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Information on Existing Inventory of USDA Foods

Nutrition Services Division Management Bulletin
Purpose: Policy, Beneficial Information

To: Food Distribution Program Recipient Agencies

Number: USDA-FDP-08-2012

Attention: Food Service Directors

Date: September 2012

Subject: Information on Existing Inventory of U.S. Department of Agriculture Foods and Commercial Products

Reference: U.S. Department of Agriculture, Food and Nutrition Service Policy Memo SP 39-2012, Existing Inventory of USDA Foods and Commercial Products

This Management Bulletin (MB) provides information on U.S. Department of Agriculture (USDA) Food and Nutrition Service Policy Memo SP 39-2012, Existing Inventory of USDA Foods and Commercial Products. The policy memo is available on the USDA School Meals Policy Memos Web page at

This MB gives direction to Recipient Agencies (RA) on how to utilize existing inventory of USDA Foods and commercial products that, due to their large portion sizes, pose challenges fitting into the new National School Lunch Program meal pattern. In addition, this MB addresses how to modify and/or cancel orders that have been submitted but are not yet processed and how to manage future orders at processors.


The USDA and the California Department of Education (CDE) recognize that both RAs and their food suppliers are working together to ensure that all end products containing USDA Foods support the new meal pattern. The CDE strongly encourages RAs to use all food purchased for their school meal programs. RAs must honor their procurement contracts and utilize inventories of end products that USDA Foods processors have produced. RAs should plan to menu these existing inventories as quickly as possible and begin planning for new procurements that were not re-bid for School Year (SY) 2012–13.

Recognizing that product development, production, and procurement timelines pose challenges for RAs and their suppliers, the CDE’s Food Distribution Program (FDP) will work with RAs to utilize existing inventories and strengthen procurement practices in support of the new meal patterns, particularly early in the school year.

It is important to note that in SY 2012–13, in accordance with the regulations, a quantity violation is not a disallowance on a first administrative review. However, if planned menus using existing inventories fall outside the weekly required ranges, RAs may not be eligible to receive the additional six cent reimbursement. RAs should apply for the six cent certification as soon as they are able to provide compliant menus that meet all meal pattern requirements. For certification requirements, please see MB USDA-SNP-35-2012, Menu Certification for Performance-Based Reimbursement, dated August 2012, located on the School Nutrition Programs MB Web page at

Strategies for Utilizing Inventory

In addition to the strategies identified below for the school meal programs, RAs should also consider other potential uses of the food (in other child nutrition programs or vended meals not subject to the new meal pattern).

  1. Physical inventory of end products

There are several options for RAs to utilize existing inventory, whether at a distributor, processor, or at schools, particularly large-portioned food items that do not easily fit the weekly maximum requirements.

RAs may plan to offer larger items less frequently on the menu, such as no more than once per week since the grain and meat/meat alternative (M/MA) limits are on a weekly basis. RAs may also find that certain items, such as larger hamburger patties, may need to be transferred to high schools where the weekly M/MA limits are higher. Products may be adjusted in form and used as ingredients in other menu items (e.g. stewing bone-in chicken for soup for smaller individual M/MA servings).

RAs should also work with other school districts or the FDP to request transfers of food where excess inventories can be utilized by others. End products containing USDA Foods may be used for staff meals or donated to local food banks or other non-profit charitable organizations. If the existing inventory is stored at distributors and/or processors, the RAs must order and receive the inventory before they can donate it.

  1. End product orders submitted at processors but not yet processed

For end products that have been ordered and are at the processing facility, but not yet processed or delivered to the school, RAs should explore with manufacturers if they can change existing product specifications for their end products. The FDP and the USDA will work closely with processors to expedite the approval and availability of end products that meet the new meal pattern requirements. Such products may be further processed or prepared in a way that reduces portion size (e.g. resizing of hamburger patties). RAs will need to work closely with both the FDP and processors to determine what flexibility exists within existing specifications and the procurement and/or contract parameters. Where necessary, the FDP and the USDA will approve additional end products to include in the Summary End Product Data Schedules to allow bulk inventory to be used with the newly available end products.

  1. Orders to be placed in the near future but not yet purchased

Where appropriate, the FDP may adjust or cancel USDA Food orders for products that have not been purchased. The FDP will, whenever possible, request orders for other USDA Foods to allow RAs to effectively utilize their planned entitlement. The USDA is currently in the process of reviewing existing USDA Foods specifications and will be working to revise them as needed.

For commercial products scheduled to be ordered in the coming months, RAs should change existing product specifications in their current contracts as soon as possible. This also applies to future procurements through the remainder of SY 2012–13. RAs that could not complete procurements prior to SY 2012-13, and amended their current contracts, are required to ensure that new procurements are in place for SY 2013–14, as indicated in MB USDA-SNP-18-2012, Procurement Q and A for the New Meal Pattern, dated July 2012, located on the School Nutrition Programs MB Web page at

RAs should assess the cost of ineffective use of existing inventories because of challenges with the new meal requirements. It is especially important that RAs have an opportunity to utilize the full value of USDA Foods.

Contact Information

For questions concerning the menu certification process, SFAs may contact the Education and Nutrition Policy Unit’s Certification Unit, by e-mail at To be contacted by phone, please e-mail your contact information to and a certification team member will return your call within one business day.

For questions regarding USDA Foods, please contact Amy Bell, Child Nutrition Consultant, Food Administration Unit, by phone at 916-322-5051 or by e-mail at; or Sherry Tam, Child Nutrition Consultant, Food Administration Unit, by phone at 916-324-9875 or by e-mail at

Questions:   Nutrition Services Division | 800-952-5609
Last Reviewed: Tuesday, February 9, 2016
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