Child and Adult Care Food Program, Improved Targeting of Day Care Home Reimbursements; Correction and Extension of Comment Period

SUMMARY: This document contains corrections to the preamble, regulatory

text, and economic impact analysis (appendix) of the interim rule

published on January 7, 1997 (62 FR 889). The interim rule contained

changes required by the Personal Responsibility and Work Opportunity

Reconciliation Act of 1996 relating to the implementation of a two-

tiered reimbursement structure for day care homes participating in the

Child and Adult Care Food Program. The comment period is also being

extended to provide the public sufficient opportunity to comment on the

interim rule in light of these corrections.

DATES: Effective July 1, 1997, except for Secs. 210.9(b)(20),

210.19(f), 226.6(f)(2) and 226.6(f)(9), which are effective March 10,

1997. To be assured of consideration, comments on the interim rule must

be postmarked on or before May 7, 1997, except for comments on the

information collection which must be received by March 10, 1997.

FOR FURTHER INFORMATION CONTACT: Robert M. Eadie, Chief, Policy and

Program Development Branch, Child Nutrition Division, Food and Consumer

Service, Department of Agriculture, 3101 Park Center Drive, Room 1007,

Alexandria, Virginia 22302 or telephone 703-305-2620.

SUPPLEMENTARY INFORMATION:

Background

On January 7, 1997, the Department published an interim rule

incorporating provisions from the Personal Responsibility and Work

Opportunity Reconciliation Act of 1996 (Pub. L. 104-193) concerning

implementation of a two-tiered reimbursement structure for day care

homes participating in the Child and Adult Care Food Program (CACFP).

Under this structure, the level of reimbursement for meals served to

enrolled children will be determined by economic need based on: the

location of the day care home; the income of the day care provider; or

the income of individual children's households.

However, the interim rule as published contains errors in the

preamble, regulatory text, and economic impact analysis (appendix) that

need correction.

Correction of Publication

Accordingly, the publication on January 7, 1997 at 62 FR 889 is

corrected as follows:

1. On page 898, first column, the preamble is corrected by removing

the second full paragraph and by adding three new paragraphs in its

place to read as follows:

The claiming percentages/blended rates alternative set forth in

section 708(e)(1) of the Act indicates that the claiming percentage

or blended rate be established based on the percentage of identified

income-eligible children enrolled in a home ``in a specified month

or other period.'' This interim regulation prescribes that the

claiming percentage or blended rate be based on one month's data

concerning the children enrolled in a particular day care home. The

Department will allow sponsors to use either of two approaches to

making this calculation, and is interested in receiving comments on

whether both of these alternative methods should continue to be

permitted.

The first alternative would involve the day care home submitting

an attendance list for the specified month to the sponsor. The

sponsor would then use the attendance list to determine the claiming

percentage or blended rate for the home based on a weighted average

of each enrolled child's level of participation during the month.

The second alternative would involve a sponsor calculating the

claiming percentage or blended rate based on a home's enrollment for

an entire month using a list of enrolled children submitted by the

day care home. The sponsor would assess the income eligibility

status of each of the children enrolled in the home during the month

and, using the enrollment list, derive the appropriate claiming

percentage or blended rate. For example, if a home's enrollment list

for the month of January indicates that 10 children were enrolled

during the month, the home's claiming percentage or blended rate

would be based on the number of identified income-eligible children,

divided by 10.

The Department believes that either of these methods will

achieve greater accuracy in reimbursement payments than basing the

six-month calculation on a single point in time (that is, one day's

data, which could misrepresent typical enrollment or attendance in

that home). Although the attendance list may impose an additional

burden on the sponsor and day care homes, it would certainly provide

a higher level of accuracy than using an enrollment list.

2. On page 899, third column, in the second full paragraph, line

10, the preamble is corrected by removing the word ``submit'' and

replacing it with the word ``collect''.

3. On page 903, in line 1 of the second column,

Sec. 226.13(d)(3)(ii) is corrected by adding the words ``one month's

data concerning'' after the words ``basis of''.

4. On page 904, third column, Sec. 226.23(h)(6) is corrected by

italicizing the paragraph heading ``Verification procedures for

sponsoring organizations of day care homes.''.

