
by category are corrected automatically on Line 18, or the first site listed on each tab of the FA
Workbook. For example, it 350 total free meals need to adjusted to paid, and rounding causes 353 meals
to be adjusted, then the 1st site listed will have its total free meals being adjusted to paid reduced by
three automatically.

Note This process is repeated in the same manner for calculating Free to Paid, Reduced to
Free, and Reduced to Paid error rates and the corresponding meals needing to be
adjusted.

Step 7: Establish fiscal action
The purpose of Step 7 is to determine the amount of fiscal action to assess due to consolidation
errors, non-reimbursable meals, and certification and benefit issuance errors.
The SA must determine the school’s claim with the SA’s corrections in order to determine the
amount of fiscal action it assesses. The SA must use the reimbursement rate the site receives
and enter it on the Fiscal Action Workbook, Block 9 for this calculation. Therefore, if the site
receives the Severe Need Breakfast rate, NSLP’s high reimbursement rate, and/or the additional
six cents for meeting the dietary specifications, the SA must use the total amount of
reimbursement per meal in these calculations.
(a)

School claim — Multiply the site’s count of the number of free, reduced-price,
and paid meals claimed for the review period (Block 4) by the respective rate of
reimbursement. The product is the amount of reimbursement claimed, by
category, for the site for the review period. This amount is automatically
calculated by the Fiscal Action Workbook, Block 10.

For Example:
For NSLP, the site received the NSLP’s high rate with the 6-cent additional reimbursement for school year
2012-2013; therefore, the site’s reimbursement rates for SYSY 2012-2013 were: Free = $2.94; ReducedPrice = $2.54; Paid = $0.35
Free:

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7,050 free meals claimed
x $2.94 free reimbursement rate
$20,727 Total reimbursement for free meals
Reduced-Price:
4,000 reduced-price meals claimed
x $2.54 reduced-price reimbursement rate
$10,160 Total reimbursement for reduced-price meals
Paid:
2,000 paid meals claimed
x $0.35 paid reimbursement rate
$700 Total reimbursement for paid meals

(b)

SA corrected claim — Multiply the SA count of the maximum number of free
meals, reduced-price meals, and paid meals the site may claim, Fiscal Action
Workbook, Block 12b, by the respective rate of reimbursement. The product is
the correct amount of reimbursement, by category, earned by the site for the
review period.
This amount is automatically calculated by the Fiscal Action Workbook, Block
12C.

For Example:
Free:
5,429 free meals validated by SA
X
$2.94 free reimbursement rate
$15,961.26 Corrected reimbursement for free meals
Reduced-Price:
3,259 reduced-price meals validated by SA
X $2.54 reduced-price reimbursement rate
$8,277.86 Corrected reimbursement for reduced-price meals
Paid:
3,312 paid meals validated by SA
X $0.35 paid reimbursement rate
$1,159.20 Corrected reimbursement for paid meals

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(c)

Fiscal action — Subtract the SA corrected amount of reimbursement, Fiscal
Action Workbook, Block 12C,from the school Claim for Reimbursement, Fiscal
Action Workbook, Block 10, . The difference is the total amount of fiscal action.
This amount is automatically combined with the other federal programs fiscal
action and calculated by the Fiscal Action Workbook, Block 15.

For Example:
Free:
$15,961.26 SA corrected reimbursement for free meals
- $20,727 Sites(s) claimed reimbursement for free meals
($4,765.74) difference for free meal reimbursement (SFA Overclaim)
Reduced-Price:
$8,277.86 SA corrected reimbursement for reduced-price meals
- $10,160.00 Site(s) reimbursement for reduced-price meal
($1,882.14) difference for reduced-price meal reimbursement (SFA Overclaim)
Paid:
$1,159.20 SA corrected reimbursement for paid meals
- $ 700.00 Site(s) claimed reimbursement for paid meals
$459.20 difference for paid meal reimbursement (SFA Underclaim)

Step 8: Calculate Fiscal Action for Other Federal Program Errors
The purpose of Step 8 is to determine and apply the amount of fiscal action to apply for errors
in the FFVP and the NSLP Afterschool Snack Service **This step is only applicable to the NSLP
Standard Tab as FFVP and the NSLP Afterschool Snack Service are not calculated with the SBP
Standard Tab.
a) FFVP – The SA must calculate the amount of fiscal action to apply by summing the total
amount of underclaim/overclaims and/or any unallowable program costs from the SFAs
FFVP claim for reimbursement. (See the S-1, line 21 for day of review and review period)
Enter this amount on the Fiscal Action Workbook, Block 13.
b) NSLP Afterschool Snack Program– The SA must calculate the amount of fiscal action to
apply by adding or subtracting any differences in the SFAs meal counts by type from the
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SA validated meal counts by type. (See the S-1, line 22 for the day of review and the
review period) Enter the meal count adjustments by type on the Fiscal Action
Workbook, Block 14A. The reimbursement rates claimed for the NSLP Afterschool Snack
Service by the site must then be entered into Block 14B.
Step 9: Total Fiscal Action
The total amount of fiscal action for each individual site is automatically calculated listed on
Fiscal Action Workbook, Block 15. The total amount of fiscal action, combined for every site, is
automatically calculated and listed in Fiscal Action Workbook, Block 3.
Calculating Fiscal Action: Other Fiscal Action Workbook Tabs
There are several additional tabs contained within the Fiscal Action Workbook. Each will be
used only for a specific situation based on the program being reviewed and whether
recalculation is required.
•

NSLP Standard SSO and SBP Standard SSO (Standard Seamless Summer) - are
intended for closed and migrant sites operating NSLP and/or SBP under the SSO.
When completing this tab, follow the same steps outlined in the NSLP Standard and
SBP Standard Tab sections. SA’s must use the NSLP Standard and SBP Standard tabs
for all other SSO sites.
Note: For all other SSO sites, use the NSLP Standard and SBP Standard tabs of the
Fiscal Action Workbook.

•

NSLP Standard RECAL and SBP Standard RECAL (Standard Recalculation) - is intended
for sites operating NSLP and/or SBP in standard situations, to include base year
Provision 2 or 3 sites, which require full recalculation. These tabs are similar in
process to that of the NSLP and SBP Standard Tabs, however, there are additional

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steps added in order to complete the full recalculation process. The additional steps
required are:
a. Block 5: Number of Meals Claimed by the SFA at the Reviewed Site for the 30Consecutive-Operating-Day Recalculation Period – Record meal count totals by
category from the 30 day recalculation period. S-1, Line 24C and/or 25C.
b. Block 8: Month Being Recalculated – Must select the month requiring full
recalculation. S-1, Line 24A and/or 25A.
c. Block 9: Nominalization Factor (See Recalculation) – This field automatically
calculates and displays the nominalization factor based on the month entered in
Step 8.
d. Block 10: Operating Days – Must entering the number of operating days in the
month requiring recalculation, S-1, Line 24B and/or 25B.
e. Block 11: Normalized and Recalculated Meal Counts – This field automatically
calculates and displays the total number of allowable meals by category which
have been adjusted based on the nominalization factor and number of operating
days.
•

NSLP P2/CEP and SBP P2/CEP (Provision 2 Non-Base Year and Community Eligibility
Provision) – is intended for sites operating NSLP and/or SBP under Provision 2 in
non-base years and sites operating the Community Eligibility Provision. These tabs
are similar to that of the NSLP and SBP Standard Tabs; however, there are slight
variations to the data and steps needed to calculate fiscal action in these types of
sites. The differences are:
a. Block 2: For these tabs you will enter the total number meals claimed by the
reviewed site, aggregate total and not by category.
b. Blocks 6A and 6B: Instead of entering and applying the certification and benefit
Issuance error rates, as these are sites in non-base years or operating the CEP,

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the SFA claiming percentages and SA validated claiming percentages are
recorded.
•

NSLP P2/CEP RECAL and SBP P2/CEP RECAL (P 2 Non-Base Year and CEP
Recalculation) - is intended for sites operating NSLP and/or SBP under Provision 2 in
non-base years and sites operating the Community Eligibility Provision which require
full recalculation. These tabs are similar in process to that of the NSLP P2/CEP and
SBP P2/CEP Tabs, however, there are additional steps added in order to complete
the full recalculation process. The additional steps required are:
a. Block 2: Meal Count for 30-Day Recalculation Period – Record meal count
totals from the 30 day recalculation period. S-1, Line 24C and/or 25C.
b. Block 6: Month Being Recalculated – Must select the month requiring full
recalculation. S-1, Line 24A and/or 25A.
c. Block 7: Nominalization Factor (See Recalculation) – This field automatically
calculates and displays the nominalization factor based on the month
entered in Step 8.
d. Block 8: Operating Days – Must entering the number of operating days in the
month requiring recalculation, S-1, Line 24B and/or 25B.
e. Block 9: Normalized and Recalculated Meal Counts – This field automatically
calculates and displays the total number of allowable meals which have been
adjusted based on the nominalization factor and number of operating days.

