[Code of Federal Regulations]
[Title 7, Volume 4]
[Revised as of January 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR210.17]

[Page 40-41]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 210_NATIONAL SCHOOL LUNCH PROGRAM--Table of Contents
 
          Subpart D_Requirements for State Agency Participation
 
Sec. 210.17  Matching Federal funds.


    (a) State revenue matching. For each school year, the amount of 
State revenues appropriated or used specifically by the State for 
program purposes shall not be less than 30 percent of the

[[Page 41]]

funds received by such State under section 4 of the National School 
Lunch Act during the school year beginning July 1, 1980; provided that, 
the State revenues derived from the operation of such programs and State 
revenues expended for salaries and administrative expenses of such 
programs at the State level are not considered in this computation. 
However, if the per capita income of any State is less than the per 
capita income of the United States, the matching requirements so 
computed shall be decreased by the percentage by which the State per 
capita income is below the per capita income of the United States.
    (b) Private school exemption. No State in which the State agency is 
prohibited by law from disbursing State appropriated funds to nonpublic 
schools shall be required to match general cash assistance funds 
expended for meals served in such schools, or to disburse to such 
schools any of the State revenues required to meet the requirements of 
paragraph (a) of this section. Furthermore, the requirements of this 
section do not apply to schools in which the Program is administered by 
a FNSRO.
    (c) Territorial waiver. American Samoa and the Commonwealth of the 
Northern Mariana Islands shall be exempted from the matching 
requirements of paragraph (a) of this section if their respective 
matching requirements are under $100,000.
    (d) Applicable revenues. The following State revenues, appropriated 
or used specifically for program purposes which are expended for any 
school year shall be eligible for meeting the applicable percentage of 
the matching requirements prescribed in paragraph (a) of this section 
for that school year:
    (1) State revenues disbursed by the State agency to school food 
authorities for program purposes, including revenue disbursed to 
nonprofit private schools where the State administers the program in 
such schools;
    (2) State revenues made available to school food authorities and 
transferred by the school food authorities to the nonprofit school food 
service accounts or otherwise expended by the school food authorities in 
connection with the nonprofit school food service program; and
    (3) State revenues used to finance the costs (other than State 
salaries or other State level administrative costs) of the nonprofit 
school food service program, i.e.:
    (i) Local program supervision;
    (ii) Operating the program in participating schools; and
    (iii) The intrastate distribution of foods donated under part 250 of 
this chapter to schools participating in the program.
    (e) Distribution of matching revenues. All State revenues made 
available under paragraph (a) of this section are to be disbursed to 
school food authorities participating in the Program, except as provided 
for under paragraph (b) of this section. Distribution of matching 
revenues may be made with respect to a class of school food authorities 
as well as with respect to individual school food authorities.
    (f) Failure to match. If, in any school year, a State fails to meet 
the State revenue matching requirement, as prescribed in paragraph (a) 
of this section, the general cash assistance funds utilized by the State 
during that school year shall be subject to recall by and repayment to 
FNS.
    (g) Reports. Within 120 days after the end of each school year, each 
State agency shall submit an Annual Report of Revenues (FNS-13) to FNS. 
This report identifies the State revenues to be counted toward the State 
revenue matching requirements specified in paragraph (a) of this 
section.
    (h) Accounting system. The State agency shall establish or cause to 
be established a system whereby all expended State revenues counted in 
meeting the matching requirements prescribed in paragraph (a) of this 
section are properly documented and accounted for.