[Federal Register Volume 59, Number 69 (Monday, April 11, 1994)]
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From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8505]
Federal Register / Vol. 59, No. 69 / Monday, April 11, 1994 /
[[Page Unknown]]
[Federal Register: April 11, 1994]
VOL. 59, NO. 69
Monday, April 11, 1994
DEPARTMENT OF AGRICULTURE
Food and Nutrition Service
7 CFR Parts 250 and 251
Donation of Foods for Use in the United States, Its Territories
and Possessions and Areas Under Its Jurisdiction (Soup Kitchens and
Food Banks), and the Emergency Food Assistance Program
AGENCY: Food and Nutrition Service, USDA.
ACTION: Final rule.
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SUMMARY: This final rule amends the Food Distribution Program
Regulations and the Emergency Food Assistance Program (TEFAP)
Regulations to codify previously proposed food distribution provisions
contained in the Hunger Prevention Act of 1988 and several
nondiscretionary food distribution requirements contained in the Food,
Agriculture, Conservation, and Trade Act of 1990, and the Food,
Agriculture, Conservation, and Trade Act Amendments of 1991. The
statutory requirements contained in this final rule address:
Distribution of additional commodities to emergency feeding
organizations, soup kitchens, and food banks; use of Emergency Food
Assistance Program administrative funds; State and local maintenance-
of-effort requirements; priority in the distribution of commodities to
existing networks and organizations under TEFAP; and explicit inclusion
of hospitals and facilities caring for needy infants and children as
charitable institutions. In addition to codifying provisions contained
in the above laws, this final rule implements previously proposed
discretionary changes initiated by the Department in order to reduce
the administrative burden imposed upon State agencies and to make the
Department's regulations more consistent.
EFFECTIVE DATE: This final rule is effective May 11, 1994.
FOR FURTHER INFORMATION CONTACT: Philip K. Cohen, Chief, Program
Administration Branch, Food Distribution Division, 3101 Park Center
Drive, room 502, Alexandria, Virginia 22302, telephone (703) 305-2662.
SUPPLEMENTARY INFORMATION:
Classification
Executive Order 12866
This final 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 final rule
will not have a significant economic impact on a substantial number of
small entities. Most of the new provisions in this rule affect State
agencies. While some of the recipient agencies affected by this rule
may be considered ``small entities,'' the cost of compliance with the
changes in this rule will be minimal because the time and cost of
preparing any paperwork relative to participation will be very limited.
Executive Order 12372
These programs are listed in the Catalog of Federal Domestic
Assistance under 10.550 and 10.568 and are subject to the provisions of
Executive Order 12372, which requires intergovernmental consultation
with State and local officials (7 CFR part 3015, subpart V and the
final rule-related notices published at 48 FR 29114, June 24, 1983 and
49 FR 22676, May 31, 1984).
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1980 (44 U.S.C.
3507), additional recordkeeping and reporting requirements contained in
this final rule are subject to review and approval by the Office of
Management and Budget. Current reporting and recordkeeping requirements
were approved under Control Number 0584-0293.
Statutory Effective Dates
The provisions of the Hunger Prevention Act of 1988, Public Law
100-435, on the following subjects were effective September 19, 1988:
(1) The distribution of additional commodities for use by emergency
feeding organizations, soup kitchens and food banks; (2) the use of
TEFAP administrative funds for the costs of providing recipients
information on commodity storage and handling; (3) the distribution of
commodities that have been donated by persons or entities other than
USDA by emergency feeding organizations; (4) the increase in the amount
of TEFAP administrative funds passed through by States to emergency
feeding organizations from 20 percent to 40 percent; (5) the use of
volunteer workers for the distribution of non-USDA commodities by State
agencies and emergency feeding organizations; (6) State and local
maintenance-of-effort requirements; and (7) the authority for States to
give priority to existing networks and organizations that distribute
food to low-income households when distributing commodities under TEFAP
(as reflected in Secs. 250.3 (definitions of ``soup kitchen'' and
``food bank''), 250.52, 251.3 (definition of ``formula''), 251.4
(c)(3), (h) and (i), 251.6(a)(4), 251.7(a), 251.8(d), 251.10 (e)(7),
(g) and (h) of this final rule).
The provisions of the Food, Agriculture, Conservation, and Trade
Act of 1990, Public Law 101-624, relating to the use of TEFAP
administrative funds for repackaging and processing certain commodities
and the specific inclusion of hospitals and facilities caring for needy
infants and children in the definition of charitable institutions (as
reflected in Secs. 251.8(d)(1)(i) and 250.3 (definition of ``charitable
institution'') of this final rule) were effective November 28, 1990.
The provision of the Food, Agriculture, Conservation, and Trade Act
Amendments of 1991, Public Law 102-237, establishing a priority system
for the distribution of commodities to soup kitchens and food banks (as
reflected in Sec. 250.52(a) of this final rule) was effective February
2, 1992. Affected parties should already be complying with the mandates
of this legislation.
Good Cause Determinations
This final rule incorporates several new statutory requirements
which were not contained in a prior proposed rule: The nondiscretionary
requirements of the Food, Agriculture, Conservation, and Trade Act of
1990, Public Law 101-624, that address the specific inclusion of
hospitals and facilities caring for needy infants and children in the
definition of charitable institutions, and the allowable use of TEFAP
administrative funds to pay costs incurred for the processing and
repackaging of TEFAP commodities. It also incorporates the
nondiscretionary requirements of the Food, Agriculture, Conservation,
and Trade Act Amendments of 1991, Public Law 102-237, that establish a
priority system for the distribution of section 110 commodities. In
light of the nondiscretionary nature of these requirements and since
the legislatively mandated effective dates of these requirements were
November 28, 1990, and February 1, 1992, respectively, the
Administrator of FNS has found, in accordance with 5 U.S.C. 553(b),
that prior notice and comment are impracticable, unnecessary and
contrary to the public interest, and that good cause exists for
publishing revisions to Secs. 250.3 (definition of ``charitable
institution''), 250.52(a), and 251.8(d)(1)(i) without prior public
notice and comment. This final rule also amends Sec. 251.10(e)(2)(ii)
to revise the current requirement that monitoring visits of
distribution sites must be conducted simultaneously with actual
commodity distribution and/or eligibility determinations. It has come
to the Department's attention that it is not always possible for
reviews to be conducted in a manner that meets this requirement.
Accordingly, this rule amends Sec. 251.10(e)(2)(ii) to require that
reviews be conducted simultaneously with actual distribution and/or
eligibility determinations only to the maximum extent feasible. Since
this change serves to reduce the administrative burden currently
imposed on State agencies, the Administrator has found, in accordance
with 5 U.S.C. 553(b), that prior notice and comment are impracticable,
unnecessary and contrary to the public interest and that good cause
exists for publishing revisions to Sec. 251.10(e)(2)(ii) without prior
public notice and comment.
Executive Order 12778
This final rule has been reviewed under Executive Order 12778,
Civil Justice Reform. This 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 this preamble.
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
distributing and recipient agencies, this includes any administrative
appeal procedures to the extent required by 7 CFR Part 3016.
Background
As stated above, this final rule incorporates into program
regulations certain nondiscretionary requirements of the Food,
Agriculture, Conservation and Trade Act of 1990 (the FACT Act), Public
Law 101-624, and the Food, Agriculture, Conservation, and Trade Act
Amendments of 1991 (the FACT Act Amendments), Public Law 102-237. With
the exception of the provisions relating to the requirements of Public
Law 101-624 and Public Law 102-237, and a modification to the
monitoring requirement for distribution sites, all provisions of this
final rule were published in a proposed rule on April 6, 1990 (55 FR
12838). That proposal and the public comments submitted to the
Department on discretionary provisions are discussed below.
Food, Agriculture, Conservation, and Trade Act of 1990
The FACT Act was enacted on November 28, 1990. The major purposes
of Title XVII of the FACT Act were to reauthorize and improve the Food
Stamp Program and certain Food Distribution Programs. This rulemaking
implements the nondiscretionary provisions contained in the FACT Act
that relate to the domestic distribution of commodities. The provisions
that affect the Food Stamp Program have been implemented through
several separate rulemakings. In addition, separate rulemakings are
being promulgated to incorporate the discretionary domestic commodity
provisions included in the FACT Act into the Department's regulations.
In accordance with the provisions of the FACT Act, this final rule
amends current regulations to: (1) Delete the word ``Temporary'' from
the title of the Emergency Food Assistance Program; (2) explicitly
include hospitals and facilities caring for needy infants and children
in the definition of charitable institutions; and (3) permit the use of
TEFAP administrative funds to pay costs associated with the processing
and repackaging of TEFAP commodities. Following is a detailed
discussion of the regulatory changes being made in this final rule to
reflect these provisions.
Change in Program Name (Part 251)
Section 1772(a) of the FACT Act struck the word ``Temporary'' from
the title of the authorizing legislation contained in Public Law 98-8
and renamed the short title, ``Title II--Emergency Food Assistance Act
of 1983.'' In order to avoid confusion during the following
discussions, the incorporation of this change in the Department's
references to the law, the program name, and the commonly-used acronym
need to be clarified. Due to this change, the authorizing legislation
will be referred to hereinafter as EFAA instead of TEFAA. In addition,
the program's name has changed from the Temporary Emergency Food
Assistance Program to the Emergency Food Assistance Program. In
response to this legislative change, this final rule changes the title
of 7 CFR Part 251 by deleting the word ``Temporary.'' However, the
Department has decided to continue to use the program's original
acronym, TEFAP, and now will refer to ``the Emergency Food Assistance
Program'' whenever the acronym needs to be established.
