School Nutrition Programs Administrative Review

Overview

Section 207 of the Healthy, Hunger-Free Kids Act of 2010 amended Section 22 of the Richard B. Russell National School Lunch Act, Title 42, U.S. Code 1769c, to require the implementation of a more robust and unified accountability system. After a thorough assessment of review requirements in Title 7, Code of Federal Regulations, Section 210.18, the U.S. Department of Agriculture (USDA) established a new process for reviews of SNPs, referred to as the AR.

Implementation of the Administrative Review

Before SY 2013–14, the CDE conducted reviews using the Coordinated Review Effort. The new AR process implements the following changes:

• New Off-site Assessment Tool
  
  
• Increased focus on the overall financial health of an SFA’s nonprofit school food service account (cafeteria fund) in a new Resource Management section. An assessment of the need for a comprehensive SNP AR using the Resource Management Risk Indicator Tool
  
  
• A comprehensive review of the SBP and other federal SNPs (i.e., Afterschool Meal Supplements [snacks], Seamless Summer Option, Special Milk Program, and Fresh Fruit and Vegetable Program)
  
  
• Elimination of follow-up review thresholds

On July 29, 2016, the USDA released the final rule titled ARs in the SNPs. The final rule became effective September 27, 2016, and establishes a unified accountability system in the SNPs by revising the state agency’s review process for the NSLP and SBP. Since the CDE already implemented the updated SNP AR process, many of the changes included in the final rule are currently in place. Some key changes that are new to California include:

• Modification to the CDE’s authority to limit fiscal action for specific critical area violations when corrective action is completed
  
  
• Identification of the scope and duration of fiscal action for repeated violations related to vegetable subgroups, milk type, food quantities, whole grain-rich foods, and dietary specifications. This will be effective beginning in SY 2017–18 in California due to a special waiver that added a fourth year to the first review cycle
  
  
• Clarification of the SFAs’ responsibilities with regard to indirect costs and donated foods
  
  
• Expansion of the SFA on-site review requirements to include the SBP and readily observable general areas of review. An SFA claims review process requirement is also included for the SBP
  
  
• Inclusion for the use of email or fax in addition to traditional methods to send specific documents. These documents include notices to the SFA regarding claim denials or withholding payment, documented corrective action, SFA requests for appeal, and notice of the time, date, and place of hearings
  
  
• Requirement for the CDE to review at least one school from each LEA for SFAs that consist of more than one LEA

The final rule is available on the Federal Register ARs on the SNPs web page .

On May 17, 2017, the USDA released Policy Memorandum SP 31-2017: Clarifications for Fiscal Action School Food Authority-Wide for Administrative Reviews in School Year 2016–2017 . This policy memo provides two options for the CDE to implement fiscal action SFA-wide beginning in SY 2016–17. The CDE has opted to follow option two: State agency discretion to trigger fiscal action SFA-wide using a 3 percent error threshold.

Review Objectives

The CDE and the SFA collaborate to complete the AR to ensure program integrity and increase overall compliance, with the following objectives:

• Determine if the SFA is meeting all federal and state SNP requirements
  
  
• Provide focused technical assistance (TA) to assist the SFA with correcting any findings
  
  
• Secure necessary corrective action documentation demonstrating the SFA’s permanent corrections
  
  
• Assess fiscal action and, when applicable, recover improperly paid funds

It is the CDE’s priority to provide clear and consistent communication, ample TA, and excellent customer service during the transition to the new review process.

In an effort to streamline the AR process, the NSD will implement a multiprogram review approach and review both the NSLP and the CACFP during the same review period if an SFA operates both programs. Federal guidance encourages this streamlined approach to lessen the burden on SFAs. This guidance comes from USDA policy memorandums SP 09-2013 and CACFP 04-2013.

Review Process Phases

The AR process consists of four phases: prereview, on-site review, off-site review, and post-review. The Administrative Review Process from the School Food Authority Perspective (DOC) flowchart provides a high-level overview of the procedures associated with each of the phases. An accessible description of the phases is available in Management Bulletin SNP-23-2015 under Administrative Review Process. Subsequent tabs provide further detail for each of the phases: Prereview, Off-site Review, On-site Review, and Post-review.