•

NSLP P3 and SBP P3 (Provision 3 Non-Base Year) – is intended for sites operating
NSLP and/or SBP under Provision 3 in non-base years. These tabs are similar to that
of the NSLP and SBP Standard Tabs; however, there are slight variations to the data
and steps needed to calculate fiscal action in these types of sites. The differences
are:

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a. Block 2: Start by entering the total amount of funds claimed by the site, since
Provision 3 sites operate on a set funding level to be claimed each month
(calculated from base year data).
b. For the tracking of fiscal action by meal category type, Block 4 contains the
number of meals by category claimed at the site. This number can be
compared to the maximum number of reimbursable meals (adjusted for
errors) that is automatically calculated and recorded in Block 6. Any
difference in these meal counts can be used for accessing fiscal action.
•

SMP (Special Milk Program) – is intended for sites operating the Special Milk
Program. Steps needed to complete this tab are:
a. Block 2: Enter the milk reimbursement rate.
b. Block 3: Enter the total number of non-reimbursable milks. S-1, Line 23.
c. Block 4: Total fiscal action is automatically calculated and recorded.

•

Fiscal Action Summary – is the final tab which shows the total cumulative amount of
fiscal action for all sites by program area. This tab is automatically calculated using
the data imputed from all other tabs contained within the Fiscal Action Workbook.

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Module: Withholding Payments
Intent/Scope
The SA must withhold program payments in the following situations:
•

The SFA fails to submit documented corrective action by the established due date,
including approved extensions, for a Performance Standard 1 or Performance Standard
2 error

•

The SFA submits documented corrective action by the established due date; however,
the SA finds that corrective action for a Critical Area in fact was not completed

The SA may withhold program payments in the following situation:
•

The SA finds a Critical Area error at the SFA on a previous review, and the SFA continues
to have the same error for a same cause

When the SA determines that it is not in the best interest of the program to withhold 100
percent of program payments, it may withhold a minimum of 40 percent. Factors that the SAs
may consider when determining the amount to withhold include:
•

The ability of the SFA to continue to provide meals to students during the time it takes
to complete corrective action

•

The willingness of the SFA to complete corrective action on a timely basis. For example,
the SA may give additional consideration when circumstances beyond the SFA’s control
cause a delay in required corrective action beyond the established due dates and
approved extensions. (7 CFR 210.18(l)(3))

FNS Approval
The SA may withhold less than 40 percent of program payments when FNSRO determines that
it is in the best interest of the program (7 CFR 210.18(l)(3)). The SA must submit a written
request to FNSRO that includes the following information:
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•

The name of the SFA

•

The date(s) of the Administrative Review and any follow-up reviews, if applicable

•

A description of the Critical Area violation(s) identified during the Administrative Review,
required corrective action, and the SFA response

•

Results of any follow-up review(s)

•

The withholding percentage requested

•

The SA's rationale for withholding less than 40 percent of program payments, including
the adverse effect that a higher withholding amount would have on the SFA

Failure to Withhold
FNSRO may suspend the program or withhold program payments and State Administrative
Expense funds, in whole or in part, for those SAs failing to withhold program payments as
required in 7 CFR 210.18(l)(4).
Discretionary Withholding
The SA may withhold payments for General Areas of Review violations. For example,
discretionary withholding of payments may be appropriate if:
•

The SFA does not complete and submit corrective action within established timeframes

•

The SFA does not take corrective action as specified in the documented corrective
action.

In the absence of the SFA submitting documentation required to complete the Administrative
Review, program compliance cannot be satisfactory verified by the SA, therefore withholding of
program payments would be appropriate. (7 CFR 210.24)
FNSRO approval for discretionary withholding of payments is not required. (7 CFR 21018(l)(iv))
SFA Notification
The SA must provide the SFA with the right to appeal any decision to withhold payments. The
contents of the notification must parallel the information in the module, Letter of Claim
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Adjustment and/or Withholding of Payment Including Notice of Appeal located later in this
section. (7 CFR 210.18(q))
Effective Date
Withholding of program payments must begin immediately upon notification to the SFA. The
SA must withhold payments for any original or upward adjusted claim, regardless of the date
submitted to the SA. The SA may process downward adjustments to previously paid claims
during the withholding period.
Duration
The SA must promptly release withheld program payments in the proper amount when the
following is complete:
•

The SFA completes all required corrective action

•

The SA receives documentation of corrective action

•

The SA completes any required follow-up review

•

The SA determines the corrective action was successful (7 CFR 210.18(l)(2))

Claim Submissions during Withholding
Since the SFA continues to earn program payments during a period of withholding, the SFA
must continue to submit Claims for Reimbursement on a timely basis.
Reporting Requirements
FNS-777

SAs must report withheld payments as an unliquidated obligation on the Financial
Status Report, FNS-777. The SAs must also identify any portion of unliquidated,
obligated funds resulting from withholding of payments in the footnote section of
the form.

FNS-10

Include meal count data from withheld claims on the appropriate monthly Report of
School Program Operation, FNS-10

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Module: Overpayment Disregard
Intent/Scope
The SA may disregard an overclaim if the overclaim does not exceed $600 per program, i.e.,
NSLP (including SSO, FFVP and the NSLP Afterschool Snack Service), SBP, and SMP. The
disregard may be made once per Federal fiscal year for any review or activity. However, the SA
may not disregard an overclaim where there is substantial evidence of criminal law violations or
civil fraud statutes.
The SA must use a written notification of potential or actual disregard when the claim
amount is $600 or less. The letter should include:
•

Date of review

•

Appreciation for response to review findings, if applicable

•

Statement of claim amount, how it was determined, and the basis for the claim

•

Name and telephone number of SA contact person

There is no $600 disregard for a Claim for Reimbursement that has yet to be submitted. The
$600 disregard also does not apply to closed claims for sites in the base year when fiscal action
is required to fix the meal counts when a Provision 2 or 3 base year review is being conducted
in conjunction with the Administrative Review.

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Module: Letter of Claim Adjustment and/or
Withholding of Payment Including Notice of Appeal
Intent/Scope
Upon receipt of the SFA’s documented corrective actions, the SA must send the SFA a notice
letter that details the grounds on which the denial of all or a part of the Claim for
Reimbursement or withholding payment is based. This notice must be sent by certified mail,
return receipt requested. (7 CFR 210.18(j))
Required Content
The required content is as follows:
•

Explain in detail why all or a part of the Claim for Reimbursement has been denied
and/or payment has been withheld.

•

Include a statement indicating that the SFA may appeal through state appeal
procedures, if established, or enclose a copy of 7 CFR 210.18(q) of the regulations for
appeal procedures. Appeal rights must be provided for any proposed fiscal action for
the review period, month in which the on-site review takes place, and all other claim
periods.

•

Inform the SFA of the entity to which the appeal should be directed.

Suggestions for Additional Content
The suggested additional content is as follows:
•

Date of review

•

Appreciation for response to review findings

•

Statement of claim adjustment amount, including meal count adjustments, how it was
determined, and the basis for the claim

•

SA recovery procedures

•

Name and telephone number of SA contact person
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Section IX: Special Provision Options

Modules contained within this Section include:
• Special Provision Options 1, 2, and 3
• Community Eligibility Provision

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Module: Special Provision Options 1, 2, and 3
Introduction
To reduce administrative challenges, local educational agencies (LEAs/SFAs) with a high
percentage of free and reduced price certifications may elect to use a Special Provision Option
(SPO) to streamline administrative requirements. The Administrative Review requirements are
modified based on the SPO(s) employed by the LEA. This Module addresses those
modifications as they relate to Special Provision Options 1, 2 and 3.
•

Provision 1 – Reducing certification to once every 2 years: Schools may reduce annual
notification of program availability and certification of children eligible for free meals to
once every 2 consecutive school years. Schools continue to take daily meal counts of
the number of meals served to children by type (free, reduced price, paid) as the basis
for calculating reimbursement claims. Provision 1 is only available in schools where at
least 80 percent of the enrolled children are eligible for free or reduced price meals.

