[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: 7CFR245.6]

[Page 282-287]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 245_DETERMINING ELIGIBILITY FOR FREE AND REDUCED PRICE MEALS AND 
FREE MILK IN SCHOOLS--Table of Contents
 
Sec.  245.6  Certification of children for free and reduced price meals 
and free milk.

    (a) Each School Food Authority of a school participating in the 
National School Lunch Program, School Breakfast Program or Special Milk 
Program or of a commodity only school shall provide supplies of a form 
for use by families in making application for free or reduced price 
meals or free milk for their children. The application shall be clear 
and simple in design and the information requested thereon shall be 
limited to that required to demonstrate that the family does, or does 
not, meet the eligibility criteria for free or reduced price meals, 
respectively, or for free milk, issued by the School Food Authority. The 
information requested on the application with respect to the current 
income of the household shall be limited to the income received by each 
member identified by the household member who received the income, and 
the source of the income (such as earnings, wages, welfare, pensions, 
support payments, unemployment compensation, social security and other 
cash income). Other cash income includes cash amounts received or 
withdrawn from any source, including savings, investments, trust 
accounts, and other resources which are available for payment of the 
price

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of a child's meals or milk. Additionally, the application shall require 
applicants to provide the names of all household members and the social 
security number of the adult household member who signs the application. 
In lieu of a social security number, the household may indicate the 
adult household member who signs the application does not possess a 
social security number. However, if application is being made for a 
child who is a member of a food stamp, FDPIR or TANF household, the 
application shall enable the household to provide the appropriate food 
stamp or TANF case number or FDPIR case number or other FDPIR identifier 
in lieu of names of all household members, household income information 
and social security number. The application shall also contain 
substantially the following statements:
    (1) ``Unless you include your child's case number for the Food Stamp 
Program, the Food Distribution Program on Indian Reservations (or other 
identifier for the Food Distribution Program on Indian Reservations) or 
the Temporary Assistance for Needy Families Program, you must include 
the social security number of the adult household member signing the 
application or indicate that the household member does not have a social 
security number. This is required by section 9 of the National School 
Lunch Act. The social security number is not mandatory, but the 
application cannot be approved if a social security number is not given 
or an indication is not made that the signer does not have a social 
security number. The social security number will be used in the 
administration and enforcement of the program.'' State agencies and 
school food authorities must ensure that the notice complies with 
section 7(b) of the Privacy Act of 1974 (5 U.S.C. 552a note); and
    (2) ``In certain cases foster children are eligible for free or 
reduced price meals or free milk regardless of your household income. If 
you have such children living with you and wish to apply for such meals 
or milk for them, please contact us.'' The application shall also 
include a statement, immediately above the space for signature, that the 
person signing the application certifies that all information furnished 
in the application is true and correct, that the application is being 
made in connection with the receipt of Federal funds, that school 
officials may verify the information on the application, and that 
deliberate misrepresentation of the information may subject the 
applicant to prosecution under applicable State and Federal criminal 
statutes. The application shall be signed by an adult member of the 
family. The application shall contain clear instructions with respect to 
the submission of the completed application to the official or officials 
designated by the School Food Authority to make eligibility 
determinations on its behalf. A family shall be permitted to file an 
application at any time during the school year.
    (b) Direct certification. In lieu of determining eligibility based 
on information provided by the household on the free and reduced price 
meal or milk application specified in paragraph (a) of this section, 
school food authorities may determine children eligible for free meals 
or milk based on documentation obtained from the appropriate State or 
local agency responsible for the administration of the Food Stamp 
Program, FDPIR and/or the TANF Program, hereafter referred to as direct 
certification. The documentation for direct certification shall include 
the information specified in Sec.  245.2(a-4)(2). The food stamp, FDPIR 
or TANF office may provide school officials with a list which includes 
all required documentation, or documentation may be obtained through a 
computerized match in which computerized lists of names of children from 
food stamp, FDPIR or TANF households and other identifying information 
are matched against a list of names and other identifying information of 
schoolchildren. When computer matches are used or the signature of the 
food stamp, FDPIR or TANF official is otherwise impracticable to obtain, 
the signature of the food stamp, FDPIR or TANF official is not required. 
However, other arrangements must be made to ensure that a responsible 
official can attest to the data. Additionally, the food stamp, FDPIR 
and/or TANF office may provide food stamp, FDPIR and/or TANF households 
with individual notices