Review Schedule

On January 25, 2023, the NSD submitted a waiver to the U.S. Department of Agriculture (USDA) for Title 7, Code of Federal Regulations (7 CFR), Section 210.18(c) to extend the current SNP three-year cycle (School Year [SY] 2023–24 through SY 2025–26) to a five-year cycle (SY 2023–24 through SY 2027–28).

On March 22, 2023, the NSD received notification from the USDA that the waiver request for 7 CFR, Section 210.18(c) was approved.

The current SNP AR cycle is as follows:

Year 1, SY 2023–24

Prior Review Schedule

On February 5, 2019, the CDE NSD submitted a waiver to the U.S. Department of Agriculture (USDA) for Title 7, Code of Federal Regulations (7 CFR), Section 210.18(c) to extend the current SNP three-year cycle (School Year [SY] 2017–18 through 2019–20) to a five-year cycle (SY 2017–18 through 2021–22).

On May 28, 2019, the NSD received notification from the USDA that the waiver request for 7 CFR, Section 210.18(c) was approved.

On December 24, 2020, the CDE NSD submitted a Child Nutrition Program (CNP) monitoring waiver to the USDA. The waiver requested to waive 7 CFR, Section 210.18(c) to extend the current SNP five-year cycle (SY 2017–18 through 2021–22) to a six-year cycle (SY 2017–18 through 2022–23) as a result of the federally declared public health emergency due to COVID-19. In addition, the waiver also included waiving the state-level monitoring for five general areas (Special Milk Program, Competitive Food Standards, Program Outreach, Professional Standards, and Local School Wellness Policy) for SNP ARs in SY 2020–21 and waives the state AR requirements at 7 CFR, sections 226.6(m)(6)(i) and (ii) for the Child and Adult Care Food Program Operators who are closed the entire Federal Fiscal Year 2020–21 as a result of the federally declared public health emergency due to COVID-19.

On January 26, 2021, the NSD received notification from the USDA that the CNP monitoring waiver was approved.

The previous SNP AR cycle is as follows:

Year 1, SY 2017–18
Year 2, SY 2018–19
Year 3, SY 2019–20
Year 4, SY 2020–21
Year 5, SY 2021–22
Year 6, SY 2022–23

The schedule of reviews is subject to change and the CDE will send an AR notification email to SFAs scheduled for review.

Prereview

The prereview phase of the AR is designed to be conducted off-site. This lessens the on-site review time without affecting the quality of the review. The reviewer provides ongoing correspondence and technical assistance (TA) throughout the prereview phase, as needed. The order and timing of prereview activities will depend on the reviewer, the SFA, and other factors affecting the AR.

Communications

The CDE will initiate the prereview phase by emailing an AR Notification Letter to the SFA’s Superintendent, Chief Business Officer (CBO), and Food Service Director (FSD). Agencies that do not have these positions will be sent an email addressed to the highest ranking official(s). Receipt of the AR Notification Letter officially marks the beginning of the AR process and includes the following pieces of information:

• An introduction to the review
  
  
• The name of the reviewer
  
  
• Direction to complete a mandatory prereview training
  
  
• Information about completing the Off-site Assessment Tool (OAT)
  
  
• Other information and/or updates pertinent to the ARs

Before the end of the prereview phase, the reviewer will also send a confirmation letter that includes the scheduled date and time of the on-site review.

Prereview Training

The CDE requires SFAs scheduled for an AR to complete a prereview training (PRT) at the start of the school year. Please refer to the AR notification email or contact your reviewer for information about the PRT.

Beginning in SY 2018–19, PRTs will be offered as an online training. The PRT can be accessed from the CDE Child Nutrition Programs Course Catalog web page.

Off-Site Review

Off-site Assessment Tool

The Off-site Assessment Tool (OAT) assists the reviewer to understand the SFA’s SNP operation prior to the on-site review. The OAT is comprised of a series of questions that relate to the five key compliance areas. The reviewer will use answers from the OAT to complete additional required forms and tools to prepare for the review. The OAT will be made available in the CNIPS by the reviewer.

SFAs selected for review must complete and submit the OAT in the AR module in the CNIPS. The SFA will have access to the OAT when the AR Notification email is received. The SFA will need to complete the OAT eight weeks prior to the date of the entrance conference. The CDE strongly encourages SFAs to attend the mandatory prereview training prior to submitting the completed OAT.

OAT Video: Learning About the Off-site Assessment Tool provides a step-by-step process to access and complete the tool in the CNIPS.

