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[CITE: 42USC1766]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                    CHAPTER 13--SCHOOL LUNCH PROGRAMS
 
Sec. 1766. Child and adult care food program


(a) Grants-in-aid; ``institution'' defined; guidelines for institutions 
        providing care to children outside of school hours; eligibility

    The Secretary may carry out a program to assist States through 
grants-in-aid and other means to initiate and maintain nonprofit food 
service programs for children in institutions providing child care. For 
purposes of this section, the term ``institution'' means any public or 
private nonprofit organization providing nonresidential child care, 
including, but not limited to, child care centers, settlement houses, 
recreational centers, Head Start centers, and institutions providing 
child care facilities for children with disabilities; and such term 
shall also mean any other private organization providing nonresidential 
day care services for which it receives compensation from amounts 
granted to the States under title XX of the Social Security Act [42 
U.S.C. 1397 et seq.] (but only if such organization receives 
compensation under such title for at least 25 percent of its enrolled 
children or 25 percent of its licensed capacity, whichever is less). In 
addition, the term ``institution'' shall include programs developed to 
provide day care outside school hours for schoolchildren, public or 
nonprofit private organizations that sponsor family or group day care 
homes, and emergency shelters (as provided in subsection (t) of this 
section). Except as provided in subsection (r) of this section, 
reimbursement may be provided under this section only for meals or 
supplements served to children not over 12 years of age (except that 
such age limitation shall not be applicable for children of migrant 
workers if 15 years of age or less or for children with disabilities). 
The Secretary may establish separate guidelines for institutions that 
provide care to school children outside of school hours. For purposes of 
determining eligibility--
        (1) an institution (except a school or family or group day care 
    home sponsoring organization) or family or group day care home 
    shall--
            (A)(i) be licensed, or otherwise have approval, by the 
        appropriate Federal, State, or local licensing authority; or
            (ii) be in compliance with appropriate procedures for 
        renewing participation in the program, as prescribed by the 
        Secretary, and not be the subject of information possessed by 
        the State indicating that the license of the institution or home 
        will not be renewed;
            (B) if Federal, State, or local licensing or approval is not 
        available--
                (i) meet any alternate approval standards established by 
            the appropriate State or local governmental agency; or
                (ii) meet any alternate approval standards established 
            by the Secretary after consultation with the Secretary of 
            Health and Human Services; or

            (C) if the institution provides care to school children 
        outside of school hours and Federal, State, or local licensing 
        or approval is not required for the institution, meet State or 
        local health and safety standards; and

        (2) no institution shall be eligible to participate in the 
    program unless it satisfies the following criteria:
            (A) accepts final administrative and financial 
        responsibility for management of an effective food service;
            (B) has not been seriously deficient in its operation of the 
        child care food program, or any other program under this chapter 
        or the Child Nutrition Act of 1966 [42 U.S.C. 1771 et seq.], for 
        a period of time specified by the Secretary;
            (C) will provide adequate supervisory and operational 
        personnel for overall monitoring and management of the child 
        care food program; and
            (D) in the case of a family or group day care home 
        sponsoring organization that employs more than one employee, the 
        organization does not base payments to an employee of the 
        organization on the number of family or group day care homes 
        recruited.

(b) Limitations on cash assistance

    For the fiscal year ending September 30, 1979, and for each 
subsequent fiscal year, the Secretary shall provide cash assistance to 
States for meals as provided in subsection (f) of this section, except 
that, in any fiscal year, the aggregate amount of assistance provided to 
a State by the Secretary under this section shall not exceed the sum of 
(1) the Federal funds provided by the State to participating 
institutions within the State for that fiscal year and (2) any funds 
used by the State under section 10 of the Child Nutrition Act of 1966 
[42 U.S.C. 1779].

(c) Formula for computation of payments; national average payment rate

    (1) For purposes of this section, except as provided in subsection 
(f)(3) of this section, the national average payment rate for free 
lunches and suppers, the national average payment rate for reduced price 
lunches and suppers, and the national average payment rate for paid 
lunches and suppers shall be the same as the national average payment 
rates for free lunches, reduced price lunches, and paid lunches, 
respectively, under sections 1753 and 1759a of this title as appropriate 
(as adjusted pursuant to section 1759a(a) of this title).
    (2) For purposes of this section, except as provided in subsection 
(f)(3) of this section, the national average payment rate for free 
breakfasts, the national average payment rate for reduced price 
breakfasts, and the national average payment rate for paid breakfasts 
shall be the same as the national average payment rates for free 
breakfasts, reduced price breakfasts, and paid breakfasts, respectively, 
under section 4(b) of the Child Nutrition Act of 1966 [42 U.S.C. 
1773(b)] (as adjusted pursuant to section 1759a(a) of this title).
    (3) For purposes of this section, except as provided in subsection 
(f)(3) of this section, the national average payment rate for free 
supplements shall be 30 cents, the national average payment rate for 
reduced price supplements shall be one-half the rate for free 
supplements, and the national average payment rate for paid supplements 
shall be 2.75 cents (as adjusted pursuant to section 1759a(a) of this 
title).
    (4) Determinations with regard to eligibility for free and reduced 
price meals and supplements shall be made in accordance with the income 
eligibility guidelines for free lunches and reduced price lunches, 
respectively, under section 1758 of this title.
    (5) A child shall be considered automatically eligible for benefits 
under this section without further application or eligibility 
determination, if the child is enrolled as a participant in a Head Start 
program authorized under the Head Start Act (42 U.S.C. 9831 et seq.), on 
the basis of a determination that the child is a member of a family that 
meets the low-income criteria prescribed under section 645(a)(1)(A) of 
the Head Start Act (42 U.S.C. 9840(a)(1)(A)).
    (6) A child who has not yet entered kindergarten shall be considered 
automatically eligible for benefits under this section without further 
application or eligibility determination if the child is enrolled as a 
participant in the Even Start program under part B of chapter 1 of title 
I of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 2741 
et seq.).\1\
---------------------------------------------------------------------------
    \1\ See References in Text note below.
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(d) Requirements for approval; notification; reapplication

    (1) Any eligible public institution shall be approved for 
participation in the child care food program upon its request. Any 
eligible private institution shall be approved for participation if it 
has been visited by a State agency prior to approval and it (A) has tax 
exempt status under title 26 or, under conditions established by the 
Secretary, is moving toward compliance with the requirements for tax 
exempt status, or (B) is currently operating a Federal program requiring 
nonprofit status. Family or group day care homes need not have 
individual tax exempt certification if they are sponsored by an 
institution that has tax exempt status, or, under conditions established 
by the Secretary, such institution is moving toward compliance with the 
requirements for tax exempt status or is currently operating a Federal 
program requiring nonprofit status. An institution moving toward 
compliance with the requirement for tax exempt status shall be allowed 
to participate in the child and adult care food program for a period of 
not more than 180 days, except that a State agency may grant a single 
extension of not to exceed an additional 90 days if the institution 
demonstrates, to the satisfaction of the State agency, that the 
inability of the institution to obtain tax exempt status within the 180-
day period is due to circumstances beyond the control of the 
institution. An institution applying for participation under this 
section shall be notified of approval or disapproval in writing within 
thirty days after the date its completed application is filed.
    (2)(A) The Secretary shall develop a policy that--
        (i) allows institutions providing child care that participate in 
    the program under this section, at the option of the State agency, 
    to reapply for assistance under this section at 3-year intervals; 
    and
        (ii) requires periodic site visits to private institutions that 
    the State agency determines have a high probability of program 
    abuse.

    (B) Each State agency that exercises the option authorized by 
subparagraph (A) shall confirm on an annual basis that each such 
institution is in compliance with the licensing or approval provisions 
of subsection (a)(1) of this section.

(e) Hearing

    (1) Except as provided in paragraph (2), the State shall provide, in 
accordance with regulations issued by the Secretary, a fair hearing and 
a prompt determination to any institution aggrieved by the action of the 
State as it affects the participation of such institution in the program 
authorized by this section, or its claim for reimbursement under this 
section.
    (2) A State is not required to provide a hearing to an institution 
concerning a State action taken on the basis of a Federal audit 
determination.
    (3) If a State does not provide a hearing to an institution 
concerning a State action taken on the basis of a Federal audit 
determination, the Secretary, on request, shall afford a hearing to the 
institution concerning the action.