•

Provision 2 – Reducing certifications to once every 4 years and claiming based on
derived percentages: Participating schools must serve meals to all participating children
at no charge for a period of 4 years. During the first year (or base year)) the school
makes eligibility determinations and takes meal counts by type (free, reduced price,
paid). During the next three years, the school makes no new eligibility determinations
and counts only the total number of reimbursable meals served each day.
Reimbursement during these years is determined by applying the percentages of free,
reduced price, and paid meals served during the corresponding month of the base year
to the total meal count for the claiming month. The base year is included as part of the
4 years. Additional 4-year extensions to Provision 2 are possible when certain
conditions are met. Schools electing Provision 2 must pay, with funds from non-Federal
sources, any difference between Federal reimbursement and the cost of serving
lunches/breakfasts at no charge to all participating students.
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Provision 3 – Reducing certifications to once every 4 years and claiming based on prior
funding levels: Participating schools must serve meals to all participating children at no
charge for a period of 4 years. Provision 3 schools make eligibility determinations in the
year preceding Provision 3 implementation (i.e., the year before the 4 year cycle starts); this
is the base year. Schools receive the level of Federal cash and commodity support paid to
them in the base year. Schools do not make additional eligibility determinations during the
4 year cycle. For each of the 4 years, the level of Federal cash and commodity support is
adjusted to reflect changes in enrollment and inflation. The base year is not included as
part of the 4 years. Additional 4-year extensions to Provision 3 are possible when certain
conditions are met. Schools electing this Provision must pay, with funds from non-Federal
sources, the difference between Federal reimbursement and the cost of serving
lunches/breakfasts at no charge to all participating students.

Intent/Scope of Monitoring
The requirements of the Administrative Review Manual apply to the review of s an LEA’s
administration of SPOs. While Administrative Review activity typically occurs at the district
level, some aspects may also occur at the school or SA level (e.g., if the SA applies the claiming
percentages to meal counts).
This Module covers the additional steps required to monitor SFAs implementing Special
Provision 1, 2, or 3 at some or all of their sites in both base and non-base years. Some
procedures, such as certification and benefit issuance and recordkeeping, may differ depending
on whether a school is in a base or non-base year. These differences in Administrative Review
procedures are discussed below.

Review Procedures
Site Selection
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The SA must use normal site selection procedures for schools in the SFA. Refer to Section I: PreVisit Procedures, Site Selection Procedures.
For schools operating Provision 1 or for schools in the base year of Provision 2 or 3, no special
targeting for site selection is necessary since meal counting and claiming procedures in these
schools mirror those of standard meal counting and claiming schools (see Section II: Meal
Access and Reimbursement).
If the school selection procedures do not result in the review of a Provision 2 or 3 school in a
Non-Base year, the SA must conduct an abbreviated review in at least one school per SPO
type (i.e., Provision 2 and Provision 3).The scope of an abbreviated review is discussed later in
this Module.
There are no additional site selection requirements if all sites within the LEALEA are operating
one or more SPOs.
Pre-visit Review Procedures for Provision 1 Schools and Provision 2/3 Base Year Schools
Selected for Review
•

Follow the Administrative Review Manual – The SA must use the Off-site Assessment
Tool, including Section IX, Special Provision Options, to obtain the procedures the SFA
uses in administering the SPO.

•

Conduct the Certification and Benefit Issuance Review – The review may be conducted
off-site or on-site. For more information, refer to On-site Review Activities for Base Year
and Non-Base Year Schools Selected for Review, Step 2 below.

Pre-visit Review Procedures for Provision 2 and 3 Non-Base Year Schools Selected for Review
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•

Use the Off-site Assessment Tool

For Non-Base Year SPOs, the SA must use the Off-site Assessment Tool, including Section IX,
Special Provision Options, to obtain the procedures the SFA used to determine their
claiming percentages and/or funding levels during the base year. The SA must also obtain
information on the procedures used by the SFA to apply the claiming percentages to nonbase year’s monthly Claim for Reimbursements.
NOTE: For Provision 2 and 3 sites, the SA must ensure that the LEA established claiming
percentages and/or funding levels separately for SBP and NSLP.
•

Conduct the Certification and Benefit Issuance Review Process – Students attending
sites in a non-base year must be excluded from the certification and benefit issuance
review. For more information, refer to On-site Review Activities for Base Year and NonBase Year Schools Selected for Review, Step 2 below.

On-site Review Activities for SPO Sites Selected for Review
Step 1: Confirm Off-site Assessment Tool
The SA must verify the SFA information received from the Off-site Assessment Tool, including
Section IX, Special Provision Options. The reviewer must ensure that the procedures described
in the Off-site Assessment Tool match what is occurring on-site.
Step 2: Conduct the Certification and Benefit Issuance Review
The SA must proceed with the certification and benefit issuance review following procedures
set forth in the Administrative Review Manual, and the adjustments described below:

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•

For Provision 1 schools, Provision 2 and 3 schools establishing a Base Year, and for
schools using Provision 2 or 3 in the SBP only, the SA must follow the procedures
described in Section II: Meal Access and Reimbursement to evaluate certification and
benefit issuance and apply and fiscal action. All free and reduced price eligible students
in the SFA are included in the statistically valid sample or 100% certification and benefit
issuance review, including students in a Provision 1 school or a Provision 2 or 3 base
year school. Note: Verification is assessed during the certification and benefit issuance
review and during the general area review of eligibility and verification procedures.
Refer to Step 5 below.
Note: For Provision 1 schools operating in the second year, the SA must ensure the
correct Income Eligibility Guidelines are used when reviewing certification and benefit
issuance for those students in their second year of free certification.

•

For Provision 2 and 3 schools operating in a Non-Base Year, the SA must exclude
students enrolled at these schools from the certification and benefit issuance review.
There are no additional certification procedures to review. The review of the
SFA/school’s claiming percentages are addressed in Step 3 below. Note: SAs are not
required to assess verification for Provision 2 or 3 schools operating in non-base years.

When performing a base year review in conjunction with the Administrative Review, the
following table describes how to determine samples to complete reviews. For additional
information on conducting Provision 2 Base Year Reviews, please see SP 46-2015, Review of
Special Provision Options 2 and 3 Base Year.

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Prov 2 & 3 SBP &
NSLP
Prov 2 & 3 SBP &
NSLP

District-wide?
Yes

# of Samples
1

No

2

Sample Make-Up
All students enrolled
(Free/Reduced/Denied
Certifications)
B.Y. Sample: All students
enrolled in the schools
operating SPO 2 or 3
(Free/Reduced/Denied
Certifications)
AR Sample: All students
enrolled in schools
operating the SBP & NSLP
except for those enrolled at
sites operating SPO 2 (i.e.
sample 1) (Free/Reduced
Certifications)
**Student names should
not appear on both samples

Prov 2 & 3 SBP
Only

Prov 2 & 3 SBP
Only

Yes

No

2

2

B.Y. Sample: All students
enrolled in the schools
operating SPO 2 or 3 for
SBP (Free/Reduced/Denied
Certifications)
AR Sample: All students
enrolled in schools
operating the SBP & NSLP
(Free/Reduced
Certifications)
**Student names from the
B.Y. Sample may be
included in the AR Sample
B.Y. Sample: All students
enrolled in the schools
operating SPO 2 or 3 for
SBP (Free/Reduced/Denied
Certifications)
AR Sample: All students
enrolled in schools
operating the SBP & NSLP
(Free/Reduced
Certifications)
**Student names from the
B.Y. Sample may be
included in the AR Sample

Administrative Review Manual

F.A. Process
AR Sample: Fiscal
Action Workbook
B.Y. Sample: Fiscal
Action Workbook

AR Sample: Fiscal
Action Workbook

**Must be
entered into
separate
workbooks
B.Y. Sample: Fiscal
Action Workbook
AR Sample: Fiscal
Action Workbook

**Must be
entered into
separate
workbooks
B.Y. Sample: Fiscal
Action Workbook
AR Sample: Fiscal
Action Workbook

**Must be
entered into
separate
workbooks

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Step 3: Validation of Claiming Percentages and/or Funding Levels
•

If a Provision 2 or 3 school under review is in the Base Year, the SA does not validate
claiming percentages or funding levels, as those levels are established during the base
years and applied in non-base years. However, as mentioned above in Pre-Visit Review
Procedures, the SA must complete the Off-site Assessment Tool and determine whether
SPO schools have acceptable processes to establish accurate claiming percentages and
funding levels.
NOTE: If systemic errors identified during the on-site review required full recalculation,
the SA must require the SPO site(s)/SFA to conduct another base year in a subsequent
school year.

•

If a Provision 2 or 3 school under review is in the Non-Base Year, at a minimum, the SA
must verify that the base year claiming percentages/funding levels were properly
applied to Claims for Reimbursement from the review period and month of the on-site
review.
NOTE: If claiming percentages and/or funding levels were applied erroneously , SAs
must require(as part of a Corrective Action Plan) that the SFA provide documentation
for every closed Claim for Reimbursement from the current school year showing that
the claiming percentages and/or funding levels were applied correctly at every non-base
year site (reviewed and non-reviewed) in the SFA.
The SA has the discretion to expand the scope of review to prior school years. This
applies to any non-base year school selected for review under the Administrative

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Review site selection procedures or selected as one of the additional sites for the
abbreviated review (described above under Site Selection).

