Documents/Forms
This section include an overview of the key elements and resources related to financial management of the school nutrition programs. For detailed guidance and more topics, refer to the CSDE's guide, Financial Management Requirements for the School Nutrition Programs.
Nonprofit School Food Service |
Nonprofit School Food Service Account |
Indirect Costs
Capital Expenditure Requests and Equipment Approvals |
Net Cash Resources
Paid Lunch Equity |
Unpaid Meal Charges |
Nonprogram Foods
Nonprofit School Food Service
The school food service program must be nonprofit. Section 7 CFR 210.9 (b)(1) of the NSLP regulations and 7 CFR 220.13(i) of the SBP regulations require SFAs to maintain a nonprofit school food service and observe the requirements for and limitations on the use of nonprofit school food service revenues (7 CFR 210.14) and the limitations on any competitive school food service (7 CFR 210.11). “Nonprofit school food service” means all food service operations conducted by the school food authority principally for the benefit of schoolchildren, all the revenue from which is used solely for the operation or improvement of such food services.
Nonprofit School Food Service Account (NSFSA)
Sections 7 CFR 210.14 (a) of the NSLP regulations and 7 CFR 220.13(i) of the SBP regulations require SFAs to establish a NSFSA. The NSFSA is the restricted account in which all the revenue from all food service operations conducted by the SFA, principally for the benefit of school children, is retained and used only for the operation or improvement of the nonprofit school food service. The USDA's manual, Indirect Costs: Guidance for State Agencies & School Food Authorities, provides assistance to SFA business officials to ensure that NSFSA funds are limited to expenses that are reasonable, necessary, and allocable to provide quality meals for the NSLP and SBP. This guide addresses allowable direct and indirect costs for the NSLP and SBP.
Indirect Costs
Indirect costs are costs incurred for the benefit of multiple programs, functions, or other cost objectives that cannot be identified readily and specifically with a particular program or other cost objective. Indirect costs typically support administrative overhead functions such as fringe benefits, accounting, payroll, purchasing, facilities management, and utilities. SFAs must follow fair and consistent methodologies to identify and allocate allowable indirect costs to the NSFSA.
- USDA Memo: SP 60-2016: Indirect Cost Guidance
- Indirect Costs: Guidance for State Agencies & School Food Authorities (USDA)
Capital Expenditure Requests and Equipment Approvals
SFAs may purchase equipment listed on the CSDE’s Capital Expenditure Approved List for School Food Authority Equipment Purchases without prior approval. However, as required by 2 CFR 200.439, SFAs must receive prior approval from the CSDE for any capital expenditure requests for equipment with a unit cost of $5,000 or greater that is not included on this list. Any used equipment with a purchase price of $5,000 or greater also requires CSDE approval.
- Capital Expenditure Approved List for School Food Authority Equipment Purchases (CSDE)
- Capital Expenditure Request Form: This form is completed in the CSDE’s Online Application and Claiming System for Child Nutrition Programs (CNP System).
- Cost Allocation Plan Form for School Nutrition Programs (CSDE): For any expenditures that benefit other programs (such as cafeteria furniture, lunch aides, and utilities), this form must be submitted to the CSDE in the CNP System with one or both of the forms below.
- Plan to Reduce Excess Operating Balance for School Nutrition Programs
- Capital Expenditure Request Form (refer to the CSDE's Instructions for Completing the Capital Expenditure Request Form for School Nutrition Programs)
- USDA Memo SP 39-2016: State Agency Prior Approval Process for School Food Authority (SFA) Equipment Purchases
Net Cash Resources (NCR): Three-Month Operating Balance
To maintain the SFA’s nonprofit status, sections 7 CFR 210.14(b) and 7 CFR 210.19(a)(1) of the NSLP regulations require that the fund balance (net cash resources) of the NSFSA cannot exceed three months’ average expenditures at any time. “Net cash resources” means all monies, as determined in accordance with the state agency’s established accounting system, that are available to or have accrued to a SFA’s nonprofit school food service at any given time, less cash payable. Such monies may include, but are not limited to, cash on hand, cash receivable, earnings on investments, cash on deposit and the value of stocks, bonds, or other negotiable securities. Refer to page 8 of the USDA's manual, Indirect Costs: Guidance for State Agencies & School Food Authorities.