OAT Guidance: The Off-Site Assessment Tool Guidance document can be downloaded in CNIPS under Download Forms.

Note: The CDE is in the process of requesting a waiver to OAT question 701 for program operators on a state agency approved budget agreement.

Site Selection

To determine the minimum number of sites to review, the CDE must obtain the following data from the SFA:

• Names and types of all schools in the SFA participating in the NSLP
• Number of serving days for each school for the month selected
• Highest number of free-eligible students for the month selected for each school
• Number of free lunches claimed in the month selected

The CDE will determine the minimum number of NSLP sites to review in accordance with USDA guidelines. The CDE establishes which sites to review based on average daily participation, findings from previous on-site visits or the claims review process, questionable daily meal counts, or recommendations from the FSD.

On-site Review

The reviewer conducts the on-site review to validate the information submitted in the Off-site Assessment Tool (OAT) and observe the operation of programs at the SFA and in selected schools.

Entrance Conference

The review commences with an entrance conference during which the reviewer summarizes the results of the OAT, explains the on-site review process, and provides the sites selected for review. The Superintendent, CBO, and FSD are expected to attend both the entrance and exit conferences.

Scope of Review

There are five key compliance areas of the AR process categorized as either a critical area of performance or a general area of review. The USDA requires the CDE to take regulatory fiscal action for noncompliance in the critical areas; however, the USDA grants authority to the CDE to determine any fiscal action in the general areas. The five key compliance areas are summarized below in an accessible version of What is an Administrative Review? (PDF).

Meal Access and Reimbursement

This component is identified as a Critical Area, Performance Standard 1, and focuses on the following:

100 Series: Certification and Benefit Issuance (number series 100)

• Reviews the SFA’s determination of a student’s eligibility for free, reduced-price, or paid meals and is the link to the SFA’s meal counting and claiming system
  • Review benefit issuance
  • Fiscal action required if: information missing, certifications miscategorized, benefit issuance errors, failure to update status, when required
• Ensures that eligible children receive meals to which they are entitled, and that reimbursement claims are valid
  
• Resource: SNP Eligibility Materials

200 Series: Verification

• Reviews the mandatory process used by the SFA to confirm selected students’ eligibility by verifying the income listed on the original household applications
• Ensures that the SFA properly completes the Verification process in the appropriate timeframe
  • Tips for Success:
    • Keep records
    • Keep supporting documents
    • Check income conversion, if used
    • Check your math
    • Complete by November 15
    • Document all letters and contacts
    • Ensure error-prone applications are correctly identified
• Resource: SNP Verification Materials
  

300 Series: Meal Counting and Claiming

• Reviews the SFA’s meal counting and claiming system that accurately counts, records, consolidates, and reports the number of reimbursable meals claimed
  • Reviewed by interviewing site staff, meal observation, meal count documentation, month claim with supporting documents, verify edit checks and supporting documentation

Meal Pattern and Nutritional Quality

This component is identified as a Critical Area, Performance Standard 2, and focuses on the following:

400 Series: Meal Components and Quantities

• Reviews the preparation, offering, and service of meals that meet the meal pattern requirements for the appropriate student grade groups on all reimbursable meal service lines
• Ensures that every reimbursable meal service line meets the daily and weekly meal pattern requirements for the appropriate grade group served
• Resources:
  • Nutrition Standards for School Meals
  • Management Bulletin CNP-07-2015 (v.3): Guidance for Accepting Processed Product
  • Documentation for Meal Pattern RequirementsSchool Meal Planning Options

500 Series: Offer Versus Serve

• Reviews the SFA’s implementation of offer versus serve, a program element that allows students to decline some of the food items offered that they do not intend to eat, helping to reduce food waste
• Ensures that the SFA provides adequate amounts of all food components, that the student selects sufficient components, and that the meals claimed for reimbursement meet meal pattern requirements
• Resource: Offer versus Serve Guidance

600 Series: Dietary Specifications and Nutrient Analysis

• Reviews the amount of calories, saturated fat, trans fat, and sodium in meals offered to children through the school nutrition programs
• Ensures that the meals served are in compliance with dietary specification standards

Resource Management

This component is identified as a General Area and addresses the four areas integral to the financial health of the SFA school food service: maintenance of the nonprofit school food service account, Paid Lunch Equity, revenue from nonprogram foods, and indirect costs. The Risk Indicator Tool is designed to assess potential risk and reflect the possibility of a need for further review.