Step 4: Recordkeeping
The SFA/school must retain records for all SPO schools, as follows:
•

Records for Provision 1 must be retained for three years after submission of the final
Claim for Reimbursement for the fiscal year to which they pertain. If audit findings have
not been resolved, these records must be retained beyond the three-year period as long
as required for the resolution of issues raised by the audit.

•

Base Year records for Provisions 2 or 3, which support subsequent years’
reimbursements, must be retained during the entire period the SPO is in effect,
including all extensions. Recordkeeping is essential because claims for the base year
and all subsequent years are based on base year data. In addition, records documenting
verification activities from the base year must be retained during the entire period the
SPO is in effect, including all extensions.
Additionally, such records must be retained for three years after submission of the final
Claim for Reimbursement for the last fiscal year that used the base year data. If audit
findings have not been resolved, these records must be retained beyond the three-year
period as long as required for the resolution of issues raised by the audit.

•

Non-Base Year records for Provisions 2 or 3 must be retained for three years after
submission of the final Claim for Reimbursement for the fiscal year to which they
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pertain. If audit findings have not been resolved, these records must be retained beyond
the three-year period as long as required for the resolution of issues raised by the audit.

If a SA determines that the SFA/school has not maintained the required records for a
participating site, the SA may require the school to return to standard application and meal
counting procedures.
Step 5: All Other Critical and General Areas of Review
When evaluating the SFA for compliance with both critical and general areas of review as part
of the Administrative Review, the SA must review all required areas and complete all required
forms as specified by the Administrative Review Manual.
Step 6: Recording Review Findings
The SA must ensure the following forms are completed as applicable:
•

Administrative Review Off-site Assessment Tool – Questions #2100 - 2111

•

Administrative Review On-site Assessment Tool – Questions #2112 - 2116

•

Administrative Review School Data and Meal Pattern Error and Other Meal Claim Errors
Forms (S-1, S-2) – Used to record all Special Provision Option (SPO) site data.

•

Eligibility Certification and Benefit Issuance Error and Other Eligibility Certification and
Benefit Issuance Errors Worksheets (SFA 1, SFA-2) – Used to record all Base Year Special
Provision Option (SPO) site Certification and Benefit Issuance errors.

•

Special Provisions Non-Base Year and CEP Claiming Percentage/Funding Level Summary
Form (SFA-1A) – Used to record all Special Provision Option site (or group of sites) SFAand SA-validated claiming percentages/funding levels.

•

Fiscal Action Workbook – Used to complete fiscal action process for all SPO Base and
Non-Base Year sites, including those requiring Full Recalculation.
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Abbreviated Review
As mentioned above, under Review Procedures, Site Selection, if the school selection
procedures do not result in the review of a SPO in a non-base year, the SA must select at least
one site per SPO type (i.e. Provision 2 or Provision 3) and conduct an abbreviated review to
ensure claiming percentages and/or funding levels are correctly applied for the review period.
•

For Provisions 2 or 3 – Only the meal counting and claiming system is reviewed to verify
that the claiming percentages and/or funding levels determined from the base year area
applied correctly to the current school year’s monthly Claims for Reimbursement. The
SA may limit this evaluation to the Claim for Reimbursement for the review period.
If the abbreviated review identifies that the claiming percentages/funding levels are
erroneously applied, the SFA is required as part of its Corrective Action Plan to correct
the deficiencies identified at the non-compliant site(s). The SFA must also submit
documentation for every non-base year SPO site showing that the claiming
percentages/funding levels calculated during the base year are applied correctly in the
non-base year for every closed Claim for Reimbursement from the school year in which
the review occurs.

When issues of severe non-compliance are identified during the abbreviated review, FNS
strongly encourages the SA to conduct a full on-site Administrative Review of the noncompliant sites.
NOTE: The abbreviated review can be conducted as part of the off-site review at the SA’s
discretion.

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Technical Assistance/Corrective Action
Technical assistance must be provided and corrective action required as specified in the
Administrative Review Manual and as described in this section.
Corrective action must be applied SFA-wide for all violations, including benefit issuance and
certification errors, at reviewed and non-reviewed sites, if applicable. If systemic errors
identified during the on-site review of a base year school(s) required full recalculation, the SA
must require the SPO school/SFA to conduct another base year in a subsequent school year.
The SA, in consultation with FNSRO, must give the SFA an adequate timeframe to complete the
certification and benefit issuance process. Generally, FNS expects corrective action to occur as
soon as practicable in the current school year. However, if it has been determined in the best
interest of program management for the SFA not to complete the standard certification process
for the current school year, the SA must ensure that the SFA implements all required corrective
action and uses the SA-validated claiming percentages and/or funding levels for submitting
Claims for Reimbursement for the remainder of the current school year.
If violations to the application of the claiming percentages for Provision 2 non-base year are
identified in reviewed schools or through the abbreviated review, the SFA will be required, as
part of its Corrective Action Plan, to:
•

correct the deficiencies identified at the reviewed sites; and

•

submit documentation for every SPO site (including all non-reviewed SPO sites) showing
that the claiming percentages calculated and approved during the base year approval
are applied correctly for every closed Claim for Reimbursement from the school year in
which the review occurs.

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When meal counting and claiming procedures yield erroneous total meal counts or meal counts
by category, the SA must require Full or Partial Recalculation as applicable to the degree of
violation identified.
For all other review area errors, the SA should ensure corrective action is implemented, as
applicable, for the type of error identified.
The SA must ensure the SFA understands the importance of operating all aspects of the SPO in
compliance with FNS requirements while providing the SFA with detailed Corrective Action
Plans that will ensure that the SFA is in compliance with all program requirements. The SA
should also encourage the SFA to participate in any SPO training opportunities that may be
available.

Fiscal Action
The SA must assess fiscal action as specified in each section of the Administrative Review
Manual. The SA must also observe the following:
1. Certification and Benefit Issuance
For Provision 2 and 3 Schools in the Base Year:
If certification errors are identified, the SA must follow the procedures listed in the Certification
and Benefit Issuance Module. Any Fiscal Action must be applied to all closed Claims for
Reimbursement for all sites establishing a base year for Provisions 2/3. By adjusting meal
counts during the base year, the resulting claiming percentages and funding levels used in
subsequent non-base years will be based on the adjusted and corrected meal counts
established during the base year. The base year review can be conducted in conjunction with
the Administrative Review. This review corrects previous SFA/site meal counts and the $600
disregard does not apply to closed claims for sites in the base year when fiscal action is required
to fix the meal counts.
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When errors are identified at reviewed sites, fiscal action must be assessed at nonreviewed Provision 2 and 3 base year sites to adjust meal counts and ensure that
claiming percentages and/or funding levels used are calculated correctly.
Note: The SA will follow the procedures detailed in the “Special Provision Option Base Year
Review” memo for situations in which the SFA has sites that established base years prior to SY
2013--14.
For Provision 2 and 3 Schools in a Non-Base Year:
•

Certification errors identified during the Administrative Review area not applied to
Provision 2 or 3 schools in a non-base year, for the calculation of fiscal action.

•

Complete the Fiscal Action Workbook, NSLP and SBP Standard tabs for standard claiming
sites selected for review for NSLP and SBP (if applicable).

•

Complete the Fiscal Action Workbook, NSLP and SBP P2/CEP and/or NSLP and SBP P3
tabs for Provision 2 or 3 schools in a non-base year selected for review.

For Schools Operating Provision 2 or 3 for SBP Only (Standard Counting and Claiming for
NSLP):
If certification errors are found, the reviewer will complete the fiscal action process as
follows:
Standard Claiming for NSLP and Provision Schools in Base Year SBP:
Complete the Fiscal Action Workbook, NSLP and SBP Standard tabs for all
standard NSLP/SBP claiming sites and Provision school base year sites review.
Standard Claiming for NSLP and Provision 2 or 3 in Non-Base Year SBP:
•

Complete the Fiscal Action Workbook, NSLP Standard tab for all standard claiming
sites.

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•

Complete the Fiscal Action Workbook, SBP P2 and CEP, and/or SBP P3 tabs for all
Provision non-base year SBP-only sites selected for review.

2. Recordkeeping
When Provision 1 records, Provision 2 or 3 base year and/or non-base year records are not
retained as required, the SA may, at its discretion, disallow some or all meals served at each
site/SFA that failed to maintain all required documentation and the SA may require the school
to return to standard application and meal counting procedures.