(f) State disbursement to institutions

    (1) Funds paid to any State under this section shall be disbursed to 
eligible institutions by the State under agreements approved by the 
Secretary. Disbursements to any institution shall be made only for the 
purpose of assisting in providing meals to children attending 
institutions, or in family or group day care homes. Disbursement to any 
institution shall not be dependent upon the collection of moneys from 
participating children. All valid claims from such institutions shall be 
paid within forty-five days of receipt by the State. The State shall 
notify the institution within fifteen days of receipt of a claim if the 
claim as submitted is not valid because it is incomplete or incorrect.
    (2)(A) Subject to subparagraph (B) of this paragraph, the 
disbursement for any fiscal year to any State for disbursement to 
institutions, other than family or group day care home sponsoring 
organizations, for meals provided under this section shall be equal to 
the sum of the products obtained by multiplying the total number of each 
type of meal (breakfast, lunch or supper, or supplement) served in such 
institution in that fiscal year by the applicable national average 
payment rate for each such type of meal, as determined under subsection 
(c) of this section.
    (B) No reimbursement may be made to any institution under this 
paragraph, or to family or group day care home sponsoring organizations 
under paragraph (3) of this subsection, for more than two meals and one 
supplement per day per child, or in the case of an institution (but not 
in the case of a family or group day care home sponsoring organization), 
2 meals and 1 supplement per day per child, for children that are 
maintained in a child care setting for eight or more hours per day.
    (3) Reimbursement of family or group day care home sponsoring 
organizations.--
        (A) Reimbursement factor.--
            (i) In general.--An institution that participates in the 
        program under this section as a family or group day care home 
        sponsoring organization shall be provided, for payment to a home 
        sponsored by the organization, reimbursement factors in 
        accordance with this subparagraph for the cost of obtaining and 
        preparing food and prescribed labor costs involved in providing 
        meals under this section.
            (ii) Tier i family or group day care homes.--
                (I) Definition of tier i family or group day care 
            home.--In this paragraph, the term ``tier I family or group 
            day care home'' means--
                    (aa) a family or group day care home that is located 
                in a geographic area, as defined by the Secretary based 
                on census data, in which at least 50 percent of the 
                children residing in the area are members of households 
                whose incomes meet the income eligibility guidelines for 
                free or reduced price meals under section 1758 of this 
                title;
                    (bb) a family or group day care home that is located 
                in an area served by a school enrolling elementary 
                students in which at least 50 percent of the total 
                number of children enrolled are certified eligible to 
                receive free or reduced price school meals under this 
                chapter or the Child Nutrition Act of 1966 (42 U.S.C. 
                1771 et seq.); or
                    (cc) a family or group day care home that is 
                operated by a provider whose household meets the income 
                eligibility guidelines for free or reduced price meals 
                under section 1758 of this title and whose income is 
                verified by the sponsoring organization of the home 
                under regulations established by the Secretary.

                (II) Reimbursement.--Except as provided in subclause 
            (III), a tier I family or group day care home shall be 
            provided reimbursement factors under this clause without a 
            requirement for documentation of the costs described in 
            clause (i), except that reimbursement shall not be provided 
            under this subclause for meals or supplements served to the 
            children of a person acting as a family or group day care 
            home provider unless the children meet the income 
            eligibility guidelines for free or reduced price meals under 
            section 1758 of this title.
                (III) Factors.--Except as provided in subclause (IV), 
            the reimbursement factors applied to a home referred to in 
            subclause (II) shall be the factors in effect on July 1, 
            1996.
                (IV) Adjustments.--The reimbursement factors under this 
            subparagraph shall be adjusted on July 1, 1997, and each 
            July 1 thereafter, to reflect changes in the Consumer Price 
            Index for food at home for the most recent 12-month period 
            for which the data are available. The reimbursement factors 
            under this subparagraph shall be rounded to the nearest 
            lower cent increment and based on the unrounded adjustment 
            in effect on June 30 of the preceding school year.

            (iii) Tier ii family or group day care homes.--
                (I) In general.--
                    (aa) Factors.--Except as provided in subclause (II), 
                with respect to meals or supplements served under this 
                clause by a family or group day care home that does not 
                meet the criteria set forth in clause (ii)(I), the 
                reimbursement factors shall be 95 cents for lunches and 
                suppers, 27 cents for breakfasts, and 13 cents for 
                supplements.
                    (bb) Adjustments.--The factors shall be adjusted on 
                July 1, 1997, and each July 1 thereafter, to reflect 
                changes in the Consumer Price Index for food at home for 
                the most recent 12-month period for which the data are 
                available. The reimbursement factors under this item 
                shall be rounded down to the nearest lower cent 
                increment and based on the unrounded adjustment for the 
                preceding 12-month period.
                    (cc) Reimbursement.--A family or group day care home 
                shall be provided reimbursement factors under this 
                subclause without a requirement for documentation of the 
                costs described in clause (i), except that reimbursement 
                shall not be provided under this subclause for meals or 
                supplements served to the children of a person acting as 
                a family or group day care home provider unless the 
                children meet the income eligibility guidelines for free 
                or reduced price meals under section 1758 of this title.

                (II) Other factors.--A family or group day care home 
            that does not meet the criteria set forth in clause (ii)(I) 
            may elect to be provided reimbursement factors determined in 
            accordance with the following requirements:
                    (aa) Children eligible for free or reduced price 
                meals.--In the case of meals or supplements served under 
                this subsection to children who are members of 
                households whose incomes meet the income eligibility 
                guidelines for free or reduced price meals under section 
                1758 of this title, the family or group day care home 
                shall be provided reimbursement factors set by the 
                Secretary in accordance with clause (ii)(III).
                    (bb) Ineligible children.--In the case of meals or 
                supplements served under this subsection to children who 
                are members of households whose incomes do not meet the 
                income eligibility guidelines, the family or group day 
                care home shall be provided reimbursement factors in 
                accordance with subclause (I).

                (III) Information and determinations.--
                    (aa) In general.--If a family or group day care home 
                elects to claim the factors described in subclause (II), 
                the family or group day care home sponsoring 
                organization serving the home shall collect the 
                necessary income information, as determined by the 
                Secretary, from any parent or other caretaker to make 
                the determinations specified in subclause (II) and shall 
                make the determinations in accordance with rules 
                prescribed by the Secretary.
                    (bb) Categorical eligibility.--In making a 
                determination under item (aa), a family or group day 
                care home sponsoring organization may consider a child 
                participating in or subsidized under, or a child with a 
                parent participating in or subsidized under, a federally 
                or State supported child care or other benefit program 
                with an income eligibility limit that does not exceed 
                the eligibility standard for free or reduced price meals 
                under section 1758 of this title to be a child who is a 
                member of a household whose income meets the income 
                eligibility guidelines under section 1758 of this title.
                    (cc) Factors for children only.--A family or group 
                day care home may elect to receive the reimbursement 
                factors prescribed under clause (ii)(III) solely for the 
                children participating in a program referred to in item 
                (bb) if the home elects not to have income statements 
                collected from parents or other caretakers.

                (IV) Simplified meal counting and reporting 
            procedures.--The Secretary shall prescribe simplified meal 
            counting and reporting procedures for use by a family or 
            group day care home that elects to claim the factors under 
            subclause (II) and by a family or group day care home 
            sponsoring organization that sponsors the home. The 
            procedures the Secretary prescribes may include 1 or more of 
            the following:
                    (aa) Setting an annual percentage for each home of 
                the number of meals served that are to be reimbursed in 
                accordance with the reimbursement factors prescribed 
                under clause (ii)(III) and an annual percentage of the 
                number of meals served that are to be reimbursed in 
                accordance with the reimbursement factors prescribed 
                under subclause (I), based on the family income of 
                children enrolled in the home in a specified month or 
                other period.
                    (bb) Placing a home into 1 of 2 or more 
                reimbursement categories annually based on the 
                percentage of children in the home whose households have 
                incomes that meet the income eligibility guidelines 
                under section 1758 of this title, with each such 
                reimbursement category carrying a set of reimbursement 
                factors such as the factors prescribed under clause 
                (ii)(III) or subclause (I) or factors established within 
                the range of factors prescribed under clause (ii)(III) 
                and subclause (I).
                    (cc) Such other simplified procedures as the 
                Secretary may prescribe.

                (V) Minimum verification requirements.--The Secretary 
            may establish any minimum verification requirements that are 
            necessary to carry out this clause.

        (B) Family or group day care home sponsoring organizations shall 
    also receive reimbursement for their administrative expenses in 
    amounts not exceeding the maximum allowable levels prescribed by the 
    Secretary. Such levels shall be adjusted July 1 of each year to 
    reflect changes in the Consumer Price Index for all items for the 
    most recent 12-month period for which such data are available.
        (C)(i) Reimbursement for administrative expenses shall also 
    include start-up funds to finance the administrative expenses for 
    such institutions to initiate successful operation under the program 
    and expansion funds to finance the administrative expenses for such 
    institutions to expand into low-income or rural areas. Institutions 
    that have received start-up funds may also apply at a later date for 
    expansion funds. Such start-up funds and expansion funds shall be in 
    addition to other reimbursement to such institutions for 
    administrative expenses. Start-up funds and expansion funds shall be 
    payable to enable institutions satisfying the criteria of subsection 
    (d) of this section, and any other standards prescribed by the 
    Secretary, to develop an application for participation in the 
    program as a family or group day care home sponsoring organization 
    or to implement the program upon approval of the application. Such 
    start-up funds and expansion funds shall be payable in accordance 
    with the procedures prescribed by the Secretary. The amount of 
    start-up funds and expansion funds payable to an institution shall 
    be not less than the institution's anticipated reimbursement for 
    administrative expenses under the program for one month and not more 
    than the institution's anticipated reimbursement for administrative 
    expenses under the program for two months.
        (ii) Funds for administrative expenses may be used by family or 
    group day care home sponsoring organizations to assist unlicensed 
    family or group day care homes in becoming licensed.
        (D) Grants to states to provide assistance to family or group 
    day care homes.--
            (i) In general.--
                (I) Reservation.--From amounts made available to carry 
            out this section, the Secretary shall reserve $5,000,000 of 
            the amount made available for fiscal year 1997.
                (II) Purpose.--The Secretary shall use the funds made 
            available under subclause (I) to provide grants to States 
            for the purpose of providing--
                    (aa) assistance, including grants, to family and day 
                care home sponsoring organizations and other appropriate 
                organizations, in securing and providing training, 
                materials, automated data processing assistance, and 
                other assistance for the staff of the sponsoring 
                organizations; and
                    (bb) training and other assistance to family and 
                group day care homes in the implementation of the 
                amendment to subparagraph (A) made by section 708(e)(1) 
                of the Personal Responsibility and Work Opportunity 
                Reconciliation Act of 1996.

