Summer Food Service Program: Program Meal Service During the School Year, Paperwork Reduction, and Targeted State Monitoring

Federal RegisterOct 13, 1998

Ask Donna

What actually matters in this document.

Text

DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 225

RIN 0584-AC06

Summer Food Service Program: Program Meal Service During the

School Year, Paperwork Reduction, and Targeted State Monitoring

AGENCY: Food and Nutrition Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This rulemaking proposes a change to the Summer Food Service

Program (SFSP) which was mandated by the Healthy Meals for Healthy

Americans Act of 1994. The change allows SFSP meal service to be

provided at non-school sites to children who are not in school due to

unanticipated school closures during the months of October through

April caused by a natural disaster, building repair, court order, or

similar occurrence. In addition, this rulemaking proposes discretionary

changes to simplify the SFSP sponsor application and State monitoring

requirements in order to eliminate unnecessary paperwork and reduce

administrative burden for sponsors and State agencies.

DATES: To be assured of consideration, comments must be postmarked on

or before December 14, 1998.

ADDRESSES: All comments concerning these proposed regulations should be

addressed to Mr. Robert M. Eadie, Chief, Policy and Program Development

Branch, Child Nutrition Division, Food and Nutrition Service,

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

Alexandria, Virginia 22302. All written submissions will be available

for public inspection at this location Monday through Friday, 8:30

a.m.-5 p.m.

FOR FURTHER INFORMATION CONTACT: Mr. Robert Eadie or Ms. Melissa

Rothstein at the above address or by telephone at 703-305-2620.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This proposed rule has been determined to be not significant for

purposes of Executive Order 12866, and, therefore, has not been

reviewed by the Office of Management and Budget.

Regulatory Flexibility Act

This action has been reviewed with regard to the requirements of

the Regulatory Flexibility Act (5 U.S.C. 601-612). The Administrator of

the Food and Nutrition Service (FNS) has certified that this proposed

rule will not have a significant economic impact on a substantial

number of small entities. The provisions of this rule will streamline

requirements and reduce administrative burden for State agencies and

sponsors of the SFSP.

Executive Order 12372

The SFSP is listed in the Catalog of Federal Domestic Assistance

under 10.559 and is subject to the provisions of Executive Order 12372,

which requires intergovernmental consultation with State and local

officials (7 CFR part 3015, subpart V and final rule-related notices

published at 48 FR 29114, June 24, 1983 and 49 FR 22676, May 31, 1984).

Notice of Information Collection

In accordance with the Paperwork Reduction Act of 1995, this notice

invites the general public and other public agencies to comment on

proposed information collection.

Written comments must be submitted on or before December 14, 1998.

Comments concerning the information collection aspects of this

proposed rule should be sent to the Office of Information and

Regulatory Affairs, OMB, Room 3208, New Executive Office Building,

Washington, DC 20503, Attention: Laura Oliven, Desk Officer for the

Food and Nutrition Service. A copy of these comments may also be sent

to Mr. Robert Eadie at the address listed in the ADDRESSES section of

this preamble. Commenters are asked to separate their comments on the

information collection requirements from their comments on the

remainder of the proposed rule.

As required by the Paperwork Reduction Act of 1995 (44 U.S.C.

3504), FNS has submitted a request to OMB for a revision of the

currently approved SFSP information collection requirements. OMB is

required to make a decision concerning the collection(s) of information

contained in this proposed rule between 30 and 60 days after

publication of this document in the Federal Register. Therefore, a

comment to OMB is best assured of having its full effect if OMB

receives it within 30 days of publication. All comments will be

summarized and will become a matter of public record.

Comments are invited on: (a) Whether the proposed collection of

information is necessary for the proper performance of the functions of

the agency, including whether the information will have practical

utility; (b) the accuracy of the agency's estimate of the burden of the

proposed collection of information including the validity of the

methodology and assumptions used; (c) ways to enhance the quality,

utility and clarity of the information to be collected; and (d) ways to

minimize the burden of the collection of information on those who are

to respond, including through the use of appropriate automated,

electronic, mechanical, or other technological collection techniques or

other forms of information technology.

The title, description, and respondent description of the proposed

information collections are shown below with an estimate of the annual

reporting and recordkeeping burdens. Included in the estimate is the

time for reviewing instructions, searching existing data sources,

gathering and maintaining the data needed, and completing and reviewing

the collection of information.

Title: 7 CFR part 225, Summer Food Service Program.

OMB Number: 0584-0280.

Expiration Date: December 31, 1999.

Type of Request: Revision of existing collection.

[[Page 54618]]

Abstract: The proposed rule, Summer Food Service Program: Program

Meal Service During the School Year, Paperwork Reduction, and Targeted

State Monitoring, proposes to implement the provision included in Pub.

L. 103-448, the Healthy Meals for Healthy Americans Act of 1994, that

allows SFSP meals to be served ``at non-school sites to children who

are not in school for a period during the months of October through

April due to a natural disaster, building repair, court order, or

similar cause.'' In addition, the rule also proposes to modify current

SFSP sponsor and site application requirements and to allow State

agencies to better target review efforts.

In accordance with the Paperwork Reduction Act of 1995, the

Department is providing the public with the opportunity to provide

comments on the information collection requirements of this proposed

rule as noted below:

----------------------------------------------------------------------------------------------------------------

Annual Number Annual Burden per Annual burden

Section of respondents frequency response hours

----------------------------------------------------------------------------------------------------------------

7 CFR 225.6(b)(4)--State agencies provide

immediate ``conditional approval'' to sponsors

in emergency program situations: Proposed...... \1\ 5 1 1 5

7 CFR 225.6(c)--Requirements for new sponsors,

new sites, and sponsors and sites which have

experienced significant operational problems in

the prior year: Proposed....................... \2\ 179 1 3.33 596

7 CFR 225.6(c)--Removal of requirements for

experienced sponsors and sites:

Existing.................................... \2\ 3309 1 3.33 11,019

Proposed.................................... \2\ 3576 1 2.33 8,332

7 CFR 225.7--State agencies target reviews of

sponsors and sites, concentrating on problem

areas:

Existing.................................... \1\ 49 \2\ 43 8.0 16,856

Proposed.................................... \1\ 49 \2\ 30 11.5 16,905

Existing.................................... \1\ 49 \3\ 104 4 20,384

Proposed.................................... \1\ 49 \3\ 73 6 21,462

----------------------------------------------------------------------------------------------------------------

\1\ State Agencies.

\2\ Sponsors.

\3\ Sites.

Total Existing Burden Hours: 48,259.

Total Proposed Burden Hours: 47,300.

Total Difference: -959.

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988,

Civil Justice Reform. This proposed rule is intended to have preemptive

effect with respect to any State or local laws, regulations or policies

which conflict with its provisions or which would otherwise impede its

full implementation. This rule is not intended to have retroactive

effect unless so specified in the ``Effective Date'' section of the

preamble of the final rule. Prior to any judicial challenge to the

provisions of this rule or the application of its provisions, all

applicable administrative procedures must be exhausted. This includes

any administrative procedures provided by State or local governments.