700 Series: Resource Management

• Reviews the six areas of risk:
  
  • Enrollment
  • Past audit Findings
  • Maintenance of the nonprofit school service account
  • Paid Lunch Equity
  • Revenue from nonprogram foods
  • Indirect costs
• Ensures the overall financial health of the SFA’s cafeteria fund
• Resource: Cafeteria Fund Guidance

General Program Compliance

This component is identified as a General Area and includes review of the following:

800 Series: Civil Rights

• Reviews laws, regulations, instructions, policies, and guidance related to nondiscrimination in child nutrition programs
• Ensures that the SFA has a written procedure and complies with requirements
  
• Resource:
  USDA Civil Rights: The USDA Food and Nutrition Service policies and procedures about nondiscrimination in the administration of the child nutrition and food distribution programs can be found at the CDE USDA Civil Rights web page.
  

900 Series: SFA On-site Monitoring

• Reviews the SFA’s completion of at least one on-site review of the lunch counting and claiming system in each school for SFAs with more than one school under its jurisdiction
• Ensures that the SFA completes the required monitoring in the appropriate timeframes

1000 Series: Local School Wellness Policy

• Reviews the effectiveness of the SFA’s local school wellness policy (LSWP) in promoting children’s health, preventing childhood obesity, and preventing diet-related chronic diseases by fostering a healthy school environment
• Ensures that the LSWP contains all mandated components including stakeholder engagement, implementation, public notification, and reporting
• Resource: Local School Wellness Model Policies

1100 Series: Smart Snacks in School

• Reviews the requirements for all food and beverages sold to students, on school campus, from midnight through 30 minutes after the end of the school day, outside of the federally reimbursable meal program
• Ensures that SFAs meet the minimum requirements for all foods and beverages sold in school to increase consumption of healthful foods during the school day and support a healthy school environment
• Resource: Competitive Foods and Beverage

1200 Series: Professional Standards

• Reviews of the new professional standards for personnel in SNP effective July 1, 2015. The review also includes California-specific policies and resources to assist with implementing the hiring and training standards.
• Resource: Professional Standards

1300 Series: Water

• Reviews the requirements that schools provide potable water to all students during lunch and to students served breakfast in the cafeteria
• Ensures that children have access to water during meal service times in meal service areas

1400 Series: Food Safety

• Reviews the safe handling, storage, preparation, and service of food
• Ensures that the SFA is compliant with state and federal food safety requirements

1500 Series: Reporting and Recordkeeping

• Reviews the SFA’s submission and maintenance of reports and the possession of records according to record retention requirements
• Ensures that the SFA complies with reporting and recordkeeping requirements

1600 Series: School Breakfast Program and Summer Food Service Program Outreach

• Reviews the requirement of SFAs to inform eligible households of the availability of breakfasts offered under the SBP and meals offered through the Summer Food Service Program
• Ensures that the SFA meets the required outreach activities to increase program participation
  
• Resource: Summer Food Service Program

Other Federal Program Reviews

This component is identified as a General and Critical Area and focuses on the following programs, if applicable:

Afterschool Meal Supplements (Snacks) (1700)

• Reviews the SFA’s option to serve NSLP snacks to students in structured afterschool programs that provide educational or enrichment activities
• Ensure that participating schools serve nutritionally-balanced snacks that meet meal pattern requirements, provide appropriate activities, and count and claim snacks accurately
• Resource: After School Snack Supplement

Seamless Summer Feeding Option (1800)

• Reviews the SFA’s option to serve meals during summer or certain other school vacation periods using the same meal service rules and claiming procedures as the NSLP
• Ensures that the SFA complies with meal counting, claiming, menu planning, and food safety requirements
• Resource: Summer Food Service Program

Fresh Fruit and Vegetable Program (1900)

• Reviews the SFA’s ability to increase elementary school students’ exposure to and consumption of a variety of fresh fruits and vegetables outside of the NSLP
• Ensures that participating schools are operating the program in compliance with requirements outlined by the USDA and the CDE
• Resource: Fresh Fruit and Vegetable Program

Special Milk Program (2000)

• Reviews the SFA’s offering of milk to eligible children in schools, residential child care institutions, and eligible camps that do not participate in other federal child nutrition programs
• Ensures that the SFA operates the program in accordance with an approved agreement and federal regulation
• Resource: Special Milk Program

Exit Conference

The post-review phase begins with an exit conference during which the reviewer notifies the SFA of any preliminary findings and discusses the initial assessment of corrective action with appropriate deadlines. The CDE expects the Superintendent, CBO, and FSD to attend the exit conference to receive information regarding any findings, corrective action, and TA. The reviewer and the SFA collaborate on a Corrective Action Plan. The CDE may finalize the plan with the SFA during the exit conference or later in the post-review phase. If there are findings, the reviewer may accept documented corrective action during the on-site review.