5. The appendix to the preamble which appears on pages 905-915 is

corrected as follows:

a. On page 905, second column, in line 13 of the second full

paragraph:

1. the words ``, and supplements'' are added after the word

``breakfasts'' in the parentheses;

2. the comma after the right parentheses is removed and replaced

with a period; and

3. the words ``and such'' before the word ``changes'' are removed

and the word ``These'' is added in their place.

b. On page 905, Table 1, in footnote a, in the first sentence, the

first word ``Percentage'' is removed and the word ``Percentages'' is

added in its place; and the word ``hoseholds'' is removed and the word

``households'' is added in its place.

c. On page 905, Table 1, in footnote a, in the second sentence, the

word ``to'' is added after the word ``propensities''; and the word

``benefirts'' is removed and the word ``benefits'' is added in its

place.

d. On page 905, first column, in line 3, the first paragraph after

Table 1, the words ``Associates, Inc.'' are added after the word

``Abt''.

[[Page 5520]]

e. On page 906, Table 2, in the column labeled ``Difference,'' a

negative sign (-) is added before all of the numbers in the column.

f. On page 906, third column, the fourth line of text after Table

3, the word ``ing'' is removed and the words ``the costs resulting''

are added after the words ``most of''.

g. On page 907, Table 4, in the column labeled ``Dollars,'' the

number ``-332,324'' is removed and the number ``-332,334'' is added in

its place.

h. On page 907, first column, after Table 4, in the third

paragraph, on line 6, a period is added after the first occurrence of

the word ``DCHs''.

i. On page 907, first column, after Table 4, in the third

paragraph, on line 6, the words ``Virtually all'' are added after the

newly added period.

j. On page 907, second column, after Table 4, in the last

paragraph, in line 3, the footnote ``3'' is removed and a footnote

``5'' is added in its place.

k. On page 908, first column, in the last paragraph, on the third-

to-last line, the word ``er'' is removed and the words ``impact of $133

per'' are added.

l. On page 908, second column, in the second paragraph under the

``Costs to Families'' heading, on line 15, the word ``recent'' is

removed and the words ``represent a 10 percent'' are added in its

place.

m. On page 909, second column, in the first paragraph under the

``Intended Effect of Tiering'' heading, on line 5, a period is added

after the words ``P.L. 104-193''.

n. On page 909, second column, in the first paragraph under the

``Tiering Determination Burden'' heading, line 13, the word ``sponsor''

is removed and the words ``the DCH provider'' are added in its place.

o. On page 909, third column, in the first full paragraph, line 23,

the word ``93-35'' is removed and the word ``97-35'' is added in its

place.

p. On page 909, third column, in the first full paragraph, line 32,

the word ``enrollment'' is removed and the words ``two types of

income'' are added in its place.

q. On page 910, first column, in the first full paragraph, line 13,

the words ``percent of'' are added after the word ``6'', and the words

``DCHs that are only area-eligible implies that 16 percent of all DCHs

will be approved for tier I'' are added after the words ``6 percent of

tier I''.

r. On page 910, third column, in the paragraph under the heading

``Data Collection and Reporting Burden for Sponsors,'' 4th from last

line, the words ``CACFP State'' are added after the words ``submits to

its''.

s. On page 912, second column, after Table 7, in the first

paragraph, the words ``The assumption that 40 percent of children in

mixed tier II DCHs are income eligible. There is a clear financial

incentive for providers to encourage their low-income families to

submit income information to sponsors. This incentive and providers'

close relationships with parents suggest that providers will attempt to

persuade parents to provide the income information and will thereby

achieve a response rate greater than the NSLP's 80 percent; ninety

percent was chosen.'' are removed.

t. On page 912, third column, after Table 7, in the first full

paragraph, line 20, the word ``DC'' is removed and the words ``DCHs

will be about'' are added in its place.

u. On page 913, first column, after Table 8, in the first paragraph

under the heading ``Costs to CACFP State Agencies,'' line 19, the word

``hof'' is removed and the words ``household income of'' are added in

its place.

v. On page 914, third column, in the footnote at the bottom of the

column, the letter ``m'' is added to the beginning of the footnote.

Dated: January 30, 1997.

William E. Ludwig,

Administrator.

[FR Doc. 97-2942 Filed 2-5-97; 8:45 am]

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