I
106TH CONGRESS
2D SESSION
H. R. 4520
To amend the Richard B. Russell National School Lunch Act to improve
program integrity of the child and adult care food program.
IN THE HOUSE OF REPRESENTATIVES
MAY 23, 2000
Mr. GOODLING (for himself, Mr. KILDEE, and Ms. WOOLSEY) introduced the
following bill; which was referred to the Committee on Education and the
Workforce
A BILL
To amend the Richard B. Russell National School Lunch
Act to improve program integrity of the child and adult
care food program.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Child and Adult Care Food Program Integrity Act of
2000’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Eligibility criteria for participating organizations.
Sec. 3. Approval of sponsoring organizations; other requirements.
Sec. 4. Termination or suspension of participating organizations.
Sec. 5. Recovery of amounts from institutions.
Sec. 6. Limitation on administrative expenses for certain sponsoring organiza-
tions.
Sec. 7. Limitations on ability of family or group day care homes to transfer
sponsoring organizations.
Sec. 8. Reallocation of audit funds.
Sec. 9. Technical and training assistance for identification and prevention of
fraud and abuse.
Sec. 10. Statewide demonstration projects involving private for-profit organiza-
tions that provide nonresidential day care services.
Sec. 11. Program for at-risk school children.
Sec. 12. Withholding of funds for failure to provide sufficient training, tech-
nical assistance, and monitoring.
SEC. 2. ELIGIBILITY CRITERIA FOR PARTICIPATING ORGA-
NIZATIONS.
Section 17(a)(2) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(a)(2)) is amended—
(1) in subparagraph (B), by inserting ‘‘, or has
not been determined to be ineligible to participate in
any other Federal program by reason of violation of
the requirements of such program’’ before ‘‘, for a
period’’;
(2) in subparagraph (C), by striking ‘‘; and’’
and inserting ‘‘, and in the case of a sponsoring or-
ganization, the organization shall employ an appro-
priate number of monitoring personnel based upon
the number and characteristics of child care centers
and family or group day care homes sponsored by
the organization, as approved by the State (in ac-
cordance with regulations developed by the Sec-
retary), to ensure effective oversight of the oper-
ations of the child care centers and family or group
day care homes;’’;
(3) in subparagraph (D), by striking the period
and inserting a semicolon; and
(4) by adding at the end the following:
‘‘(E) in the case of a sponsoring organiza-
tion, that such organization has in effect a pol-
icy that restricts other employment by employ-
ees that interferes with the responsibilities and
duties of such sponsoring organization employ-
ees with respect to the program; and
‘‘(F) in the case of a private institution
that applies for initial participation in the pro-
gram on or after the date of the enactment of
the Child and Adult Care Food Program Integ-
rity Act of 2000, that, if the State requires
such institutions to be bonded under State law,
regulation, or policy, the institution is bonded
in accordance with such law, regulation, or pol-
icy.’’.
SEC. 3. APPROVAL OF SPONSORING ORGANIZATIONS;
OTHER REQUIREMENTS.
(a) APPROVAL OF SPONSORING ORGANIZATIONS.—
Section 17(d)(1) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(d)(1)) is amended—
(1) by striking ‘‘(d)(1) Any eligible public insti-
tution’’ and inserting ‘‘(d)(1)(A) Any eligible public
institution’’;
(2) by striking ‘‘Any eligible private institution’’
and inserting ‘‘Subject to subparagraph (B), any eli-
gible private institution’’;
(3)(A) by striking ‘‘(A) has tax exempt status’’
and inserting ‘‘(i) has tax exempt status’’; and
(B) by striking ‘‘(B) is currently operating’’
and inserting ‘‘(ii) is currently operating’’; and
(4) by adding at the end the following:
‘‘(B) In approving the initial application of a spon-
soring organization for participation in the program, the
State shall consider whether the sponsoring organization
has the administrative capability to operate the program
(including whether or not the sponsoring organization has
business experience and management plans appropriate to
operate the program), would fulfill an identified need
under the program, and will meet the other requirements
of this section. In the case of a sponsoring organization
of a family or group day care home seeking approval for
participation in the program on or after the date of the
enactment of the Child and Adult Care Food Program In-
tegrity Act of 2000, the State may limit the number of
such sponsoring organizations in any geographical area of
the State if the State determines that a sufficient number
of sponsoring organizations, based on identified and docu-
mented need, are available and able to serve the day care
homes in the geographical area.’’.