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which contain all required documentation. The household may then 
transmit the notice to the school.
    (1) Information about the child or the household obtained directly 
from the food stamp, FDPIR or TANF office must be kept confidential and 
shall be used solely for the purpose of determining the child's 
eligibility for school meal or milk benefits, or as otherwise permitted 
by section 9 of the National School Lunch Act.
    (2) School food authorities are not required to provide the letter 
specified in Sec.  245.5(a) to the parents of children who are eligible 
for free meals under paragraph (b) of this section when the school food 
authorities distribute the letters or notices with application forms and 
the notice to households concerning eligibility for benefits under 
direct certification, specified in paragraph (c)(1) of this section, 
through the mail, individualized student packets, or other method which 
prevents the overt identification of children eligible for direct 
certification.
    (c) Determination of eligibility. Prior to the processing of 
applications or the completion of direct certification procedures for 
the current school year, children from households with approved 
applications or documentation of direct certification on file from the 
preceding year may be served reimbursable free and reduced price meals 
or free milk. However, applications and documentation of direct 
certification from the preceding year may be used to determine 
eligibility only during the 30 operating days following the first 
operating day at the beginning of the school year, or during a timeframe 
established by the State agency, provided that any State agency 
timeframe does not exceed the 30 operating day limit. The school food 
authority must take the income information provided by the household on 
the application and calculate the household's total current income. When 
a household submits an application containing complete documentation, as 
specified in Sec.  245.2(a-4)(1)(i), and the household's total current 
income is at or below the eligibility limits specified in the Income 
Eligibility Guidelines, the children in that household must be approved 
for free or reduced price benefits, as applicable. When a household 
submits an application containing the required food stamp, FDPIR or TANF 
documentation, as specified in Sec.  245.2(a-4)(1)(ii), the children in 
that household must be approved for free benefits. Additionally, when 
the school food authority obtains documentation from the State or local 
agency responsible for the administration of the Food Stamp Program, 
FDPIR and/or TANF Program that children are members of currently 
certified food stamp, FDPIR or TANF households, as specified in Sec.  
245.2(a-4)(2), the school food authority must approve such children for 
free benefits without applications from the households.
    (1) Notice of approval. The school food authority must promptly 
notify the household of their children's eligibility and provide them 
the benefits to which they are entitled. Households approved for 
benefits based on documentation provided by the appropriate State or 
local agency responsible for the administration of the Food Stamp 
Program, FDPIR or TANF Program must be notified, in writing, that their 
children are eligible for free meals or free milk, that households must 
contact the school when their children are no longer eligible for food 
stamp, FDPIR or TANF benefits, and that no application for free and 
reduced price school meals is required at this time. The notice of 
eligibility must also inform households that they must notify the school 
if they do not want their children to receive free benefits. When the 
household transmits the notice of eligibility containing the above 
information and the documentation provided by the food stamp, FDPIR or 
TANF office to the school, the school food authority is not required to 
provide a separate notice of eligibility. Children from households that 
notify the school that they do not want free benefits must have their 
benefits discontinued as soon as possible. Any notification from the 
household declining benefits must be documented and maintained on file, 
in accordance with paragraph (e) of this section. Additionally, a school 
food authority that is notified by the household that they are no longer 
eligible to receive food stamp,