For disputes involving procurements by State agencies and sponsors,

this includes any administrative appeal procedures to the extent

required by 7 CFR part 3016. In the SFSP, the administrative procedures

are set forth under the following regulations: (1) Program sponsors and

food service management companies must follow State agency hearing

procedures issued pursuant to 7 CFR 225.13; and (2) disputes involving

procurement by State agencies and sponsors must follow administrative

appeal procedures to the extent required by 7 CFR 225.17 and 7 CFR part

3015.

Unfunded Mandate Reform Act

Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Pub.L.

104-4, establishes requirements for Federal agencies to assess the

effects of their regulatory actions on State, local, and tribal

governments and the private sector. Under section 202 of UMRA, the Food

and Nutrition Service generally must prepare a written statement,

including a cost-benefit analysis, for proposed and final rules with

``Federal mandates'' that may result in expenditures to State, local,

or tribal governments, in the aggregate, or to the private sector, of

$100 million or more in any one year. When such a statement is needed

for a rule, section 205 of UMRA generally requires the Food and

Nutrition Service to identify and consider a reasonable number of

regulatory alternatives and adopt the least costly, more cost-effective

or least burdensome alternative that achieves the objectives of the

rule.

This rule contains no Federal mandates (under the regulatory

provisions of Title II of UMRA) for State, local, and tribal

governments or the private sector of $100 million or more in any one

year. Thus, this rule is not subject to the requirements of sections

202 and 205 of UMRA.

Background

The Summer Food Service Program (SFSP) is authorized by section 13

of the National School Lunch Act (NSLA) (42 U.S.C. 1761). On November

2, 1994, the President signed into law Pub. L. 103-448, the Healthy

Meals for Healthy Americans Act of 1994 (the Act). The Act reauthorized

the SFSP through Fiscal Year 1998 and made a number of changes to the

Program. Most of these mandated changes are non-discretionary and are

being addressed in a separate interim rulemaking. However, the Act also

included a provision that allows SFSP meals to be served ``at non-

school sites to children who are not in school for a period during the

months of October through April due to a natural disaster, building

repair, court order, or similar cause.'' Since the wording of this

change to the statute raises a number of implementation issues which

may be subject to interpretation, the

[[Page 54619]]

Department is soliciting public comments through this proposed

rulemaking.

The SFSP was established by Congress to ensure that children in

low-income areas could continue to receive nutritious meals during the

summer that are comparable to those they receive during the school year

under the National School Lunch and School Breakfast Programs. To this

end, the SFSP provides free meals to all children at approved SFSP

sites in areas with significant concentrations of low-income children.

Current law (section 13(a)(1) of the NSLA) defines such an area as one

in which one-half or more of the children are from households with

incomes at or below the eligibility level for free and reduced-price

school meals (185 percent of the Federal poverty guidelines). In

addition, Program sites may include homeless feeding sites and camps as

defined at section 13(a)(3)(c) of the NSLA and SFSP regulations at 7

CFR 225.2. (The SFSP regulations are located in Title 7, part 225 of

the Code of Federal Regulations. Hereinafter, all citations of SFSP

regulations will simply indicate the particular section of the SFSP

regulation being discussed without repeated reference to Title 7.)

When the SFSP was created, it was the intent of Congress to provide

nutritious meals to children during the summer when school is out of

session. Consequently, section 13(c)(1) of the NSLA limited SFSP

operation to the months of May through September. In addition, in order

to accommodate children who attend schools which operate on a year-

round basis, that same section allowed SFSP sponsors to operate food

service programs for children on school vacation at any time if the

children attend school on a year-round, or continuous school calendar,

basis.

Since the SFSP was established, there have been times (e.g., in the

case of a school strike) when a single school or an entire school

system did not open as scheduled at the end of summer. Because the NSLA

prohibited the SFSP from operating after September 30 unless the school

was in session on a year-round basis, and because the National School

Lunch and Breakfast Programs may only operate when school is in

session, many children in low-income areas were denied the benefit of a

nutritious meal while the schools were closed. These situations led

Congress to include in section 114(c) of Pub. L. 103-448 the

aforementioned provision allowing sponsors to operate the SFSP and

provide meals to children at eligible non-school sites during times of

unanticipated school closures.

In order to implement this provision, the Department must consider

a number of issues, including: (1) The circumstances that may warrant

employing this authority; (2) the definition of ``non-school sites'' as

eligible sites; and (3) the application of existing provisions of law

when providing emergency SFSP benefits during the school year. These

issues are discussed in more detail below.

In addition, in an effort to fulfill the Department's commitment to

reduce barriers to SFSP participation, the Department has consulted

with local, State, and Federal administrative personnel and hunger

advocacy groups to explore ways of reducing and easing the

administrative burden on State and local program administrators. The

extensive SFSP sponsor and site application procedures and the

requirements pertaining to State monitoring of the program have

repeatedly been targeted as potential areas where paperwork could be

reduced and administrative efforts better targeted. These issues are

also discussed in detail in this preamble.

The Department has requested public comments on this proposed rule

by December 14, 1998. Based on the number and nature of any public

comments received, the Department will publish an interim or final

rulemaking at a later date.

I. Unanticipated School Closures

A. Circumstances Warranting Implementation

Section 13(c)(1) of the NSLA, as amended by section 114(c) of Pub.

L. 103-448, allows for a variety of circumstances warranting operation

of the SFSP during unanticipated school closures. Generally, other than

those times when schools operate on a continuous school calendar, the

SFSP begins operation after the end of a school year and concludes

prior to the start of the new school year. However, the Act's listing

of ``natural disaster, building repair, court order, or similar cause''

suggests a variety of circumstances intended to authorize the service

of SFSP meals during the months of October through April, including

circumstances such as: (1) The need to remove asbestos from, or make

major repairs to, one or more school buildings in order to comply with

safety regulations or other State or local ordinances; (2) the

destruction of one or more school buildings due to a natural disaster

such as a tornado, flood, or hurricane; or (3) a labor-management

dispute which prevents schools from opening, or which would close

schools during the school year, pending the outcome of negotiations.

Additionally, given the inclusion in the law of the phrase ``or similar

cause,'' the Department recognizes that there may be other instances

which warrant operation of the SFSP during an unanticipated school

closure.

Accordingly, this rule proposes to amend Sec. 225.6(e)(1) to

specify several situations in which a sponsor may operate during

unanticipated school closures in the months of October through April.

In addition, given the numerous possibilities of ``similar causes''

that may warrant operation of the SFSP during an unanticipated school

closure, and in order to maintain a sufficient level of oversight,

Sec. 225.6(e)(1) would also be amended to clarify that other situations

which might fall into the category of ``similar cause'' could be

considered and approved or denied on a case-by-case basis by the State

agency. In addition, Sec. 225.6(b)(4) would be amended to permit State

agencies to approve sponsors which do not meet the requirement of a

year-round service to the community (in Sec. 225.14(c)(5)) to serve as

sponsors during unanticipated school closures.

