Local Food for Schools

Overview

Since the pandemic, many SFAs of the National School Lunch Program (NSLP) and School Breakfast Program (SBP) have experienced unprecedented supply chain challenges in purchasing and receiving nutritious domestic foods through their normal distribution channels.

To combat the challenges, the USDA Agricultural Marketing Service established the LFS funds. The purpose of this program is to increase purchasing of local and regional foods by schools. This funding opportunity is intended to strengthen the food system for schools by helping to build a fair, competitive, and resilient local food chain, and expand local and regional markets with an emphasis on purchasing from historically underserved producers and processors.

The LFS funds achieves this purpose by:

1. Providing an opportunity for schools to strengthen their local and regional food system.
2. Helping to support local, small, and socially disadvantaged farmers and producers through building and expanding economic opportunities.
3. Establishing and broadening partnerships between farmers, producers and schools to facilitate an increased distribution of fresh and nutritious foods.

Frequently Asked Questions

The USDA has developed a comprehensive question and answer guide pertaining to the LFS funds.

Access the LFS Questions and Answers document on the USDA Local Food for Schools Cooperative Agreement Program web page .

Guidelines

Opt-In Process

The CDE will conduct a two-part online opt-in process for SFAs to receive funds. First, SFAs will complete an attestation opt-in registration indicating their intent to participate in the LFS and their understanding and agreement to comply with the LFS guidelines and requirements. Second, after notification of their award amount, SFAs will provide specific data and procurement documents to exhibit how they have committed their LFS funds.

On-line Opt-In Process – Part One: Attestation Statement

Eligible SFAs intending to accept (opt in) or deny (opt out of) their LFS funding allocation must sign and submit the attestation statement. By signing the attestation statement, the SFA also agrees to:

• Use LFS funds only for purchasing unprocessed or minimally processed local, regional or California grown and produced food products from local producers, small businesses, and socially disadvantaged farmers/producers; and
• Comply with all existing program requirements regarding recordkeeping and accountability in connection with the use of their LFS funding.

New National School Lunch Program (NSLP) and/or School Breakfast Program (SBP) sponsors in School Year 2022–23 must complete the full sponsor approval process and sign and submit the attestation statement in order to be eligible for LFS funds.

The attestation will take about 30 minutes to complete. The attestation must be completed and submitted by 5:00 p.m. on March 24, 2023. Late submissions will not be accepted.

The required attestation is available on the CDE attestation web page.

Following completion of the attestation survey, SFAs will be notified of their LFS subaward amount via email.

On-Line Opt-In Process – Part Two: Procurement Documentation

After the notification of the SFA’s award amount, SFAs must provide procurement documents and an established purchasing schedule to exhibit how LFS funds will be spent during the program prior to receiving the initial advance payment. Instructions will be provided on how to submit the required documents and the required timeline in the award notification.

Financial Management

LFS funds should be deposited into the nonprofit food service account (NPFSA) of the SFA for which the funds were intended. Once deposited into the NPFSA, they should be separated from other monies within the account or tracked separately from an accounting standpoint.

The CDE has created a new standardized account code to help you record the LFS funds. Please use Resource Code 5467.

LFS funds may only be used for the purchase of unprocessed or minimally processed local, regional, or California grown and produced food. LFS funds may not be used for any administrative work relating to the procurement.

Supplanting

LFS funds must supplement (by increasing or expanding) but not duplicate, existing food procurement. The funds cannot be used to remit funds due for purchases made prior the completion of the opt-in/opt-out process.

Monitoring and Reporting

In addition to the two-part opt in process, LFS participants will also be required to submit records of actual expenditures of funds every 90-day period throughout the program period. This is a requirement of the LFS and will be used to monitor progress and compliance of the program goals and guidelines. Records must validate appropriate purchases of fresh, unprocessed, or minimally processed foods from local, regional or California vendors, farmers, ranchers, or producers and indicate whether the acquisition was with a vendor designated as small or socially disadvantaged. These reports will provide data that will be compiled and used by USDA to validate the effectiveness of the program and to assist in consideration of future programs.

For each 90-day reporting period, the CDE will provide a template to collect information from SFAs. Information to be collected will include:

• Name of vendors and dollar value expended to vendors receiving contracts and type of food purchased (fruit, vegetable, dairy, seafood, other). Copies of any new or revised awarded contracts will be requested.
• Break-down of number of small businesses expended funds and type of commodity purchased (fruit, vegetable, dairy, seafood, other).
• Break-down of number of socially disadvantaged farmers/producers expended funds and type of commodities purchased (fruit, vegetable, dairy, seafood, other).

Funding

State-level Funding Distribution

The USDA has allocated $23,071,364 in LFS funds to the CDE. This amount was determined by the USDA based equally on: 1) student enrollment data, and 2) annualized program earnings data.

The CDE will allocate LFS funds to all eligible SFAs who accept the funding and conditions through the attestation by the specified due date.