            (ii) Allocation.--The Secretary shall allocate from the 
        funds reserved under clause (i)(I)--
                (I) $30,000 in base funding to each State; and
                (II) any remaining amount among the States, based on the 
            number of family day care homes participating in the program 
            in a State during fiscal year 1995 as a percentage of the 
            number of all family day care homes participating in the 
            program during fiscal year 1995.

            (iii) Retention of funds.--Of the amount of funds made 
        available to a State for fiscal year 1997 under clause (i), the 
        State may retain not to exceed 30 percent of the amount to carry 
        out this subparagraph.
            (iv) Additional payments.--Any payments received under this 
        subparagraph shall be in addition to payments that a State 
        receives under subparagraph (A).

        (E) Provision of data to family or group day care home 
    sponsoring organizations.--
            (i) Census data.--The Secretary shall provide to each State 
        agency administering a child and adult care food program under 
        this section data from the most recent decennial census survey 
        or other appropriate census survey for which the data are 
        available showing which areas in the State meet the requirements 
        of subparagraph (A)(ii)(I)(aa). The State agency shall provide 
        the data to family or group day care home sponsoring 
        organizations located in the State.
            (ii) School data.--
                (I) In general.--A State agency administering the school 
            lunch program under this chapter or the school breakfast 
            program under the Child Nutrition Act of 1966 (42 U.S.C. 
            1771 et seq.) shall provide to approved family or group day 
            care home sponsoring organizations a list of schools serving 
            elementary school children in the State in which not less 
            than \1/2\ of the children enrolled are certified to receive 
            free or reduced price meals. The State agency shall collect 
            the data necessary to create the list annually and provide 
            the list on a timely basis to any approved family or group 
            day care home sponsoring organization that requests the 
            list.
                (II) Use of data from preceding school year.--In 
            determining for a fiscal year or other annual period whether 
            a home qualifies as a tier I family or group day care home 
            under subparagraph (A)(ii)(I), the State agency 
            administering the program under this section, and a family 
            or group day care home sponsoring organization, shall use 
            the most current available data at the time of the 
            determination.

            (iii) Duration of determination.--For purposes of this 
        section, a determination that a family or group day care home is 
        located in an area that qualifies the home as a tier I family or 
        group day care home (as the term is defined in subparagraph 
        (A)(ii)(I)), shall be in effect for 3 years (unless the 
        determination is made on the basis of census data, in which case 
        the determination shall remain in effect until more recent 
        census data are available) unless the State agency determines 
        that the area in which the home is located no longer qualifies 
        the home as a tier I family or group day care home.

    (4) By the first day of each month of operation, the State may 
provide advance payments for the month to each approved institution in 
an amount that reflects the full level of valid claims customarily 
received from such institution for one month's operation. In the case of 
a newly participating institution, the amount of the advance shall 
reflect the State's best estimate of the level of valid claims such 
institutions will submit. If the State has reason to believe that an 
institution will not be able to submit a valid claim covering the period 
for which such an advance has been made, the subsequent month's advance 
payment shall be withheld until the State receives a valid claim. 
Payments advanced to institutions that are not subsequently deducted 
from a valid claim for reimbursement shall be repaid upon demand by the 
State. Any prior payment that is under dispute may be subtracted from an 
advance payment.

(g) Meals served by participating institutions; compliance assistance

    (1)(A) Meals served by institutions participating in the program 
under this section shall consist of a combination of foods that meet 
minimum nutritional requirements prescribed by the Secretary on the 
basis of tested nutritional research.
    (B) The Secretary shall provide technical assistance to those 
institutions participating in the program under this section to assist 
the institutions and family or group day care home sponsoring 
organizations in complying with the nutritional requirements prescribed 
by the Secretary pursuant to subparagraph (A).
    (2) No physical segregation or other discrimination against any 
child shall be made because of his or her inability to pay, nor shall 
there be any overt identification of any such child by special tokens or 
tickets, different meals or meal service, announced or published lists 
of names, or other means.
    (3) Each institution shall, insofar as practicable, use in its food 
service foods designated from time to time by the Secretary as being in 
abundance, either nationally or in the food service area, or foods 
donated by the Secretary.

(h) Donation of agricultural commodities by Secretary; measurement of 
        value; annual readjustment of assistance; cash in lieu of 
        commodities; Department of Defense child care feeding program

    (1)(A) The Secretary shall donate agricultural commodities produced 
in the United States for use in institutions participating in the child 
care food program under this section.
    (B) The value of the commodities donated under subparagraph (A) (or 
cash in lieu of commodities) to each State for each school year shall 
be, at a minimum, the amount obtained by multiplying the number of 
lunches and suppers served in participating institutions in that State 
during the preceding school year by the rate for commodities or cash in 
lieu of commodities established under section 1755(c) of this title for 
the school year concerned.
    (C) After the end of each school year, the Secretary shall--
        (i) reconcile the number of lunches and suppers served in 
    participating institutions in each State during such school year 
    with the number of lunches and suppers served by participating 
    institutions in each State during the preceding school year; and
        (ii) based on such reconciliation, increase or reduce subsequent 
    commodity assistance or cash in lieu of commodities provided to each 
    State.

    (D) Any State receiving assistance under this section for 
institutions participating in the child care food program may, upon 
application to the Secretary, receive cash in lieu of some or all of the 
commodities to which it would otherwise be entitled under this 
subsection. In determining whether to request cash in lieu of 
commodities, the State shall base its decision on the preferences of 
individual participating institutions within the State, unless this 
proves impracticable due to the small number of institutions preferring 
donated commodities.
    (2) The Secretary is authorized to provide agricultural commodities 
obtained by the Secretary under the provisions of the Agricultural Act 
of 1949 (7 U.S.C. 1421 et seq.) and donated under the provisions of 
section 416 of such Act [7 U.S.C. 1431], to the Department of Defense 
for use by its institutions providing child care services, when such 
commodities are in excess of the quantities needed to meet the needs of 
all other child nutrition programs, domestic and foreign food assistance 
and export enhancement programs. The Secretary shall require 
reimbursement from the Department of Defense for the costs, or some 
portion thereof, of delivering such commodities to overseas locations, 
unless the Secretary determines that it is in the best interest of the 
program that the Department of Agriculture shall assume such costs.

(i) Availability of money for audits

    The Secretary shall make available for each fiscal year to States 
administering the child care food program, for the purpose of conducting 
audits of participating institutions, an amount up to 1.5 percent 
(except, in the case of each of fiscal years 2005 through 2007, 1 
percent) of the funds used by each State in the program under this 
section, during the second preceding fiscal year.

(j) Standard form agreement regulations

    The Secretary may issue regulations directing States to develop and 
provide for the use of a standard form of agreement between each family 
or group day care sponsoring organization and the family or group day 
care homes participating in the program under such organization, for the 
purpose of specifying the rights and responsibilities of each party.

(k) Training and technical assistance

    A State participating in the program established under this section 
shall provide sufficient training, technical assistance, and monitoring 
to facilitate effective operation of the program. The Secretary shall 
assist the State in developing plans to fulfill the requirements of this 
subsection.

(l) Non-diminishment of State and local funds

    Expenditures of funds from State and local sources for the 
maintenance of food programs for children shall not be diminished as a 
result of funds received under this section.

(m) Accounts and records

    States and institutions participating in the program under this 
section shall keep such accounts and records as may be necessary to 
enable the Secretary to determine whether there has been compliance with 
the requirements of this section. Such accounts and records shall be 
available at any reasonable time for inspection and audit by 
representatives of the Secretary, the Comptroller General of the United 
States, and appropriate State representatives and shall be preserved for 
such period of time, not in excess of five years, as the Secretary 
determines necessary.

(n) Authorization of appropriations

    There are hereby authorized to be appropriated for each fiscal year 
such funds as are necessary to carry out the purposes of this section.

(o) Participation of older persons and chronically impaired disabled 
        persons

    (1) For purposes of this section, adult day care centers shall be 
considered eligible institutions for reimbursement for meals or 
supplements served to persons 60 years of age or older or to chronically 
impaired disabled persons, including victims of Alzheimer's disease and 
related disorders with neurological and organic brain dysfunction. 
Reimbursement provided to such institutions for such purposes shall 
improve the quality of meals or level of services provided or increase 
participation in the program. Lunches served by each such institution 
for which reimbursement is claimed under this section shall provide, on 
the average, approximately \1/3\ of the daily recommended dietary 
allowance established by the Food and Nutrition Board of the National 
Research Council of the National Academy of Sciences. Such institutions 
shall make reasonable efforts to serve meals that meet the special 
dietary requirements of participants, including efforts to serve foods 
in forms palatable to participants.
    (2) For purposes of this subsection--
        (A) the term ``adult day care center'' means any public agency 
    or private nonprofit organization, or any proprietary title XIX or 
    title XX center, which--
            (i) is licensed or approved by Federal, State, or local 
        authorities to provide adult day care services to chronically 
        impaired disabled adults or persons 60 years of age or older in 
        a group setting outside their homes, or a group living 
        arrangement, on a less than 24-hour basis; and
            (ii) provides for such care and services directly or under 
        arrangements made by the agency or organization whereby the 
        agency or organization maintains professional management 
        responsibility for all such services; and

        (B) the term ``proprietary title XIX or title XX center'' means 
    any private, for-profit center providing adult day care services for 
    which it receives compensation from amounts granted to the States 
    under title XIX or XX of the Social Security Act [42 U.S.C. 1396 et 
    seq., 1397 et seq.] and which title XIX or title XX beneficiaries 
    were not less than 25 percent of enrolled eligible participants in a 
    calendar month preceding initial application or annual reapplication 
    for program participation.