B. ``Non-school Sites''

Section 114(c) of Pub. L. 103-448 further amended section 13(c)(1)

of the NSLA by specifically stating that only ``non-school'' sites are

considered eligible sites for SFSP operation during the months of

October through April. The Department believes that the specific

reference to ``non-school'' sites was included to ensure that, in the

event of a labor-management dispute, SFSP meal service could be

provided without exacerbating the dispute. However, since the law

requires this in all cases, this rule proposes to amend

Sec. 225.6(d)(1) to provide that, regardless of the reason for the

school closure, only those sites not located on the premises of a

school will be considered eligible sites for the purpose of serving

SFSP meals during an unanticipated school closure.

The specific reference to ``non-school sites'' in the law also

raises questions with regard to whether school food authorities should

be permitted to act as sponsors during operation of the SFSP under

these conditions, or whether their sponsorship could create legal

complications in the case of a strike. Despite this possibility, the

Department recognizes that in many situations, the school food

authority is the most capable--and possibly the only willing--sponsor

available to operate

[[Page 54620]]

the program in an area. Therefore, in the interest of providing meals

to affected children in the most expeditious and efficient manner, and

to provide maximum State flexibility in responding to these situations,

this rule does not alter the current regulations which permit the

approval for program participation of all entities, including school

food authorities, which meet the sponsor eligibility requirements

contained in Sec. 225.14(b) of the current regulations.

C. Applying Existing Provisions of Regulations During Emergency Program

Participation

Although it is not possible to foresee all of the circumstances

which might attend any particular instance of school closure, the

Department believes it is important to consider how some existing

provisions of program regulations will be applied during an

unanticipated school closure.

1. Site Eligibility Documentation

Section 225.6(c)(2)(ii) of the current regulations requires a

sponsor to provide documentation supporting the eligibility of each

program site as serving an ``area in which poor economic conditions

exist,'' as defined in Sec. 225.2. Clearly, the aforementioned

provision of Pub. L. 103-448 does not intend to override site

eligibility documentation requirements. However, as indicated above,

during situations involving unanticipated school closures, it is

important to begin meal service as soon as possible so that affected

children can receive program benefits.

Accordingly, in an effort to balance these opposing needs during

unanticipated school closures, this rule proposes to amend

Secs. 225.6(c)(2)(i)(F) and (c)(3)(i)(B) (as amended by this proposed

rule and discussed in Part II of this preamble) to consider as eligible

without new documentation of area eligibility for these limited

purposes, any site which has participated in the SFSP at any time

during the current year or prior two calendar years. For example, if a

sponsor wants to operate the SFSP at a particular site during an

unanticipated school closure in October 1998, the site would have to

have been in the SFSP at some time in the years 1996, 1997, or 1998 in

order to be exempt from the site eligibility documentation requirements

discussed above. Since a given area's demographics are not likely to

change drastically within this period, we believe that exempting such

sites from normal area eligibility documentation requirements is

appropriate in these emergency situations.

2. Sponsor Applications and Agreements

The various requirements pertaining to sponsor applications and

agreements are contained in the current regulations under Secs. 225.6

and 225.14. These regulations require that each potential sponsor

submit a written application to the State agency for participation in

the program. This application must include detailed information

regarding the proposed meal service, including documentation supporting

the eligibility of each site as serving an area in which poor economic

conditions exist, a complete administrative and operating budget,

several policy statements and program assurances, and other

information.

This rule proposes to amend Secs. 225.6(c)(1) and 225.14(a) to

allow State agencies, at their discretion, to approve sponsors that

have participated in the program at any time during the current year or

prior two calendar years without a new application, solely for the

purpose of sponsoring sites during periods of unexpected school

closings from October to April. Allowing State agencies to rely on

applications made within this timeframe will help to expedite operation

of the emergency program. All sponsors would still be required to enter

into written agreements with the State agency, in accordance with the

requirements of Sec. 225.6(e), prior to initiating program operations.

For those sponsors that have not participated in the SFSP at any

time during the current year or the prior two calendar years, program

applications would be required. However, as discussed below, the State

agency would not be required to conduct pre-approval visits. Conforming

changes would be made to the application requirements at

Sec. 225.6(c)(1) and Sec. 225.14(a). Additionally, this rule proposes

to amend Sec. 225.6(b)(1) to add specific reference to exempt these

sponsors from the annual June 15 deadline for receipt of sponsor

applications.

3. Monitoring

Section 225.7(d)(1) of the current regulations requires each State

agency to conduct pre-approval visits of certain sponsors and sites,

including those applicants which did not participate in the program in

the prior year, and all proposed non-school sites with an expected

average daily attendance of more than 300 (or more than 100 for private

nonprofit sponsors) which did not participate in the prior year.

Similarly, Sec. 225.14(c)(6) of the current regulations requires that a

sponsor certify that it has visited all program sites in order to be

eligible to participate in the program. The purpose of these visits is

to assess the sponsor's or site's potential for successful program

operations, and to verify the information contained in the program

application.

The Department continues to prefer that the State agency conduct

these visits in advance of a sponsor's approval when the sponsor has

not recently participated in the SFSP. However, recognizing the time

constraints that may often accompany unanticipated school closures,

this rule proposes to amend Sec. 225.7(d)(1)(i) to give State agencies

discretion in conducting pre-approval visits of sponsors in cases in

which sponsors are operating the program during unanticipated school

closures. Of course, in cases in which State agencies feel compelled to

approve an inexperienced sponsor to administer the SFSP during an

unanticipated school closure without a pre-approval visit, the

Department expects State personnel to work in especially close

partnership with such sponsors to ensure the proper operation of the

SFSP. This rule does not propose any change to the requirement in

Sec. 225.14(c)(6) that a sponsor certify that all sites have been

visited because these visits are critical in helping to ensure that

sites are capable of operating a safe and accountable meal service in

accordance with program rules.

Sections 225.7(a) and 225.15(d) require that State agencies and

sponsors, respectively, conduct training sessions for sponsor and site

personnel prior to the beginning of Program operations. Again

recognizing the time constraints accompanying emergency situations,

this rule proposes to amend Sec. 225.7(a) and 225.15(d) to permit the

State agency, at its discretion, to waive these training requirements

for operation of the Program during unanticipated school closures. As

with pre-approval visits discussed above, the Department expects State

agencies to work very closely with inexperienced sponsors which are

approved to operate the Program in such situations. This assistance

likely would involve on-site technical assistance and training during

operation of the Program.

II. Paperwork Reduction

This rulemaking proposes to substantially reorganize and revise the

SFSP sponsor and site application requirements which are currently set

forth at Sec. 225.6(c). These are the minimum standards for sponsor and

site applications; State agencies administering the SFSP may include

[[Page 54621]]

other provisions in their prototype applications as long as they do not

establish additional eligibility requirements for SFSP participation.

Based on formal and informal input received from State Program

administrators, as well as from sponsor staff and hunger advocacy

groups, it has become apparent that some of the minimum Federal

requirements set forth at Sec. 225.6(c) have become unnecessary and/or

duplicative. In addition, in recent years, several State agencies have

requested and have received waivers to eliminate duplicative

application requirements for experienced sponsors. These waivers were

granted under the authority provided to the Department under section

12(l) of the NSLA (42 U.S.C. 1760). Therefore, the Department believes

that it is appropriate to propose simplified minimum application

standards for sponsors whose staff have had prior experience

administering the SFSP.

