Procedures for Unused Federal Admin. Payments

This Management Bulletin (MB) provides updated guidance to the Child and Adult Care Food Program (CACFP) day care home (DCH) sponsors on the procedures for retaining or returning unused federal administrative payments (UFAP) each program year (PY).

Background

In March 2012, the U.S. Department of Agriculture (USDA) issued Policy Memorandum CACFP 11-2012, which allowed state agencies to provide options to DCH sponsors for monthly administrative payments. There are three administrative payment options:

• Total homes claimed by the current rates
• Actual costs (not to exceed total homes claimed by the current rates)
• No administrative payments

For additional information about these three administrative payment options, please refer to the California Department of Social Services (CDSS) MB USDA-CACFP-10-2013.

DCH sponsors are responsible for correctly accounting for all income and costs, as well as maintaining records and sufficient supporting documentation to demonstrate that costs claimed have been incurred, are allowable, and comply with all applicable CACFP regulations and policies.

The UFAP maximum carryover amount of 10 percent of administrative payments received during the PY is limited to only those DCH sponsors that selected option 1 above for calculating administrative payments, total homes claimed by the current rates.

Every year by December 10, sponsors with any UFAP must complete and submit the UFAP spreadsheet to request carryover into the following PY. Any UFAP in excess of 10 percent of the federal administrative payments received during the PY must be returned to the CDSS by December 10.

The following procedures only apply to any DCH sponsors that choose option 1 above for receiving administrative payments any time during the PY. Options 2 and 3 do not have UFAP if selected for the entire PY. DCH sponsors are not required to carryover any UFAP. However, if they choose not to carryover any UFAP, they must repay the entire amount of the UFAP to the CDSS by December 10.

Calculating Available UFAP for Carryover

DCH sponsors are allowed to carryover up to 10 percent of the federal administrative payments they received during the PY. For example, if a DCH sponsor received $100,000 in federal administrative payments during PY 2016–17, the sponsor is eligible to carryover up to $10,000 of the UFAP into PY 2017–18.

The CDSS uses the following calculation to determine the amount of UFAP (if any) a sponsor has at the end of each PY:

1. PY federal administrative payments received plus approved carryover from the previous PY (if any) equals total federal administrative payments
2. Actual administrative costs
3. Total federal administrative payments minus actual administrative costs equals UFAP

The following criteria apply to DCH sponsors’ use of available UFAP:

• If the UFAP available to carryover are equal to or less than 10 percent of the federal administrative payments received during the PY, the sponsor may carryover all of the UFAP with a request to the CDSS by December 10.

• If the available UFAP to carryover are greater than 10 percent of the federal administrative payments received during the PY, the sponsor may carryover up to 10 percent of the federal administrative payments and must return any amount in excess of the 10 percent limit by December 10.

• If the sponsor chooses to carryover less than the full 10 percent, they must return all UFAP to the CDSS that they choose not to carryover by December 10.

Example: A DCH sponsor receives $100,000 in administrative payments during PY 2016–17, had approved $8,000 carryover from previous PY 2015–16, and has $85,000 in actual administrative costs. The following table illustrates the CDSS’s calculation of available UFAP to carryover:

When applying the calculation of the 10 percent maximum described above, the sponsor may only carryover $10,000 (10 percent of the federal administrative payments received in PY 2016–17) into the following PY. The DCH sponsor must return the $13,000 that exceeds the 10 percent allowable carryover to the CDSS by December 10. Alternatively, if the DCH sponsor chooses not to carryover any of the UFAP, it must return the entire $23,000 to the CDSS by December 10.

To ensure carryover payments are used for CACFP administrative costs in the following PY, DCH sponsors must use these payments on a first-in, first-out basis after receiving approval from the sponsor’s assigned DCH specialist to carryover the UFAP to the following PY.

UFAP Procedure for Approval of Carryover

Between October 1 and December 10 every year, each DCH sponsor requesting carryover using option 1, the total homes claimed by the current rates, must complete and submit the UFAP worksheet, the first tab of the DCH administrative budget workbook.

The UFAP worksheet calculates the UFAP and the allowable amount to carryover to the next PY (if any). The UFAP worksheet includes directions on the actions necessary to complete and submit by e-mail the required documents to the assigned DCH specialist.

The DCH sponsor cannot submit the UFAP spreadsheet until all prior closing year claims are submitted in the Child Nutrition Information and Payment System (CNIPS).

This procedure is for UFAP carryover for processing and approval only. Revisions to the budget require a separate submission.

After the December 10 deadline, the DCH specialist cannot change the approved carryover amount.

Returning UFAP

By December 10 of each year, any DCH sponsors returning UFAP to the CDSS must complete and submit the UFAP form (Form ID DCH 07) located in the Download Forms section of the Child Nutrition Information and Payment System (CNIPS). Mail the UFAP form, with a personal or cashier’s check containing your agency’s vendor number, to the CDSS’ Cashier Office. Note: The CDSS Cashier Office’s mailing address is pending review. We are working diligently to get this updated as soon as possible.

Note: The CDSS will charge a $25 fee if a check is returned for nonpayment.

When returning UFAP, DCH sponsors are also required to email their assigned DCH specialist a scanned copy of the completed UFAP form.

Consequences of Late or Unreturned UFAP

• If the CDSS does not receive the UFAP by December 10, the CDSS may deduct the UFAP from the DCH sponsor’s claim for reimbursement. The UFAP deduction may delay delivery of the DCH sponsor’s administrative and provider payments by up to four weeks.

• For DCH sponsors with UFAP, failure to submit UFAP and associated documents by December 10 of each year may result in the CDSS declaring the DCH sponsor seriously deficient.

Contact Information

If you have any questions regarding this subject, please contact your assigned CACFP DCH specialist. A list of the CACFP DCH sponsor specialists is available on the Child and Adult Food Care Program Contact List. You can also contact the CACFP Office Technician by email at CACFPinfo@dss.ca.gov to be directed to your assigned DCH specialist.

This institution is an equal opportunity provider.

Esta institución es un proveedor que ofrece igualdad de oportunidades.