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DCH Sponsor Administrative Payment Options


Nutrition Services Division Management Bulletin
Purpose: Policy, Action Required, Beneficial Information
To: Child and Adult Care Food Program Day Care Home Sponsors Number: USDA-CACFP-10-2013
Attention: Executive Directors and Authorized Representatives Date: November 2013
Subject: Child and Adult Care Food Program Day Care Home Sponsor Administrative Payment Options
Reference: The Healthy, Hunger-Free Kids Act of 2010, Public Law 111-296; USDA Policy Memoranda CACFP 06-2011; USDA Policy Memoranda: CACFP 18-2011; USDA Policy Memoranda: CACFP 11-2012; California Department of Education Management Bulletin USDA-CACFP-08-2011

This Management Bulletin (MB) provides details to Child and Adult Care Food Program (CACFP) Day Care Home (DCH) sponsors of a new annual requirement. DCH sponsors are required to select one of three administrative payment options beginning with Program Year (PY) 2013–14 in the Child Nutrition Information and Payment System (CNIPS).

Background

The Healthy, Hunger-Free Kids Act of 2010, Public Law 111-296, modified the calculation for administrative payments to DCH sponsors in the CACFP. Effective PY 2010–11, monthly administrative payments were modified to be calculated based solely on the number of DCH providers that submit a claim during the month, multiplied by the current administrative reimbursement rate.

The modification to the administrative payment calculation caused some DCH sponsors, that used none or a partial amount of their administrative payment, to account for and return overpayments to the California Department of Education (CDE) at the end of the PY.

Due to the significant amounts of returned unused administrative payments, the U.S. Department of Agriculture issued new guidance in Policy Memorandum CACFP 11-2012 that authorizes the CDE to provide administrative payment options to DCH sponsors.

Annual Action Required

Beginning with the administrative payments for PY 2013–14, each DCH sponsor must select one of three administrative payment options in the CNIPS DCH Sponsor Application during the annual update process. 

The three administrative payment options are:

  1. Total homes claimed by the current rates
  2. Actual costs (not to exceed total homes claimed by the current rates)
  3. No administrative payments

If a DCH sponsor determines the need to stop receiving administrative payment(s) while in the current PY to reduce the amount of returned unused payments, a DCH sponsor can revise their CNIPS DCH Sponsor Application. If a sponsor chooses to no longer receive administrative payment(s) after the annual update process, the change has no effect on claim month(s) already submitted during the PY. Once the last claim is submitted, any PY month(s) going forward will not receive administrative payment(s).

Example 1: A DCH sponsor selects “Actual costs.” The administrative payments for each month during the PY will equal the sponsor’s expenses so there will be no remaining funds to carry over or return.

Example 2: A DCH sponsor selects “Total homes claimed by the current rates.” The administrative payments for each month during the PY will be based on this formula. After submitting the June claim, the DCH sponsor chooses to stop receiving administrative payments and revises the CNIPS DCH Sponsor Application. The DCH sponsor will have received administrative payments for the PY months of October through June and will not receive any administrative payments for the PY months of July through September.

Note: After a DCH sponsor selects to not receive administrative payments, either during the annual update process or later in the PY, the administrative payment option cannot be changed for the remainder of that PY.

Questions

If you have any questions regarding this MB, please contact your CACFP Analyst. The CACFP Analyst list is available in the CNIPS Download Forms section, titled as “CACFP 01.” You may also contact a CACFP Office Technician by phone at 916-327-2991 or 800-952-5609.

Questions:   Nutrition Services Division | 800-952-5609
Last Reviewed: Thursday, January 14, 2016

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