As currently organized, Sec. 225.6(c)(2)(i) sets forth the general

requirements for the information which sponsors must provide for all

sites which they plan to operate; Secs. 225.6(c)(2)(ii)-(v) set forth

special requirements pertaining to specific types of sites (e.g.,

camps, homeless feeding sites, etc.); and Secs. 225.6(c)(2)(vi)-(x) set

forth more generic, sponsor-level requirements for information to be

included in all sponsor applications (e.g., administrative budget,

staffing and monitoring plan, etc.).

The most detailed and lengthy of these paragraphs is

Sec. 225.6(c)(2)(i), which sets forth the minimum requirements for

``site information sheets.'' Sponsors must annually submit site

information sheets for each of their sites, regardless of whether the

site has previously participated in the SFSP, has undergone substantial

changes in site staff or meal service systems from one year to the

next, or is providing the same service at the same location year after

year. It is this paragraph which the Department believes is most in

need of revision.

First, this rule proposes to divide the information currently in

Sec. 225.6(c)(2) into new paragraphs (c)(2) and (c)(3). New paragraph

(c)(2) would set forth the requirements for ``new'' sponsors and sites

(i.e., sponsors and sites which did not participate in the SFSP in the

prior Program year, or, as determined by the State agency, sponsors and

sites which have had significant staff turnover from the prior year).

The requirements in new paragraph (c)(2) would also apply to sponsors

and sites which, in the determination of the State agency, have

experienced significant operational problems in the prior Program year.

New paragraph (c)(3) would set forth the simplified requirements for

``experienced'' sponsors and sites--those which successfully

participated in the SFSP in the prior Program year. Experienced

sponsors which add new sites must follow the site application

requirements in paragraph (c)(2) (for ``new'' sites) only for their new

sites. Such sponsors would follow the requirements of paragraph (c)(3)

(for ``experienced'' sponsors and sites) for all other sites, and for

sponsor information. At the discretion of the State agency, any of the

requirements set forth for ``new'' sponsors and sites in paragraph

(c)(2) could be applied to ``experienced'' sponsors and sites as well.

Accordingly, this rule proposes to amend Sec. 225.6(c) by deleting

paragraph (c)(2), by replacing it with two new paragraphs, (c)(2) and

(c)(3), and by redesignating current paragraphs (c)(3) and (c)(4) as

paragraphs (c)(4) and (c)(5), respectively. This rule also proposes to

amend Sec. 225.2 by adding definitions of ``new sponsor,'' ``new

site,'' ``experienced sponsor,'' and ``experienced site,'' as discussed

in the preceding paragraph. These definitions will help clarify

application and other requirements for sponsors and sites with varying

degrees of experience and/or success in operating the Program, and will

also be used to better target State agency monitoring requirements, as

discussed in Section III of this preamble, below.

A. General Requirements for Site Information Sheets

In addition to reorganizing Sec. 225.6(c) as described above, this

rule proposes to completely revise the text, as well. Described below

are the changes which the Department proposes to make to current

Sec. 225.6(c)(2)(i).

Current Sec. 225.6(c)(2)(i)(A) requires sponsors to describe their

system for serving meals to children at each site. When this

requirement was first promulgated, the SFSP was a new food assistance

program with far fewer management controls written into the authorizing

statute or the program regulations. The Department therefore believed

that this requirement would help underscore the importance of a site

having an organized food service system for efficient program

operation.

However, now that the SFSP is an established program, we believe

that including this information in every site's information sheet

serves little purpose. The Department continues to recognize the

importance of this information for new sites, and for those sites that

have experienced significant operational problems in the prior year.

Therefore, this requirement will be retained in Sec. 225.6(c)(2)(i)(A)

for new sponsors and sites, and for sponsors and sites, which, in the

determination of the State agency, have experienced significant

operational problems in the prior year. However, recognizing that, once

established, the system for serving meals to children at each site does

not change significantly from year to year for most sites, this rule

proposes to remove this requirement for experienced sponsors and sites.

Section 225.6(c)(2)(i)(B) of the current regulations requires site

information sheets to contain the estimated number and types of meals

to be served and the times of meal service for each site. Such

information helps both sponsors and State agencies develop their plans

for monitoring site operations. Since meal service information can, and

frequently does, change from year to year, we are not proposing a

change to this requirement. This proposal would move this requirement

to Secs. 225.6(c)(2)(i)(B) and (c)(3)(i)(A).

Current Sec. 225.6(c)(2)(i)(C) requires that each site information

sheet provide information on arrangements, in accordance with State or

local health standards, for delivery and holding of meals until they

are served, and for storing and refrigerating any leftovers. The

Department believes that this information is critical for new sites and

for sites which have experienced significant operational problems in

the prior year, in order to emphasize the sponsor's need for proper

meal planning in accordance with Sec. 225.15(b). However, for

experienced sites, the logistics of delivering, holding and storing

meals may not change significantly from year to year. Therefore, we are

proposing to remove the requirement, for sponsors of experienced sites

only, that sponsors provide information on arrangements for delivery

and holding of meals until they are served, and for storing and

refrigerating any leftovers. This requirement will be in new

Sec. 225.6(c)(2)(i)(C) for new sponsors and sites, and for sponsors and

sites which, in the determination of the State agency, have experienced

significant operational problems in the prior year.

Sections 225.6(c)(2)(i)(D) and (E) of the current regulations

require that information be provided about sites regarding arrangements

for food service during periods of inclement weather, and for access to

a means of communication for making necessary adjustments in the number

of meals delivered in accordance with the site's

[[Page 54622]]

average daily attendance, respectively. The Department believes that

these types of arrangements, once made, typically remain constant from

year to year. Therefore, we are proposing to remove these requirements

for experienced sites. We are not proposing a change to these

requirements for new sponsors and sites, and for sponsors and sites

which have experienced significant operational problems in the prior

year. For these sites, the requirements will be in new

Secs. 225.6(c)(2)(i)(D) and (c)(2)(i)(D), respectively.

Current Secs. 225.6(c)(2)(i)(F) and (G) require that information be

provided for each site on the geographic area to be served, and on the

percentage of children in the area to be served by the site who meet

the Program's income standards, respectively. The requirement in

Secs. 225.6(c)(2)(i)(F) and (G) to collect information on the

geographic area to be served and the percentage of income-eligible

children is duplicative, as it is already collected under current

Sec. 225.6(c)(2)(ii) (as redesignated by this proposal,

Secs. 225.6(c)(2)(vi)-(vii) and (c)(3)(iii)-(iv)). Accordingly, this

rule proposes to delete the information contained in current

Secs. 225.6(c)(2)(i)(F) and (G).

Current Sec. 225.6(c)(2)(i)(H) requires information from each site

on whether it is rural or non-rural, and whether the site's food

service will be self-prepared or vended. Realizing that sites tend to

remain in the same area and that sites, once established, typically

implement the same type of food service from year to year, the

Department believes this information is unnecessary for experienced

sponsors and sites. Therefore, this proposed rule will remove this

requirement for experienced sponsors and sites only. For new sponsors

and sites, and for sponsors and sites which have experienced

significant operational problems in the prior year, the requirement

will be relocated to Sec. 225.6(c)(2)(i)(F).