(b) SITE VISITS.—Section 17(d)(2)(A) of the Richard
B. Russell National School Lunch Act (42 U.S.C.
1766(d)(2)(A)) is amended—
(1) in clause (i), by striking ‘‘; and’’ and insert-
ing a semicolon;
(2) by redesignating clause (ii) as clause (iii);
and
(3) by inserting after clause (i) the following:
‘‘(ii)(I) requires periodic unannounced site visits
at not less than 3-year intervals to sponsored child
care centers and family or group day care homes to
identify and prevent management deficiencies and
fraud and abuse under the program;
‘‘(II) requires at least one scheduled site visit
each year to sponsored child care centers and family
or group day care homes to identify and prevent
management deficiencies and fraud and abuse under
the program and to improve program operations;
and
‘‘(III) requires at least one scheduled site visit
at not less than 3-year intervals to institutions to
identify and prevent management deficiencies and
fraud and abuse under the program and to improve
program operations; and’’.
(c) PROGRAM INFORMATION.—
(1) IN GENERAL.—Section 17(d) of the Richard
B. Russell National School Lunch Act (42 U.S.C.
1766(d)) is amended by adding at the end the fol-
lowing:
‘‘(3)(A) Upon enrollment of a child in a sponsored
child care center or family or group day care home partici-
pating in the program, the center or home (or its spon-
soring organization) shall provide to the child’s parents
or guardians information that describes the program and
its benefits and the name and telephone number of the
sponsoring organization of the center or home and the
State agency involved in the operation of the program.
‘‘(B) The information described in subparagraph (A)
shall be in a form and, to the extent practicable, language
easily understandable by the child’s parents or guard-
ians.’’.
(2) EFFECTIVE DATE.—In the case of a child
that is enrolled in a sponsored child care center or
family or group day care home participating in the
child and adult care food program under section 17
of the Richard B. Russell National School Lunch
Act (42 U.S.C. 1766) before the date of the enact-
ment of this Act, the center or home shall provide
information to the child’s parents or guardians pur-
suant to section 17(d)(3) of such Act, as added by
paragraph (1), not later than 90 days after the date
of the enactment of this Act.
(d) ALLOWABLE ADMINISTRATIVE EXPENSES FOR
SPONSORING
ORGANIZATIONS.—Section 17(d) of the
Richard B. Russell National School Lunch Act (42 U.S.C.
1766(d)), as amended by subsection (c), is further amend-
ed by adding at the end the following:
‘‘(4) The Secretary, in consultation with State agen-
cies and sponsoring organizations, shall develop and pro-
vide for the dissemination to State agencies and institu-
tions, of a list of allowable reimbursable administrative ex-
penses for sponsoring organizations under the program.’’.
SEC. 4. TERMINATION OR SUSPENSION OF PARTICIPATING
ORGANIZATIONS.
Section 17(d) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(d)), as amended by
section (3), is further amended by adding at the end the
following:
‘‘(5)(A) The Secretary shall establish procedures for
the termination of participation by institutions and spon-
sored child care centers and family or group day care
homes under the program.
‘‘(B) Procedures established pursuant to subpara-
graph (A) shall include standards for terminating the par-
ticipation of an institution or sponsored child care center
or family or group day care home that—
‘‘(i) engages in unlawful practices, falsifies in-
formation provided to the State agency, or conceals
a criminal background; or
‘‘(ii) substantially fails to fulfill the terms of its
agreement with the State agency.
‘‘(C) Procedures established pursuant to subpara-
graph (A)—
‘‘(i) shall require an entity described in clause
(i) or (ii) of subparagraph (B) to undertake correc-
tive action; and
‘‘(ii) may require the immediate suspension of
operation of the program by an entity described in
clause (i) or (ii) of subparagraph (B), without the
opportunity for corrective action, if the State agency
determines that there is imminent threat to the
health or safety of a participant at the entity or the
entity engages in any activity that poses a threat to
public health or safety.
‘‘(D) An institution or sponsored child care center or
family or group day care home shall be provided a fair
hearing in accordance with subsection (e)(1) prior to any
determination to terminate participation by the institution
under the program.
