[Code of Federal Regulations]
[Title 7, Volume 4]
[Revised as of January 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR226.11]

[Page 203-204]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 226_CHILD AND ADULT CARE FOOD PROGRAM--Table of Contents
 
                      Subpart D_Payment Provisions
 
Sec.  226.11  Program payments for child care centers, adult day care 
centers and outside-school-hours care centers.

    (a) Payments shall be made only to institutions operating under an 
agreement with the State agency for the meal types specified in the 
agreement served at approved child care centers, adult day care centers 
and outside-school-hours care centers. A State agency may make payment 
for meals served in accordance with provisions of the Program in the 
calendar month preceding the calendar month in which the agreement is 
executed.
    (b) Each child care institution shall report each month to the State 
agency the total number of meals, by type (breakfasts, lunches, suppers, 
and supplements), served to children, except that such reports shall be 
made for a proprietary title XX center only for calendar months during 
which not less than 25 percent of enrolled children, or 25 percent of 
licensed capacity, whichever is less, were title XX beneficiaries. Each 
adult day care institution shall report each month to the State agency 
the total number of meals, by type (breakfasts, lunches, suppers, and 
supplements), served to adult participants, except that such reports 
shall be made for a proprietary title XIX or title XX center only for 
calendar months during which no less than 25 percent of enrolled adult 
participants were title XIX or title XX beneficiaries.
    (c) Each State agency shall base reimbursement to each child care 
institution on the number of meals, by type, served to children 
multiplied by the assigned rates of reimbursement, except that 
reimbursement shall be payable to proprietary title XX child care 
centers only for calendar months during which not less than 25 percent 
of enrolled children, or 25 percent of licensed capacity, whichever is 
less, were title XX beneficiaries. Each State

[[Page 204]]

agency shall base reimbursement to each adult day care institution on 
the number of meals, by type, served to adult participants multiplied by 
the assigned rates of reimbursement, except that reimbursement shall be 
payable to proprietary title XIX and title XX adult day care centers 
only for calendar months during which not less than 25 percent of 
enrolled adult participants were title XIX or Title XX beneficiaries. In 
computing reimbursement, the State agency shall either:
    (1) Base reimbursement to institutions on actual daily counts of 
meals served, and multiply the number of meals, by type, served to 
participants eligible to receive free meals, served to participants 
eligible to receive reduced-price meals, and served to participants from 
families not meeting such standards by the applicable national average 
payment rate; or
    (2) Apply the applicable claiming percentage or percentages to the 
total number of meals, by type, served to participants and multiply the 
product or products by the assigned rate of reimbursement for each meal 
type; or
    (3) Multiply the assigned blended per meal rate of reimbursement by 
the total number of meals, by type, served to participants.
    (d) If the State agency elects to reimburse its institutions 
according to the lesser of rates or actual costs, total Program payments 
to an institution during any fiscal year, including any cash payments in 
lieu of commodities, shall not exceed allowable Program operating and 
administrative costs, less income to the Program. The State agency may 
limit payments for administrative costs to the amount approved in the 
annual administrative budget of the institution. The State agency may 
prohibit an institution from using payments for operating costs to pay 
for administrative expenses.
    (e) Each institution shall maintain records as prescribed by the 
State agency's financial management system.

[47 FR 36527, Aug. 20, 1982, as amended at 48 FR 21530, May 13, 1983; 52 
FR 36907, Oct. 2, 1987; 53 FR 52590, Dec. 28, 1988; 62 FR 23618, May 1, 
1997]