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FDPIR or TANF benefits must follow the procedures specified in Sec.  
245.6a(e), and inform the household that it must submit an application 
with income information to establish continued eligibility.
    (2) Notice of denial. When the application furnished by the family 
is not fully documented or does not meet the eligibility criteria for 
free or reduced price benefits, school officials shall promptly provide 
written notice to each family denied benefits. As a minimum, this notice 
shall include:
    (i) The reason for the denial of benefits, e.g. income in excess of 
allowable limits or incomplete application; (ii) notification of the 
right to appeal; (iii) instructions on how to appeal; and (iv) a 
statement reminding parents that they may reapply for free and reduced 
price benefits at any time during the school year. The reasons for 
ineligibility shall be properly documented and retained on file at the 
School Food Authority.
    (3) Appeals of denied benefits. A family who wishes to appeal a 
denied application by the School Food Authority may do so as specified 
in Sec.  245.7. However, prior to initiating the hearing procedure, the 
parent may request a conference to provide the opportunity for the 
parent and school officials to discuss the situation, present 
information, and obtain an explanation of the data submitted in the 
application or the decision rendered. The request for a conference shall 
not in any way prejudice or diminish the right to a fair hearing. The 
School Food Authority shall promptly schedule a fair hearing, if 
requested.
    (d) After the letter to parents and the applications have been 
disseminated, the School Food Authority may determine, based on 
information available to it, that a child for whom an application has 
not been submitted meets the School Food Authority's eligibility 
criteria for free and reduced price meals or for free milk. In such a 
situation, the School Food Authority shall complete and file an 
application for such child setting forth the basis of determining the 
child's eligibility. When a School Food Authority has obtained a 
determination of individual family income and family-size data from 
other sources, it need not require the submission of an application for 
any child from a family whose income would qualify for free or reduced 
price meals or for free milk under the School Food Authority's 
established criteria. In such event, the School Food Authority shall 
notify the family that its children are eligible for free or reduced 
price meals or for free milk. Nothing in this paragraph shall be deemed 
to provide authority for the School Food Authority to make eligibility 
determinations or certifications by categories or groups of children.
    (e) The school food authority must maintain documentation 
substantiating eligibility determinations on file for 3 years after the 
date of the fiscal year to which they pertain, except that if audit 
findings have not been resolved, the documentation must be maintained as 
long as required for resolution of the issues raised by the audit.
    (f) Disclosure of program eligibility information to State Medicaid 
(Medicaid) and the State Children's Health Insurance Program (SCHIP) 
Program eligibility information about children eligible for free and 
reduced price meals may be disclosed to Medicaid and SCHIP as described 
in this section.
    (1) Who decides whether to disclose program eligibility information 
to Medicaid and/or SCHIP? The State agency may elect to allow school 
food authorities to disclose children's free and reduced price meal 
eligibility information to Medicaid and SCHIP. School food authorities 
may then elect to do so. Children's program eligibility information may 
only be disclosed to Medicaid or SCHIP when both the State agency and 
the school food authority so elect, the parent/guardian does not decline 
to have their eligibility information disclosed as described in 
paragraph (f)(5), and the requirements in this paragraph (f) are met.
    (2) What information may we disclose for use by Medicaid and SCHIP? 
The State agency or school food authority, as appropriate, may disclose 
children's names, eligibility status (whether they are eligible for free 
or reduced price meals or free milk), and any other eligibility 
information obtained through the free and reduced price meal/milk

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application or obtained through direct certification to persons directly 
connected with the administration of Medicaid or SCHIP.
    (3) Who are persons ``directly connected'' with the administration 
of Medicaid and SCHIP? State employees and persons authorized under 
Federal and State Medicaid and SCHIP requirements to carry out initial 
processing of Medicaid or SCHIP applications or to make eligibility 
determinations are persons directly connected with the administration of 
Medicaid and SCHIP for purposes of disclosure of children's free and 
reduced price meal and free milk eligibility information.
    (4) What are the restrictions on how Medicaid and SCHIP use 
children's free and reduced price meal and free milk eligibility 
information? Medicaid and SCHIP agencies and health insurance program 
operators receiving children's free and reduced price meal and free milk 
eligibility information may only use the information to seek to enroll 
children in Medicaid or SCHIP. The Medicaid and SCHIP enrollment process 
may include targeting and identifying children from low-income 
households who are potentially eligible for Medicaid or SCHIP for the 
purpose of seeking to enroll them in Medicaid or SCHIP.
    (5) Must we notify households of potential disclosure to Medicaid or 
SCHIP? The State agency or school food authority, as appropriate, must 
notify parents/guardians that their children's free or reduced price 
meal or free milk eligibility information will be disclosed to Medicaid 
and/or SCHIP unless the parent/guardian elects not to have their 
information disclosed. Additionally, the State agency or school food 
authority, as appropriate, must give parents/guardians an opportunity to 
elect not to have their information disclosed to Medicaid or SCHIP. Only 
the parent or guardian who is a member of the household or family for 
purposes of the free and reduced price meal or free milk application may 
decline the disclosure of eligibility information. The notification must 
inform parents/guardians that they are not required to consent to the 
disclosure, that the information, if disclosed, will be used to identify 
children eligible for and seek to enroll children in a health insurance 
program, and that their decision will not affect their children's 
eligibility for free or reduced price meals or free milk. The 
notification may be included in the letter/notice to parents/guardians 
that accompanies the free and reduced price meal or free milk 
application, on the application itself or in a separate notice provided 
to parents/guardians. The notice must give parents/guardians adequate 
time to respond. For children determined eligible through direct 
certification, the notice of potential disclosure may be included in the 
document informing parents/guardians of their children's eligibility for 
free meals or free milk through direct certification.
    (6) May social security numbers be disclosed? The State agency or 
school food authority, as appropriate, may disclose social security 
numbers to any programs or persons authorized to receive all program 
eligibility information under this paragraph (f), provided parents/
guardians have not declined to have their information disclosed. 
However, State agencies and school food authorities that plan to 
disclose social security numbers must give notice of the planned use of 
the social security numbers. This notice must be in accordance with 
section 7(b) of the Privacy Act of 1974 (5 U.S.C. 552a note). The 
application must include substantially the following language for 
disclosures of social security numbers to Medicaid or SCHIP: ``The 
social security number may also be disclosed to Medicaid and the State 
Children's Health Insurance Program for the purpose of identifying and 
seeking to enroll eligible children in one of these health insurance 
programs.'' This language is in addition to the notice required in 
paragraph (a)(1) of this section. State agencies and school food 
authorities are responsible for drafting the appropriate notice for 
disclosures of social security numbers.
    (7) Are agreements required before disclosing program eligibility 
information? The State agency or school food authority, as appropriate, 
must have a written agreement with the State or local agency or agencies 
administering Medicaid or SCHIP prior to disclosing

