Prior Approval for CACFP Allowable Costs

This management bulletin (MB) provides clarification on the required prior approval of allowable costs in the Child and Adult Care Food Program (CACFP). The U.S. Department of Agriculture (USDA) Food and Nutrition Service (FNS) Instruction 796-2, Revision 4, establishes guidelines for the financial management of CACFP funds. These guidelines include, but are not limited to, information on CACFP allowable costs, and the level of approval required for such costs. As a reminder, all costs, including food, require prior approval before the cost is incurred. Some expenses require specific prior written approval by the California Department of Social Services (CDSS) or the FNS, depending on the nature of the cost. An agency’s failure to obtain prior approval, or specific prior written approval, for any CACFP cost will result in findings during the administrative review and audit processes. As with all findings, significant noncompliance may result in declaring an agency seriously deficient.

Prior Approval

For expenses that require prior approval, the cost must be approved on the appropriate budget line in the Child Nutrition Information and Payment System (CNIPS). CDSS approved budgets, therefore, must be based on real CACFP costs. In the CNIPS, agencies must submit budget revisions and obtain CDSS approval prior to exceeding a budget line in the original approved annual budget.

Because the CDSS considers a school food authority’s (SFA) successful operation of the National School Lunch Program as sufficient evidence of administrative capability and financial viability, SFAs are not required to submit budgets for the At-risk Afterschool Meals Component of the CACFP. This exemption, however, only applies to costs that require prior approval, and not to costs that require specific prior written approval. For more information, see the California Department of Education (CDE) MB CACFP-06-2014, Streamlining CACFP At-risk Afterschool Meal Participation for SFAs.

Specific Prior Written Approval

CACFP allowable costs that require specific prior written approval must be approved in writing by the CDSS or the FNS. Effective February 23, 2017, for SFAs on the CACFP, specific prior written approval is not required for equipment ($5,000 or more per unit) detailed on the USDA Capital Expenditure Approved List. You can find this list on the CDE Capital Expenditure Approved List.

Questions

If you have any questions regarding this subject, please contact your CACFP specialist. A contact list of CACFP specialists is available on the Child and Adult Food Care Program Contact List or in the Download Forms section of the Child Nutrition Information & Payment System (CNIPS), Form ID CACFP 01. You can also contact the CACFP Office Technician email at CACFPinfo@dss.ca.gov to be directed to your CACFP specialist.

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