Charitable Institution Definition (Sec. 250.3)
Section 1771(b) of the FACT Act amended section 4(a) of the
Agriculture and Consumer Protection Act of 1973 (Public Law 93-86; 7
U.S.C. 612c note) and section 416(a)(3) of the Agricultural Act of 1949
(7 U.S.C. 1431(a)(3)) to explicitly include hospitals and facilities
caring for needy infants and children in the category of institutions
eligible for commodity donations under these authorities. While these
institutions are, by definition, eligible to receive donations as
charitable institutions under current regulations, Sec. 250.3 of this
final rule is nonetheless being amended to specifically identify these
institutions in the definition of charitable institutions.
Repackaging and Processing Costs (Sec. 251.8(d)(1)(i))
Section 1772(d) of the FACT Act amended section 204 of the EFAA to
permit emergency feeding organizations to use TEFAP administrative
funds to pay costs associated with the repackaging and processing of
USDA commodities that are made available under the EFAA and section 110
of the Hunger Prevention Act of 1988 (Hunger Prevention Act). This
final rule revises Sec. 251.8(d)(1)(i) to incorporate this
nondiscretionary legislative mandate. For further discussion of this
provision, please refer to ``Restructuring of Administrative Cost
Provisions'' later in this preamble.
Hunger Prevention Act of 1988
In addition to certain nondiscretionary provisions in the FACT Act
and the FACT Act Amendments, this final rule incorporates certain
requirements contained in the Hunger Prevention Act. The major purposes
of the Hunger Prevention Act are to require the Secretary to purchase
additional commodities for distribution to low-income households,
improve the Child Nutrition and Food Stamp Programs, and provide other
hunger relief to needy households and the homeless. The commodity
provisions contained in the Hunger Prevention Act were addressed in a
proposed rule amending Parts 250 and 251 which was published in the
Federal Register on April 6, 1990 (55 FR 12838). The proposed rule
addressed the commodity provisions contained in the Hunger Prevention
Act relative to: (1) The distribution of additional commodities for use
by emergency feeding organizations, soup kitchens, and food banks; (2)
the use of TEFAP administrative funds to pay for the costs of providing
information on commodity storage and handling to recipients; (3) the
distribution of commodities that have been donated by persons or
entities other than USDA by emergency feeding organizations; (4) the
increase in the amount of administrative funding to be passed through
by States to emergency feeding organizations from 20 percent to 40
percent; (5) the use of volunteer workers and distribution of non-USDA
commodities by State agencies and emergency feeding organizations; (6)
State and local maintenance-of-effort requirements; and (7) the
authority for States to give priority to existing networks and
organizations that distribute food to low-income households when
distributing commodities under TEFAP.
The proposed rule also addressed certain discretionary changes to
provisions in part 251 which: (1) Reduced the required TEFAP monitoring
by State agencies; (2) clarified the State matching requirements for
TEFAP administrative funds; (3) included references to 7 CFR part 3016;
and (4) changed reference to the form used to report State and local
TEFAP costs. The proposed rule afforded the general public 60 days in
which to comment.
A total of 37 comment letters were received on the proposed rule.
Respondents represented 14 State agencies, 2 cities, 2 counties and 19
interested groups. Despite general support of the proposed rule, the
following issues were raised by some commenters: Limitations on the
distribution of section 110 soup kitchen/food bank commodities
resulting from the Hunger Prevention Act's definition of food banks and
soup kitchens; the organization of regulations pertaining to the
administration and distribution of soup kitchen/food bank commodities
obtained under section 110 of the Hunger Prevention Act; authorization
for the Secretary to establish procedures which allow non-USDA
commodities to be used to supplement USDA commodities; and the decrease
in the monitoring for emergency feeding organizations.
The remainder of this preamble discusses the provisions contained
in the proposed rule, the comments received in response to that rule,
and the Department's response to the comments on discretionary
provisions as implemented through this final rule. For a more
comprehensive understanding of the provisions contained in this final
rule, the reader should refer to the preamble of the proposed rule.
Additional Commodities
Additional TEFAP Commodities (Sec. 251.4(h))
Section 104 of the Hunger Prevention Act amended the EFAA to add
sections 213 and 214. Section 214 required the Secretary to spend $120
million to purchase, process and distribute additional commodities
during each of Fiscal Years 1989 and 1990. Paragraph (a) of section 213
mandated that these commodities be provided to States for distribution
to emergency feeding organizations. Section 1772 of the FACT Act
extended the Secretary's authority to purchase additional commodities
for distribution through TEFAP through Fiscal Year 1995.
In order to clarify the eligibility of emergency feeding
organizations to receive these commodities, a new paragraph (h) was
added to Sec. 251.4 in the proposed rule. Commenters did not oppose
this provision. Since section 1772(g) of the FACT Act, enacted
subsequent to the proposed rule, extended the Secretary's purchase
authority through Fiscal Year 1995, the provisions contained in
paragraph (h) of Sec. 251.4 of the proposed rule relative to the types
of additional TEFAP commodities emergency feeding organizations are
eligible to receive have been retained in this final rule.
In addition, section 105(c) of the Hunger Prevention Act amended
section 203B(a) of the EFAA to grant States the option, when allocating
TEFAP commodities within the State, to give priority to existing food
bank networks and other organizations whose ongoing primary function is
to facilitate the distribution of food to low-income households. This
provision was included in Sec. 251.4(h) of the proposed rule, and is
retained this final rule.
Section 110 Commodities for Soup Kitchens/Food Banks
Section 110(c) of the Hunger Prevention Act required the Secretary
to purchase, process, and distribute additional commodities to States.
The Hunger Prevention Act authorized the distribution of these
commodities to soup kitchens and food banks in addition to the
commodities otherwise made available to these organizations. Section
1774(a) of the FACT Act amended section 110 to extend the Secretary's
authority to purchase additional commodities for distribution to these
organizations, and provided that there are authorized to be
appropriated $40 million for each of Fiscal Years 1992 through 1995.
However, only $32 million was appropriated for Fiscal Years 1992 and
1993. The specific provisions relative to the distribution of these
commodities as they were proposed and the comments received are
discussed in detail below.
Organization of Regulations
A few comments were received concerning the proposed placement of
the provisions regarding the distribution of the section 110
commodities in both parts 250 and 251. Commenters expressed concern
that the separation of regulations led to confusion and unnecessary
delays in administering the program in cases where the State agency
responsible for distributions to charitable institutions was not also
the State agency administering TEFAP. Two commenters recommended the
consolidation of all regulations regarding section 110 commodities in
the TEFAP regulations (part 251).
It should be noted that section 110 of the Hunger Prevention Act
did not amend the EFAA; thus, the distribution of commodities under
this section is not directly a part of TEFAP. Therefore the Department
decided, in implementing the legislation, to treat food banks and soup
kitchens that serve the needy with section 110 commodities as recipient
agencies under the Food Distribution Program regulations (part 250).
Conversely, authorization for the receipt of TEFAP administrative funds
by institutions receiving section 110 commodities is contained in
section 204(a)(1) of the EFAA. Thus, for administrative funding
purposes, these institutions are considered emergency feeding
organizations and are governed by TEFAP regulations (part 251).
In addition, part 251 contains certain requirements which are not
appropriate for soup kitchens and food banks receiving section 110
commodities. Such provisions in part 251 include requiring individual
certification of recipients and certain recordkeeping and reporting
requirements. Rather than include all regulations regarding section 110
commodities in part 251 along with a host of exceptions to existing
regulations that do not apply, the Department will continue to address
the section 110 provisions as appropriate through both parts 250 and
251.
Since implementation of the provisions of the Hunger Prevention Act
of 1988, it has been brought to the Department's attention that there
is considerable confusion relating to the structure of the proposed
regulations resulting from the fact that many soup kitchens and food
banks receive commodities through both the Department's donations to
charitable institutions and through section 110. As indicated above,
the Department will continue to address provisions for outlets
receiving section 110 commodities through both parts 250 and 251.
However, for the purpose of clarification, this final rule has been
restructured to move all of the provisions for the receipt of section
110 commodities from Sec. 250.41 to new Sec. 250.52. For commodities
received through the Department's donations to charitable institutions,
soup kitchens and food banks must continue to comply with the
provisions of Sec. 250.41; for section 110 commodities, the provisions
of the new Sec. 250.52 will apply. Requirements relating to soup
kitchens and food banks receiving TEFAP administrative funds will
continue to be addressed in part 251. The specific provisions contained
in Sec. 250.52 are discussed in further detail below.
Definition of Eligible Institutions (Secs. 250.3 and 250.52(a))
The Hunger Prevention Act specifically defines the types of food
banks and soup kitchens that are eligible to receive commodities
purchased under section 110. In section 110(b)(3), the Hunger
Prevention Act defines ``food bank'' as ``public and charitable
institutions that maintain an established operation involving the
provision of food or edible commodities, or the products thereof, to
food pantries, soup kitchens, hunger relief centers, or other food or
feeding centers that provide meals or food to needy persons on a
regular basis as an integral part of their normal activities.'' In
section 110(b)(6), the Hunger Prevention Act defines ``soup kitchen''
as ``public and charitable institutions that maintain an established
feeding operation to provide food to needy homeless persons on a
regular basis as an integral part of their normal activities.'' Section
110(e)(2)(A) of the Hunger Prevention Act further specifies that in
determining the amount of commodities that will be accepted by soup
kitchens and food banks, States shall give priority to institutions
that provide ``meals'' to homeless individuals.
The proposed rule incorporated the definitions of ``soup kitchen''
and ``food bank'' and the procedures for distributing section 110
commodities to these organizations in Sec. 250.41(d).