In accordance with Sec. 225.9(d)(7)(iii), meals served to

participants at rural or self-preparation sites are eligible to receive

additional administrative reimbursement. Thus, State agencies should

remind sponsors that a failure to report changes in site status or food

delivery service could result in over- or under-payments.

B. Site Information Sheet Requirements for Specific Types of Sites

Current Secs. 225.6(c)(2)(ii)-(v) set forth specific site

application requirements pertaining to how various types of sites

(e.g., open sites, camps, homeless feeding sites, and migrant sites)

document that they meet basic eligibility requirements. The

requirements, as currently set forth, are incomplete in several cases.

The Department therefore proposes to revise the information at current

Secs. 225.6(c)(2)(ii)-(v) and place it into new Secs. 225.6(c)(2) and

(3).

1. Area Eligible Sites--Open and Enrolled

Open sites are those at which meals are available to all children

in the area, and are located in areas in which at least 50 percent of

the children are from households that would be eligible for free and

reduced price meals under the School Programs. ``Open'' sites qualify

for participation in the SFSP on the basis of aggregate socioeconomic

data, typically obtained from schools or from census data, which

demonstrates that the area meets the 50 percent criterion described

above.

As defined in guidance issued to State agencies on April 23, 1992,

open enrolled sites exist where enrolled sites are initially open to

broader community participation, but the sponsor limits attendance for

reasons of security, safety, or control. The sponsor can document site

eligibility through the use of area school or census data, as ``open''

sites do. Sponsors of ``open enrolled'' sites must make it publicly

known, however, that the site is open on a first-come first-served

basis to all children of the community at large, and that the site's

total enrollment will be limited for reasons of security, safety, or

control. Examples of these sites may include recreation programs

sponsored by community organizations, and sites located in public

housing projects.

In order to clarify the requirements for each of the types of

sites, this rule proposes to amend Sec. 225.2 to include definitions of

``open site'' and ``open enrolled site,'' as described above. This rule

also proposes to amend the current definition of ``Areas in which poor

economic conditions exist'' at Sec. 225.2(a) to include explicit

reference to open and open enrolled sites as eligible on the basis of

school, census or other appropriate area data.

Current regulations at Sec. 225.6(c)(2)(ii)(B) should indicate that

``open'' sites and ``open enrolled'' sites, as defined above, must

submit documentation of area eligibility every other year. However,

while this is the case for those sites qualifying based on school data,

it is not true for sites qualifying on the basis of census data, since

census data are only collected and published every ten years.

Nevertheless, the Department believes that establishing a site's

eligibility every other year when using school data is unnecessary

since an area's socioeconomic status typically does not change rapidly.

Therefore, to clarify the requirements for documenting area eligibility

for ``open'' and ``open enrolled'' sites, and to alleviate unnecessary

burden for site eligibility documentation, this rule proposes to

include in new Sec. 225.6(c)(3)(i)(B) the requirement for experienced

sites that sponsors must obtain new documentation every three years

when elementary school data are used. When census data are used,

however, new documentation would be required only when new census data

are made available, or earlier if the State agency has reason to

believe that an area's socioeconomic status has changed significantly

since the last decennial census. It is important to note that this

proposed requirement is not intended to establish the implementation

year of this rule as the ``base year'' for site eligibility

determinations. Rather, it is intended to initiate time period

requirements that apply to when a site was last determined eligible for

``open'' or ``open-enrolled'' status. For example, under this proposal,

a site which last established its eligibility in 1997 would not be

required to re-establish eligibility until 2000. For new sites, the

current language in the introductory paragraph of Sec. 225.6(c)(2)(ii)

would be retained, but moved to new Sec. 225.6(c)(2)(i)(G).

However, the Department wishes to stress that, in determining the

eligibility of open sites and open enrolled sites, census data should

not be used when relevant, current-year information on free and reduced

price eligibility in neighborhood elementary schools is available.

School data are far more current than census data, which are collected

only once every ten years, and should more accurately represent current

neighborhood economic conditions. There may be certain, limited

circumstances which warrant the use of census data to establish site

eligibility, even when current-year school data are available. Examples

include situations where: (1) The potential site is located in a rural

area where geographically large school attendance areas may obscure

localized pockets of poverty which can be identified through the use of

census data; (2) school data show an area to be close to the 50 percent

threshold, and the census data may reveal specific portions of the

school's attendance area which are eligible for the SFSP; and (3)

bussing has affected the percentage of free and reduced price eligibles

in neighborhood schools, and the school is

[[Page 54623]]

unable to factor out the students bussed in from other areas and

provide the sponsor with data on the percentage of free and reduced

price eligibles in the school's immediate neighborhood. In any of these

situations, use of census data would be warranted to help a State

agency more precisely ascertain a neighborhood's current income poverty

status.

Closed enrolled sites are those which are only open to enrolled

children, not to the community at large, and in which at least 50

percent of the enrolled children at the site are eligible for free or

reduced price school meals, as determined by approval of applications

for meals. The provisions of current regulations regarding ``closed

enrolled'' sites are unclear. In 7 CFR part 225, enrolled sites are

referred to in Secs. 225.15(e) and 225.15(f)(1) as ``programs not

eligible under Sec. 225.2 (paragraph (a) of `areas in which poor

economic conditions exist').'' These sites are not specifically

mentioned at all in current Sec. 225.6(c)(2)(ii). The language in the

current regulations could be read to imply that any site except camps

and homeless feeding sites may submit documentation of eligibility

every other year. However, this is not true, since the number and

identity of the children attending a particular closed enrolled site

will likely vary from year to year, and a closed enrolled site's

Program eligibility is always predicated on at least 50 percent of

enrolled children being from free and reduced price households.

Therefore, this rule proposes to add a definition of ``closed

enrolled site,'' to revise the definition of ``Areas in which poor

economic conditions exist'' in Sec. 225.2 by adding specific reference

to open, open enrolled, and closed enrolled sites, and to clarify the

requirement in both new Secs. 225.6(c)(2)(i)(H) and (c)(3)(i)(C) that

site information sheets for closed enrolled sites must include the

projected number of children enrolled and the projected number of

children eligible for free and reduced price meals. The actual numbers

must be monitored carefully by State agency personnel during early-

Program visits in order to ensure that the 50 percent level is actually

reached.

National Youth Sports Program (NYSP) sites are a particular type of

site eligible to participate in the SFSP. Prior to the enactment of

Pub. L. 104-193, the Personal Responsibility and Work Opportunity

Reconciliation Act of 1996, NYSP sites were eligible to participate in

the SFSP during both the summer months and during the academic year

(October through April). However, Sec. 706(d) of Pub. L. 104-193

amended section 13(c) of the NSLA to eliminate academic-year NYSP sites

from the SFSP. This rule also removes references to academic year NYSP

sites under Sec. 225.6(e)(1), ``State-Sponsor Agreements.''

Section 225.6(c)(2)(v) of the current regulations requires that

site information sheets for NYSP sites include certification from the

sponsor on items related to streamlining applications for children who

participate in the NYSP during both the summer months and academic

year. Since academic-year NYSP sites are no longer eligible to

participate in the SFSP, this rule removes the certification

requirements pertaining to academic-year NYSP sites.