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Module: Community Eligibility Provision
Introduction
To reduce administrative challenges, LEAs with a high percentage of free and reduced price
certifications may elect to use a Special Provision Option (SPO). Determining compliance with
the requirements associated with each option requires some modification of the Administrative
Review requirements. This Module addresses those modifications as they relate to the
Community Eligibility Provision (CEP):
•

Community Eligibility Provision (CEP) – Eliminating household applications in lowincome LEAs, groups of schools, and individual schools and claiming based on derived
percentages: To elect CEP, schools must agree to serve lunch and breakfast at no
charge to all enrolled students and must agree to cover with non-Federal funds any
operating costs that exceed the Federal reimbursement. The reimbursement is based
on claiming percentages derived from the percentage of identified students multiplied
by a factor of 1.6. The term “identified student percentage” (ISP) refers to the
percentage of enrolled students who are categorically eligible for free meals based on
participation in another, specific assistance program. The claiming percentages
established in the year preceding CEP participation are guaranteed for four school years
and may be updated if the ISP increases. CEP is only available to LEAs, groups of
schools, and individual schools with an ISP that is greater than or equal to 40 percent as
of April 1 of the school year prior to participating in CEP.

NOTE: Refer to FNS Memo SP 5454-2016, Community Eligibility Provision: Guidance and
Updated Q&As on the FNS PartnerWeb for additional information on CEP.

Intent/Scope of Monitoring

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The requirements of the Administrative Review Manual apply to the review of an LEA’s
administration of CEP. While Administrative Review activity typically occurs at the SFA or
district level, some aspects may also occur at the school or SA level (e.g., if the SA applies the
claiming percentages to meal counts).
This Module covers the additional steps required to monitor SFAs implementing CEP at one or
more sites.

Review Procedures
Site Selection
The SA must use normal site selection procedures for schools in the SFA. Refer to Section I: PreVisit Procedures, Site Selection Procedures.
If the school selection procedures do not result in the review of a CEP school, the SA must
conduct an abbreviated review in at least one CEP school. The scope of an abbreviated review
is discussed later in this Module.
There are no additional site selection requirements if all sites within the SFA are operating CEP.
Pre-visit Review Procedures for CEP Schools Selected for Review
•

Use the Off-site Assessment Tool
For CEP schools, the SA must use the Off-site Assessment Tool, including Section IX,
Special Provision Options. The SA must also determine whether any adjustments to the
ISP have been made since the most recent ISP was established and whether the updated
claiming percentages are correct and are properly applied.
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NOTE: For CEP sites, a claiming percentage for the free and paid meals is established
and applied to both the SBP and NSLP Claims for Reimbursement equally. However, the
SA must ensure that the SBP and NSLP meals are counted separately prior to applying
the free and paid claiming percentages to generate monthly Claims for Reimbursement
at CEP sites.
•

Certification and Benefit Issuance Review Process
When conducting the Certification and Benefit Issuance Review, students attending sites
operating CEP must be excluded from the review. For more information, refer to Onsite Review Activities for CEP Schools Selected for Review, Step 2 below.

On-site Review Activities for CEP Sites Selected for Review
Step 1: Confirm Off-site Assessment Tool
The SA must verify the SFA information received from the Off-site Assessment Tool, including
Section IX, Special Provision Options. The reviewer must ensure that the procedures described
in the Off-site Assessment Tool match the procedures occurring on-site.
Step 2: Conduct the Certification and Benefit Issuance Review
Not all schools in an LEA may be participating in CEP, so the SA must proceed with the
certification and benefit issuance review following procedures set forth in the Administrative
Review Manual, for non-CEP sites and the adjustments described below for non-CEP sites:

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•

For LEAs or schools operating CEP, the SA must exclude students enrolled at CEP
schools from the certification and benefit issuance review because household
applications are not processed when a site/school is participating in CEP. The review of
the LEAs/school’s claiming percentages are addressed in Step 3 below.
Note: SAs are not required to assess verification for LEAs/schools operating CEP.

•

For CEP schools, the SA must review the certification documentation used to determine
the ISP and claiming percentages that were submitted for the current ISP.
The certification documentation may include direct certification lists, documentation for
extended eligibility, and lists from homeless/migrant liaisons (see SP 5454-2016 for
more information on acceptable certification documentation). Documentation required
to evaluate the ISP is derived from the April 1st certification documentation from the
school year prior to CEP election, which is used to establish the claiming percentages in
the current four-year CEP cycle.
Reviewers must obtain the list of all students used to derive the ISP and randomly*
select at least of 10% of student names to verify that those students can be found on
source documentation that certifies eligibility for free meal benefits. If more than 10%
of the randomly selected sample cannot be properly verified on source documentation,
the SFA must be required, as part of their Corrective Action Plan, to provide source
documentation for every student used to establish the free claiming percentage.

*As part of the certification documentation review for CEP schools, SAs may randomly select 10% of
identified student names at random or a statistically valid sample (see following chart).

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Sample Size Chart
Total # of students in
the SFA ISP calculation

SAMPLE SIZE (99%)

Total # of students in the
SFA ISP calculation

SAMPLE SIZE (99%)

1-100

All

1251-1500

450

101-250

75%

1501-1750

475

251-500

60%

1751-2000

490

501-750

50%

2001-3000

525

751-1000

380

3001-4000

560

1001-1250

420

4001-5000

580

5000+

590

Note: SAs can randomly select 10% of student names or a statistically valid sample.

Step 3: Validation of Claiming Percentages
When a CEP school is reviewed, the SA must ensure that the correct claiming
percentages for free and paid meals were used (complete the SFA-2A).
At a minimum, the SA must verify that the claiming percentages identified for the most
recent ISP were properly applied to the review period and month of the on-site review
from the current school year. The SA may review certification documents for the ISP
and validate the claiming percentages as part of the off-site assessment.
If the review identifies that claiming percentages were erroneously applied, LEA must correct
the deficiencies identified at the non-compliant site(s) as part of its Corrective Action Plan. The
LEA must also submit documentation for every CEP site showing that the claiming percentages
calculated for the current ISP are applied correctly for every closed Claim for Reimbursement
from the school year in which the review occurs.
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Step 4: Recordkeeping
The LEA/school must retain records for all SPO schools, as follows:
•

For CEP, LEAs/schools must retain records used to develop the ISP (e.g., records for the
initial CEP election year showing numbers of identified and enrolled students, and records
from any updates made to the ISP) during the entire period the SPO is in effect, including all
extensions. In addition, this documentation and all other documentation must be retained
for three years after submission of the final Claim for Reimbursement for the last fiscal year
of CEP. If audit findings have not been resolved, these records must be retained beyond the
three-year period as long as required for the resolution of issues raised by the audit.

If a SA determines that the LEA/school has not maintained the required records for a
participating site, the SA may require the school to return to standard application and meal
counting procedures.
Step 5: All Other Critical and General Areas of Review
When evaluating the SFA for compliance with both critical and general areas of review as part
of the Administrative Review, the SA must review all required areas and complete all required
forms as specified by the Administrative Review Manual.
Step 6: Recording Review Findings
The SA must ensure the following forms are completed as applicable:
•

Administrative Review Off-site Assessment Tool – Questions #2100 - 2111

•

Administrative Review On-site Assessment Tool – Questions #2112 - 2116
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•

Administrative Review School Data and Meal Pattern Error and Other Meal Claim Errors
Forms (S-1, S-2) – Used to record all Special Provision Option (SPO) site data.

•

Special Provisions Non-Base Year and CEP Claiming Percentage/Funding Level Summary
Form (SFA-1A) – Used to record all Special Provision Option (SPO) site (or group of sites)
SFA- and SA-validated claiming percentages/funding levels.

•

Community Eligibility Provision Individual Student Percentage Validation Form (SFA-2A)
– Used to record ISP information from the validation review of CEP sites.

•

Fiscal Action Workbook – Used to complete fiscal action process for all SPO Non-Base
Year sites to include CEP sites, including those requiring Full Recalculation.

Abbreviated Review
As mentioned above, under Review Procedures, Site Selection, if the school selection
procedures do not result in the review of a CEP site, the SA must select at least one CEP site and
conduct an abbreviated review. The abbreviated review must include(1) a review the
certification documentation used to determine the ISP, and (2) a review of Claims for
Reimbursement to ensure that claiming percentages are applied correctly.
The Certification documentation may include direct certification lists, documentation for
extension of eligibility, and lists from homeless/migrant liaisons (see SP 5454-2016 for more
information on acceptable certification documentation). The documentation required to
evaluate the ISP is derived from the April 1st certification documentation from the school year
prior to CEP election, which is used to establish the claiming percentages in the current fouryear cycle.
Reviewers must obtain the list of all students used to derive the ISP and randomly select at
minimum 10% of student names (or a statistically valid sample as discussed in On-site Review
Activities for CEP Sites Selected for Review, Step 1) to verify that those students can be found
on source documentation that certifies eligibility for free meal benefits. If more than 10% of
the randomly selected sample cannot be properly verified on source documentation, the SFA
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must be required, as part of their Corrective Action Plan, to provide source documentation for
every student used to establish the free claiming percentage.
If the review identifies that claiming percentages were erroneously applied, the LEA must
correct the deficiencies identified at the non-compliant site(s) as part of its Corrective Action
Plan. The LEA must also submit documentation for every CEP site showing that the claiming
percentages calculated for the current ISP are applied correctly for every closed Claim for
Reimbursement from the school year in which the review occurs.
When issues of severe non-compliance are identified during the abbreviated review, FNS
strongly encourages the SA to conduct a full on-site Administrative Review of the noncompliant sites.
NOTE: The abbreviated review can be conducted as part of the off-site review at the SA’s
discretion.