While the Hunger Prevention Act clearly defines ``food bank'' and
``soup kitchen'' and stipulates that section 110 commodities are to be
directed to the needy and homeless, several commenters opposed the
Department's proposed implementation of its provisions. Three
commenters rejected the regulatory proposal that commodities be
distributed only to soup kitchens and food banks as defined by the
Hunger Prevention Act. Their principal concern was that many rural
areas do not have access to food bank networks or soup kitchens and
thus would be excluded from receiving the additional commodities
authorized under section 110. One commenter recommended that ``food
pantries'' be eligible to receive commodities in areas where soup
kitchens and food bank warehouses do not exist. Another suggested that
alcohol treatment centers and domestic violence shelters should be
considered eligible for section 110 commodities on the basis that
without the services of these agencies, their clients could potentially
be homeless. Only two commenters supported the limitation of
distribution of section 110 commodities to soup kitchens and food banks
that provide meals to homeless individuals.
Subsequent to the publication of the proposed rule, Congress passed
the FACT Act. Section 1774(a)(2)(B) defines ``food pantry'' as ``a
public or private nonprofit organization that distributes food to low-
income and unemployed households, including food from sources other
than the Department of Agriculture, to relieve situations of emergency
and distress.'' Section 1774(a)(3) of the FACT Act addressed the
unintended exclusion of some States which have food pantries rather
than food banks by allowing distribution to food pantries in some
instances. Since the Department intends to exercise some discretion in
implementing this provision, the distribution of section 110
commodities to food pantries will be addressed in a separate proposed
rule. However, since section 1774(a) became effective on February 1,
1992, affected State distributing agencies should already be complying
with this statutory requirement.
On December 13, 1991, Congress passed the FACT Act Amendments,
Public Law 102-237. Section 922(a)(2) of Public Law 102-237 amended
section 110 of the Hunger Prevention Act to establish a priority system
for the distribution of these commodities, which at least partially
addresses the above comments. As discussed below, this final rule
reflects the priority distribution system set forth in Public Law 102-
237. The remaining commodity provisions contained in Public Law 102-237
will be addressed through a separate proposed rulemaking.
The priority system for the distribution of section 110 commodities
presented in this final rule increases the number and types of
institutions eligible to receive and distribute these commodities.
However, as required by statute, Sec. 250.52(a)(1) of this final rule
continues to mandate that distributing agencies give first priority in
the distribution of these commodities to soup kitchens, as defined in
Sec. 250.3, and other like organizations that serve meals to homeless
persons, and to food banks for distribution to such organizations. If
distributing agencies determine that they will not likely exhaust their
allocation of section 110 commodities through distribution to this
first priority group, the distributing agency must make the remaining
commodities available to food banks for distribution to the second
priority group, institutions that distribute commodities to the needy.
Eligibility to receive the commodities for household consumption from
such institutions must be established through a means test as
determined appropriate by the distributing agency. If a food bank
determines that it will not likely exhaust its allocation of section
110 commodities through distribution to this second priority group, it
may distribute the remaining commodities to institutions that serve
meals to needy individuals but whose programs do not use a means test
as part of their eligibility criteria, provided that such organizations
have documented, to the satisfaction of the food bank, that they do, in
fact, serve predominantly needy persons. Examples of this third
priority group include domestic violence shelters, child care centers
and alcohol rehabilitation centers.
Section 250.52(a) of this final rule is revised to provide for the
distribution of section 110 commodities in accordance with the priority
system described above. In addition, the definitions of ``food bank''
and ``soup kitchen'' have been deleted from this section and
incorporated in Sec. 250.3, ``Definitions,'' for the purpose of
consistency.
Tax-Exempt Status (Sec. 250.52(b))
Sections 250.41(d)(2)(ii) and 250.41(d)(3)(ii) of the proposed rule
required that soup kitchens and food banks must have obtained
recognition of tax-exempt status, or have applied for, and be moving
toward, obtaining recognition of their tax-exempt status by the
Internal Revenue Service, or be currently operating a Federal program
requiring nonprofit status. The proposed rule would allow them 12
months to receive recognition of Federal tax-exempt status. No comments
were received opposing this provision. Thus, it is retained in
Sec. 250.52(b) of this final rule with minor revisions emphasizing
recognition of tax-exempt status by the Internal Revenue Service and
clarifying that the 12-month grace period runs from the effective date
of the organization's approval for participation, not from the date of
filing with the Internal Revenue Service, and that documentation of
recognition of tax-exempt status must be not only obtained, but also
forwarded to the State distributing agency, within that period. So as
not to penalize soup kitchens or food banks for delays which are beyond
their control, when a soup kitchen or food bank has not received a
decision on its application for tax-exempt status in the required 12-
month period, Sec. 250.52(b) of this final rule also permits such an
organization to continue participation in the program if the
distributing agency determines that it has provided sufficient
documentation of compliance with all IRS requirements and provided
information to IRS in a timely manner.
Participation Data and Household Distribution (Sec. 250.52(c)(2))
The proposed rule recognized that soup kitchens, unlike certain
other types of charitable institutions, have been established for the
specific purpose of providing assistance to the indigent. Thus, the
Department believes that it is reasonable to assume that individuals
seeking a meal at a soup kitchen are needy. Based on this premise,
Sec. 250.41(d)(2)(iii) of the proposed rule provided for the
distribution of section 110 commodities on the basis of the number of
meals expected to be served daily, as submitted by the soup kitchen or
food bank that has an agreement with the State and approved or adjusted
by the distributing agency, rather than using the detailed formula
required for other charitable institutions.
Sections 250.41(d)(3)(iii) (A) and (B) of the proposed rule also
provided that distributing agencies must base the distribution of
commodities to food banks on: (1) The number of meals to be served
daily in a congregate meal setting by institutions receiving
commodities from the food bank; and (2) the number of needy households
that meet the State's eligibility criteria for participation in TEFAP
that will be provided food for home consumption by such institutions.
Given that commenters did not oppose these provisions, the
provision concerning the number of congregate meals projected to be
served is retained in Sec. 250.52(c)(2)(i) of this final rule as
proposed, with certain technical changes to clarify that projections
must contain the number of days that meals will be served during the
agreement period. The provision concerning household distribution is
contained in Sec. 250.52(c)(2)(ii) of this final rule with a change to
the eligibility determination. In instances in which section 110
commodities are made available for distribution to households,
Sec. 250.41(d)(3)(iii)(C) of the proposed rule required food banks to
ensure that organizations receiving the commodities distribute them
only to households which meet the eligibility criteria established by
the State pursuant to Sec. 251.5(b) of the TEFAP regulations. However,
section 922(a) of Public Law 102-237 amended section 110(j)(2) of the
Hunger Prevention Act to authorize institutions that distribute
commodities to the needy for home consumption to determine eligibility
through a means test that has been determined appropriate by the
distributing agency. Thus, the State need not require the same
eligibility criteria it has established for TEFAP. Sections 250.52
(c)(2)(ii) and (c)(6)(ii) of this final rule have been revised to
reflect this current legislative provision.
Section 250.41(d)(3)(iii) of the proposed rule also required that
food banks ensure that organizations distributing section 110
commodities to households comply with the provisions contained in
Sec. 251.10(f) concerning the limitation on unrelated activities (e.g.,
recipients cannot be required to register to vote as a condition for
receiving USDA commodities). Since commenters did not oppose this
provision, it has been retained in Sec. 250.52(c)(6)(i) of this final
rule.
Allocation of Additional Commodities by the Department
Section 214 of the EFAA and section 110 of the Hunger Prevention
Act require the Secretary to allocate, on an annual basis, the
additional TEFAP and soup kitchen/food bank commodities to States based
on a formula that takes into account each State's population of low-
income and unemployed persons as percentages of the national totals.
Each State's share of commodities must be based 60 percent on the
number of households within the State which have incomes below the
poverty line and 40 percent on the average monthly number of unemployed
persons within the State. These sections also require that such
additional commodities be allocated among States on the basis of value.
Soup Kitchen/Food Bank Commodities (Sec. 250.52(d)(1))
In accordance with the legislative provisions described above,
Sec. 250.41(d)(4)(i) of the proposed rule incorporated the allocation
formula and provided for the annual allocation, based on value, of
section 110 commodities by the Department.
TEFAP Commodities (Secs. 251.3 and 251.7(a))
The definition of ``formula'' was revised in Sec. 251.3 of the
proposed rule to more closely follow the wording relative to the 60/40
formula contained in section 214 of the EFAA and to clarify that
surplus commodities made available for distribution through TEFAP will
continue to be allocated based on the amount of commodities in pounds
while the purchased commodities will be allocated based on value. In
addition, Sec. 251.7(a) of the proposed rule was revised to provide for
the allocation formula of the purchased commodities to be adjusted once
a year.
Comments in response to the provisions contained in the proposed
rule relative to the Department's allocation of section 110 and TEFAP
commodities addressed the use of the 60/40 formula. Two commenters
supported the use of the 60/40 formula, whereas one commenter expressed
concern that current allocations are based on 1980 poverty statistics
and stated that more up-to-date information should be utilized when
making allocations. Although the Census is conducted once every 10
years, it represents the best available source of national data on low-
income persons. Since no better data base is available, the Department
must accept the limitations resulting from the relative infrequency of
the Census. It should be noted, however, that the program allocation
data base has been updated based on the results of the 1990 Census.
Until such time as the Department identifies the existence of data
more appropriate for use in allocating TEFAP and section 110
commodities, the allocation formula described in Secs. 251.3, 251.7(a)
and 250.52(d)(1) of this final rule will continue to be used.
