Food and Nutrition Service December 2008 – Federal Register Recent Federal Regulation Documents

This action provides final rulemaking for a proposed rule. It revises the current bonding requirements imposed against participating retailers and wholesalers who have violated the Food Stamp Program rules and regulations. Currently, all violating retailers and wholesalers that are disqualified for a specified period of time or have a civil money penalty imposed in lieu of a disqualification for a specified period of time are required to submit a valid collateral bond, usually on an annual basis, if they wish to continue to participate in the Food Stamp Program. Over the years, securing a collateral bond has become increasingly more difficult for retailers and wholesalers. Thus, this final rule revises the current requirement in order to help alleviate the financial burden to those retailers and wholesalers who are required to submit such a bond and also to reduce the recordkeeping burden with respect to the FNS field offices which have to keep track of the expirations and renewals of these bonds. This final rule also places in the Food Stamp Program regulations the longstanding policy FNS has adopted to accept irrevocable letters of credit (LOC) in lieu of collateral bonds. Lastly, this rule establishes a specified period of time for retailers and wholesalers to be removed from the program for accepting food stamp benefits in payment for eligible food on credit, a violation of the Food Stamp Program regulations.

This interim rule implements provisions of the Child Nutrition and WIC Reauthorization Act of 2004 relating to verification of applications approved for free or reduced price meals in the National School Lunch Program and the School Breakfast Program. This interim rule includes changes to sample sizes for local education agencies (school districts) when conducting verification which include alternatives when there is an increase in the number of responses to the requests for verification; direct verification provisions which allow the local educational agency to contact means- tested programs to verify the information on applications without contacting the applicant household for documentation; and revised deadlines for completion of verification efforts. This interim rule also establishes a standard sample size of three percent for local educational agencies that do not qualify for use of an alternative sample size. The direct verification provision will reduce the number of households that must be contacted to submit documentation. This interim rule incorporates other statutory changes designed to assist households in completing the verification process. These changes require the local educational agency to have a telephone number that households may call, without charge, for questions about verification. The local educational agency must also make at least one attempt to follow-up with households selected for verification prior to denying benefits when the household fails to respond. There is also a provision that gives local education agencies the discretion to replace selected applications when households are deemed unlikely to respond to the verification request. These are safeguards to avoid termination of a child's benefits due to misunderstandings or other difficulties that may preclude households from effectively complying with the verification request. The changes made in this interim rule are intended to enhance verification efforts which will improve the accuracy of benefit distribution.

The final rule entitled Management of Donated Foods in Child Nutrition Programs, the Nutrition Services Incentive Program, and Charitable Institutions was published on August 8, 2008. The Office of Management and Budget approved and cleared the associated information collection requirements (ICR) on October 14, 2008. This document announces approval of the ICR.