Technical Assistance/Corrective Action
Technical assistance must be provided and corrective action must be required as specified in
the Administrative Review Manual and as described in this section.

If violations to the application of the claiming percentages for CEP schools are identified in
reviewed schools or through the abbreviated review, the SFA will be required, as part of its
Corrective Action Plan, to:
•

correct the deficiencies identified at the reviewed sites; and

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•

submit documentation for every CEP site (including non-reviewed sites) showing that
the claiming percentages calculated for the current ISP are applied correctly for every
closed Claim for Reimbursement from the school year in which the review occurs.

When meal counting and claiming procedures are identified as yielding erroneous total meal
counts or meal counts by category, the SA must require Full or Partial Recalculation as
applicable to the degree of violation identified.
If the review of the ISP(s) calculation results in errors that place the CEP participating site(s)
below the minimum ISP requirement for CEP eligibility, the participating site(s) must return to
standard meal counting and claiming. The LEA must be given adequate time (at least 30 days)
to complete the certification process in accordance with7 CFR 245.9(j). If, in the fourth year of
the CEP cycle, the ISP is below 40% but at least 30%, the SA has the discretion to allow the LEAs
or site to continue operating CEP at the State-identified claiming percentage for a fifth year (a
“grace year”). Reimbursement for schools operating in a grace year is based on the ISP as of
April 1 in Year 4 of the current four-year cycle. See SP 54-2016 for additional grace year
information. To begin new four-year cycle, the LEA must have an ISP of 40% or higher as of April
1st of the fourth year (or grace year, if applicable). However, the LEA would not qualify for the
grace year option (as described in SP 54-2016).

For all other errors, the SA should ensure corrective action is implemented, as applicable, for
the type of error identified.
The SA must ensure the SFA understands the importance of operating all aspects of the SPO in
compliance with FNS requirements while providing the SFA with detailed Corrective Action
Plans that will ensure that the SFA is in compliance with all Program requirements. The SA
should also encourage the SFA to participate in any SPO training opportunities that may be
available.
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Fiscal Action
The SA must assess fiscal action as specified in each section of the Administrative Review
Manual. The SA must also observe the following:
1. Certification and Benefit Issuance
For Schools/LEAs operating CEP:
•

Any certification errors identified during the Administrative Review at standard
operating sites are not applied to the CEP sites for the calculation of fiscal action.

•

Complete the Fiscal Action Workbook, NSLP and SBP Standard tabs for standard claiming
sites selected for review for NSLP and SBP.

•

Complete the Fiscal Action Workbook, NSLP and SBP P2/CEP and/or NSLP and SBP P3
tabs for Provision 2/3 schools in a non-base year and/or CEP sites selected for review.

2.Recordkeeping

When ISP records under CEP are not retained as required, the SA may, at its discretion, disallow
some or all meals served at each site/LEA that failed to maintain all required documentation
and the SA may require the school to return to standard application and meal counting
procedures.

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Section XI:

Resources

The Resource in this Section is:
• Reference Guide: Forms and Tools

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Recommended Prior to
On-site Review
DATES:

These activities
should be conducted
at least 4-6 weeks
prior to the on-site
review

Select/identify sites that will
receive on-site reviews for
NSLP
Determine the number
of sites/ identify sites that
will receive:
SBP review
FFVP review
ASP review
SMP review

Complete Off-site
Assessment Tool
Use data already on file and
request any necessary
information from SFA; work
collaboratively with SFA to
complete
• Consider using specialized
staff to complete
appropriate sections

Request Benefit
Issuance Document from
SFA

Required Prior to
On-site Review

After completion of
Off-site Assessment Tool and
prior to On-site Review

On-site Review

Post Review

These activities must be
conducted prior to an on-site
Resource Management review

Within 4-6 weeks of start of
on-site review

While on-site

Within 30 calendar days after
on-site review
(unless otherwise noted)

Request Resource
Management Information
for Off-site Assessment Tool
Collect Resource
Management section of the
Off-site Assessment Tool
from the SFA
This information must be
completed by the SFA offsite prior to the on-site
review or prior to the off-site
review of Resource
Management.
Complete the Resource
Management Risk Indicator
Tool
Determine whether a
comprehensive RM Review
will be conducted in any
Resource Management area
If a comprehensive RM
review will be conducted,
notify SFA of any additional
documentation that must be
submitted

Assess any areas of noncompliance based on off-site
assessment

Prepare in advance for
possible technical assistance
needs at SFA
If using the Dietary
Specifications Assessment
Tool (Option 1) for Targeted
Menu review, complete Offsite section of Dietary
Specifications Assessment
Tool to determine the initial
risk level for the selected site
If validating a SFAconducted nutrient analysis
(Option 2) for Targeted
Menu Review, gather any
additional documentation
necessary and begin
validation procedures.
If conducting a nutrient

Administrative Review Manual

Complete On-site
Assessment Tool
Record errors on S-1 SFA-2
Conduct a
comprehensive RM review,
if necessary
The comprehensive review
may be conducted off-site
instead, with the exception
of allowable costs, which
must be reviewed on‐site
If using the Dietary
Specifications Assessment
Tool (Option 1) for Targeted
Menu Review, complete the
On-site section of the
Dietary
Specifications Risk
Assessment Tool to
determine the validated risk
level. If determined high risk,
refer to the Nutrient Analysis
and Validation Checklist

Conduct Exit Conference
with SFA
Record errors on SFA-1
Issue Administrative Review
Summary Report

Establish Corrective Action
deadline, if necessary

Receive, review, respond to
documented Corrective
Action from SFA
Use Fiscal Action
Workbooks to calculate any
needed fiscal action
Determine whether onsite
follow-up is necessary

Complete nutrient
analysis/validation process
(if required)

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Recommended Prior to
On-site Review
Select students for
Certification/ Benefit
Issuance Review

Required Prior to
On-site Review

After completion of
Off-site Assessment Tool and
prior to On-site Review
analysis (Option 3), gather
any additional
documentation necessary
and begin data entry
procedures.

Use Meal Compliance
Risk Assessment Tool to
rank selected sites and
determine the site that will
receive the Targeted Menu
Review
Request Meal Pattern
Compliance Documentation
from SFA
Allow sufficient time for SA
review of Meal Compliance
Documentation prior to onsite review. Meal Pattern
Compliance documentation
includes menus, production
records, USDA Foods
Information Sheets and
other related materials (e.g.,
CN labels, standardized
recipes) that show meals
meet requirements.

On-site Review
If validating a SFAconducted nutrient analysis
(Option 2) for Targeted
Menu Review, examine
menu documentation with
the SFA, refer to the
Nutrient Analysis and
Validation Checklist, and
complete the On-site
section of the Dietary
Specifications Risk
Assessment Tool

Post Review

Conduct SSO review (if
applicable). Issue SSO
report as addendum to
Administrative Review
report. (SSO reviews will
likely occur outside the
range of dates covered in
this timeline).

If conducting a nutrient
analysis (Option 3) for
Targeted Menu Review,
examine menu
documentation with the
SFA, refer to the Nutrient
Analysis and Validation
Checklist, and complete the
On-site section of the
Dietary Specifications Risk
Assessment Tool

Assess Compliance with
Meal Pattern Requirements
Review meals and snacks at
each site selected for review
to assess compliance with

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Recommended Prior to
On-site Review
meal components and
quantities.

Required Prior to
On-site Review

After completion of
Off-site Assessment Tool and
prior to On-site Review

On-site Review

Post Review

Be mindful of Offer vs.
Serve (OVS) policy when
reviewing meal compliance
documentation. Perform
optional OVS edit check.
If planning a targeted
menu review using FNSapproved Menu Planning
Tools for Certification for Six
Cents Reimbursement
(Option 4), submit proposed
methodology to FNS for
approval prior to
Administrative Review.
Determine if the SFA
operates the Seamless
Summer Option (SSO). If so,
determine when SSO will be
operating and schedule SSO
review.