- Financial Report: To document compliance with the NCR requirement, SFAs must submit the annual Financial Report for School Nutrition Programs in the Connecticut Online Application and Claiming System for Child Nutrition Programs (CNP System). The CSDE’s Instructions for Submitting the Financial Report for School Nutrition Programs provides step-by-step guidance on how to complete this report. SFAs that exceed three months’ average expenditures must submit their Plan to Reduce Excess Operating Balance as part of the Financial Report.
- Plan to Reduce Excess Operating Balance: SFAs that exceed three months’ average expenditures must submit a Plan to Reduce Excess Operating Balance for School Nutrition Programs to the CSDE to indicate how the excess balance will be spent to maintain the SFA’s nonprofit status. Expenditures must make improvements to the school nutrition programs such as improving food quality and replacing or purchasing necessary equipment.
- Expenditures benefitting other programs: For any expenditures that benefit other programs (such as cafeteria furniture, lunch aides, and utilities), SFAs must submit the Cost Allocation Plan Form for School Nutrition Programs with the Plan to Reduce Excess Operating Balance for School Nutrition Programs.
- Items not on Capital Expenditure Approved List: For any item with a unit cost of $5,000 or greater that is not listed on the Capital Expenditure Approved List for School Food Authority Equipment Purchases, SFAs must submit the Capital Expenditure Request Form in the CNP System (refer to the CSDE's Instructions for Completing the Capital Expenditure Request Form for School Nutrition Programs).
- Managing an Excess Operating Balance in the School Nutrition Programs: A one-page summary of the requirements and process for handling an excess operating balance for the school nutrition programs and determining allowable and unallowable costs.
Paid Lunch Equity
Section 7 CFR 210.14 (e) of the NSLP regulations requires that SFAs must ensure that schools are providing the same level of support for lunches served to students who are not eligible for free or reduced-price lunches (i.e., paid lunches) as they are for lunches served to students eligible for free lunches. SFAs must compare the average price charged for lunches served to students receiving paid lunches to the difference between the higher Federal reimbursement provided for free lunches and the lower Federal reimbursement provided for paid lunches.
The USDA provides the PLE Tool annually to assist SFAs with making price adjustment calculations. During the NSLP application renewal process, SFAs must use the PLE Tool to ensure that paid lunch prices are set appropriately to cover the cost of a paid student meal. If the average paid lunch price is less than the difference, the SFA must either gradually adjust average prices or provide non-Federal funding to cover the difference.
- Operational Memorandum No. 12-24: Paid Lunch Equity: Guidance for School Year 2024-25
- CSDE Operational Memorandum No. 10-2024: New Paid Lunch Equity (PLE) Allowances for School Year (SY) 2023-24 Only – Offsetting Unpaid School Meal Charges
- Equity in School Lunch Pricing Fact Sheet (USDA)
- Paid Lunch Equity Calculations and Tool: School Year 2024-25 (USDA)
- USDA Memo SP 39-2011: Child Nutrition Reauthorization 2010: Guidance on Paid Lunch Equity and Revenue from Nonprogram Food
- USDA Memo SP 14-2024: Paid Lunch Equity: Guidance for SY 2024-25
- USDA Webinar: School Year 2024-25 Paid Lunch Equity Tool Walkthrough
Unpaid Meal Charges
The CSDE requires that households pay all delinquent student debts no later than June 30 to ensure that students’ accounts are closed. Any delinquent debts that have not been recovered by June 30 will be considered bad debt. These student meal accounts must be at a zero balance for the next school year.
- CSDE Operational Memorandum No. 4-17: Guidance on Unpaid Meal Charges and Collection of Delinquent Meal Payment
USDA Requirements for Unpaid Meal Charge Policy
USDA Memo SP 46-2016 requires all SFAs to have a written and clearly communicated system to address meal charges. SFAs must inform students and their parents or guardians about how students who pay the full or reduced-price cost of a reimbursable meal are impacted by having insufficient funds on hand or in their account to purchase a meal.
SFAs must ensure that the policy is provided in writing to all households at the start of each school year and to households that transfer to the school during the school year. Additionally, SFAs are encouraged to include the policy in student handbooks and/or in online portals households use to access student accounts. SFAs are encouraged to use multiple methods to disseminate the policy. The written policy also could be provided again to the household through mail or email the first time the policy is applied to a specific student.