Allocation of Section 110 Commodities by States (Sec. 250.52(d)(3))
Section 250.41(d)(4)(iii) of the proposed rule required State
distributing agencies to use the data reported in the agreement by soup
kitchens and food banks to allocate section 110 commodities. This
section of the proposed rule also required that section 110 commodities
be allocated in a manner that ensures that commodities will not be made
available in quantities that are in excess of anticipated use or the
ability of the organization to accept and store the commodities. Since
no comments were received concerning this provision, it is retained in
Sec. 250.52(d)(3) of this final rule with language clarifying that the
distributing agency may critically review and adjust the estimates as
appropriate.
Reallocation of Additional Commodities (Secs. 250.52(d)(4) and 251.3)
When a State determines that it will not accept all of its share of
the additional TEFAP commodities, section 214(g) of the EFAA, as added
by section 104 of the Hunger Prevention Act, requires the Department to
reallocate these commodities on the basis of the same 60/40 formula
that is used for the initial allocation. Section 251.3 of the proposed
rule expanded the definition of ``formula'' to include the reallocation
requirement. This final rule retains the definition as proposed.
When a State determines that it will not accept all of its share of
section 110 commodities, section 110(e) of the Hunger Prevention Act
requires the Department to reallocate these commodities in a fair and
equitable manner among States that have already accepted the full
amount of their allocation and have requested additional amounts. This
procedure for reallocating section 110 commodities was included in
Sec. 250.41(d)(4)(iv) of the proposed rule.
One commenter suggested that the Department set aside a particular
month of the year to make reallocations to afford each soup kitchen/
food bank the opportunity to plan ahead accordingly. Unfortunately,
this recommendation is not feasible. Often the commodities have been
purchased for the proximate shipping period, forcing the Department to
reallocate commodities turned back by States immediately. Thus, the
proposed reallocation formula is retained without modification in
Sec. 250.52(d)(4) of this final rule. The Department will continue to
review its procurement methods so that reallocations can be as
responsive to State planning needs as possible.
Notification of Acceptance of Additional Commodities (Secs.
250.52(d)(2) and 251.4(c)(3))
Section 214(g) of the EFAA and section 110(e) of the Hunger
Prevention Act require that each State promptly notify the Secretary
when it has determined that it will not accept any or all of its
allocation of the additional TEFAP or section 110 commodities. So that
reallocations can be made and deliveries can be arranged in a timely
manner, Secs. 250.41(d)(4)(ii) and 251.4(c)(3) of the proposed rule
required State agencies to notify the Department at least 30 days prior
to the shipping period of the amount of the commodities which they will
accept. Since no comments were received in response to these
provisions, they are retained in Secs. 250.52(d)(2) and 251.4(c)(3) of
this final rule as proposed, with clarification that the requirement
for notification applies to the beginning of the shipping period.
State Maintenance-of-Effort Requirement (Secs. 250.52(f) and 251.10(h))
Section 214(i) of the EFAA, as added by section 104 of the Hunger
Prevention Act, prohibits a State which uses its own funds to provide
commodities or services to organizations receiving funds or services
under that section from diminishing the level of support it provides to
such organizations or from reducing the amount of funds available for
other nutrition programs in the State in each fiscal year. This
provision was incorporated in Sec. 251.10(h) of the proposed rule, and
is retained in the final rule.
The proposed rule also incorporated the requirement in section
110(h)(3) of the Hunger Prevention Act that local agencies receiving
section 110 commodities provide assurance to the State that donations
of food from other sources will not be diminished as a result of the
receipt of the section 110 commodities. To implement this provision,
Sec. 250.41(d)(6) of the proposed rule required that distributing
agencies obtain this assurance from each institution prior to making
commodities available. The proposed rule mandated that this assurance
be provided in writing and maintained on file by the distributing
agency. Commenters did not oppose this method for ensuring compliance
with the Hunger Prevention Act. Thus, the provision is retained in
Sec. 250.52(f) of this final rule.
Emergency Food Assistance Program Administrative Funds
Allowable Costs
Administrative Costs for Additional Commodities (Secs. 250.52(e),
251.6(a)(4), 251.8(d) (1) and (2), and 251.10(e)(7))
Section 204(a)(1) of the EFAA, as amended by section 105 of the
Hunger Prevention Act, authorizes States and emergency feeding
organizations to use TEFAP administrative funds to pay costs associated
with the distribution of commodities provided under section 214 of the
EFAA and section 110 of the Hunger Prevention Act.
Section 250.41(d)(5) of the proposed rule included this provision
and required that soup kitchens and food banks receiving foods under
section 110 enter into a TEFAP agreement in order to receive TEFAP
administrative funds for costs associated with the distribution of
section 110 commodities. Commenters did not oppose this requirement.
The Department believes that this arrangement will ensure
accountability by applying the same requirements for the use of all
TEFAP administrative funds, whether used by traditional TEFAP emergency
feeding organizations or soup kitchens/food banks. In addition, this
will mean that funds provided to soup kitchens and food banks may be
counted toward the amount of TEFAP funds a State agency is required to
pass through to emergency feeding organizations in accordance with the
provisions contained in Sec. 251.8(d)(3)(i). This requirement is
retained in Sec. 250.52(e) of this final rule with minor revisions.
The provision allowing the use of TEFAP funds to cover the costs
associated with the distribution of section 110 commodities was also
included in Sec. 251.8(d)(1) of the proposed rule. As stated in the
proposed rule, the Department will continue to make all TEFAP
administrative funds available only to the TEFAP State agencies. When
it is determined that TEFAP administrative funds will be made available
to pay costs associated with the distribution of section 110
commodities and the State agency responsible for TEFAP is not also
responsible for the distribution of section 110 commodities,
Sec. 251.8(d)(1) of the proposed rule required the TEFAP State agency
to enter into an agreement with the entity which will receive and, if
applicable, allocate the TEFAP funds in connection with section 110
commodities. This agreement would be with either: (1) The soup kitchens
or food banks; or (2) the distributing agency responsible for the
distribution of section 110 commodities, which would in turn enter into
a TEFAP agreement with each soup kitchen and food bank. The proposed
rule provided for the agreement to be in the form of the TEFAP
agreement currently being used for emergency feeding organizations or
an amended charitable institution agreement which requires compliance
with Sec. 251.8, which governs the use of TEFAP administrative funds,
and Secs. 251.10 (a) (records) and (e) (State monitoring).
The administration of TEFAP funds allotted to a State becomes more
complicated when the State agency responsible for TEFAP is not the
agency responsible for the distribution of section 110 commodities. As
stated in the proposed rule, when TEFAP funds will be made available to
pay costs associated with the distribution of section 110 commodities,
it will be the responsibility of the two State agencies to determine
how to allocate TEFAP administrative funds between the State agencies
and among the emergency feeding organizations, including any soup
kitchens/food banks with TEFAP agreements. To ensure proper monitoring
of the distribution of TEFAP funds within the State, Sec. 251.6(a)(4)
of the proposed rule required TEFAP State agencies to describe in the
State plan how these funds will be allocated between State agencies and
among emergency feeding organizations, including soup kitchens and food
banks. In addition, Sec. 251.10(e)(7) of the proposed rule required
TEFAP State agencies to ensure that emergency feeding organizations
receiving funds for the distribution of section 110 commodities are
reviewed to ensure compliance with the provisions contained in
Sec. 251.8.
Most commenters supported the proposed regulations on the payment
of funds for storage and distribution costs, and the need for States to
enter into agreements with organizations receiving section 110
commodities and to describe the allocation of funds in their plan.
Thus, the requirements described above are retained, as proposed, in
Secs. 251.6(a)(4), 251.8(d)(2) and 251.10(e)(7) of this final rule with
minor clarifying changes.
Due to commenter concern about the difficulty of administering one
program through two State agencies, the Department would like to
emphasize that States have the authority to structure the
administration and distribution of section 110 commodities in the
fashion they deem most efficient and accountable. The Department
recognizes that there may be some dissension among State agencies
regarding the allocation of funds. As stated in the preamble to the
proposed rule, when the allocation of these funds cannot be mutually
agreed upon by the State agencies, the Department anticipates that the
necessary decisions will be made by the Governor's office.
Administrative Costs for Non-USDA Commodities (Secs. 251.8(d) (1)(ii)
and (2)(ii))
Section 102 of the Hunger Prevention Act added a new section
203D(b) to the EFAA, which authorizes States and emergency feeding
organizations to use funds made available under the EFAA to pay costs
incurred for the storage, handling and distribution of commodities
which have been donated by persons or entities other than USDA. Section
251.8(d)(1) of the proposed rule incorporated this provision, and is
retained in Secs. 251.8(d) (1)(ii) and (2)(ii) of this final rule with
certain clarifying changes which are described below.
Costs of Providing Information to Recipients (Sec. 251.8(d)(1)(i))
Section 109(c) of the Hunger Prevention Act amended section
204(a)(2) of the EFAA to permit emergency feeding organizations to use
TEFAP funds to cover the costs of providing information on the
appropriate storage and preparation of USDA commodities to persons
participating in TEFAP. This provision was included in Sec. 251.8(d)(3)
of the proposed rule, and is retained in the final rule, although it
has been moved to Sec. 251.8(d)(1)(i). This provision is discussed in
more detail below.