    (3)(A) The Secretary, in consulation \2\ with the Assistant 
Secretary for Aging, shall establish, within 6 months of October 1, 
1988, separate guidelines for reimbursement of institutions described in 
this subsection. Such reimbursement shall take into account the 
nutritional requirements of eligible persons, as determined by the 
Secretary on the basis of tested nutritional research, except that such 
reimbursement shall not be less than would otherwise be required under 
this section.
---------------------------------------------------------------------------
    \2\ So in original. Probably should be ``consultation''.
---------------------------------------------------------------------------
    (B) The guidelines shall contain provisions designed to assure that 
reimbursement under this subsection shall not duplicate reimbursement 
under part C of title III of the Older Americans Act of 1965 [42 U.S.C. 
3030e et seq.], for the same meal served.
    (4) For the purpose of establishing eligibility for free or reduced 
price meals or supplements under this subsection, income shall include 
only the income of an eligible person and, if any, the spouse and 
dependents with whom the eligible person resides.
    (5) A person described in paragraph (1) shall be considered 
automatically eligible for free meals or supplements under this 
subsection, without further application or eligibility determination, if 
the person is--
        (A) a member of a household receiving assistance under the Food 
    Stamp Act of 1977 (7 U.S.C. 2011 et seq.); or
        (B) a recipient of assistance under title XVI or XIX of the 
    Social Security Act [42 U.S.C. 1381 et seq., 1396 et seq.].

    (6) The Governor of any State may designate to administer the 
program under this subsection a State agency other than the agency that 
administers the child care food program under this section.

(p) Demonstration projects for qualification under this section of 
        private for-profit organizations providing nonresidential day 
        care services

    (1) From amounts appropriated or otherwise made available for 
purposes of carrying out this section, the Secretary shall carry out 2 
statewide demonstration projects under which private for-profit 
organizations providing nonresidential day care services shall qualify 
as institutions for the purposes of this section. An organization may 
participate in a demonstration project described in the preceding 
sentence if--
        (A) at least 25 percent of the children enrolled in the 
    organization or 25 percent of the licensed capacity of the 
    organization for children, whichever is less, meet the income 
    eligibility criteria established under section 1758(b) of this title 
    for free or reduced price meals; and
        (B) as a result of the participation of the organization in the 
    project--
            (i) the nutritional content or quality of meals and snacks 
        served to children under the care of such organization will be 
        improved; or
            (ii) fees charged by such organization for the care of the 
        children described in subparagraph (A) will be lowered.

    (2) Under each such project, the Secretary shall examine--
        (A) the budgetary impact of the change in eligibility being 
    tested;
        (B) the extent to which, as a result of such change, additional 
    low-income children can be reached; and
        (C) which outreach methods are most effective.

    (3) The Secretary shall choose to conduct demonstration projects 
under this subsection--
        (A) 1 State that--
            (i) has a history of participation of for-profit 
        organizations in the child care food program;
            (ii) allocates a significant proportion of the amounts it 
        receives for child care under title XX of the Social Security 
        Act [42 U.S.C. 1397 et seq.] in a manner that allows low-income 
        parents to choose the type of child care their children will 
        receive;
            (iii) has other funding mechanisms that support parental 
        choice for child care;
            (iv) has a large, State-regulated for-profit child care 
        industry that serves low-income children; and
            (v) has large sponsors of family or group day care homes 
        that have a history of recruiting and sponsoring for-profit 
        child care centers in the child care food program; and

        (B) 1 State in which--
            (i) the majority of children for whom child care 
        arrangements are made are being cared for in center-based child 
        care facilities;
            (ii) for-profit child care centers and preschools are 
        located throughout the State and serve both rural and urban 
        populations;
            (iii) at least \1/3\ of the licensed child care centers and 
        preschools operate as for-profit facilities;
            (iv) all licensed facilities are subject to identical 
        nutritional requirements for food service that are similar to 
        those required under the child care food program; and
            (v) less than 1 percent of child care centers participating 
        in the child care food program receive assistance under title XX 
        of the Social Security Act [42 U.S.C. 1397 et seq.].

(q) Management support

                (1) Technical and training assistance

        In addition to the training and technical assistance that is 
    provided to State agencies under other provisions of this chapter 
    and the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.), the 
    Secretary shall provide training and technical assistance in order 
    to assist the State agencies in improving their program management 
    and oversight under this section.

                             (2) Funding

        For each of fiscal years 1999 through 2003, the Secretary shall 
    reserve to carry out paragraph (1) $1,000,000 of the amounts made 
    available to carry out this section.

(r) Program for at-risk school children

               (1) Definition of at-risk school child

        In this subsection, the term ``at-risk school child'' means a 
    school child who--
            (A) is not more than 18 years of age, except that the age 
        limitation provided by this subparagraph shall not apply to a 
        child described in section 1760(d)(1)(A) of this title; and
            (B) participates in a program authorized under this section 
        operated at a site located in a geographical area served by a 
        school in which at least 50 percent of the children enrolled are 
        certified as eligible to receive free or reduced price school 
        meals under this chapter or the Child Nutrition Act of 1966 (42 
        U.S.C. 1771 et seq.).

       (2) Participation in child and adult care food program

        An institution may participate in the program authorized under 
    this section only if the institution provides supplements under a 
    program--
            (A) organized primarily to provide care to at-risk school 
        children during after-school hours, weekends, or holidays during 
        the regular school year; and
            (B) with an educational or enrichment purpose.

                         (3) Administration

        Except as otherwise provided in this subsection, the other 
    provisions of this section apply to an institution described in 
    paragraph (2).

                    (4) Supplement reimbursement

        (A) Limitations

            An institution may claim reimbursement under this subsection 
        only for--
                (i) a supplement served under a program organized 
            primarily to provide care to at-risk school children during 
            after-school hours, weekends, or holidays during the regular 
            school year; and
                (ii) one supplement per child per day.

        (B) Rate

            A supplement shall be reimbursed under this subsection at 
        the rate established for a free supplement under subsection 
        (c)(3) of this section.

        (C) No charge

            A supplement claimed for reimbursement under this subsection 
        shall be served without charge.

(s) Information concerning the special supplemental nutrition program 
        for women, infants, and children

                           (1) In general

        The Secretary shall provide each State agency administering a 
    child and adult care food program under this section with 
    information concerning the special supplemental nutrition program 
    for women, infants, and children authorized under section 17 of the 
    Child Nutrition Act of 1966 (42 U.S.C. 1786).

                 (2) Requirements for State agencies

        Each State agency shall ensure that each participating family 
    and group day care home and child care center (other than an 
    institution providing care to school children outside school 
    hours)--
            (A) receives materials that include--
                (i) a basic explanation of the importance and benefits 
            of the special supplemental nutrition program for women, 
            infants, and children;
                (ii) the maximum State income eligibility standards, 
            according to family size, for the program; and
                (iii) information concerning how benefits under the 
            program may be obtained;

            (B) receives periodic updates of the information described 
        in subparagraph (A); and
            (C) provides the information described in subparagraph (A) 
        to parents of enrolled children at enrollment.

(t) Participation by emergency shelters

                 (1) Definition of emergency shelter

        In this subsection, the term ``emergency shelter'' means--
            (A) an emergency shelter (as defined in section 11351 of 
        this title); or
            (B) a site operated by the shelter.

                         (2) Administration

        Except as otherwise provided in this subsection, an emergency 
    shelter shall be eligible to participate in the program authorized 
    under this section in accordance with the terms and conditions 
    applicable to eligible institutions described in subsection (a) of 
    this section.

                     (3) Licensing requirements

        The licensing requirements contained in subsection (a)(1) of 
    this section shall not apply to an emergency shelter.

                   (4) Health and safety standards

        To be eligible to participate in the program authorized under 
    this section, an emergency shelter shall comply with applicable 
    State or local health and safety standards.

                (5) Meal or supplement reimbursement

        (A) Limitations

            An emergency shelter may claim reimbursement under this 
        subsection--
                (i) only for a meal or supplement served to children 
            residing at an emergency shelter, if the children are--
                    (I) not more than 12 years of age;
                    (II) children of migrant workers, if the children 
                are not more than 15 years of age; or
                    (III) children with disabilities; and

                (ii) for not more than 3 meals, or 2 meals and a 
            supplement, per child per day.

        (B) Rate

            A meal or supplement eligible for reimbursement shall be 
        reimbursed at the rate at which free meals and supplements are 
        reimbursed under subsection (c) of this section.

        (C) No charge

            A meal or supplement claimed for reimbursement shall be 
        served without charge.