‘‘(E) The Secretary shall maintain a list of institu-
tions, sponsored child care centers, sponsored family or
group day care homes, and individuals that have been ter-
minated or otherwise disqualified from participation in the
program. The Secretary shall make such list available to
State agencies for use in approving or renewing applica-
tions by institutions, sponsored child care centers, spon-
sored family or group day care homes, and individuals for
participation in the program.’’.
SEC. 5. RECOVERY OF AMOUNTS FROM INSTITUTIONS.
Section 17(f)(1) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(f)(1)) is amended—
(1) by striking ‘‘(f)(1) Funds paid’’ and insert-
ing ‘‘(f)(1)(A) Funds paid’’; and
(2) by adding at the end the following:
‘‘(B)(i) The State may recover funds disbursed under
subparagraph (A) to an institution if the State determines
that the institution has engaged in fraud or abuse with
respect to the program or has submitted an invalid claim
for reimbursement.
‘‘(ii) Amounts recovered under clause (i)—
‘‘(I) may be paid by the institution to the State
over a period of 1 or more years; and
‘‘(II) shall not be paid from funds used to pro-
vide meals and supplements.
‘‘(iii) An institution shall be provided a fair hearing
in accordance with subsection (e)(1) prior to any deter-
mination to recover funds under this subparagraph.’’.
SEC. 6. LIMITATION ON ADMINISTRATIVE EXPENSES FOR
CERTAIN SPONSORING ORGANIZATIONS.
Section 17(f)(2) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(f)(2)) is amended by
adding at the end the following:
‘‘(C)(i) Except as provided in clause (ii), a sponsoring
organization of a day care center may reserve not more
than 15 percent of the funds provided under paragraph
(1) for the administrative expenses of the organization.
‘‘(ii) A State may waive the requirement in clause (i)
with respect to a sponsoring organization if the organiza-
tion provides justification to the State that the organiza-
tion requires funds in excess of 15 percent of the funds
provided under paragraph (1) to pay such administrative
expenses.’’.
SEC. 7. LIMITATIONS ON ABILITY OF FAMILY OR GROUP
DAY CARE HOMES TO TRANSFER SPON-
SORING ORGANIZATIONS.
Section 17(f)(3) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(f)(3)) is amended by
striking subparagraph (D) and inserting the following:
‘‘(D) LIMITATIONS ON ABILITY OF FAMILY
OR
GROUP
DAY
CARE
HOMES
TO
TRANSFER
SPONSORING ORGANIZATIONS.—
‘‘(i) IN GENERAL.—Subject to clause
(ii), a State agency shall limit the ability
of a family or group day care home to
transfer from a sponsoring organization to
another sponsoring organization more fre-
quently than once a year.
‘‘(ii) GOOD CAUSE.—The State agency
may permit or require a family or group
day care home to transfer from a spon-
soring organization to another sponsoring
organization more frequently than once a
year for good cause (as determined by the
State agency). Such good cause may in-
clude circumstances where the sponsoring
organization of the family or group day
care home ceases to participate in the child
and adult care food program.’’.
SEC. 8. REALLOCATION OF AUDIT FUNDS.
(a) IN GENERAL.—Section 17(i) of the Richard B.
Russell National School Lunch Act (42 U.S.C. 1766(i))
is amended—
(1) by striking ‘‘(i) The Secretary shall’’ and
inserting the following:
‘‘(i) AUDIT FUNDS.—
‘‘(1) IN GENERAL.—The Secretary shall’’; and
(2) by adding at the end the following:
‘‘(2) REALLOCATION OF FUNDS.—
‘‘(A) RETURN TO THE SECRETARY.—For
each fiscal year, any amounts allocated to a
State under this subsection that are not obli-
gated during the fiscal year shall be returned to
the Secretary in accordance with procedures es-
tablished by the Secretary.
‘‘(B) 
REALLOCATION
BY
THE
SEC-
RETARY.—The Secretary shall allocate any
amounts returned under subparagraph (A)
among States that demonstrate a need for the
amounts, for the purposes described in para-
graph (1), in accordance with procedures estab-
lished by the Secretary.
