[Code of Federal Regulations]
[Title 7, Volume 4]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR226.21]

[Page 234-235]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 226--CHILD AND ADULT CARE FOOD PROGRAM--Table of Contents
 
                    Subpart E--Operational Provisions
 
Sec. 226.21  Food service management companies.

    (a) Any institution may contract with a food service management 
company. An institution which contracts with a food service management 
company shall remain responsible for ensuring that the food service 
operation conforms to its agreement with the State agency. All 
procurements of meals from food service management companies shall 
adhere to the procurement standards set forth in Sec. 226.22. Public 
institutions shall follow applicable State or local laws governing bid 
procedures. In the absence of any applicable State or local laws, and in 
addition to the procurement provisions set forth in Sec. 226.22, the 
State agency may mandate that each institution with Program meal 
contracts of an aggregate value in excess of $10,000 formally advertise 
such contracts and comply with the following procedures intended to 
prevent fraud, waste, and Program abuse:
    (1) All proposed contracts shall be publicly announced at least once 
14 calendar days prior to the opening of bids. The announcement shall 
include the time and place of the bid opening;
    (2) The institution shall notify the State agency at least 14 
calendar days prior to the opening of the bids of the time and place of 
the bid opening;
    (3) The invitation to bid shall not provide for loans or any other 
monetary benefit or terms or conditions to be made to institutions by 
food service management companies;
    (4) Nonfood items shall be excluded from the invitation to bid, 
except where such items are essential to the conduct of the food 
service;
    (5) The invitation to bid shall not specify special meal 
requirements to meet ethnic or religious needs unless special 
requirements are necessary to meet the needs of the participants to be 
served;
    (6) The bid shall be publicly opened;
    (7) All bids totaling $50,000 or more shall be submitted to the 
State agency for approval before acceptance. All bids shall be submitted 
to the State agency for approval before accepting a bid which exceeds 
the lowest bid. State agencies shall respond to any request for approval 
within 10 working days of receipt;
    (8) The institutions shall inform the State agency of the reason for 
selecting the food service management company chosen. State agencies may 
require institutions to submit copies of all bids submitted under this 
section.
    (b) The institution and the food service management company shall 
enter into a standard contract as required by Sec. 226.6(i). However, 
public institutions may, with the approval of the State agency, use 
their customary form of contract if it incorporates the provisions of 
Sec. 226.6(i).
    (c) A copy of the contract between each institution and food service 
management company shall be submitted to the State agency prior to the 
beginning of Program operations under the subject contract.

[[Page 235]]

    (d) Each proposed additional provision to the standard form of 
contract shall be submitted to the State agency for approval.
    (e) A food service management company may not subcontract for the 
total meal, with or without milk, or for the assembly of the meal.

[47 FR 36527, Aug. 20, 1982, as amended at 53 FR 52594, Dec. 28, 1988]