Section 225.6(c)(2)(v) of the current regulations also requires

sponsors of NYSP sites to certify that all of the children who will

receive SFSP meals are enrolled participants in the SFSP. Therefore,

this rule proposes to include this requirement in new

Secs. 225.6(c)(2)(i)(I) for new sponsors and sites, and for sponsors

and sites which experienced significant operational problems in the

prior year. However, the Department believes that requiring experienced

sponsors and sites to include this certification every year is

unnecessary.

Finally, this rule proposes to delete the redundant language at

Sec. 225.14(d)(1), which requires that sponsors for sites other than

camps or homeless feeding sites provide documentation of area

eligibility, since this requirement will be contained in revised

Secs. 225.6 (c)(2)(i)(G) and (c)(3)(i)(B).

2. Camps

Current regulations at Sec. 225.6(c)(2)(iii) require camps to

provide documentation showing the number of children enrolled in each

session who meet the Program's income standards. In a situation similar

to the closed enrolled sites discussed above, the children attending a

camp may change from year to year and from session to session. In

addition, camps only receive reimbursement for meals served to children

who are eligible for free and reduced price school meals. Therefore,

this rule retains the sponsor application information requirements in

current Sec. 225.6(c)(2)(iii) in new Sections 225.6(c)(2)(i)(J) and

(c)(3)(i)(D), and clarifies that camps are not required to submit the

individual free and reduced price applications to the State agency, but

rather the actual number of enrolled children who meet the Program's

income standards. Of course, all camps must have the individual free

and reduced price applications on file.

3. Migrant Sites

To demonstrate that they serve areas in which poor economic

conditions exist, Sec. 225.6(c)(2)(ii)(A) of the current regulations

specifies that sites which serve children of migrant workers may

provide ``data from an organization determined by the State agency to

be a migrant organization which supports the eligibility of those

children as a group.'' In the past, we have interpreted this

requirement to mean that a State migrant organization must have actual

statistical data which show that the families served by a specific site

are income eligible for participation in the SFSP. However, it has

become increasingly apparent that few State and local migrant

organizations have such data available.

Because of the difficulties inherent in documenting the income of

small groups of migrants, and the discernible poverty of migrant

workers as a whole, as documented by national studies and corroborated

by several Federal agencies that work directly with this population

group, we believe it is more appropriate to use national data to

support the eligibility of sites which serve children of migrant

workers. Therefore, as previously addressed in Departmental guidance

issued on March 12, 1993, and May 27, 1998, this rule proposes to

remove the migrant site documentation requirements in current

Sec. 225.6(c)(2)(ii)(A). For new sponsors and sites, and for those that

have experienced significant operational problems in the prior year,

this rule proposes to require in new Sec. 225.6(c)(2)(i)(K) that a

migrant site document its eligibility with certification from a migrant

organization which attests that the site serves children of migrant

worker families. If the site also serves non-migrant children, the

sponsor will also be required to certify that the site predominantly

serves migrant children. Although different families may be present

from year to year, the Department believes that migrant sites that

participate in the SFSP every year continue to serve the children of

migrant worker families. Therefore, this rule does not require

experienced sponsors and sites to include this certification.

4. Homeless Feeding Sites

For homeless feeding sites, current regulations at

Sec. 225.6(c)(2)(iv) require the submission of information sufficient

to document that the site is not a residential child care institution,

and

[[Page 54624]]

that the site's primary purpose is to provide shelter and one or more

meal services per day to homeless families. Sponsors also are required

to describe the methods used to ensure that cash payments, food stamps,

and in-kind services are not received for any SFSP meal served to

children at these sites. The Department believes that the above

information continues to be important for new sponsors and sites, and

for sponsors and sites which have experienced significant operational

problems in the prior year.

Current Sec. 225.14(d)(5) also contains the requirement that

sponsors of homeless feeding sites provide documentation that the site

is not a residential child care institution, as well as certification

that such sites employ meal counting methods which ensure that

reimbursement is claimed only for meals served to children (homeless

and non-homeless). This rule proposes to relocate the requirement for

documentation of nonresidential status and certification of meal

counting methods to new Sec. 225.6(c)(2)(i)(L) for new sponsors and

sites and for sponsors and sites which have experienced significant

operational problems in the prior year, and to delete Sec. 225.14(d)(5)

as duplicative. However, this information is not necessary for

experienced sponsors and sites since, once established, the status of

the site (as nonresidential) and meal counting methods, typically do

not change. Therefore, this proposed rule would remove the requirement

for experienced sponsors and sites.

Accordingly, this rule proposes to amend Sec. 225.14(d) by deleting

paragraph (d)(1) (as discussed under ``Area eligible sites'' above), by

deleting paragraph (d)(5), and by redesignating paragraphs (d)(2)

through (d)(4), and (d)(6) through (d)(7) as paragraphs (d)(1) through

(d)(5), respectively.

C. Other Requirements for Sponsor Applications

Current Sec. 225.6(c)(2)(vi) requires that sponsor applications

include information in sufficient detail to enable the State agency to

determine whether the sponsor meets the criteria for Program

participation outlined in Sec. 225.14; the extent of Program payments

needed; and a staffing and monitoring plan. For new sponsors and

sponsors which, in the determination of the State agency, have

experienced significant operational problems in the prior year, this

rule retains in proposed new Sec. 225.6(c)(2)(ii)(A) the requirement in

the first clause of current Sec. 225.6(c)(2)(vi) that applications

include information for determining sponsor eligibility. However, such

information would not be necessary for experienced sponsors (i.e.,

sponsors that have been determined eligible and have successfully

participated in the Program in the prior year). Consequently, this rule

proposes to delete the collection of that information for experienced

sponsors. This rule retains, for all sponsors, in new

Secs. 225.6(c)(2)(ii)(A) and (c)(3)(ii)(A), the current requirements

for estimating Program payments, requesting advance or start-up funds,

if applicable, and submitting the staffing and monitoring plan in the

application.

In accordance with Sec. 225.6(c)(2)(vii), a sponsor's application

must also currently include a complete administrative and operating

budget for State agency review and approval each year. Unquestionably,

administrative and operating budgets should be updated each year the

Program is in operation, not only to ensure that Federal funds are

properly spent, but also to help sponsors determine whether their

planned expenditures will be adequately funded under the SFSP's

``lesser of costs versus rates'' funding formula. Accordingly, this

rule retains, but relocates the requirements in current

Sec. 225.6(c)(2)(vii) to new Secs. 225.6(c)(2)(ii)(B) and

(c)(3)(ii)(B).

Current Sec. 225.6(c)(2)(viii) requires that a sponsor submit ``[a]

plan for and a synopsis of its invitation to bid for food service, if

an invitation to bid is required under Section 225.15(g).'' The wording

of this regulation is somewhat ambiguous, leaving unclear whether

sponsors must always summarize their plans for obtaining meals.