Post-review

Administrative Review Report

The reviewer completes an electronic AR Report that includes any findings, provides a summary of corrective actions with associated deadlines, and identifies potential fiscal action. An exact amount of fiscal action cannot be identified until the review has been fully processed by the CDE. The reviewer will document all findings in the AR Report even if corrective action was immediately implemented during the review process. Within 30 calendar days of the exit conference, the reviewer will provide the AR Report to the SFA’s Superintendent, CBO, and FSD and discuss the preliminary findings.

The reviewer will save the electronic AR Report in the CNIPS. The SFA can review the AR findings in the CNIPS by completing the following steps:

• Log in to the CNIPS with a User ID and password
• On the Programs screen—select School Nutrition Programs
• On the Welcome screen—select the Compliance tab
• On the Compliance screen—select Review Tracking
• On the SNP Reviews screen—select Details next to current Review Year
• On the Review Dashboard screen—select View next to Corrective Action Documents

If there are no findings, receipt of the closure letter marks the end of the AR. If there are findings, the SFA must provide corrective action documentation (CAD).

Administrative Review Transparency Requirement

The USDA issued Policy Memo SP 56-2016: Additional Guidance for the Implementation of the AR in SNPs Final Rule. The final rule, located in 7 CFR, Section 210.18(m) requires the CDE to post a summary of the most recent final AR results for each SFA. To view final AR results, visit the Child Nutrition Information and Payment System.

Corrective Action Documents

The SFA must provide CAD for all findings to the reviewer no later than 30 calendar days from the deadline for each action. If the CAD is incomplete, incorrect, or submitted more than 30 calendar days from the deadline, the CDE may place the SFA’s reimbursements on hold. The SFA must submit a request in writing for an extension of the due date. Once the CDE receives and determines the acceptability of the CAD, the CDE processes any fiscal action and sends the SFA a closure letter of claim adjustment and notice of appeal, if appropriate.

Final Closure of Review

Once the CDE receives and determines the CAD is acceptable, the CDE sends a closure letter to the SFA stating what action, if any, will be taken. If fiscal action is necessary, the SFA will receive a closure letter explaining the findings with the claim adjustment amount and appeal procedures, if appropriate. Any fiscal action taken is based upon regulations and guidance issued by the USDA and the CDE.

Resources

The CDE is committed to providing ongoing technical assistance (TA), training, and resources to support SFAs in the successful completion of their AR. SFAs can use the following resources to better prepare for an AR.

USDA Administrative Review Manual: The USDA Food and Nutrition Service provides federal-level guidance and resources to standardize the AR process. SFAs can review the AR Manual by completing the following steps:

Log in to the CNIPS with a User ID and password
On the Programs screen—select School Nutrition Programs
On the Welcome screen—select the Applications tab
On the Applications screen—select Download Forms
On the Download Forms screen—select Manual AR

What is an Administrative Review? Diagram: What is an Administrative Review? (PDF) diagram summarizes the five key compliance areas and explains why they are part of the AR. An accessible version of the five key compliance areas are summarized in the On-site Review tab.

Tips for Success: The Tips to Increase Success in a SNP Administrative Review provides advice to SFAs for successful completion of the prereview portion of the AR.

Contacts

If you have any questions regarding this subject, please contact your NSD Field Services Unit (FSU) representative. The FSU contact list is available in the Child Nutrition Information and Payment System Download Forms section, Form ID Caseload. You can also contact the FSU office by phone at 916-323-4558 to be directed to your FSU representative.

The Resource Management Unit (RMU) can be contacted by email at SNPCafeFundQuestions@cde.ca.gov.

The Procurement Resources Unit (PRU) can be contacted by email at NSDProcurementReview@cde.ca.gov.