‘‘(3) ANNUAL REPORT.—Each State agency ad-
ministering the program that receives amounts for a
fiscal year for the purpose of conducting audits of
participating institutions pursuant to paragraph (1)
shall prepare and submit to the Secretary a report
that contains a summary description of the results
of the audits and other activities conducted with
such amounts.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall take effect on October 1, 2000, or the
date of the enactment of this Act, whichever occurs later.
SEC. 9. TECHNICAL AND TRAINING ASSISTANCE FOR IDEN-
TIFICATION AND PREVENTION OF FRAUD
AND ABUSE.
Section 17(q)(1) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(q)(1)) is amended by
adding at the end the following: ‘‘As part of such training
and technical assistance, the Secretary shall provide train-
ing on a continuous basis to State agencies, and shall en-
sure that such training is provided to sponsoring organiza-
tions, for the identification and prevention of fraud and
abuse under the program and to improve management of
the program.’’.
SEC. 10. STATEWIDE DEMONSTRATION PROJECTS INVOLV-
ING PRIVATE FOR-PROFIT ORGANIZATIONS
THAT PROVIDE NONRESIDENTIAL DAY CARE
SERVICES.
(a) IN GENERAL.—Section 17(p) of the Richard B.
Russell National School Lunch Act (42 U.S.C. 1766(p))
is amended—
(1) in the first sentence of paragraph (1), by
striking ‘‘2 statewide demonstration projects’’ and
inserting ‘‘statewide demonstration projects in 4
States’’; and
(2) in paragraph (3)—
(A) in subparagraph (A), by striking
‘‘and’’ at the end;
(B) in subparagraph (B), by striking the
period at the end and inserting ‘‘; and’’; and
(C) by adding at the end the following:
‘‘(C) in 2 other States, as approved by the Sec-
retary through a competitive application process.’’.
(b) EFFECTIVE DATE.—The Secretary of Agriculture
may carry out demonstration projects in States described
in section 17(p)(3)(C) of the Richard B. Russell National
School Lunch Act, as added by subsection (a)(2)(C), be-
ginning no earlier than October 1, 2001.
SEC. 11. PROGRAM FOR AT-RISK SCHOOL CHILDREN.
Section 17(r) of the Richard B. Russell National
School Lunch Act (42 U.S.C. 1766(r)) is amended—
(1) in paragraph (2), by inserting ‘‘meals or’’
before ‘‘supplements’’;
(2) in paragraph (4)—
(A) in the heading, by striking ‘‘SUPPLE-
MENT’’ and inserting ‘‘MEAL
AND
SUPPLE-
MENT’’;
(B) in subparagraph (A)—
(i) by striking ‘‘only for’’ and all that
follows through ‘‘(i) a supplement’’ and in-
serting ‘‘only for one meal per child per
day and one supplement per child per
day’’;
(ii) by striking ‘‘; and’’ and inserting
a period; and
(iii) by striking clause (ii);
(C) in subparagraph (B), by striking
‘‘RATE.—A supplement’’ and inserting the fol-
lowing: ‘‘RATES.—
‘‘(i) MEALS.—A meal shall be reim-
bursed under this subsection at the rate
established for free meals under subsection
(c).
‘‘(ii) SUPPLEMENTS.—A supplement’’;
and
(D) in subparagraph (C), by inserting
‘‘meal or’’ before ‘‘supplement’’; and
(3) by adding at the end the following:
‘‘(5) LIMITATION.—The Secretary shall limit
reimbursement under this subsection for meals
served under a program to institutions located in 6
States, as approved by the Secretary through a com-
petitive application process.’’.
SEC. 12. WITHHOLDING OF FUNDS FOR FAILURE TO PRO-
VIDE SUFFICIENT TRAINING, TECHNICAL AS-
SISTANCE, AND MONITORING.
Section 7(a)(9)(A) of the Child Nutrition Act of 1966
(42 U.S.C. 1776(a)(9)(A)) is amended by inserting after
‘‘the Richard B. Russell National School Lunch Act (42
U.S.C. 1751 et seq.)’’ the following: ‘‘(including the re-
quirement to provide sufficient training, technical assist-
ance, and monitoring of the child and adult care food pro-
gram under section 17(k) of the Richard B. Russell Na-
tional School Lunch Act)’’.
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