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children's free and reduced price eligibility information. At a minimum, 
the agreement must:
    (i) Identify the health insurance program or health agency receiving 
children's eligibility information;
    (ii) Describe the information that will be disclosed;
    (iii) Require that the Medicaid or SCHIP agency use the information 
obtained and specify that the information must only be used to seek to 
enroll children in Medicaid or SCHIP;
    (iv) Describe how the information will be protected from 
unauthorized uses and disclosures;
    (v) Describe the penalties for unauthorized disclosure; and
    (vi) Be signed by both the Medicaid or SCHIP program or agency and 
the State agency or school food authority, as appropriate.
    (8) What are the penalties for unauthorized disclosure or misuse of 
information? In accordance with section 9(b)(2)(C)(v) of the Richard B. 
Russell National School Lunch Act (42 U.S.C. 1758(b)(2)(C)(v)), any 
individual who publishes, divulges, discloses or makes known in any 
manner, or to any extent not authorized by statute or this section, any 
information obtained under this paragraph (f) will be fined not more 
than $1,000 or imprisoned for up to 1 year, or both.
    (9) What are the State agency's responsibilities regarding 
disclosures? State agencies that elect to allow disclosure of children's 
free and reduced price meal eligibility information to Medicaid or 
SCHIP, as provided in this paragraph (f), must ensure that any school 
food authority acting in accordance with that option:
    (i) Has a written agreement with the State or local agency or 
agencies administering health insurance programs for children under 
titles XIX and XXI of the Social Security Act (42 U.S.C. 1396 et seq. 
and 1397aa et seq.) that requires the health agencies to use children's 
free and reduced price meal eligibility information to seek to enroll 
children in those health insurance programs; and
    (ii) Notifies each household of the information that will be 
disclosed, that the information disclosed will be used only to seek to 
enroll children in Medicaid or SCHIP and provides each parent/guardian 
with an opportunity to elect not to have the information disclosed.

(Sec. 803, Pub. L. 97-35, 95 Stat. 521-535 (42 U.S.C. 1758))

[35 FR 14065, Sept. 4, 1970, as amended at 38 FR 14957, June 7, 1973; 
Amdt. 6, 39 FR 30338, Aug. 22, 1974; Amdt. 9, 41 FR 26192, June 25, 
1976; Amdt. 19, 45 FR 67287, Oct. 10, 1980; 47 FR 31853, July 23, 1982; 
49 FR 26034, June 26, 1984; 52 FR 19275, May 22, 1987; 55 FR 19240, May 
9, 1990; 56 FR 32950, July 17, 1991; 56 FR 33860, July 24, 1991; 64 FR 
72472, Dec. 28, 1999; 66 FR 2205, Jan. 11, 2001; 66 FR 48328, Sept. 20, 
2001; 68 FR 53489, Sept. 11, 2003]