Restructuring of Administrative Cost Provisions (Secs. 251.3
(Definition of ``Storage and Distribution Costs'') and 251.8(d))
Currently, the allowable uses of TEFAP administrative funds are set
forth in Sec. 251.3(f) in the definition of ``storage and distribution
costs.'' Now that TEFAP administrative funds may be used not only in
connection with TEFAP commodities, but also in connection with both
section 110 commodities and other commodities under varying
circumstances, a single definition setting forth the allowable uses of
these funds has become awkward. In order to clarify the administrative
costs for which TEFAP administrative funds may be used, the definition
of ``storage and distribution costs'' has been removed from this final
rule, and Sec. 251.8(d) has been restructured to perform the now more
complex function previously served by the definition.
The EFAA does not explicitly authorize the use of TEFAP
administrative funds to pay administrative costs associated with USDA
commodities other than those provided under TEFAP and section 110. A
requirement that reimbursable administrative costs associated with
TEFAP and section 110 commodities be separated from costs generated in
the management of USDA commodities received from other sources would
impose a burden on many local program operators which they could not
reasonably be expected to meet. This burden would make commodity
distribution more difficult without any compensatory increase in either
the quality of service to participants or program accountability.
Typically, local organizations receive commodities from several
sources. For example, a soup kitchen receiving commodities under
section 110 may also get commodities as a charitable institution, as
well as donations from non-USDA sources. Some USDA commodities received
under different authorities are identical in type and package size, and
thus cannot be distinguished from each other unless segregated upon
receipt so as to be able to identify storage costs by commodity source.
Furthermore, it would be burdensome for local organizations to record
the staff time spent handling USDA commodities received under different
legislative authorities so as to assure that only time devoted to TEFAP
and section 110 commodities is reimbursed with TEFAP administrative
funds. Therefore, permitting local organizations to use such funding to
handle section 110 commodities, but not the USDA commodities they
receive as charitable institutions, would be unreasonable. It would
also be illogical to permit the use of TEFAP administrative funds for
the storage, handling, and distribution of non-USDA commodities, as the
EFAA clearly does, while prohibiting the use of funds for the same
costs associated with USDA commodities not provided under TEFAP or
section 110.
By allowing those costs associated with the storage, handling, and
distribution of non-USDA commodities, as well as TEFAP and section 110
commodities, we believe the EFAA intended to streamline commodity
management at the local level. Therefore, the Department believes that
it is fully within the intent of Congress, as well as prudent from a
management perspective, to allow TEFAP administrative funds to be used
for the same categories of costs for all USDA commodities received by
organizations participating in TEFAP or receiving section 110
commodities. This policy would include the costs of processing and
repackaging all USDA commodities, regardless of the authority under
which they are provided.
Thus, Sec. 251.8(d)(1)(i) of the final rule consolidates the
allowable uses of TEFAP administrative funds in connection with the
distribution of USDA commodities. This section contains the allowable
uses previously contained in the definition of ``storage and
distribution costs,'' incorporates the addition of repackaging and
processing costs as allowable administrative costs in connection with
all USDA commodities received by organizations which get commodities
under TEFAP or section 110, and includes the provision from
Sec. 251.8(d)(3) of the proposed rule authorizing emergency feeding
organizations to use TEFAP administrative funds to pay costs incurred
for providing information to recipients relative to the appropriate
storage and preparation of USDA commodities.
Section 251.8(d)(1)(ii) of the final rule provides that TEFAP
administrative funds may also be used for the direct costs associated
with the intrastate distribution of non-USDA commodities. This section
further makes clear that such costs are limited to the costs of
storing, handling and distributing these commodities and that State-
level expenditures are allowable only for costs associated with
commodities which are ultimately distributed by emergency feeding
organizations or soup kitchens/food banks receiving TEFAP
administrative funds. These restrictions are necessary to comply with
the limitations in section 203D(b) of the EFAA, which authorizes the
use of TEFAP administrative funds in connection with non-USDA
commodities. A related provision in Sec. 251.8(d)(2)(i) of the final
rule requires local organizations to have entered into an agreement
pursuant to Sec. 251.2(c) (for the receipt of TEFAP commodities) or
Sec. 251.8(d)(2)(ii) (for the receipt of administrative funds in
connection with the distribution of section 110 commodities) in order
to be eligible to receive TEFAP funds for non-USDA commodities.
Finally, the provisions from proposed Sec. 251.8(d)(1) regarding
the agreements necessary for soup kitchens/food banks to receive TEFAP
administrative funds for section 110 commodity distribution are moved
to Sec. 251.8(d)(2), and references to ``storage and distribution
costs'' throughout the regulation have been changed to ``administrative
costs'' to reflect the broader uses of TEFAP administrative funds now
permitted.
Distribution Charges (Sec. 251.8(d)(3)(ii))
One commenter was concerned that proposed Sec. 251.8(d)(2)(ii)
would prohibit States with commercial distribution systems from
charging a fee to soup kitchens for the storage and handling of section
110 commodities. The Department appreciates the commenter's request for
clarification. Proposed Sec. 251.8(d)(2)(ii) prohibited State agencies
from charging for commodities made available to emergency feeding
organizations. However, this prohibition does not apply to instances in
which State agencies provide section 110 commodities to soup kitchens
and food banks. Confusion regarding this regulation stems from the
``dual identity'' soup kitchens and food banks have when they receive
section 110 commodities: For purposes of eligibility to receive TEFAP
administrative funding, they are considered to be emergency feeding
organizations; for all other purposes, they are classified as recipient
agencies. Thus, State agencies may charge soup kitchens and food banks
for costs incurred at the State level for intrastate transportation and
storage of section 110 commodities as long as State agencies comply
with the provisions in Sec. 250.15(a)(2) governing fees for recipient
agencies. Section 251.8(d)(3)(ii) of this final rule makes clear that
the prohibition on fees applies only to commodities made available
under Part 251.
Local Support (Sec. 251.8(d)(3)(i))
Section 103(b) of the Hunger Prevention Act amended Sec. 204(a)(2)
of the EFAA to increase the percentage of Federal TEFAP administrative
funds which must be made available to, or expended on behalf of,
emergency feeding organizations from 20 percent to 40 percent.
Section 251.8(d)(3) of this final rule also clarifies that the 40
percent pass-through should not be applied to the amount of funds
provided to each State agency; rather, the requirement applies to the
total TEFAP grant of the State. When TEFAP administrative funds are
made available to pay costs associated with the distribution of section
110 commodities, and the State agency administering TEFAP is not the
agency responsible for the distribution of section 110 commodities, the
TEFAP State agency is responsible for ensuring that the 40-percent
requirement is met. If the TEFAP State agency makes funds available to
the State agency responsible for section 110 commodities, only the
amount of funds ultimately provided to emergency feeding organizations,
or used to pay costs on their behalf, may count toward the State's 40-
percent requirement. Any funds retained by the distributing agency to
pay State-level administrative costs associated with the distribution
of section 110 commodities must be matched in accordance with the
provisions contained in Sec. 251.9(a).
For the purpose of clarification, Sec. 251.8(d)(2)(i) of the
proposed rule was also amended to reference ``Federal Temporary
Emergency Food Assistance Program administrative funds'' in lieu of
``State funds.'' No comments were received in response to this change,
which more accurately describes the funds in question. Since this
clarification will help to ensure that 40 percent of the ``Federal''
grant is passed on to emergency feeding organizations or expended on
their behalf, the term ``Federal Emergency Food Assistance Program
administrative funds'' is retained in Sec. 251.8(d)(3)(i) of this final
rule with the following changes: (1) Deletion of the word
``Temporary,'' (2) use of the term ``administrative costs'' rather than
``storage and distribution costs,'' and (3) restructuring of the
paragraph for the sake of clarity.
State Matching Requirement (Secs. 251.9(a) and 251.9(c))
The proposed rule amended Sec. 251.9(a) to clarify that the portion
of the TEFAP grant the State is required to match is that portion which
is retained by the State agency to pay State-level storage and
distribution costs. No comments were received concerning the clarifying
language. Thus, Sec. 251.9(a) of this final rule is retained as
proposed with a change in terminology from ``storage and distribution
costs'' to ``administrative costs.''
An area of concern during development of the proposed rule involved
a limitation on the types of State expenditures which meet the matching
requirements for TEFAP. Section 204(a)(4) of the EFAA requires States
to match the portion of Federal TEFAP funds which is retained by the
State to pay State-level administrative costs. This section also
prohibits States from passing the cost of the matching requirements on
to emergency feeding organizations. In Sec. 251.9(c) of the current
regulations, the Department limits the types of contributions which may
count toward the match to contributions (cash or in-kind) for costs
which could otherwise be allowable as State-level administrative costs.
It was pointed out that this provision prohibited States from counting
two types of State expenditures toward meeting the match: (1) State-
appropriated funds which were used to pay local-level costs associated
with the distribution of commodities; and (2) any in-kind contributions
made by the State agency to an emergency feeding organization.
The Department re-evaluated this provision together with
Department-wide rules describing allowable contributions toward
matching requirements. The proposed rule eliminated the restriction in
Sec. 251.9(c) that any contributions to the matching requirement be
limited to State-level storage and distribution costs. Two commenters
supported this revision; none opposed it. Thus, as proposed,
Sec. 251.9(c) of this final rule allows the following contributions to
be counted toward meeting the match: Any cash outlay of the State
agency specifically identifiable as an allowable State- or local-level
administrative cost, including the outlay of money contributed to the
State agency by other public agencies and institutions, and private
organizations and individuals; in-kind contributions by the State
agency or third parties identifiable as being used to defray State-
level administrative costs; and State agency in-kind contributions
toward a local-level administrative cost. However, the prohibition
against passing on the costs of the matching requirement to emergency
feeding organizations remains. Therefore, only those emergency feeding
organization cash or in-kind contributions which can be specifically
identified as addressing State-level administrative costs may be
counted toward the match.