- Checklist: Checklist for Reviewing the Local Educational Agency’s Unpaid Meal Charge Policy and Procedures for the School Nutrition Programs (CSDE)
- Guide: Overcoming the Unpaid Meal Challenge: Proven Strategies from Our Nation’s Schools (USDA)
- USDA Memo SP 29-2017: 2017 Edition of Overcoming the Unpaid Meal Challenge: Proven Strategies from Our Nation’s Schools
- USDA Memo SP 23-2017: Unpaid Meal Charges: Guidance and Q&A
- USDA Memo SP 47-2016: Unpaid Meal Charges: Clarification on Collection of Delinquent Meal Payments
- USDA Memo SP 46-2016: Unpaid Meal Charges: Local Meal Charge Policies
- Unpaid Meal Charges (USDA webpage)
Connecticut Requirements for Unpaid Meal Charge Policy in Public Schools
C.G.S. Section 10-215b requires that each board of education’s (BOE) unpaid meal charge policy must include the three elements below.
- A prohibition on publicly identifying or shaming a child for any unpaid charges, including but not limited to delaying or refusing to serve a meal to the child, designating a specific meal option for the child, or taking any disciplinary action against the child.
- A declaration of the right for any child to purchase a meal that may exclude any a la carte items or be limited to one meal.
- A procedure for communicating with parents or guardians for the purpose of collecting unpaid charges. Communication must include but is not limited to: information regarding local food pantries; applications for free or reduced-priced meals; applications for the Supplemental Nutrition Assistance Program (SNAP) administered by the Department of Social Services; and a link to the town’s website listing any community services available to residents. If a child’s unpaid charges equal or exceed the cost of 30 meals, the BOE must refer the parent or guardian to the BOE’s local homeless education liaison.
C.G.S. Section 10-215c allows BOEs to accept gifts, donations, or grants from any public or private sources for the purpose of paying off any unpaid meal charges.
- CSDE Operational Memorandum No. 11-22: Connecticut Statutory Requirements for Unpaid Meal Charges in Public Schools
- C.G.S. Section 10-215 (Amended 2021): Lunches, breakfasts and other feeding programs for public school children and employees. Collection of unpaid charges. Acceptance of gifts, donations or grants
Nonprogram Foods
Section 7 CFR 210.14 (f) of the NSLP regulations requires that the revenue from the sale of nonprogram foods covers the cost of the food and is not subsidized though federal reimbursement. “Nonprogram foods” include any nonreimbursable foods and beverages purchased using funds from the NSFSA. This encompasses all foods and beverages sold in schools such as a la carte items (e.g., milk, juice, entrées, and snack foods), second student meals, adult meals, foods sold outside of school hours, and any foods used for catering or vending activities. For most SFAs, a la carte foods offered during meal service account for the largest share of nonprogram foods.
- A la Carte Food Cost and Price Charged Comparison Worksheet (CSDE): This Excel worksheet determines if the a la carte price for a food or beverage item covers the cost of producing that item.
- Nonprogram Pricing Worksheets for Adult Meals (CSDE): This Excel document contains two worksheets to determine the breakfast and lunch price for adult meals: Worksheet 1: Pricing of Adult Meals in School Nutrition Programs; and Worksheet 2: Pricing of Adult Meals in Community Eligibility Provision (CEP) Schools.
- Pricing Worksheet for A La Carte Sales in School Nutrition Programs (CSDE): This Excel worksheet determines the correct pricing of a la carte items to meet a SFA's desired food cost percentage.
- Nonprogram Revenue Calculator (USDA): This Excel worksheet helps SFAs ensure that revenue from the sale of nonprogram foods covers the cost of the food and is not subsidized though federal reimbursement.
- USDA Memos
- USDA Memo SP 20-2016: Nonprofit School Food Service Account Nonprogram Food Revenue Requirements
- USDA Memo SP 13-2014: School Food Service Account Revenue from the Sale of Nonprogram Foods
- USDA Memo SP 39-2011 Revised: Guidance on Paid Lunch Equity and Revenue from Nonprogram Foods