Therefore, to clarify this point, this rule proposes to add in new

Sec. 225.6(c)(2)(ii)(C) the requirement that new sponsors and sponsors

which have experienced significant operational problems in the prior

year, as determined by State agencies, submit a summary of how meals

will be obtained (e.g., self-prepared at each site, self-prepared and

transported from a central kitchen, purchased from a school food

authority, competitively procured from a food service management

company, or some combination of these or other methods). In addition,

if an invitation to bid is required under Section 225.15(g), new

sponsors and sponsors which have experienced significant operational

problems in the prior year will be required to submit a schedule for

bid dates, and a copy of their invitation for bid (IFB). Under proposed

Sec. 225.6(c)(3)(ii)(C), experienced sponsors will be required to

submit the bid schedule each year, but will only be required to submit

a summary of their meal service and their IFB if they are changing

their method of procuring meals or their IFB.

Section 225.6(c)(2)(ix) of the current regulations requires

submission by sponsors of a free meal policy statement. Since such a

statement already is required and further explained in current

Sec. 225.6(c)(3) (redesignated Sec. 225.6(c)(4) by this rule), the

Department is proposing to delete current Sec. 225.6(c)(2)(ix) as

redundant.

Section 225.6(c)(2)(x) of the current regulations requires that

sponsors that seek to operate the Program as units of local, municipal,

county or State government, or as private nonprofit organizations,

provide certification in their annual applications that they will have

direct operational control over the Program, as further defined in

Sec. 225.14(d)(4). Realizing that experienced sponsors typically

implement the same, continual, service from year to year, it is the

Department's belief that this information also remains constant.

Therefore, this rule proposes to delete this requirement for

experienced sponsors and sites, and to relocate this requirement to new

Sec. 225.6(c)(2)(ii)(D) for new sponsors.

Finally, current Sec. 225.6(c)(3), which has been redesignated as

Sec. 225.6(c)(4) by this proposed rule, requires that all sponsors,

regardless of type, submit a statement of their policy for serving free

meals at all sites under their jurisdiction. This Section also

contains, in paragraph (ii), additional requirements for policy

statements for camps that charge separately for meals. The requirements

for all sponsors are contained in the introductory paragraph and in

paragraph (i). For improved organizational purposes, this rule proposes

to amend redesignated Sec. 225.6(c)(4) by combining the introductory

paragraph with paragraph (i) under new Section 225.6(c)(4)(i).

III. State Agency Monitoring Requirements

As is true of the sponsor and site application requirements

discussed above, the monitoring provisions contained in the current

regulations are minimum standards. State agencies and sponsors may

elect to conduct additional reviews, outside of the prescribed

requirements, to ensure compliance with Program requirements.

The current regulations contain various minimum requirements for

monitoring of SFSP sites by sponsors. For example, a sponsor in the

SFSP must: (1) Certify prior to submitting its application that all

proposed sites have been visited (Sec. 225.14(c)(6)); (2) visit each

site at least once during the first

[[Page 54625]]

week of operation (Sec. 225.15(d)(2)); and (3) formally review food

service operations at each site at least once during the first four

weeks of operation, and at reasonable intervals thereafter

(Sec. 225.15(d)(3)). This proposed rule will not make revisions to the

monitoring requirements for sponsors because we believe that the

current requirements are reasonable and necessary for efficient and

effective operation of the Program.

Given the critical importance of monitoring as a tool for effective

Program management, this rule also does not propose to lessen the

overall effort currently expended by State agencies in their monitoring

of sponsors. However, the Department believes that current monitoring

requirements do not afford State agencies sufficient flexibility to

determine where to focus their monitoring resources. The current State

agency monitoring requirements and our proposed changes to these

requirements are discussed in detail below.

A. Pre-Approval Visits

Section 225.7(d)(1) of the current regulations requires the State

agency to conduct pre-approval visits of all applicant sponsors which

did not participate in the SFSP in the prior year, with the exception

of school food authorities which have been reviewed by the State agency

under the National School Lunch Program during the preceding 12 months

and had no significant deficiencies noted. State agencies may conduct

pre-approval visits of these school food authority sponsors at their

discretion. State agencies also exercise discretion in conducting pre-

approval visits for all sponsors which had operational problems noted

in the prior year.

Current Sec. 225.7(d)(1) further requires each State agency to

conduct pre-approval visits of all new nonschool sites with an expected

average daily attendance of 300 children or more, and all new sites

administered by private nonprofit organization sponsors with an

expected average daily attendance of 100 children or more.

Since there is considerable variation among State agencies with

regard to what constitutes a ``large'' site, the Department believes

that requiring a State agency to conduct monitoring visits, based on

the number of attending children, may be ineffective. Furthermore,

State agencies have first-hand experience and knowledge of sponsors

with problem-prone sites. Therefore, in order to provide maximum State

flexibility while ensuring sufficient program oversight, we are

retaining the current requirements in Secs. 225.7(d)(1)(i) and (ii) for

State agency pre-approval visits of sponsors (except for the change

proposed in Section I (C)(3) of the preamble above), but are proposing

to amend Sec. 225.7(d)(1)(iii) and to remove Sec. 225.7(d)(1)(iv) to

make pre-approval visits of sites by State agencies discretionary.

B. Sponsor and Site Reviews

Section 225.7(d)(2)(i) of the current regulations requires that,

within the first four weeks of operation, State agencies conduct a

review of sponsor operations, and review an average of 15 percent of

sponsors' sites (with a minimum of one site reviewed per sponsor) for:

(1) New private nonprofit organizations which administer only urban

sites and have three or more urban sites; (2) any new sponsor which has

10 or more sites; and (3) any other private nonprofit organization, and

any other sponsor with 10 or more sites, which the State agency

determines need early reviews. Section 225.7(d)(2)(iii) requires State

agencies to conduct reviews, at any time during the Program year, of an

average of at least 15 percent of the sites of all remaining sponsors

with 10 or more sites; and, for 70 percent of remaining sponsors with

fewer than 10 sites, an average of at least 10 percent of their sites.

Finally, Sec. 225.7(d)(2)(ii) requires that State agencies review all

academic-year NYSP sponsors, and at least one of their sites, during

the period October through April. This rulemaking proposes a number of

changes to these existing requirements.

First, this rule proposes to eliminate the special requirements in

Sec. 225.7(d)(2)(i) for State agency review of private nonprofit

organizations described above. The Department believes that the

additional level of monitoring required by Congress for private

nonprofit organizations under section 13(p)(1) of the NSLA is

satisfactorily provided under the current Federal review system. In

addition, although Pub. L. 103-448 maintained this special Federal

monitoring of private nonprofit organizations, it made a number of

other changes to the rules governing their program participation which

demonstrate Congressional intent to now recognize that, as a result of

additional Federal monitoring and training materials, these

organizations are more capable of properly administering the SFSP. (For

example, section 114(b) of Pub.L. 103-448 amended section 13(a)(7) of

the NSLA to eliminate the one year waiting period formerly imposed on

private, nonprofit organizations in some areas for participation in the

SFSP). Therefore, this rule proposes to eliminate the current

requirements for State-level review of new urban private nonprofit

organizations with three or more sites during the first four weeks of

program operation, as set forth at current Sec. 225.7(d)(2)(i)(A).

In addition, as indicated earlier in this preamble, Pub. L. 104-193

removed the participation of academic-year NYSP sites from SFSP.

Therefore, this proposed rule would remove the review requirement for

these sponsors in Sec. 225.7(d)(2)(ii).