(June 4, 1946, ch. 281, Sec. 17, as added Pub. L. 94-105, Sec. 16, Oct. 
7, 1975, 89 Stat. 522; amended Pub. L. 95-166, Secs. 3, 19(d), Nov. 10, 
1977, 91 Stat. 1332, 1345; Pub. L. 95-627, Sec. 2, Nov. 10, 1978, 92 
Stat. 3603; Pub. L. 96-499, title II, Secs. 207(a), 208(b), (c), Dec. 5, 
1980, 94 Stat. 2602; Pub. L. 97-35, title VIII, Secs. 810, 817(c), 
819(k), Aug. 13, 1981, 95 Stat. 528, 532, 534; Pub. L. 99-500, title 
III, Secs. 361, 372(a), Oct. 18, 1986, 100 Stat. 1783-367, 1783-369, and 
Pub. L. 99-591, title III, Secs. 361, 372(a), Oct. 30, 1986, 100 Stat. 
3341-370, 3341-372; Pub. L. 99-661, div. D, title IV, Sec. 4401, title 
V, Sec. 4502(a), Nov. 14, 1986, 100 Stat. 4079, 4080; Pub. L. 100-175, 
title IV, Sec. 401, Nov. 29, 1987, 101 Stat. 972; Pub. L. 100-435, title 
II, Secs. 211, 214, Sept. 19, 1988, 102 Stat. 1657, 1659; Pub. L. 100-
460, title VI, Sec. 641, Oct. 1, 1988, 102 Stat. 2265; Pub. L. 101-147, 
title I, Secs. 105(a), (b), 131(b), title II, Sec. 204(a), title III, 
Secs. 310, 312(2), Nov. 10, 1989, 103 Stat. 883, 907, 909, 915, 916; 
Pub. L. 102-342, title II, Secs. 202, 203, Aug. 14, 1992, 106 Stat. 913; 
Pub. L. 102-375, title VIII, Sec. 811(a), Sept. 30, 1992, 106 Stat. 
1295; Pub. L. 103-171, Sec. 3(b)(4), Dec. 2, 1993, 107 Stat. 1991; Pub. 
L. 103-448, title I, Secs. 105(c), 109(b), 116, Nov. 2, 1994, 108 Stat. 
4702, 4705, 4714; Pub. L. 104-193, title VII, Sec. 708(a)-(j), Aug. 22, 
1996, 110 Stat. 2293-2299; Pub. L. 105-336, title I, Secs. 101(b), 
107(a)-(j)(1), (2)(B), (3)(C), Oct. 31, 1998, 112 Stat. 3144, 3149-
3153.)

                       References in Text

    The Social Security Act, referred to in subsecs. (a), (o)(2)(B), 
(5)(B), and (p)(3)(A)(ii), (B)(v), is act Aug. 14, 1935, ch. 531, 49 
Stat. 620, as amended. Titles XVI, XIX, and XX of the Social Security 
Act are classified generally to subchapters XVI (Sec. 1381 et seq.), XIX 
(Sec. 1396 et seq.), and XX (Sec. 1397 et seq.), respectively, of 
chapter 7 of this title. For complete classification of this Act to the 
Code, see section 1305 of this title and Tables.
    The Child Nutrition Act of 1966, referred to in subsecs. (a)(2)(B), 
(f)(3)(A)(ii)(I)(bb), (E)(ii)(I), (q)(1), and (r)(1)(B), is Pub. L. 89-
642, Oct. 11, 1966, 80 Stat. 885, as amended, which is classified 
generally to chapter 13A (Sec. 1771 et seq.) of this title. For complete 
classification of this Act to the Code, see Short Title note set out 
under section 1771 of this title and Tables.
    The Head Start Act, referred to in subsec. (c)(5), is subchapter B 
(Secs. 635-657) of chapter 8 of subtitle A of title VI of Pub. L. 97-35, 
Aug. 13, 1981, 95 Stat. 499, as amended, which is classified generally 
to subchapter II (Sec. 9831 et seq.) of chapter 105 of this title. For 
complete classification of this Act to the Code, see Short Title note 
set out under section 9801 of this title and Tables.
    Part B of chapter 1 of title I of the Elementary and Secondary 
Education Act of 1965, referred to in subsec. (c)(6), means part B of 
chapter 1 of title I of Pub. L. 89-10 which was classified generally to 
part B (Sec. 2741 et seq.) of division 1 of subchapter I of chapter 47 
of Title 20, Education, prior to being omitted in the general amendment 
of Pub. L. 89-10 by Pub. L. 103-382, title I, Sec. 101, Oct. 20, 1994, 
108 Stat. 3519. See section 6361 et seq. of Title 20.
    Section 708(e)(1) of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, referred to in subsec. 
(f)(3)(D)(i)(II)(bb), is section 708(e)(1) of Pub. L. 104-193, title 
VII, Aug. 22, 1996, 110 Stat. 2294, which amended this section.
    The Agricultural Act of 1949, referred to in subsec. (h)(2), is act 
Oct. 31, 1949, ch. 792, 63 Stat. 1051, as amended, which is classified 
principally to chapter 35A (Sec. 1421 et seq.) of Title 7, Agriculture. 
For complete classification of this Act to the Code, see Short Title 
note set out under section 1421 of Title 7 and Tables.
    The Older Americans Act of 1965, referred to in subsec. (o)(3)(B), 
is Pub. L. 89-73, July 14, 1965, 79 Stat. 218, as amended. Part C of 
title III of the Older Americans Act of 1965 is classified generally to 
part C (Sec. 3030e et seq.) of subchapter III of chapter 35 of this 
title. For complete classification of this Act to the Code, see Short 
Title note set out under section 3001 of this title and Tables.
    The Food Stamp Act of 1977, referred to in subsec. (o)(5)(A), is 
Pub. L. 88-525, Aug. 31, 1964, 78 Stat. 703, as amended, which is 
classified generally to chapter 51 (Sec. 2011 et seq.) of Title 7, 
Agriculture. For complete classification of this Act to the Code, see 
Short Title note set out under section 2011 of Title 7 and Tables.

                          Codification

    October 1, 1988, referred to in subsec. (o)(3)(A) [formerly 
(p)(3)(A)], was in the original ``enactment'', which was translated as 
meaning the date of enactment of Pub. L. 100-460, which amended subsec. 
(p)(3)(A) generally, to reflect the probable intent of Congress.
    Pub. L. 99-591 is a corrected version of Pub. L. 99-500.