Local-level Funding Distribution

The CDE will allocate the $23,071,364 in LFS funding to SFAs based on a predetermined formula. The predetermined formula includes two components: a base payment of $5,000 to all eligible SFAs, and a proportional funding amount based on each SFA’s share of statewide student enrollment from October 2021. The base payment of $5,000 is intended to ensure that the smallest SFAs receive a meaningful level of funding. The proportional amount is intended to provide additional funding resources based on the size of the student population served by an SFA.

The CDE will be utilizing a sub-award process. All of the $23,071,364 funds will be designated for food purchases, including any shipping and handling fees associated with the SFA purchases. The CDE will disburse the funds in two increments. To minimize potential hardship on SFAs, the CDE will make an initial advance payment of 80 percent of the funding to each participating SFA after the two-step opt-in process has been completed, with the remaining 20 percent of funds to be distributed as a reimbursement contingent upon full and accurate completion of the required reporting indicating proof of allowable expenditure of LFS funds. This split is to ensure there are no unspent funds that would need to be repaid to USDA.

Funding amounts are posted on the CDE Funding Results web page.

Funding Notification

SFAs that accept their LFS funding through the attestation statement will receive a notification email. This notification letter will include the SFA’s calculated award amount and further information on the proper use of the funds. The notification letters will be sent within one month after the attestation statement deadline has passed. Schools that do not receive notification should send an email to LFSGrant@cde.ca.gov to check the status of their application.

Period of Performance

The period of performance for the LFS is 18 months which commenced on award from USDA’s Agricultural Marketing Service to the CDE in October 2022 and is scheduled to end in March 2025.

Eligibility

LFS funds are only available to SFAs (including school districts, county offices of education, charter schools, private nonprofit schools, Residential Child Care Institutions, and tribal schools [such as those administered through the Bureau of Indian Education]) currently operating the National School Lunch Program (NSLP) and/or School Breakfast Program (SBP). SFAs that do not operate these School Nutrition Programs are not eligible to receive LFS funds.

Funding is noncompetitive. Program operators of the NSLP or the SBP must register their interest in receiving these funds via an online survey (attestation statement) by the deadline. The attestation statement web link will be posted on the Guidelines tab when it is available.

Expenses

Allowable Expenses

LFS funds must be used exclusively for the purchase of local, regional or California grown and produced food products (also known as commodities) that are unprocessed or minimally processed for use in school meal programs, specifically the National School Lunch Program (NSLP) and School Breakfast Program (SBP). Examples of allowable food products are:

• Fluid milk
• Cheese
• Yogurt
• Fruits and vegetables (including 100 percent juices)
• Grain products such as pastas and rice
• Meats (whole, pieces, or food items such as ground meats)
• Beans
• Legumes
• Foods in a wide variety of minimal processing states (e.g., whole, cut, pureed, etc.) and/or forms (e.g., fresh, frozen, canned, dried, etc.)

Incidental costs (such as those related to storage and distribution) that are a part of the normal or customary purchase price charged by a vendor for any given food product are also an allowable use of LFS funds.

Ensuring Local or Regional Purchases:

LFS funds must be used to purchase local or regional food. Local and regional food is raised, produced, stored, processed, and distributed in the region where the final product is marketed to consumers, so that the total distance that the product travels between where the product originates and the end consumer is at most 400 miles, or the origin of the product is within California.

Target purchases from socially disadvantaged farmers and producers and small businesses:

While purchasing from socially disadvantaged farmers and ranchers and small businesses is not a requirement of the LFS, it is the intent of the program to establish a more robust local supply chain supporting typically underutilized vendors for school food purchases.

For the purpose of this program, socially disadvantaged is a farmer or rancher who is a member of a Socially Disadvantaged Group. A Socially Disadvantaged Group is a group whose members have been subject to discrimination on the basis of race, color, national origin, age, disability, and, where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or a part of an individual's income is derived from any public assistance program.

Examples of Unallowable Expenses

Foods that are generally understood to be significantly processed or prepared may not be purchased using LFS funds. For example:

• Baked goods such as breads, muffins, or crackers
• Pre-packaged sandwiches or meals
• Prepared and/or pre-cooked items such as chicken nuggets, that come ready-to-eat or that require no further preparation beyond heating
• Nondomestic food products

To further illustrate, crushed tomatoes, shredded cheese, whole-wheat flour, and sliced vegetables are all food items that are individually allowable, but a pre-made pizza comprised of those ingredients would not be allowable. A second example is a pre-cooked egg patty where the egg originated from a chicken in another state, but was delivered to and processed into an egg patty at a California based vendor. It is a minimally processed food product, however because the product originated outside of California, it would not be allowable.

Frequently Asked Questions

What is the definition of local and regional food for the LFS funds?

Local and regional food is raised, produced, aggregated, stored, processed, and distributed in the locality or region where the final product is marketed to consumers, so that the total distance that the product travels between the farm or ranch where the product originates and the point of sale to the end consumer is at most 400 miles or within California.

What is the definition of local or regional producer for the LFS funds?

Local or regional producers are farmers, ranchers, producers, processors or distributors and other businesses involved in food production or distribution that are located in the state of California or within 400 miles of the delivery destination.

What is meant by socially disadvantaged producers?