As set forth in current regulations, in order for a third-party in-
kind contribution to be classified as an allowable cost for the
purposes of meeting the State's matching requirement, the cost must be
specifically identified as addressing State-level storage and
distribution costs. For purposes of clarification, Sec. 251.9(c) of
this final rule also includes the following criteria which must be met
in order for a third-party in-kind contribution to qualify as a State-
level storage and distribution cost for purposes of meeting the match:
(1) In its administration of food assistance programs, the State has
performed this type of function over a sustained period of time in the
past; (2) the function was not previously performed by the State on
behalf of emergency feeding organizations; and (3) the State would
normally perform the function as part of its responsibility in
administering TEFAP or related food assistance programs if it were not
provided as an in-kind contribution.
Procedures for the Distribution of Non-USDA Commodities
(Sec. 251.4(i))
Section 203D(b) of the EFAA, as added by section 102 of the Hunger
Prevention Act, also requires that the Secretary establish procedures
for the distribution of commodities which have been donated by persons
or entities other than USDA. The Department responded to this
legislative provision by proposing in Sec. 251.4(i) that emergency
feeding organizations be permitted to distribute such commodities
either in conjunction with or separate from the distribution of USDA
commodities.
Two commenters stressed that this legislative requirement should be
clarified. They suggested that any procedures which are developed
should (1) apply only to combined distributions of USDA commodities and
non-USDA commodities, and (2) neither hinder current effective
practices, nor conflict with the donation-handling procedures as
outlined by the Internal Revenue Service in section 170(e)(3) of the
Internal Revenue Code. The Department agrees that State agencies and
emergency feeding organizations should have maximum flexibility in
distributing these non-USDA commodities; thus, no additional regulatory
requirements were imposed. Accordingly, this provision is retained in
Sec. 251.4(i) of this final rule as proposed.
References to 7 CFR Part 3016 (Sec. 251.9(c) and 251.10(a)(2))
The proposed rule amended Secs. 251.9(c) and 251.10(a)(2) to
correct references to the Department's Uniform Federal Assistance
Regulations. As stated in the proposed rule, previously all grant
programs were governed by regulations at 7 CFR part 3015. However, on
March 11, 1988, new regulations were published at 7 CFR part 3016 which
cover all USDA grants except open-ended entitlements. The references to
part 3015 in the matching and recordkeeping sections of this final rule
have been changed to part 3016, and the language describing these
provisions has been revised as proposed.
Report of Administrative Costs--Form FNS-667 (Sec. 251.10(d)(1))
Section 251.10(d)(1) of the proposed rule was revised to require
that Form FNS-667, Report of Storage and Distribution Costs (TEFAP), be
used for reporting TEFAP administrative cost data. Since it has been
determined that the revised Standard Form (SF) 269, Financial Status
Report, is inappropriate for use in TEFAP because it does not
separately identify the State- and local- level components of total
program costs, comments on the proposed rule supported use of Form FNS-
667. Therefore, Sec. 251.10(d)(1) of this final rule retains the
requirement that Form FNS-667 be used for reporting TEFAP cost data. As
stated in the preamble to the proposed rule, FNS has obtained Office of
Management and Budget approval for the use of this form in accordance
with procedures established under the Paperwork Reduction Act of 1980.
As discussed above, the title of the form has been changed from
``Report of Storage and Distribution Costs (TEFAP)'' to ``Report of
Administrative Costs (TEFAP).''
State Monitoring Requirement (Sec. 251.10(e))
The Department has been asked by States and emergency feeding
organizations to eliminate the current requirement for annual State
agency reviews of all emergency feeding organizations. The Department
agrees that the reduction in the volume of available USDA commodities
justifies a reduction in the monitoring burden imposed upon State
agencies and emergency feeding organizations. Therefore, proposed
Sec. 251.10(e)(2)(i) reduced the required State agency reviews of
emergency feeding organizations by requiring an annual review of at
least 25 percent of all emergency feeding organizations and a review of
all such emergency feeding organizations not less frequently than once
every four years.
Ten commenters supported this reduction. Three commenters, however,
asserted that monitoring requirements should be strengthened rather
than weakened. One commenter wondered what procedure should be followed
if the State agency contract requires an annual evaluation.
The reduction in the monitoring burden is retained in
Sec. 251.10(e)(2)(i) of this final rule. In addition to the support
received from commenters, the Department is committed to reducing the
administrative burden currently imposed on States while ensuring
accountability. It should be emphasized, however, that the 25-percent-
per-year requirement comprises the minimum monitoring requirement. If a
State agency sees the need to implement more stringent monitoring
standards, it is encouraged to do so.
In addition to comments addressing the proposed amendment of the
annual requirement for reviews of emergency feeding organizations, the
Department received comments relative to the review requirements for
distribution sites. Section 251.10(e)(2)(ii) of the current regulations
mandates an annual review of one-third or 50, whichever is fewer, of
all distribution sites within the State. The regulations further
require that the reviews be conducted simultaneously with actual
distribution and/or eligibility determinations. The Department has been
made aware, through comments made in response to the proposed rule and
consultation with State agencies, that in some instances, e.g., when
distributions are conducted Statewide on the same day, it is not
possible for reviews to be conducted simultaneously with actual
distribution and/or eligibility determinations. Since the Department is
in agreement with the concerns expressed and seeks to reduce the
administrative burden currently imposed on States,
Sec. 250.10(e)(2)(ii) of this final rule is revised to require that, to
the maximum extent feasible, reviews be conducted simultaneously with
actual distribution and/or eligibility determinations.
Besides reducing the monitoring requirement, the proposed rule
revised Sec. 251.10(e)(7) to require that soup kitchens and food banks
which receive TEFAP funds for the storage, handling and distribution of
commodities obtained under section 110 of the Hunger Prevention Act be
included in the TEFAP State agency's monitoring system to ensure
compliance with the provisions contained in Sec. 251.8. The proposed
rule permitted the delegation of this responsibility to the
distributing agency which administers distributions to charitable
institutions. However, under the proposed rule, the TEFAP State agency
retained the ultimate responsibility for ensuring that the review
requirements are met. Commenters did not object to this provision; thus
it is retained in Sec. 251.10(e)(7) of this final rule.
Volunteer Workers (Sec. 251.10(g))
Section 203D(c) of the EFAA, added by section 102 of the Hunger
Prevention Act, requires States and emergency feeding organizations to
continue to use, to the maximum extent practicable, volunteer workers,
as well as commodities and other foodstuffs donated by charitable and
other organizations, in the operation of TEFAP. This requirement was
included in Sec. 251.10(g) of the proposed rule. This requirement is
retained, as proposed, in Sec. 251.10(g) of this final rule.
Food Bank Demonstration Projects
Section 1773(e) of the FACT Act amended section 4 of the Commodity
Distribution Reform Act and WIC Amendments of 1987, Public Law 100-237,
to authorize, on a permanent basis, the distribution of USDA
commodities to needy individuals and families through community food
banks. Since the provisions governing the demonstration projects were
never included in regulations, this legislative revision is referenced
in this preamble to advise the general public that this provision is
now permanent but will not be included in the Code of Federal
Regulations. No additional sites will be accepted for participation as
community food banks under Public Law 100-237.
Deletion of Obsolete Provision
As discussed in the preamble to the proposed rule, section 202A of
the EFAA, which authorized the distribution of additional quantities of
flour, cornmeal, and cheese, has expired. The proposed rule deleted
reference to the obsolete provision in Sec. 251.4(d)(3) of the TEFAP
regulations. This deletion is also made in the final rule. The
reference to this provision in Sec. 251.4(h) of the proposed rule has
also been deleted in this final rule.
In addition to the changes described above, a few nonsubstantive
revisions which simply serve to clarify the regulatory wording have
been made in this final rule.
List of Subjects
7 CFR Part 250
Aged, Agricultural commodities, Business and industry, Food
assistance programs, Food donations, Food processing, Grant programs-
social programs, Indians, Infants and children, Price support programs,
Reporting and recordkeeping requirements, School breakfast and lunch
programs, Surplus agricultural commodities.
7 CFR Part 251
Aged, Agricultural commodities, Business and industry, Food
assistance programs, Food donations, Grant programs-social programs,
Indians, Infants and children, Price support programs, Reporting and
recordkeeping requirements, School breakfast and lunch programs,
Surplus agricultural commodities.
Accordingly, 7 CFR parts 250 and 251 are amended as follows:
PART 250--DONATION OF FOODS FOR USE IN THE UNITED STATES, ITS
TERRITORIES AND POSSESSIONS AND AREAS UNDER ITS JURISDICTION
1. The authority citation for part 250 is revised to read as
follows:
Authority: 5 U.S.C. 301; 7 U.S.C. 612c, 612c note, 1431, 1431b,
1431e, 1431 note, 1446a-1, 1859; 15 U.S.C. 713c; 22 U.S.C. 1922; 42
U.S.C. 1751, 1755, 1758, 1760, 1761, 1762a, 1766, 3030a, 5179, 5180.
2. Section 250.3 is amended as follows:
a. The definition of Charitable institutions is amended by adding
the words ``, including hospitals and facilities caring for needy
infants and children,'' after the word ``institution'' in the first
sentence of paragraph (c); and
b. definitions of Food bank and Soup kitchen are added in
alphabetical order to read as follows:
Sec. 250.3 Definitions.
* * * * *
Food bank means a public or charitable institution that maintains
an established operation involving the provision of food or edible
commodities, or the products thereof, to food pantries, soup kitchens,
hunger relief centers, or other food or feeding centers that provide
meals or food to needy persons on a regular basis as an integral part
of its normal activities.
