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10.556 SPECIAL MILK PROGRAM FOR CHILDREN

FEDERAL AGENCY

FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE

AUTHORIZATION

Child Nutrition Act of 1966, as amended, 42 U.S.C. 1772 and 1779.

OBJECTIVES

To provide subsidies to schools and institutions to encourage the consumption of fluid milk by children.

TYPES OF ASSISTANCE

Formula Grants.

USES AND USE RESTRICTIONS

Funds are made available to State agencies to encourage the consumption of fluid milk by children in public and private nonprofit schools of high school grade and under, public and private nonprofit nursery schools, child-care centers, settlement houses, summer camps, and similar nonprofit institutions devoted to the care and training of children, except Job Corps Centers, provided that these schools and institutions do not participate in a meal service program authorized under the National School Lunch Act or the Child Nutrition Act of 1966. The Child Nutrition Amendments of 1986 expanded eligibility in the program to include children in split session kindergarten and pre-kindergarten programs in nonprofit schools and institutions who do not have access to the Federal meal service program operating in schools the children attend. Disbursement to States is made on the basis of the number of half pints of milk served to non-needy children, using a reimbursement rate specified by law. Milk served free to eligible needy children is reimbursed at the average cost of a half pint of milk.

ELIGIBILITY REQUIREMENTS

Applicant Eligibility

Any State or U.S. Territory (except territories subject to the requirements of the Compact of Free Association). Any public and nonprofit private school of high school grade or under, and public and private nonprofit residential and nonresidential child care institutions, except Job Corps Centers, may participate in the Special Milk Program upon request if it does not participate in a meal service program authorized under the National School Lunch Act or the Child Nutrition Act of 1966. This generally includes nonprofit nursery schools, child-care centers, settlement houses and summer camps. Schools with split session kindergarten and pre-kindergarten programs can receive subsidies for milk served to children in the split session kindergartens and pre- kindergartens who do not have access to another meal service program operating in the school. All schools and child care institutions which participate must agree to operate the program on a nonprofit basis for all children without regard to race, sex, color, National origin, age or disability.

Beneficiary Eligibility

All children attending schools and institutions in which the Special Milk Program is in operation may participate in the program.

Credentials/Documentation

Applicant organizations must furnish evidence of nonprofit status. Costs will be determined in accordance with USDA Uniform Federal Assistance Regulations (7 CFR Part 3015 or 3016 and 3019).

APPLICATION AND AWARD PROCESS

Preapplication Coordination

The standard application forms as furnished by the State agency or Food and Nutrition Service, as applicable, must be used for this program. This program is eligible for coverage under E.O. 12372, "Intergovernmental Review of Federal Programs." An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance.

Application Procedure

Public schools in all States make application to the State educational agency unless a waiver designating an alternate agency is approved. Appropriate forms may be obtained from this agency. In most cases, nonprofit private schools and institutions also apply to the State educational agency. However, in some States, the State educational agency is prohibited by State statute from disbursing Federal funds to nonprofit private schools and institutions. In such instances, the application will be referred to the appropriate alternate State agency or the appropriate Food and Nutrition Service regional office.

Award Procedure

State agency or Food and Nutrition Service regional office, where applicable, reviews written application of school or child care institution and upon determination of eligibility makes written agreement with sponsor for participation in the program.

Deadlines

Federal/State agreement must be signed.

Range of Approval/Disapproval Time

Agreements are effective upon approval of the State Agency or Food and Nutrition Service, where applicable.

Appeals

None. State agencies or Food and Nutrition Service regional offices, where applicable, are responsible for determining eligibility of a school or institution.

Renewals

Permanent, amended as necessary.

ASSISTANCE CONSIDERATIONS

Formula and Matching Requirements

The reimbursement rate for each paid half pint of milk served to children with household income levels above 130 percent of the poverty line in schools and institutions that participate in the Special Milk Program during school year 2004-05 is 17.0 cents, and the reimbursement rate for each 1/2 pint of milk served free (in pricing programs with a free milk option) to children with household income levels at or below 130 percent of poverty is the average cost of 1/2 pint of milk. This rate is adjusted each school year to correspond to the change in the Producer Price Index for Fluid Milk Products published by the Bureau of Labor Statistics. The statistical factor used for beneficiary eligibility for free milk is 130 percent of the poverty line and the source is the Federal income poverty guidelines. There is no matching guideline. The cost of milk in excess of the Federal reimbursement must be borne by sources within the States (7 CFR Part 215). Disbursement to States is based on the number of half pints served to children. This program has no maintenance of effort (MOE) requirement.

Length and Time Phasing of Assistance

For the period covered by the agreement.

POST ASSISTANCE REQUIREMENTS

Reports

State agencies, schools and institutions file monthly reports on program operations to claim for reimbursement. Schools must submit final claims to the State agency no later than 60 days after the claiming month, and States must submit final program reports to Food and Nutrition Service no later than 90 days after the claiming month. For each fiscal year, States must submit final grant close out reports to the Food and Nutrition Service not later than 120 days after the close of the fiscal year to which they pertain.

Audits

In accordance with the provisions of OMB Circular No. A- 133, "Audits of States, Local Governments, and Nonprofit Organizations," State and local governments, and nonprofit organizations that expended $500,000 or more under Federal awards within any fiscal year shall have either a single audit or (in certain cases) a program specific audit made for that year. Audits may be conducted less frequently under conditions specified in A-133.

Records

Schools and institutions must maintain full and accurate records of Special Milk Program operations. Such records shall be retained for a period of 3 years after the end of the fiscal year to which they pertain except that, if audit findings have not been resolved, the records shall be retained as long as required for their resolution. This program is subject to periodic audits.

FINANCIAL INFORMATION

Account Identification

12-3539-0-1-605.

Obligations

Obligations(Grants) FY 04 $13,977,000; FY 05 est $16,868,000; and FY 06 est $14,819,000.

Range and Average of Financial Assistance

For fiscal year 2004, average Federal assistance is (information to be inserted by budget division) cents for each half-pint of milk served to children with income levels above 130 percent of poverty. State grants vary according to participation in the program. Average Federal assistance for half- pints served free is (information to be inserted by budget division) cents.

PROGRAM ACCOMPLISHMENTS

In fiscal year 2004, 103.4 million half-pints of milk were served.

REGULATIONS, GUIDELINES, AND LITERATURE

Regulations -- 7 CFR Part 215, "Special Milk Program for Children," and 7 CFR Part 245, "Determining Eligibility of Free and Reduced Price Meals and Free Milk in Schools."

INFORMATION CONTACTS

Regional or Local Office

See Appendix IV of the Catalog.

Headquarters Office

Director, Child Nutrition Division, Food and Nutrition Service, Department of Agriculture, Alexandria, VA 22302. Contact: Stanley C. Garnett, Director. Telephone: (703) 305-2590.

Web Site Address

http://www.fns.usda.gov/cnd

EXAMPLES OF FUNDED PROJECTS

Not applicable.

CRITERIA FOR SELECTING PROPOSALS

Not applicable.