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Glossary of Terms

A la carte means food items available for cash sale independent of the reimbursable meal.
Administrative Review means the comprehensive off-site and on-site evaluation of all SFAs
participating in the Program. The term “Administrative Review” is used to reflect a review of
both Critical and General Areas, and includes other areas of program operations determined by
the SA to be important to Program performance, with FNS approval.
Alternate meal service location means anywhere outside the typical food service
area/cafeteria. Alternate meal locations include places such as classrooms, in-school
suspension areas, and grab & go stations.
Average daily participation (ADP) means the average number of children, by eligibility
category, participating in the Program each operating day. These numbers are obtained by
dividing (a) the total number of free lunches claimed during a reporting period by the number
of operating days in the same period; (b) the total number of reduced price lunches claimed
during a reporting period by the number of operating days in the same period; and (c) the total
number of paid lunches claimed during a reporting period by the number of operating days in
the same period.
Base year is a term used with Special Provision 2 and Provision 3. For Provision 2, the base year
is the last school year for which eligibility determinations were made and meal counts by type
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were taken and during which all meals were served at no charge, or the last year in which a
school conducted a streamlined base year period. It is the first year, and is part of Provision 2’s
four-year cycle. For Provision 3, the base year is the last complete school year for which
eligibility determinations were made and meal counts by type were taken, or the last year in
which a school conducted a streamlined base year period. The Provision 3 base year
immediately precedes and is not included in the four-year cycle.
Benefit issuance means the link in the accountability system between the eligibility
determination and the benefit delivery.
Categorical eligibility means any child who is a member of a SNAP, FDPIR household, or TANF
assistance unit that is automatically eligible for free meals or free milk. Such households must
provide current SNAP, TANF, or FDPIR case numbers on the application. Based on information
retained by the LEA, children may be determined categorically eligible from documentation of
foster children, Head Start, homeless, runaway, and migrant status, as specified in 7 CFR 245.6.
Certification/benefit Issuance means the process used to determine a student’s eligibility for
free or reduced price meal benefits and the method used to apply the correct meal benefit
level for the student at the Point-of-service. The review of the certification documents may
include a review of a household’s application for meal benefits, direct certification information,
or other source documentation. The review of the benefit issuance documents may include a
review of a roster or medium of exchange (any type of ticket, token, ID, name or number) used
in the process of providing a meal benefit.
Child means (a) a student of high school grade or under as determined by the State educational
agency, who is enrolled in an educational unit of high school grade or under as described in the
definition of “School”, including students who are mentally or physically disabled as defined by
the State and who are participating in a school program for the mentally or physically disabled;
or (b) a person under 21 chronological years of age who is enrolled in residential child care
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institution; or (c) for purposes of afterschool snacks, a child means an individual enrolled in an
afterschool care program operated by an eligible school, who serves children up to 18 years of
age or who turn 19 during the school year.
Child Nutrition Act of 1966 means a law enacted by Congress in 1966 (42 USC 1773 et seq.) to
strengthen and expand domestic food service programs for children under the authority of the
Secretary of Agriculture. These programs include Special Milk and School Breakfast Programs
and State Administrative Expense Funds (SAE).
Child nutrition programs include the National School Lunch Program (7 CFR 210) (including the
Fresh Fruit and Vegetable Program, the Seamless Summer Option, and afterschool snacks),
Special Milk Program (7 CFR 215), School Breakfast Program (7 CFR 220), and the Food
Distribution Program, as it relates to the donation of food to schools participating in the Child
Nutrition Programs.
Civil rights means no child shall be denied benefits or be otherwise discriminated against
because of race, color, national origin, age, sex, or disability. SAs and SFAs must comply with
Title VI of the Civil Rights Act of 1964; Title IX of the Education Amendments of 1972; section
504 of the Rehabilitation Act of 1973; the Age Discrimination Act of 1975; 7 CFR 15, 15a, and
15b; and FNS Instruction 113-1, Civil Rights Compliance and Enforcement – Nutrition Programs
and Activities.
Claim for Reimbursement means the claim submitted to a SA or FNSRO (where applicable) on a
monthly basis by a SFA for reimbursement for meals served under the Child Nutrition Programs.
Closed Claim for Reimbursement means any month for which a Claim for Reimbursement was
submitted.

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Code of Federal Regulations (CFR) means the codification of the general and permanent rules
published in the Federal Register by the executive departments and agencies of the Federal
Government. Child nutrition regulations are contained in Title 7 of the CFR.
Corrective action means actions required to correct any violation identified under the
Administrative Review and must be applied to all schools in the SFA, as appropriate, to ensure
that previously deficient practices and procedures are revised system-wide. Corrective action
may include correction of incorrect practices and training.
Critical areas mean Performance Standard 1 and Performance Standard 2, measures of
performance under the Administrative Review, as described in 210.18(g).
Cycle menu means a set of food components and food items that are different for each day
during a cycle and repeats.
Day(s) means calendar day(s) unless otherwise specified.
Day of Review is the day(s) on which the on-site review of the individual sites selected for
review occurs.
Direct certification means the process of establishing children's categorical eligibility for
benefits by obtaining documentation directly from the State or local SNAP, TANF, or FDPIR
office that the children are from households currently receiving SNAP, TANF, or FDPIR benefits.
Households determined eligible for benefits through direct certifications are not required to
submit a free and reduced price application to the school.
Direct verification means using records from public agencies to verify income and/or student
eligibility. Direct verification may be completed at the State or local level or through a joint
effort at both levels. LEAs are not required to conduct direct verification. However, any SFA
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that wishes to conduct direct verification must contact their SA for assistance with establishing
a direct verification method. For further information, please consult FNS’ Eligibility Manual for
School Meals.
Documented corrective action means written documentation provided by the SFA to the SA
describing the actions taken to correct violations and the dates of completion. Documented
corrective action may be provided at the time of the review or may be submitted to the SA
within specified timeframes.
Edit checks means the procedure used by the SFA to compare each school’s daily counts of
free, reduced price, and paid lunches against the product of the number of children in that
school currently eligible for free, reduced price, and paid lunches, respectively, times an
attendance factor.
Eligibility certification means the process used to determine a child’s eligibility for benefits
based on a free and reduced price application submitted by a household or through other
certification documentation.
Entrance conference means the initial meeting between the SA and the SFA to discuss prereview and review content and post-review procedures.
Exit conference means a meeting at the close of a review to communicate findings to
appropriate officials.
Family means a group of related or unrelated individuals, who are not residents of an
institution or boarding house, but who are living as one economic unit.
Finding: Identification of non-compliance with program regulations, FNS Instructions, and/or
policy memoranda. Each finding is associated with a required corrective action.

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First in, first out (FIFO) means an inventory accounting method by which the first items placed
in inventory (i.e., foods and other meal service goods) are the first items used in meal
preparation and production.
Fiscal action includes, but is not limited to, the recovery of overpayment through direct
assessment or offset of future claims, disallowance of overclaims as reflected in unpaid Claims
for Reimbursement, submission of a revised Claim for Reimbursement, and correction of
records to ensure that unfiled Claims for Reimbursement are corrected when filed. It also
includes disallowance of funds for failure to take corrective action to meet the meal
requirements.
Fiscal year (FY) means a period of 12 calendar months beginning October 1 of any year and
ending with September 30 of the following year. This period represents the Federal Fiscal Year.
A State may have designated a periods other than October 1 through September 30 as its fiscal
year. The Administrative Review uses the Federal Fiscal Year.
Food(s) of minimal nutritional value means the four categories of foods and beverages under
7CFR 210.11 and 220.12 (soda water, water ices, chewing gum, and certain candies) that cannot
be served in areas where reimbursable meals are served and/or consumed unless the specific
food item has been exempted from its foods of minimal nutritional value category by the Food
and Nutrition Service.
Food and Nutrition Service (FNS) means the agency under the United States Department of
Agriculture responsible for administering the National School Lunch, School Breakfast, Special
Milk, and other nutrition and food assistance programs.
Food Distribution Program on Indian Reservations (FDPIR) means a nutrition assistance
program administered by FNS that provides donated UDSA Foods to needy families residing on
Indian reservations.
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Food production record means the documentation of what was prepared and served. This
documentation is necessary to support the claim for reimbursable meals and to identify
information needed for the nutrient analysis.
Food service management company (FSMC) means a commercial enterprise or a nonprofit
organization that is or may be contracted with by the SFA to manage any aspect of the school
food service.
Free lunch means a lunch served under the Program to a child from a household eligible for
such benefits under 7 CFR 245 and for which neither the child nor any member of the
household pays or is required to work in the school or in the school's food service.
Free milk means milk served under the regulations governing the Special Milk Program for
which neither the child nor any member of his family pays or is required to work in the school
or in the school's food service. See 7 CFR 215 for more specific guidance.
Fresh Fruit and Vegetable Program (FFVP) means a USDA program under the National School
Lunch Act that provides funding to States to make free fresh fruits and vegetables available in
eligible elementary schools.
General areas mean the areas of review as specified in 7 CFR 210.18(h).
Hazard Analysis and Critical Control Points (HACCP) means a systematic preventive approach
to food safety and pharmaceutical safety that addresses physical, chemical, and biological
hazards as a means of prevention rather than finished product inspection.
Household (see Family)

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Incomplete meal means any meal that does not meet the meal pattern and nutritional
specification requirements set forth in 7 CFR 210 and 220, as applicable.
Limited English Proficient means an individual or household that does not speak English as
their primary language and has a limited ability to read, speak, write, or understand English.
Local educational agency (LEA) means a public board of education or other public or private
nonprofit authority legally constituted within a state having administrative control of schools.
Local school wellness policy means a comprehensive LEA-wide policy that establishes goals and
guidelines for nutrition education, physical activity, nutrition promotion, and other schoolbased activities to promote student wellness, prevent and reduce childhood obesity, and
provide assurance that school meal nutrition guidelines meet the minimum Federal school meal
standards.
Lunch means a meal that meets the National School Lunch Program requirements for specified
age/grade groups of children as designated in 7 CFR 210.10.
Meal component/food component means one of the required food groups that comprise a
reimbursable meal: meats/meat alternates, grains, vegetables, fruits, and milk.
Medium of exchange means cash or any type of ticket, token, ID, name, biometric identifier, or
number that eligible students exchange to obtain a meal.
Miscategorization occurs when a determining official has approved a student in a category
other than the one supported by either a SNAP, TANF, or FDPIR number, or by the household
size and income information provided by the household.