For the purpose of this program, socially disadvantaged is a farmer or rancher who is a member of a Socially Disadvantaged Group. A Socially Disadvantaged Group is a group whose members have been subject to discrimination on the basis of race, color, national origin, age, disability, and, where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or a part of an individual's income is derived from any public assistance program.

What is the definition of a small business for the LFS funds?

A small business means an independently owned and operated business that is not dominant in its field of operation, the principal office is located in California, the officers reside in California, and together with affiliates, has 100 or fewer employees, and average annual gross receipts of $10 million dollars or less over the previous three years, or is a manufacturer with 100 or fewer employees.

Are there any resources to help me connect with vendors that meet the target criteria of small or socially disadvantaged for the LFS funds?

Yes, the California Department of Food and Agriculture Farm to Fork’s Farm to School can assist SFAs throughout the state to connect with local farmers, ranchers, producers, processors or distributors including those that are in a socially disadvantaged group or are a small business. The Farm to School team can be reached at cafarmtoschool@cdfa.ca.gov.

Are purchases limited to socially disadvantaged producers and small businesses for the LFS funds?

While purchasing from socially disadvantaged farmers and ranchers and small businesses is not a requirement, it is a significant goal of the LFS program and must be reported on for each purchase made with LFS funds.

What foods are considered unprocessed or minimally processed for the LFS funds?

Examples of allowable unprocessed or minimally processed food products include fruits and vegetables (including 100 percent juices); grain products such as pastas and rice; meats (whole, pieces, or food items such as ground meats); meat alternates such as beans or legumes, and fluid milk and other dairy foods such as cheese and yogurt. Foods in a wide variety of minimal processing states (e.g., whole, cut, pureed, etc.) and/or forms (e.g., fresh, frozen, canned, dried, etc.) are also allowable.

What are examples of unallowable foods for the LFS funds?

Foods that are generally understood to be significantly processed or prepared are unallowable. Examples of unallowable products include baked goods such as breads, muffins, or crackers; prepackaged sandwiches or meals; other prepared and/or pre-cooked items that come ready-to-eat or that require no further preparation beyond heating (e.g. chicken nuggets, fish sticks, pre-made pizzas, etc.).

Which School Nutrition Programs can we support with LFS funds?

LFS funds may only be used to support the National School Lunch Program and the School Breakfast Program.

Can LFS funds be used for existing contracts with suppliers?

Yes, if a School Food Authority (SFA) has an existing purchasing agreement already in place with a local, regional California producer/vendor to supply unprocessed or minimally processed foods, then LFS funds awarded can supplement existing procurement but must not supplant or displace existing food procurement activities. For example, if a school has an existing agreement to purchase $6,000 dollars of fresh strawberries from a local farmer, that agreement can be amended to increase the purchase order for an additional $5,000 dollars of fresh strawberries or strawberries and blueberries from the same contacted vendor.

Where should the LFS funds be deposited?

The LFS funds should be deposited into the nonprofit school food service account, also known as the Cafeteria Fund or Fund 13. LFS funds deposited to the cafeteria fund do not need to be separated from other monies within the account.

How should LFS funds be tracked?

SFAs are required to maintain documentation (such as invoices and receipts) supporting their allowable food purchases equal to the amount received and the documentation must be consistent with the regular program recordkeeping requirements.

Can SFAs use LFS funds if they utilize contracts to procure vended meals and/or the services of a Food Service Management Company (FSMC)?

In situations where an SFA has a FSMC, or a vended meal contract, the SFA may use LFS funds toward the payment of invoices associated with those agreements. However, it is the responsibility of the SFA to ensure that such payments, over the period in which the award is used, include charges for minimally processed domestic foods at least equal to the amount of LFS funds used to pay the invoices. SFAs will need to work with their FSMC/vendor to ensure that appropriate expenditures are being made and documented for foods meeting the requirements as specified in the terms and conditions of the award.

In practice, SFAs are not required to collect documentation from their FSMC in advance of payment; however, there is an expectation that documentation will be available upon demand. Documentation should include invoices for minimally processed domestic foods purchased in support of the contract that are at least equal to LFS funds paid to the FSMC/vendor.

Additionally, SFAs retain the ability to purchase allowable food items outside of their food service management contract, as long as the contract permits such purchases.

How much time do I have to expend the LFS Funds?

Funds must be fully expended by June 2024.

Can LFS Funds be used to purchase livestock, live animals, or cattle?

No. Funding can only be used to purchased unprocessed or minimally processed foods, such as meat, poultry, fruit, vegetables, seafood, and dairy.

Resources

Local Food for Schools Funding Overview (PPTX)

Contacts

LFS Fund Questions

Submit questions regarding this funding to LFSgrant@cde.ca.gov.

School Nutrition Program (SNP) Analysts

For general questions regarding the SNP, contact your SNP Analyst on the CDE SNP Specialist Directory web page.

California Department of Food and Agriculture Office of Farm to Fork’s Farm to School Program

For resources to establish connections with farmers, producers, and suppliers who are able to provide fresh, unprocessed, and/or minimally processed foods contact the California Department of Food and Agriculture (CDFA) Office of Farm to Fork’s Farm to School program .