Also, in order to streamline and simplify the current general

monitoring requirements and provide increased flexibility to State

agencies, this rule proposes to revise the minimum State agency review

requirements for sponsors and their sites. This proposal would require

the State agency to review every new sponsor, as defined in Sec. 225.2

of this proposed rule, at least once during its first year of

operation. State agencies would also be required under this proposed

rule to review each year every sponsor with 20 or more sites, and every

sponsor which, in the determination of the State agency, experienced

significant operational problems in the prior year. In place of the

current requirement that reviews of certain sponsors take place in the

first four weeks of operation, the timing of reviews of these sponsors

would be at the discretion of the State agency, with the stipulation

that sponsors with large sites, larger numbers of sites, or significant

operational problems in the prior year, be reviewed earlier. Finally,

all sponsors would be required to be reviewed by the State agency at

least once every three years.

The Department believes that these new proposed requirements better

target State agency reviews by restricting required reviews in a given

year to new and large sponsors, which monitoring data indicate are the

most problem-prone sponsors in the SFSP, and those which experienced

significant operational problems in the prior year. They also provide

an updated and more realistic definition of ``large'' sponsors (those

administering more than 20 sites), and permit State agencies to review

experienced sponsors with fewer than 20 sites as infrequently as once

every three years, at the State agency's discretion. This rule should

not result in a reduction in a State agency's monitoring efforts.

Rather, it is intended that the State agency's monitoring resources

would become more targeted to reviews of new sponsors and sponsors of

over 20 sites, and other sponsors the State agency identifies, and that

a correspondingly greater amount of

[[Page 54626]]

State agency time and effort could be spent in conducting such reviews.

In addition, this rule proposes to amend Sec. 225.7(d)(2) by adding

language which recommends that State agencies prioritize other review

efforts to target all other sponsors which increase their total number

of sites by five or more from one year to the next, or whose

participation increases substantially from one year to the next. Such

targeting is important since smaller, experienced sponsors (those with

20 or fewer sites) which add a number of new sites or additional

children at the same time may experience difficulties administering a

Program which is significantly larger than the prior year's Program.

For reviews of sites, this rule proposes to amend Sec. 225.7(d)(2)

by requiring that, as a part of each sponsor review, the State agency

also conduct annual reviews of at least 10 percent of the sponsor's

sites or one site, whichever number is greater. This revision will

further simplify the current requirements, while providing a reasonable

sample size and a guarantee that at least one site for each sponsor

will be reviewed.

The Department expects that State agencies will use this increased

flexibility to properly target their reviews to ensure program

accountability and integrity. Each State's level of resources devoted

to monitoring should remain the same under these revised regulations.

Improved targeting of the resources will ensure better program

oversight with the same level of resource commitment.

Accordingly, this rule proposes to completely revise the review

requirements in current Secs. 225.7(d)(2)(i)-(iii) and to replace them

with the new requirements discussed above.

List of Subjects in 7 CFR Part 225

Food and Consumer Service, Food assistance programs, Grant

programs-health, Infants and children, Labeling, Reporting and

recordkeeping requirements.

Accordingly, 7 CFR Part 225 is proposed to be amended as follows:

PART 225--SUMMER FOOD SERVICE PROGRAM

The authority citation for part 225 continues to read as follows:

Authority: Secs. 9, 13 and 14, National School Lunch Act, as

amended (42 U.S.C. 1758, 1761, and 1762a).

2. In Sec. 225.2:

a. New definitions of Closed enrolled site, Experienced site,

Experienced sponsor, New site, New sponsor, Open enrolled site, and

Open site are added in alphabetical order; and

b. The definition of Areas in which poor economic conditions exist

is revised.

The additions and revision read as follows:

Sec. 225.2 Definitions.

* * * * *

Areas in which poor economic conditions exist means:

(a) The local areas from which an open or open enrolled site draws

its attendance in which at least 50 percent of the children are

eligible for free or reduced price school meals under the National

School Lunch Program and the School Breakfast Program, as determined.

(1) By information provided from departments of welfare, education,

zoning commissions, census tracts, and organizations determined by the

State agency to be migrant organizations;

(2) By the number of free and reduced price lunches or breakfasts

served to children attending public and nonprofit private schools

located in the areas of Program sites; or

(3) From other appropriate sources; or

(b) A closed enrolled site.

* * * * *

Closed enrolled site means a site which is open only to enrolled

children, as opposed to the community at large, and in which at least

50 percent of the enrolled children at the site are eligible for free

or reduced price school meals under the National School Lunch Program

and the School Breakfast Program, as determined by approval of

applications in accordance with Sec. 225.15(f) of this part.

* * * * *

Experienced site means a site which, as determined by the State

agency, has successfully participated in the Program in the prior year.

Experienced sponsor means a sponsor which, as determined by the

State agency, has successfully participated in the Program in the prior

year.

* * * * *

New site means a site which did not participate in the Program in

the prior year, or, as determined by the State agency, a site which has

experienced significant staff turnover from the prior year.

New sponsor means a sponsor which did not participate in the

Program in the prior year, or, as determined by the State agency, a

sponsor which has experienced significant staff turnover from the prior

year.

* * * * *

Open enrolled site means an enrolled site which is initially open

to broad community participation, but at which the sponsor limits

attendance for reasons of security, safety, or control. Site

eligibility for an open enrolled site shall be documented in accordance

with paragraph (a) of the definition of Areas in which poor economic

conditions exist.

Open site means a site at which meals are made available to all

children in the area and which is located in an area in which at least

50 percent of the children are from households that would be eligible

for free or reduced price school meals under the National School Lunch

Program and the School Breakfast Program, as determined in accordance

with paragraph (a) of the definition of Areas in which poor economic

conditions exist.

* * * * *

3. In Sec. 225.6:

a. Paragraph (b)(1) is amended by adding a new sentence at the end;

b. Paragraph (b)(4) is revised;

c. Paragraph (c)(1) is amended by adding a new sentence after the

first sentence;

d. Paragraph (c)(2) is revised;

e. Paragraphs (c)(3) and (c)(4) are redesignated as paragraphs

(c)(4) and (c)(5), respectively, and a new paragraph (c)(3) is added;

f. Newly redesignated paragraph (c)(4) is amended by removing

paragraph (c)(4) introductory text and adding it as the first sentence

in newly redesignated paragraph (c)(4)(i); the paragraph is further

amended by removing the reference to ``(c)(4)'' in paragraph

(c)(4)(ii)(D) and adding in its place a reference to ``(c)(5)'.

g. Paragraph (d)(1)(ii) is amended by removing the word ``and'' at

the end of the paragraph;

h. Paragraph (d)(1)(iii) is amended by removing the period at the

end of the paragraph and adding in its place the word ``; and'';

i. A new paragraph (d)(1)(iv) is added;

j. Paragraph (e)(1) is revised.

The additions and revisions read as follows:

Sec. 225.6 State agency responsibilities.

* * * * *

(b) * * *

(1) * * * Sponsors applying for participation in the Program due to

an unanticipated school closure during the period from October through

April shall be exempt from the application submission deadline.

* * * * *

(4) The State agency shall determine the eligibility of applicant