[Code of Federal Regulations]

[Title 7, Volume 4]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 7CFR247.7]



[Page 406]

 

                          TITLE 7--AGRICULTURE

 

    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE

 

PART 247_COMMODITY SUPPLEMENTAL FOOD PROGRAM--Table of Contents

 

Sec. 247.7  Selection of local agencies.



    (a) How does a local agency apply to participate in CSFP? Local 

agencies wishing to participate in CSFP must submit a written 

application to the State agency. The application must describe how the 

local agency will operate the program and, for nonprofit agencies, must 

include the agency's tax-exempt status. To be eligible to participate in 

CSFP, a nonprofit agency must have tax-exempt status under the Internal 

Revenue Code (IRC), or have applied for tax-exempt status with the 

Internal Revenue Service (IRS), and be moving towards such status. 

Nonprofit agencies organized or operated exclusively for religious 

purposes are automatically tax-exempt under the IRC. Nonprofit agencies 

required to obtain tax-exempt status must provide documentation from the 

IRS that they have obtained such status, or have applied for it.

    (b) On what basis does the State agency make a decision on the local 

agency's application? The State agency must approve or disapprove the 

local agency's application based on, at minimum, the following criteria:

    (1) The ability of the local agency to operate the program in 

accordance with Federal and State requirements;

    (2) The need for the program in the projected service area of the 

local agency;

    (3) The resources available (caseload and funds) for initiating a 

program in the local area; and

    (4) For nonprofit agencies, the tax-exempt status, with appropriate 

documentation.

    (c) What must the State agency do if a nonprofit agency approved for 

CSFP is subsequently denied tax-exempt status by the IRS, or does not 

obtain this status within a certain period of time? In accordance with 

paragraph (a) of this section, the State agency may approve a nonprofit 

agency that has applied to the IRS for tax-exempt status, and is moving 

toward compliance with the requirements for recognition of tax-exempt 

status. However, if the IRS subsequently denies a participating agency's 

application for recognition of tax-exempt status, the agency must 

immediately notify the State agency of the denial. The State agency must 

terminate the agency's agreement and participation immediately upon 

notification. If documentation of recognition of tax-exempt status is 

not received within 180 days of the effective date of the agency's 

approval to participate in CSFP, the State agency must terminate the 

agency's participation until such time as recognition of tax-exempt 

status is obtained. However, the State agency may grant an extension of 

90 days if the agency demonstrates that its inability to obtain tax-

exempt status in the 180-day period is due to circumstances beyond its 

control.

    (d) How much time does the State agency have to make a decision on 

the local agency's application? The State agency must inform the local 

agency of approval or denial of the application within 60 days of its 

receipt. If the application is denied, the State agency must provide a 

written explanation for the denial, along with notification of the local 

agency's right to appeal the decision, in accordance with Sec. 247.35. 

If the application is approved, the State and local agency must enter 

into an agreement in accordance with the requirements of Sec. 247.4.



(Approved by the Office of Management and Budget under control number 

0584-0293)