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National School Lunch Act means the legislation that established the National School Lunch
Program (NSLP) (42 USC 1751 et seq.) in 1946.
National School Lunch Program (NSLP) means the Program under which participating schools
operate a nonprofit lunch program in accordance with 7 CFR 210. General and special cash
assistance and donated food assistance are made available to schools in accordance with
7 CFR 210.
Non-base year means any year outside the base year, including the extension years for
Provision 2 and Provision 3 schools.
Non-systemic error means an error in which the contributing factors are unusual or not part of
the normal operating procedure, and the system does not require changes to achieve accurate
results.

Observation: Identification of a weakness in program operations or management that does not
rise to the level of a finding. Each observation is associated with a suggestion.

Offer versus serve (OVS) means a provision that allows students to decline a specific number of
food components/food items depending on the menu planning approach used.
Open Claim for Reimbursement means any month for which a Claim for Reimbursement has
not been submitted.
Operating days are those days when lunches are served under the National School Lunch
Program.
Overclaim means the portion of a SFA's Claim for Reimbursement that exceeds the Federal
financial assistance that is properly payable.
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Overt identification means when students receiving free or reduced price benefits are openly
or physically identified by students or adults as receiving meals at the free or reduced price
rate.
Paid lunch means a lunch served to children who are either not certified for or elect not to
receive the free or reduced price benefits offered under 7 CFR 245.
Participation factor means the percentages of children approved by the school for free,
reduced price, and paid lunches, respectively, who are participating in the Program. The free
participation factor is derived by dividing the number of free lunches claimed for any given
period by the product of the number of children approved for free lunches for the same period
times the operating days in that period. A similar computation is used to determine the
reduced price and paid participation factors. The number of children approved for paid lunches
is derived by subtracting the number of children approved for free and reduced price lunches
for any given period from the total number of children enrolled in the reviewed school for the
same period of time, if available. If such enrollment figures are not available, the most recent
total number of children enrolled shall be used. If SFA participation factors are unavailable or
unreliable, State-wide data must be employed.
Participation rate means the ratio of free, reduced price, and paid meals served to the total
number of meals served.
Performance Standard 1 means the standard requiring that all free, reduced price, and paid
meals claimed for reimbursement are served only to children eligible for free, reduced price,
and paid meals, respectively; and counted, recorded, consolidated, and reported through a
system which consistently yields correct claims. (7 CFR 210.18(g))
Performance Standard 2 means the standard requiring that reimbursable lunches must meet
the meal requirements in 7 CFR 210.10, as applicable to the age/grade group reviewed.
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Reimbursable breakfasts must meet the meal requirements in 7 CFR 220.8 and 220.23, as
applicable to the age/grade group reviewed. (7 CFR 210.18(g))
Point-of-service means the point in the food service operation where a determination can
accurately be made that a reimbursable free, reduced price, or paid lunch has been served to
an eligible child.
Recalculation means a method for determining the number of lunches that are eligible for
reimbursement in schools that do not have reliable reimbursable meal data.
Reduced price lunch means a lunch served under the Program: (a) to a child from a household
eligible for such benefits under 245; (b) for which the price is less than the SFA designated full
price of the lunch and that does not exceed the maximum allowable reduced price specified
under 245; and (c) for which neither the child nor any member of the household is required to
work in the school or in the school's food service.
Reimbursable meal means a meal meeting the USDA meal pattern requirements, served to an
eligible student, and priced as an entire meal rather than based on individual items. Such a
meal qualifies for reimbursement with Federal funds.
Reimbursement means Federal cash assistance, including advances paid or payable to
participating schools for lunches meeting the requirements of 210.10 and served to eligible
children.
Residential child care institution (RCCI) means any distinct part of a public or nonprofit private
institution that (1) maintains children in residence, (2) operates principally for the care of
children, and (3) if private, is licensed by the State or local government to provide residential
child care services under the appropriate licensing code.

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Review period is the most recent month for which a Claim for Reimbursement was submitted,
provided that it covers at least ten (10) operating days.
Reviewed school means the school(s) selected for review using the school selection
procedures.
Reviewed students are the students selected for the certification and benefit issuance review.
School means: (a) An educational unit of high school grade or under, recognized as part of the
educational system in the State and operating under public or nonprofit private ownership in a
single building or complex of buildings; (b) any public or nonprofit private classes of preprimary
grade when they are conducted in the aforementioned schools; or (c) any public or nonprofit
private residential child care institution, or distinct part of such institution, that operates
principally for the care of children, and, if private, is licensed to provide residential child care
services under the appropriate licensing code by the State or a subordinate level of
government, except for residential summer camps which participate in the Summer Food
Service Program for Children, Job Corps centers funded by the Department of Labor, and
private foster homes.
School Breakfast Program (SBP) means the program authorized by Section 4 of the Child
Nutrition Act of 1966, which provides meals to children in the morning hours served at or close
to the beginning of the child’s day at school and that meets the nutritional requirements set out
in 7 CFR 220.8.
School food authority (SFA) means the governing body that is responsible for the
administration of one or more schools, and has the legal authority to operate the Program
therein or be otherwise approved by FNS to operate the Program.

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School year (SY) means a period of 12 calendar months beginning July 1 of any year and ending
June 30 of the following year.
Seamless Summer Option (SSO) means an option under the National School Lunch Program
and School Breakfast Program that allows schools to provide breakfasts and lunches to children
in low income areas during the summer months and other school vacation periods.
Self-service station or self-service food bar means any place in the food service operation
where students serve themselves.
Site means the physical location where Program meals are offered to children.
Special Milk Program (SMP) means the program under which participating schools receive cash
assistance for each half-pint of milk served in accordance with 7 CFR 215.
Special Provision Options (SPOs) are alternative provisions to the normal requirements for
annual determinations of eligibility for free and reduced price school meals and daily meal
counts by type (free, reduced price and paid meals) at the point-of-service. These provisions
are intended to reduce paperwork at the local level.
State agency (SA) means (a) the State educational agency; (b) any other agency of the State
that has been designated by the Governor or other appropriate executive or legislative
authority of the State and approved by the Department to administer the Program in schools,
as specified in 7 CFR 210.3(b); or (c) the FNSRO, where the FNSRO administers the Program as
specified in 7 CFR 210.3(c).
Student with disabilities means any child who has a physical or mental impairment as defined
in 7 CFR 15(b)(3) of USDA's nondiscrimination regulations.

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Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp
Program, operates under the Food Stamp Act of 1977.
Supplemental Nutrition Assistance Program household means any individual or group of
individuals that is currently certified to receive assistance as a household under the
Supplemental Nutrition Assistance Program.
Systemic error means an error that occurs when any of the contributing factors are built into
the process and would likely recur if the process is not changed.
Technical assistance means help or advice provided to the SFA or school, by the SA or FNS, to
improve program operations.
Temporary Assistance for Needy Families (TANF) means the State funded program under Part
A of Title IV of the Social Security Act that the Secretary determines complies with standards
established by the Secretary that ensure that the standards under the State program are
comparable to or more restrictive than those in effect on June 1, 1995. This program is
commonly referred to as Temporary Assistance for Needy Families, although States may refer
to the program by another name.
Underclaim means the Claim for Reimbursement submitted by a SFA that requests less than
the amount deemed properly reimbursable.
United States Department of Agriculture (USDA) means the Federal agency designated by
Congress to administer the NSLP, SBP, and SMP.
Verification means confirmation of eligibility for free or reduced price benefits under the NSLP
or SBP. Verification includes confirmation of income eligibility and, at State or local discretion,

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may also include confirmation of any other information required in the application, which is
defined as documentation in 7 CFR 245.2.

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Authorities

7 CFR 210.18

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