                               Amendments

    1998--Subsec. (a). Pub. L. 105-336, Sec. 107(j)(3)(C), substituted 
``children with disabilities'' for ``children with handicaps'' in two 
places in introductory provisions.
    Pub. L. 105-336, Sec. 107(j)(2)(B), in third sentence of 
introductory provisions, substituted ``public'' for ``and public'' and 
inserted, ``, and emergency shelters (as provided in subsection (t) of 
this section)'' before period at end.
    Pub. L. 105-336, Sec. 107(a)(1), in fourth sentence of introductory 
provisions, substituted ``Except as provided in subsection (r) of this 
section, reimbursement'' for ``Reimbursement''.
    Subsec. (a)(1). Pub. L. 105-336, Sec. 107(a)(2), added par. (1) and 
struck out former par. (1) which read as follows: ``no institution, 
other than a family or group day care home sponsoring organization, or 
family or group day care home shall be eligible to participate in the 
program unless it has Federal, State, or local licensing or approval, or 
is complying with appropriate renewal procedures as prescribed by the 
Secretary and the State has no information indicating that the 
institution's license will not be renewed; or where Federal, State, or 
local licensing or approval is not available, it receives funds under 
title XX of the Social Security Act or otherwise demonstrates that it 
meets either any applicable State or local government licensing or 
approval standards or approval standards established by the Secretary 
after consultation with the Secretary of Health and Human Services; 
and''.
    Subsec. (c)(6). Pub. L. 105-336, Sec. 107(b), struck out ``(A)'' 
before ``A child'' and struck out subpar. (B) which read as follows: 
``Subparagraph (A) shall apply only with respect to the provision of 
benefits under this section for the period beginning September 1, 1995, 
and ending September 30, 1997.''
    Subsec. (d)(1). Pub. L. 105-336, Sec. 107(c)(1), (d), inserted ``has 
been visited by a State agency prior to approval and it'' after ``if 
it'' in second sentence, inserted ``An institution moving toward 
compliance with the requirement for tax exempt status shall be allowed 
to participate in the child and adult care food program for a period of 
not more than 180 days, except that a State agency may grant a single 
extension of not to exceed an additional 90 days if the institution 
demonstrates, to the satisfaction of the State agency, that the 
inability of the institution to obtain tax exempt status within the 180-
day period is due to circumstances beyond the control of the 
institution.'' after third sentence, and struck out at end ``If an 
institution submits an incomplete application to the State, the State 
shall so notify the institution within fifteen days of receipt of the 
application.''
    Subsec. (d)(2)(A). Pub. L. 105-336, Sec. 107(c)(2), substituted 
``policy that--'' for ``policy that'', inserted ``(i)'' before ``allows 
institutions'', substituted ``; and'' for period at end, and added cl. 
(ii).
    Subsec. (h)(1)(B). Pub. L. 105-336, Sec. 101(b), substituted 
``1755(c)'' for ``1755(e)''.
    Subsec. (i). Pub. L. 105-336, Sec. 107(e), substituted ``1.5 percent 
(except, in the case of each of fiscal years 2005 through 2007, 1 
percent)'' for ``2 percent''.
    Subsec. (p)(4), (5). Pub. L. 105-336, Sec. 107(f), struck out pars. 
(4) and (5) which read as follows:
    ``(4) Such project shall--
        ``(A) commence not earlier than May 1, 1990, and not later than 
    June 30, 1990; and
        ``(B) terminate on September 30, 1998.
    ``(5) Notwithstanding paragraph (4)(B), the Secretary shall continue 
until September 30, 1998, the two pilot projects established under this 
subsection to the extent, and in such amounts, as are provided for in 
advance in appropriations Acts.''
    Subsec. (q). Pub. L. 105-336, Sec. 107(g), added subsec. (q).
    Subsec. (r). Pub. L. 105-336, Sec. 107(h), added subsec. (r).
    Subsec. (s). Pub. L. 105-336, Sec. 107(i), added subsec. (s).
    Subsec. (t). Pub. L. 105-336, Sec. 107(j)(1), added subsec. (t).
    1996--Subsec. (a). Pub. L. 104-193, Sec. 708(a), substituted 
``initiate and maintain nonprofit food service programs'' for 
``initiate, maintain, and expand nonprofit food service programs'' in 
first sentence.
    Subsec. (a)(2)(D). Pub. L. 104-193, Sec. 708(b), added subpar. (D).
    Subsec. (c)(1) to (3). Pub. L. 104-193, Sec. 708(e)(4), inserted 
``except as provided in subsection (f)(3) of this section,'' after ``For 
purposes of this section,''.
    Subsec. (d)(1). Pub. L. 104-193, Sec. 708(c), struck out ``, and 
shall provide technical assistance, if necessary, to the institution for 
the purpose of completing its application'' before period at end.
    Subsec. (f)(2)(B). Pub. L. 104-193, Sec. 708(d), substituted ``2 
meals and 1 supplement'' for ``two meals and two supplements or three 
meals and one supplement''.
    Subsec. (f)(3). Pub. L. 104-193, Sec. 708(e)(1), inserted heading.
    Subsec. (f)(3)(A). Pub. L. 104-193, Sec. 708(e)(1), added heading 
and text of subpar. (A) and struck out former subpar. (A) which read as 
follows: ``Institutions that participate in the program under this 
section as family or group day care home sponsoring organizations shall 
be provided, for payment to such homes, a reimbursement factor set by 
the Secretary for the cost of obtaining and preparing food and 
prescribed labor costs, involved in providing meals under this section, 
without a requirement for documentation of such costs, except that 
reimbursement shall not be provided under this subparagraph for meals or 
supplements served to the children of a person acting as a family or 
group day care home provider unless such children meet the eligibility 
standards for free or reduced price meals under section 1758 of this 
title. The reimbursement factor in effect as of August 13, 1981, shall 
be reduced by 10 percent. The reimbursement factor under this 
subparagraph shall be adjusted on July 1 of each year to reflect changes 
in the Consumer Price Index for food away from home for the most recent 
12-month period for which such data are available. The reimbursement 
factor under this subparagraph shall be rounded to the nearest one-
fourth cent.''
    Subsec. (f)(3)(B). Pub. L. 104-193, Sec. 708(f)(1)(A), struck out at 
end ``The maximum allowable levels for administrative expense payments, 
as in effect as of August 13, 1981, shall be adjusted by the Secretary 
so as to achieve a 10 percent reduction in the total amount of 
reimbursement provided to institutions for such administrative expenses. 
In making the reduction required by the preceding sentence, the 
Secretary shall increase the economy of scale factors used to 
distinguish institutions that sponsor a greater number of family or 
group day care homes from those that sponsor a lesser number of such 
homes.''
    Subsec. (f)(3)(C)(ii). Pub. L. 104-193, Sec. 708(f)(1)(B), 
substituted ``assist unlicensed family or group day care homes in 
becoming'' for ``conduct outreach and recruitment to unlicensed family 
or group day care homes so that the day care homes may become''.
    Subsec. (f)(3)(D). Pub. L. 104-193, Sec. 708(e)(2), added subpar. 
(D).
    Subsec. (f)(3)(E). Pub. L. 104-193, Sec. 708(e)(3), added subpar. 
(E).
    Subsec. (f)(4). Pub. L. 104-193, Sec. 708(f)(2), substituted ``State 
may provide'' for ``State shall provide'' in first sentence.
    Subsec. (g)(1)(A). Pub. L. 104-193, Sec. 708(g)(1), struck out at 
end ``Such meals shall be served free to needy children.''
    Subsec. (g)(1)(B). Pub. L. 104-193, Sec. 708(g)(2), struck out at 
end ``The Secretary shall provide additional technical assistance to 
those institutions and family or group day care home sponsoring 
organizations that are having difficulty maintaining compliance with the 
requirements.''
    Subsec. (k). Pub. L. 104-193, Sec. 708(h), added heading and text of 
subsec. (k) and struck out former subsec. (k) consisting of pars. (1) to 
(3) which related to training and technical assistance, monitoring, 
research, and demonstration projects.
    Subsec. (m). Pub. L. 104-193, Sec. 708(i), substituted ``available 
at any reasonable time'' for ``available at all times''.
    Subsec. (q). Pub. L. 104-193, Sec. 708(j), struck out subsec. (q) 
which related to provision of information concerning special 
supplemental nutrition program for women, infants, and children.
    1994--Subsec. (c)(5). Pub. L. 103-448, Sec. 109(b), added par. (5).
    Subsec. (c)(6). Pub. L. 103-448, Sec. 116(a), added par. (6).
    Subsec. (d)(2)(A). Pub. L. 103-448, Sec. 116(b), substituted ``3-
year intervals'' for ``2-year intervals''.
    Subsec. (f)(3)(C). Pub. L. 103-448, Sec. 116(c), designated existing 
provisions as cl. (i) and added cl. (ii).
    Subsec. (g)(1). Pub. L. 103-448, Sec. 105(c), designated existing 
provisions as subpar. (A) and added subpar. (B).
    Subsec. (k)(4). Pub. L. 103-448, Sec. 116(d), added par. (4).
    Subsec. (p). Pub. L. 103-448, Sec. 116(e), substituted ``25 percent 
of the children enrolled in the organization or 25 percent of the 
licensed capacity of the organization for children, whichever is less,'' 
for ``25 percent of the children served by such organization'' in par. 
(1)(A), ``1998'' for ``1992'' in par. (4)(B), and ``1998'' for ``1994'' 
in par. (5).
    Subsec. (q). Pub. L. 103-448, Sec. 116(f), added subsec. (q).
    1993--Subsec. (o)(3)(A). Pub. L. 103-171 substituted ``Assistant 
Secretary for Aging'' for ``Commissioner of Aging''.
    1992--Subsec. (a). Pub. L. 102-342, Sec. 202, substituted ``of its 
enrolled children or 25 percent of its licensed capacity, whichever is 
less'' for ``of the children for which the organization provides such 
nonresidential day care services''.
    Subsec. (o)(2)(A)(i). Pub. L. 102-375 inserted ``, or a group living 
arrangement,'' after ``homes''.
    Subsec. (p)(5). Pub. L. 102-342, Sec. 203, added par. (5).
    1989--Pub. L. 101-147, Sec. 105(a), substituted ``Child and adult 
care food program'' for ``Child care food program'' in section 
catchline.
    Subsec. (a). Pub. L. 101-147, Sec. 310(a)(1), substituted ``children 
with handicaps'' for ``handicapped children'' wherever appearing.
    Subsec. (c). Pub. L. 101-147, Sec. 312(2), substituted ``reduced 
price'' for ``reduced-price'' wherever appearing.
    Subsec. (d). Pub. L. 101-147, Sec. 204(a), designated existing 
provisions as par. (1), redesignated cls. (1) and (2) as (A) and (B), 
respectively, and added par. (2).
    Subsec. (d)(1). Pub. L. 101-147, Sec. 310(a)(2), substituted 
``Internal Revenue Code of 1986'' for ``Internal Revenue Code of 1954'', 
which for purposes of codification was translated as ``title 26'' thus 
requiring no change in text.
    Subsec. (e). Pub. L. 101-147, Sec. 310(b), amended subsec. (e), as 
identically amended by Pub. L. 99-500 and 99-591, Sec. 361, and Pub. L. 
99-661, Sec. 4401, to read as if only the amendment by Pub. L. 99-661 
was enacted, resulting in no change in text, see 1986 Amendment note 
below.
    Subsec. (f)(1). Pub. L. 101-147, Sec. 310(a)(3)(A), substituted 
``day care'' for ``day-care''.
    Subsec. (f)(2)(B). Pub. L. 101-147, Sec. 310(a)(3)(B), struck out 
second period at end.