* * * * *
Soup kitchen means a public or charitable institution that
maintains an established feeding operation to provide food to needy
homeless persons on a regular basis as an integral part of its normal
activities.
* * * * *
3. In Sec. 250.41, the first sentence of paragraph (a)(1) is
revised to read as follows:
Sec. 250.41 Charitable institutions.
(a) Distribution. (1) With the exception of section 110
commodities, which are to be distributed in accordance with the
provisions of Sec. 250.52, the distributing agency shall distribute
donated food only to those charitable institutions which have entered
into a written agreement for participation in the program with the
distributing agency in accordance with Sec. 250.12(b). * * *
* * * * *
4. A new Sec. 250.52 is added to read as follows:
Sec. 250.52 Section 110 commodities.
(a) Donations. Distributing agencies shall make commodities donated
to the State under section 110 of the Hunger Prevention Act of 1988
available to soup kitchens and food banks, as defined in Sec. 250.3.
Such distributions shall be made on the following priority basis:
(1) Soup kitchens. The distributing agency shall offer, or
otherwise make available, its full allocation of commodities to soup
kitchens and other like organizations that prepare meals for the
homeless and to food banks for distribution to such organizations.
(2) Institutions that serve only low-income recipients. If the
distributing agency determines that it is not likely to exhaust its
allocation of commodities under this section through distribution to
institutions referred to in paragraph (a)(1) of this section, it shall
make the remaining commodities available to food banks for distribution
to institutions that exclusively serve the needy. When such
institutions distribute commodities to individuals for home
consumption, eligibility for such commodities shall be established
through a means test as determined appropriate by the distributing
agency.
(3) Other institutions. If a food bank determines that it is not
likely to exhaust its allocation of commodities through distribution to
institutions referred to in paragraphs (a)(1) and (a)(2) of this
section, it may make the remaining commodities available to
institutions that:
(i) Document, to the satisfaction of the food bank, that they serve
meals predominantly to needy persons; and
(ii) Do not employ a means test to determine eligibility for such
meals.
(b) Tax-exempt status. Prior to making section 110 donated food
available, the distributing agency shall ensure that the soup kitchen/
food bank has obtained recognition of tax-exempt status under the
Internal Revenue Code, has made application for recognition of such
status and is moving toward compliance with the requirements for
recognition of tax-exempt status, or is currently operating another
Federal program requiring such tax-exempt status. If the Internal
Revenue Service (IRS) denies a participating organization's application
for recognition of tax-exempt status, the organization shall
immediately notify the distributing agency of such denial, and the
distributing agency shall terminate the organization's agreement and
participation immediately upon receipt of such notification. If
documentation of IRS recognition of tax-exempt status has not been
obtained and forwarded to the distributing agency within 12 months of
the effective date of the organization's approval for participation,
the distributing agency shall terminate the organization's agreement
and participation until such time as documentation of IRS recognition
of tax-exempt status is obtained, unless the organization documents to
the distributing agency's satisfaction that it has made good faith
efforts to obtain recognition of its tax-exempt status and that such
recognition has not been provided due to no fault of the organization.
It shall be the responsibility of the soup kitchen/food bank to
document that it has complied with all IRS requirements and has
provided all information requested by IRS in a timely manner.
(c) Agreements. The distributing agency shall distribute section
110 commodities only to those soup kitchens and food banks which have
entered into an agreement for participation in the program with the
distributing agency in accordance with Sec. 250.12(b). In addition to
the terms and conditions set forth in Sec. 250.12(b), written
agreements shall, at a minimum, include:
(1) The name and location of the organization;
(2) Total number of meals expected to be served or commodities
provided to households for home consumption during the agreement
period, to be determined as follows:
(i) The total number of meals to be served in a congregate meal
setting shall be determined by projecting the average number of meals
to be served daily and the number of days meals will be served during
the agreement period; and
(ii) The number of needy households to be provided food for home
consumption shall be determined by projecting the number of households
to be served during the agreement period (in accordance with the method
set by the distributing agency) which meet the eligibility criteria
which the distributing agency has determined appropriate pursuant to
paragraph (a)(2) of this section;
(3) For congregate meal service, indication of whether the
organization will employ the services of a food service management
company to conduct its food service operations;
(4) Assurance that proper inventory controls will be maintained;
(5) Assurance that all reports will be submitted as required by the
distributing agency; and
(6) In instances in which the donated food will be made available
to an institution for household distribution, assurance that the food
bank will ensure that the institution distributing the commodities
will:
(i) Comply with the limitation on unrelated activities established
under Sec. 251.10(f) of this chapter; and
(ii) Limit distribution of the donated food to those households
which meet the eligibility criteria as determined appropriate by the
distributing agency pursuant to paragraph (a)(2) of this section.
(d) Quantities of donated foods. (1) Donated food purchased under
section 110 of the Hunger Prevention Act of 1988 will be allocated to
States by the Department on the basis of a formula that compares each
State's population of low-income and unemployed persons to the national
statistics. Each State's share of commodities, as measured by their
value, shall be based 60 percent on the number of persons in households
within the State having incomes below the poverty level and 40 percent
on the number of unemployed persons within the State. The Department
will notify each State of the types and amounts of such commodities
allotted to the State under the formula when funds have been
appropriated for the purchase of such commodities. The Department will
make annual adjustments to the commodity allocations for each State,
based on updated unemployment statistics, which will be effective for
the entire fiscal year, except that such allocations shall be subject
to reallocation or transfer in accordance with paragraph (d)(4) of this
section and Sec. 250.13(a).
(2) The distributing agency shall notify the appropriate FNSRO of
the amount of the donated food it will accept no later than 30 days
prior to the beginning of the shipping period.
(3) The distributing agency shall accept or adjust the data
reported in the agreement by soup kitchens and food banks to determine
the number of meals to be served to needy persons and the number of
needy households to be served in order to allocate the donated food in
an equitable manner that ensures that commodities will not be made
available in quantities in excess of anticipated use or the ability of
the organization to accept and store the commodities.
(4) In instances in which a State determines that it will not
accept its full allocation, the Department will reallocate these
commodities in a fair and equitable manner among those States that
accept the full amount of their allocations and request additional
amounts.
(e) Funding. Soup kitchens and food banks receiving section 110
commodities shall be eligible to receive Emergency Food Assistance
Program administrative funds for use in accordance with the provisions
set forth in Sec. 251.8(d)(1)(ii) of this chapter, provided that they
have entered into an agreement in accordance with Sec. 251.8(d)(2) of
this chapter.
(f) Maintenance of effort. Prior to making donated food available,
the distributing agency shall obtain written assurance from the soup
kitchen or food bank that food donations from other sources will not be
diminished as a result of donated foods being made available under
section 110 of the Hunger Prevention Act of 1988. This assurance
statement shall be maintained on file by the distributing agency.
(g) Food service management companies. Institutions preparing
congregate meals with section 110 commodities may employ food service
management companies to conduct food service operations in accordance
with Sec. 250.12(c).
PART 251--THE EMERGENCY FOOD ASSISTANCE PROGRAM
1. The authority citation for Part 251 continues to read as
follows:
Authority: Pub. L. 98-8, as amended (7 U.S.C. 612c note).
2. The Part heading is revised as set forth above.
3. In Sec. 251.2, paragraph (c) is amended by removing the words
``storage and distribution costs'' in the first sentence and adding in
their place the words ``administrative costs''.
4. In Sec. 251.3, paragraph (d) is revised to read as follows,
paragraph (f) is removed, and paragraph (g) is redesignated as
paragraph (f).
Sec. 251.3 Definitions.
* * * * *
(d) Formula means the formula used by the Department to allocate
among States the commodities and funding available under this part. The
amount of such commodities and funds to be provided to each State will
be based on each State's population of low-income and unemployed
persons, as compared to national statistics. Each State's share of
commodities and funds shall be based 60 percent on the number of
persons in households within the State having incomes below the poverty
level and 40 percent on the number of unemployed persons within the
State. The surplus commodities will be allocated to States on the basis
of their weight (pounds), and the commodities purchased under section
214 of the Emergency Food Assistance Act of 1983 will be allocated on
the basis of their value (dollars). In instances in which a State
determines that it will not accept the full amount of its allocation of
commodities purchased under section 214 of the Emergency Food
Assistance Act of 1983, the Department will reallocate the commodities
to other States on the basis of the same formula used for the initial
allocation.
* * * * *
5. In Sec. 251.4:
a. A new paragraph (c)(3) is added;
b. paragraph (d)(3) is revised, and the concluding text beginning
with the word `Cheese' is removed;
c. paragraphs (h), (i) and (j) are redesignated as paragraphs (j),
(k) and (l), and new paragraphs (h) and (i) are added; and
d. the references to ``paragraph (j)(4)'' in newly redesignated
paragraph (l) are removed, and references to ``paragraph (l)(4)'' are
added in their place.
The revision and additions read as follows:
Sec. 251.4 Availability of commodities.
* * * * *
(c) Allocations. * * *
(3) State agencies shall notify the appropriate FNSRO of the amount
of the commodities they will accept not later than 30 days prior to the
beginning of the shipping period.
(d) Quantities requested. * * *
(3) Establish distribution rates, based on household size, to be
used by emergency feeding organizations which provide commodities to
needy persons in households.
* * * * *
(h) Distribution to emergency feeding organizations. Emergency
feeding organizations shall be eligible to receive commodities which
are made available under sections 202 and 214 of the Emergency Food
Assistance Act of 1983. State agencies may give priority in the
distribution of these commodities to existing food bank networks and
other organizations whose ongoing primary function is to facilitate the
distribution of food to low-income households, including food from
sources other than the Department.