    Subsec. (f)(3)(A). Pub. L. 101-147, Sec. 312(2), substituted 
``reduced price'' for ``reduced-price''.
    Subsec. (f)(3)(C). Pub. L. 101-147, Sec. 105(b)(1), inserted before 
period at end of first sentence ``and expansion funds to finance the 
administrative expenses for such institutions to expand into low-income 
or rural areas'', inserted ``and expansion funds'' after ``start-up 
funds'' in second, fourth, and fifth sentences and after ``Start-up 
funds'' in third sentence, and inserted after first sentence 
``Institutions that have received start-up funds may also apply at a 
later date for expansion funds.''
    Subsec. (h)(1). Pub. L. 101-147, Sec. 131(b), amended par. (1) 
generally. Prior to amendment, par. (1) read as follows: ``The Secretary 
shall donate agricultural commodities produced in the United States for 
use in institutions participating in the child care food program under 
this section. The value of such commodities (or cash in lieu of 
commodities) donated to each State for each school year shall be, at a 
minimum, the amount obtained by multiplying the number of lunches and 
suppers served in participating institutions in that State during that 
school year by the rate for commodities or cash in lieu thereof 
established for that school year under section 1755(e) of this title. 
Any State receiving assistance under this section for institutions 
participating in the child care food program may, upon application to 
the Secretary, receive cash in lieu of some or all of the commodities to 
which it would otherwise be entitled under this subsection. In 
determining whether to request cash in lieu of commodities, the State 
shall base its decision on the preferences of individual participating 
institutions within the State, unless this proves impracticable due to 
the small number of institutions preferring donated commodities.''
    Subsec. (k). Pub. L. 101-147, Sec. 310(a)(4), redesignated subsec. 
(l) as (k) and struck out former subsec. (k) which related to study and 
report on maximum administrative payments reflecting costs of 
institutions.
    Subsec. (l). Pub. L. 101-147, Sec. 310(a)(4), redesignated subsec. 
(m) as (l). Former subsec. (l) redesignated (k).
    Pub. L. 101-147, Sec. 105(b)(2), designated existing provisions as 
par. (1) and added pars. (2) and (3).
    Subsecs. (m), (n). Pub. L. 101-147, Sec. 310(a)(4), redesignated 
subsecs. (n) and (o) as (m) and (n), respectively. Former subsec. (m) 
redesignated (l).
    Subsec. (o). Pub. L. 101-147, Sec. 312(2), substituted ``reduced 
price'' for ``reduced-price'' in par. (4).
    Pub. L. 101-147, Sec. 310(a)(4), redesignated subsec. (p) as (o). 
Former subsec. (o) redesignated (n).
    Subsec. (p). Pub. L. 101-147, Sec. 310(a)(4), redesignated subsec. 
(q) as (p). Former subsec. (p) redesignated (o).
    Pub. L. 101-147, Sec. 105(b)(3)(A), inserted at end of par. (1) 
``Lunches served by each such institution for which reimbursement is 
claimed under this section shall provide, on the average, approximately 
\1/3\ of the daily recommended dietary allowance established by the Food 
and Nutrition Board of the National Research Council of the National 
Academy of Sciences. Such institutions shall make reasonable efforts to 
serve meals that meet the special dietary requirements of participants, 
including efforts to serve foods in forms palatable to participants.''
    Pub. L. 101-147, Sec. 105(b)(3)(B), added par. (6).
    Subsec. (q). Pub. L. 101-147, Sec. 310(a)(4), redesignated subsec. 
(q) as (p).
    Pub. L. 101-147, Sec. 105(b)(4), added subsec. (q).
    1988--Subsec. (f)(2)(B). Pub. L. 100-435, Sec. 211, inserted 
provisions relating to reimbursement to institutions maintaining a child 
care setting for eight or more hours per day.
    Subsec. (h). Pub. L. 100-435, Sec. 214, designated existing 
provisions as par. (1) and added par. (2).
    Subsec. (p)(3)(A). Pub. L. 100-460, Sec. 641(c), amended subpar. (A) 
generally. Prior to amendment, subpar. (A) read as follows: ``The 
Secretary of Agriculture, in consultation with the Commissioner on 
Aging, may establish separate guidelines for reimbursement of 
institutions described in this subsection.''
    Subsec. (p)(4). Pub. L. 100-460, Sec. 641(a), added par. (4).
    Subsec. (p)(5). Pub. L. 100-460, Sec. 641(b), added par. (5).
    1987--Subsec. (p). Pub. L. 100-175 added subsec. (p).
    1986--Subsec. (a)(1). Pub. L. 99-500 and Pub. L. 99-591, 
Sec. 372(a), and Pub. L. 99-661, Sec. 4502(a), amended par. (1) 
identically, substituting ``Health and Human Services'' for ``Health, 
Education, and Welfare''.
    Subsec. (e). Pub. L. 99-500 and Pub. L. 99-591, Sec. 361, and Pub. 
L. 99-661, Sec. 4401, amended subsec. (e) identically, designating 
existing provisions as par. (1), substituting ``Except as provided in 
paragraph (2), the'' for ``The'', and adding pars. (2) and (3).
    1981--Subsec. (a). Pub. L. 97-35, Sec. 810(a), inserted provisions 
respecting 25 percent requirement for children receiving nonresidential 
day care services, and reimbursement for meals and supplements.
    Subsec. (b). Pub. L. 97-35, Sec. 810(b), substituted provisions 
respecting applicability of subsec. (f), for provisions respecting 
applicability of subsec. (c).
    Subsec. (c). Pub. L. 97-35, Sec. 810(c), substituted provisions 
respecting applicability, determinations, etc., for national average 
payment rates for free lunches and suppers, etc., for provisions 
respecting formula for computation of payments, and applicability of 
national average payment rates.
    Subsec. (f)(1). Pub. L. 97-35, Sec. 819(k), struck out authorization 
respecting financing the cost of meals.
    Subsec. (f)(2) to (5). Pub. L. 97-35, Sec. 810(d), in par. (2) 
substituted provisions setting forth formula for disbursements for meals 
for provisions setting forth maximum per meal rates of reimbursements, 
struck out par. (3) which related to election rights of institutions 
other than family or group day care home sponsoring organizations, 
redesignated par. (4) as (3) and, as so redesignated, substantially 
revised and restructured provisions, and redesignated par. (5) as (4).
    Subsec. (g). Pub. L. 97-35, Sec. 810(e), struck out par. (2) which 
related to prohibitions respecting meals served by institutions, and 
redesignated pars. (3) and (4) as (2) and (3), respectively.
    Subsec. (i). Pub. L. 97-35, Secs. 810(f), 817(c)(2), struck out 
subsec. (i) which related to information required from State plans. 
Former subsec. (j) redesignated (i).
    Subsecs. (j) to (l). Pub. L. 97-35, Secs. 810(g), 817(c)(2), 
redesignated subsecs. (k), (l), and (o) as (j), (k), and (l), 
respectively, and in subsec. (l), as so redesignated, struck out 
provision respecting availability of funds from food service equipment 
program. Former subsecs. (j) to (l) redesignated (i) to (k), 
respectively.
    Subsec. (m). Pub. L. 97-35, Sec. 817(c), struck out subsec. (m) 
which related to withholding of funds. Subsec. (p) redesignated (m).
    Subsec. (n). Pub. L. 97-35, Secs. 810(f), 817(c)(2), struck out 
subsec. (n) which related to appropriations, etc., for equipment 
assistance. Subsec. (q) redesignated (n).
    Subsecs. (o) to (r). Pub. L. 97-35, Sec. 817(c)(2), redesignated 
subsecs. (o) to (r) as (l) to (o), respectively.
    1980--Subsec. (a). Pub. L. 96-499, Sec. 207(a), included in 
definition of ``institution'' any private organization providing 
nonresidential day care services for which compensation was received 
from amounts granted to the States under title XX of the Social Security 
Act.
    Subsec. (c). Pub. L. 96-499, Sec. 208(b), inserted provision in 
pars. (1), (2), and (3) that the average payment rates for supplements 
served in such institutions was to be three cents lower than the 
adjusted rates prescribed by the Secretary in accordance with the 
adjustment formulas contained in such pars. (1), (2), and (3).
    Subsec. (n)(1). Pub. L. 96-499, Sec. 208(c), substituted 
``$4,000,000'' for ``$6,000,000''.
    1978--Subsec. (a). Pub. L. 95-627 excepted family or group day care 
homes from licensing requirements, set out guidelines for institutions 
providing care for children outside of school hours, and set out 
criteria for determining eligibility under this section.
    Subsec. (b). Pub. L. 95-627 substituted provisions limiting the 
aggregate amount of cash assistance to a State under this section for 
provisions setting out a formula for computation of payments under this 
section and adjustments to such payments. See subsec. (c) of this 
section.
    Subsec. (c). Pub. L. 95-627 substituted provisions relating to the 
formula for the computation of payments under this section and the 
prescription of a national average payment rate for provisions relating 
to the maintenance of national nutritional standards and the prohibition 
of discrimination and identification of children unable to pay under the 
program.
    Subsec. (d). Pub. L. 95-627 substituted provisions stating 
requirements for approval for participation in the program and requiring 
written notification of such approval or disapproval for provisions 
relating to State disbursements to participating institutions.
    Subsec. (e). Pub. L. 95-627 substituted provisions relating to fair 
hearings for provisions relating to donations of agricultural 
commodities and cash in lieu of commodities. See subsec. (h) of this 
section.
    Subsec. (f). Pub. L. 95-627 substituted provisions relating to 
disbursements to participating institutions by the State for provisions 
calling for direct disbursements to participating institutions by the 
Secretary and prescribing conditions therefor.
    Subsec. (g). Pub. L. 95-627 substituted provisions relating to meals 
served at participating institutions and the necessary nutritional 
content thereof for provisions prohibiting the diminution of 
expenditures by State and local sources by reason of the availability of 
Federal funds.
    Subsec. (h). Pub. L. 95-627 substituted provisions relating to 
donations of agricultural land commodities and cash in lieu of 
commodities for provisions authorizing appropriations to meet the 
administrative expenditures of the Secretary.
    Subsec. (i). Pub. L. 95-627 substituted provisions relating to 
information required from State plans for provisions requiring adequate 
accounts and general record-keeping by States, State educational 
agencies, and participating institutions.
    Subsec. (j). Pub. L. 95-627 substituted provisions relating to the 
availability of Federal funds to the States for audits of participating 
institutions for provisions relating to food service equipment 
assistance and the apportionment of unused funds.
    Subsec. (k). Pub. L. 95-627 substituted provisions relating to the 
use of a standard form of agreement and the issuance of regulations 
pertaining to such use for provisions relating to the issuance of rules 
and regulations to carry out this section by the Secretary.
    Subsecs. (l) to (r). Pub. L. 95-627 added subsecs. (l) to (r).
    1977--Subsec. (e). Pub. L. 95-166, Sec. 19(d), substituted in last 
sentence ``school year'' for ``fiscal year'' in three instances.
    Subsec. (j)(1). Pub. L. 95-166, Sec. 3, substituted ``food service 
equipment assistance'' for ``nonfood assistance''.