(i) Distribution of non-USDA foods. Emergency feeding organizations
may incorporate the distribution of foods which have been donated by
charitable organizations or other entities with the distribution of
USDA-donated commodities or distribute them separately.
* * * * *
6. In Sec. 251.6, paragraph (a)(4) is revised to read as follows:
Sec. 251.6 Distribution plan.
(a) Contents of the plan. * * *
(4) A description of the State's formula for allocating
administrative funds among State agencies and emergency feeding
organizations, including, if applicable, soup kitchens and food banks
receiving administrative funds in connection with commodities which are
made available under section 110 of the Hunger Prevention Act of 1988
in accordance with Sec. 251.8(d)(1); and
* * * * *
7. In Sec. 251.7, paragraph (a) is revised to read as follows:
Sec. 251.7 Formula adjustments.
(a) Commodity adjustments. The Department will make adjustments to
the commodity allocation formula for each State, based on updated
unemployment statistics, as follows:
(1) Surplus commodities. Adjustments will be made semi-annually
effective on January 1 and July 1 of each fiscal year; and
(2) Purchased commodities. Adjustments will be made annually and
will be effective for the entire fiscal year, subject to reallocation
or transfer in accordance with this part.
* * * * *
8. Section 251.8 is amended by revising the section heading and
paragraph (d) to read as follows:
Sec. 251.8 Payment of funds for administrative costs.
* * * * *
(d) Use of funds--(1) Allowable administrative costs. Funds made
available under this part shall be used by State agencies or emergency
feeding organizations only for the following administrative costs:
(i) USDA commodities. Funds may be used for the direct costs
associated with the intrastate distribution of commodities donated
under this part and under section 110 of the Hunger Prevention Act of
1988 by emergency feeding organizations. In addition, emergency feeding
organizations that also receive commodities under part 250 of this
chapter may use the funds provided under this part for direct costs
associated with the distribution of such commodities. These costs
include the costs paid by an emergency feeding organization or paid by
a State agency on behalf of an emergency feeding organization for:
(A) Transporting, storing, handling, repackaging, processing, and
distributing commodities incurred after they are received by the
organization;
(B) Costs associated with determinations of eligibility,
verification, and documentation;
(C) Costs of providing information to persons receiving USDA
commodities concerning the appropriate storage and preparation of such
commodities;
(D) Costs involved in publishing announcements of times and
locations of distribution; and
(E) Costs of recordkeeping, auditing, and other administrative
procedures required for program participation.
(ii) Non-USDA commodities. Funds may also be used by emergency
feeding organizations for the direct costs associated with the
intrastate distribution of commodities donated by persons or entities
other than USDA, provided, however, that these costs shall be limited
to the costs of storing, handling and distributing such commodities.
State-level costs shall be allowable only to the extent that the
commodities are ultimately distributed by emergency feeding
organizations which have entered into agreements with the State agency
in accordance with paragraph (d)(2) of this section.
(2) Agreements. (i) In order to be eligible for funds under
paragraph (d)(1) of this section, emergency feeding organizations shall
have entered into an agreement pursuant to Sec. 251.2(c) for the
receipt of donated foods under this part or an agreement pursuant to
paragraph (d)(2)(ii) of this section for the receipt of funds in
connection with section 110 commodities.
(ii) In instances in which administrative funds are made available
in connection with section 110 commodities and the State agency
responsible for the distribution of TEFAP commodities and funds is not
also responsible for the distribution of section 110 commodities, the
State agency responsible for the administration of TEFAP shall enter
into an agreement with the soup kitchens/food banks (as described in
Sec. 250.52(c) of this chapter) requesting the funds, or with the State
agency responsible for the distribution of section 110 commodities,
which will then enter into agreements with those soup kitchens and food
banks. The agreement with the soup kitchen or food bank shall require
compliance with the provisions of this section and Sec. 251.10(a) and
(e).
(3) Local support. (i) Not less than 40 percent of the Federal
Emergency Food Assistance Program administrative funds allocated to the
State in accordance with paragraph (a) of this section shall be:
(A) Provided by the State agency to emergency feeding organizations
as either reimbursement or advance payment for administrative costs
incurred by emergency feeding organizations in accordance with
paragraph (d)(1) of this section, except that emergency feeding
organizations may retain advance payments only to the extent that they
actually incur such costs; or
(B) Directly expended by the State agency to cover administrative
costs incurred by, or on behalf of, emergency feeding organizations in
accordance with paragraph (d)(1) of this section.
(ii) State agencies shall not charge for commodities made available
under this part to emergency feeding organizations.
* * * * *
9. Section 251.9 is amended by revising paragraphs (a) and (c) to
read as follows:
Sec. 251.9 Matching of funds.
(a) State matching requirement. The State shall provide a cash or
in-kind contribution equal to the amount of the Federal Emergency Food
Assistance Program administrative funds received under Sec. 251.8 and
retained by the State agency for State-level costs. Any portion of the
Federal grant passed through for administrative costs incurred at the
local level or directly expended by the State agency for such local-
level costs (in accordance with Sec. 251.8(d)(3)) shall be exempt from
the State match requirement.
* * * * *
(c) Applicable contributions. States shall meet the requirements of
paragraph (a) of this section through cash or in-kind contributions
from sources other than Federal funds which are prohibited by law from
being used to meet a Federally mandated State matching requirement.
Such contributions shall meet the requirements set forth in 7 CFR
3016.24. In accordance with 7 CFR 3016.24(b)(1), the matching
requirement shall not be met by contributions for costs supported by
another Federal grant, except as provided by Federal statute. Allowable
contributions are only those contributions for costs which would
otherwise be allowable as State or local-level administrative costs.
(1) Cash. An allowable cash contribution is any cash outlay of the
State agency for a specifically identifiable allowable State- or local-
level administrative cost, including the outlay of money contributed to
the State agency by other public agencies and institutions, and private
organizations and individuals. Examples of cash contributions include,
but are not limited to, expenditures for office supplies, storage
space, transportation, loading facilities and equipment, employees'
salaries, and other goods and services specifically identifiable as
State- or local-level administrative costs for which there has been a
cash outlay by the State agency.
(2) In-kind. (i) Allowable in-kind contributions are any
contributions, which are non-cash outlays, of real property and non-
expendable personal property and the value of goods and services
specifically identifiable with allowable State administrative costs or,
when contributed by the State agency to an emergency feeding
organization, allowable local-level administrative costs. Examples of
in-kind contributions include, but are not limited to, the donation of
office supplies, storage space, vehicles to transport the commodities,
loading facilities and equipment such as pallets and forklifts, and
other non-cash goods or services specifically identifiable with
allowable State-level administrative costs or, when contributed by the
State agency to an emergency feeding organization, allowable local-
level administrative costs. In-kind contributions shall be valued in
accordance with 7 CFR 3016.24(c) through 3016.24(f).
(ii) In order for a third-party in-kind contribution to qualify as
a State-level administrative cost for purposes of meeting the match,
all of the following criteria shall be met:
(A) In its administration of food assistance programs, the State
has performed this type of function over a sustained period of time in
the past;
(B) The function was not previously performed by the State on
behalf of emergency feeding organizations; and
(C) The State would normally perform the function as part of its
responsibility in administering TEFAP or related food assistance
programs if it were not provided as an in-kind contribution.
* * * * *
8. In Sec. 251.10:
a. Paragraph (a)(2) is amended by removing reference to ``3015''
and adding a reference to ``3016'' in its place;
b. the third sentence of paragraph (d)(1) is revised;
c. paragraph (e)(2) is revised; and
d. new paragraphs (e)(7), (g) and (h) are added.
The revisions and additions read as follows:
Sec. 251.10 Miscellaneous provisions.
* * * * *
(d) Reports. (1) * * * The data shall be identified on Form FNS-
667, Report of Administrative Costs (TEFAP), and shall be submitted to
the appropriate FNS Regional Office on a quarterly basis. * * *
* * * * *
(e) State monitoring system. * * *
(2) Unless specific exceptions are approved in writing by the FNS
Regional Office, the State monitoring system shall include:
(i) An annual review of at least 25 percent of all emergency
feeding organizations and a review of all such organizations not less
frequently than once every four years; and
(ii) An annual review of one-third or 50, whichever is fewer, of
all distribution sites within the State, to be conducted, to the
maximum extent feasible, simultaneously with actual distribution and/or
eligibility determinations.
* * * * *
(7) State agencies shall ensure that emergency feeding
organizations which receive administrative funds in connection with
commodities made available under section 110 of the Hunger Prevention
Act of 1988 are reviewed at the frequency stipulated in paragraph
(e)(2)(i) of this section to ensure compliance with the provisions
contained in Sec. 251.8.
* * * * *
(g) Use of volunteer workers and non-USDA commodities. In the
operation of the Emergency Food Assistance Program, State agencies and
emergency feeding organizations shall, to the maximum extent
practicable, use volunteer workers and foods which have been donated by
charitable and other types of organizations.
(h) Maintenance of effort. If the State uses its own funds to
provide commodities or services to organizations receiving funds or
services under section 214 of the Emergency Food Assistance Act of
1983, the State shall not diminish the level of support it provides to
such organizations or reduce the amount of funds available for other
nutrition programs in the State in each fiscal year.
Dated: April 3, 1994.
William E. Ludwig,
Administrator.
[FR Doc. 94-8505 Filed 4-8-94; 8:45 am]
BILLING CODE 3410-30-U