                    Effective Date of 1998 Amendment

    Amendment by section 107(j)(1), (2)(B) of Pub. L. 105-336 effective 
July 1, 1999, see section 107(j)(4) of Pub. L. 105-336, set out as a 
note under section 1761 of this title.
    Amendment by sections 101(b) and 107(a)-(i), (j)(3)(C) of Pub. L. 
105-336 effective Oct. 1, 1998, see section 401 of Pub. L. 105-336, set 
out as a note under section 1755 of this title.


                    Effective Date of 1996 Amendment

    Section 708(k)(1), (2) of Pub. L. 104-193 provided that:
    ``(1) In general.--Except as provided in paragraph (2), the 
amendments made by this section [amending this section] shall become 
effective on the date of enactment of this Act [Aug. 22, 1996].
    ``(2) Improved targeting of day care home reimbursements.--The 
amendments made by paragraphs (1) and (4) of subsection (e) [amending 
this section] shall become effective on July 1, 1997.''


                    Effective Date of 1994 Amendment

    Amendment by sections 105(c) and 116 of Pub. L. 103-448 effective 
Oct. 1, 1994, see section 401 of Pub. L. 103-448, set out as a note 
under section 1755 of this title.
    Amendment by section 109(b) of Pub. L. 103-448 effective Sept. 25, 
1995, see section 109(c) of Pub. L. 103-448, set out as a note under 
section 1758 of this title.


                    Effective Date of 1992 Amendment

    Section 811(b) of Pub. L. 102-375 provided that: ``The amendment 
made by subsection (a) [amending this section] shall take effect as if 
the amendment had been included in the Older Americans Act Amendments of 
1987 [Pub. L. 100-375].''


                    Effective Date of 1989 Amendment

    Amendment by section 131(b) of Pub. L. 101-147 effective July 1, 
1989, see section 131(c) of Pub. L. 101-147, set out as a note under 
section 1755 of this title.


                    Effective Date of 1988 Amendment

    Amendment by section 211 of Pub. L. 100-435 to be effective and 
implemented on July 1, 1989, and amendment by section 214 of Pub. L. 
100-435 to be effective and implemented on Oct. 1, 1988, see section 
701(a), (b)(4) of Pub. L. 100-435, set out as a note under section 2012 
of Title 7, Agriculture.


                    Effective Date of 1987 Amendment

    Amendment by Pub. L. 100-175 effective Oct. 1, 1987, see section 
701(a) of Pub. L. 100-175, set out as a note under section 3001 of this 
title.


                    Effective Date of 1981 Amendment

    Amendment by sections 810(a), (f), (g), 817(c), and 819(k) of Pub. 
L. 97-35 effective Oct. 1, 1981, see section 820(a)(3), (4) of Pub. L. 
97-35, set out as a note under section 1753 of this title. For effective 
dates of amendments by section 810(b)-(e) of Pub. L. 97-35, see section 
820(a)(1)(B)-(D), (3), (4), (6) of Pub. L. 97-35.


                    Effective Date of 1980 Amendment

    Section 207(b) of Pub. L. 96-499 provided that: ``The amendment made 
by subsection (a) of this section [amending this section] shall apply 
with respect to all fiscal years beginning on or after October 1, 
1980.''


                    Effective Date of 1978 Amendment

    Amendment by Pub. L. 95-627 effective Oct. 1, 1978, see section 14 
of Pub. L. 95-627, set out as a note under section 1755 of this title.


                    Effective Date of 1977 Amendment

    Section 19 of Pub. L. 95-166 provided that the amendment made by 
that section is effective July 1, 1977.


                    Implementation of 1989 Amendments

    Section 105(d) of Pub. L. 101-147 provided that:
    ``(1) Expansion; demonstration project.--The Secretary of 
Agriculture shall implement the amendments made by subsections (b)(1) 
and (b)(2) [amending this section] not later than July 1, 1990.
    ``(2) Dietary requirements for adult day care food program.--Not 
later than July 1, 1990, the Secretary of Agriculture shall issue final 
regulations to implement the amendments made by subsection (b)(3) 
[amending this section].''


                               Regulations

    Section 708(k)(3) of Pub. L. 104-193 provided that:
    ``(A) Interim regulations.--Not later than January 1, 1997, the 
Secretary of Agriculture shall issue interim regulations to implement--
        ``(i) the amendments made by paragraphs (1), (3), and (4) of 
    subsection (e) [amending this section]; and
        ``(ii) section 17(f)(3)(C) of the [Richard B. Russell] National 
    School Lunch Act (42 U.S.C. 1766(f)(3)(C)).
    ``(B) Final regulations.--Not later than July 1, 1997, the Secretary 
of Agriculture shall issue final regulations to implement the provisions 
of law referred to in subparagraph (A).''
    Section 204(b) of Pub. L. 101-147 provided that: ``Not later than 
July 1, 1990, the Secretary shall issue final regulations to implement 
the amendments made by subsection (a) [amending this section].''


      Study of Impact of Amendments by Pub. L. 104-193 on Program 
               Participation and Family Day Care Licensing

    Section 708(l) of Pub. L. 104-193 directed Secretary of Agriculture, 
in conjunction with Secretary of Health and Human Services, to conduct 
study and report to Congress not later than 2 years after Aug. 22, 1996, 
on impact of the amendments made by section 708 of Pub. L. 104-193, 
amending this section, on the number of family day care homes and day 
care home sponsoring organizations participating in the child and adult 
care food program established under this section, the number of day care 
homes that are licensed, certified, registered, or approved by each 
State in accordance with regulations issued by the Secretary, the rate 
of growth of such numbers, the nutritional adequacy and quality of meals 
served in family day care homes, and the proportion of low-income 
children participating in the program prior to such amendments to this 
section and the proportion of low-income children participating in the 
program after such amendments to this section, and further required each 
State agency participating in the child and adult care food program 
under this section to submit to the Secretary of Agriculture data 
necessary to carry out this study.


           Family or Group Day Care Home Demonstration Project

    Section 503 of Pub. L. 100-435, as amended by Pub. L. 101-147, title 
I, Sec. 105(c)(1), Nov. 10, 1989, 103 Stat. 885, directed Secretary of 
Agriculture to conduct a demonstration project to begin 30 days after 
Sept. 19, 1988, but in no event earlier than Oct. 1, 1988, in one State 
(selected by the Secretary) regarding the Child Care Food Program 
authorized under 42 U.S.C. 1766 in which day care institutions and 
family or group day care sponsoring organizations shall receive a 
reimbursement (in addition to that received under 42 U.S.C. 1766(d) and 
(f)) for providing one additional meal or supplement for children that 
are maintained in a day care institution or in a family or group day 
care home setting for eight or more hours per day, directed Secretary to 
submit a preliminary report to Congress not later than Aug. 1, 1989, and 
a final report after the conclusion of such project, with project to 
terminate Sept. 30, 1990.


  Review and Revision of Nutrition Requirements for Meals Served Under 
             Breakfast Program; Promulgation of Regulations

    Section 330(b) of title III of Pub. L. 99-500 and Pub. L. 99-591 and 
section 4210(b) of Pub. L. 99-661 directed Secretary of Agriculture to 
review and revise nutrition requirements for meals served under the 
breakfast program authorized under the Child Nutrition Act of 1966 (42 
U.S.C. 1771 et seq.) and this section to improve nutritional quality of 
meals, taking into consideration both findings of National Evaluation of 
School Nutrition Programs and need to provide increased flexibility in 
meal planning to local food authorities, and to promulgate regulations 
to implement revisions not later than 180 days after Oct. 18, 1986.


  Adjustments in National Average Payment Rate for Supplements During 
                  Fiscal Year Ending September 30, 1981

    Section 208(a) of Pub. L. 96-499 related to adjustments required 
under the former pars. (1) through (3) of subsec. (c) of this section 
applicable in determining the national average payment rate for 
supplements during the fiscal year ending Sept. 30, 1981.

                  Section Referred to in Other Sections

    This section is referred to in sections 1752, 1758, 1759a, 1760, 
1766a, 1769f, 1773, 1776 of this title.
