FORM 1536-B
Instructions

APPLICATION AND MANAGEMENT PLAN FOR CHILD CARE CENTERS

07-2003

PURPOSE

To provide information required to determine if an applicant is eligible for participation in the Child and Adult Care Food Program (CACFP) for Child Care Centers.

PROCEDURE

When to Prepare

Complete Form 1536-B to apply for participation in the CACFP-CCC. In addition, complete pages 6–11 whenever you have changes to your approved budget.

Number of Copies

Complete Form 1536-B and make two copies. The original and one copy must have original signatures.

Transmittal

Send both forms with original signatures to your Area Program Office. Keep one copy for your files.

How to Obtain Copies

Make additional copies as needed.

Form Retention

Keep Form 1536-B for three years and 90 days from the end of the contract period. Exception: If audit findings, claims, or litigation have not been resolved by the end of the retention period, all forms and records must be retained until all issues are resolved.

Terms and Definitions

Review the following terms and definitions to assist you in completing Form 1536-B appropriately. (Refer to the Terms and Definitions Section of the Child and Day Care Food Program - Child Care Centers Handbook for additional information.)

Administrative Costs —  Allowable costs incurred by a contractor related to planning, organizing, and managing CACFP operations.

Affiliated —  A sponsored facility that is a part of the same legal entity as the sponsoring organization (see "Sponsoring Organization").

Business Related Offense —  A business related offense includes fraud, antitrust violations, embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, receiving stolen property, making false claims, obstruction of justice, or any other activity indicating a lack of business integrity.

Contractor —  A sponsoring organization or independent center that enters into an agreement with DHS to assume final administrative and financial responsibility for CACFP operations.

Disqualified —  The status of a contractor, a responsible principal or responsible individual, or a day care home that is ineligible for participation in the CACFP.

Facility —  A sponsored center or a day care home.

Income to the Program —  Any funds used in a contractor's food service except CACFP payments. Examples include, but are not limited to, funds from other government sources, children's payments for meals and food service fees, income from food sales to adults, cash donations, and grants from organizations or individuals.

Independent Center —  An adult day care center, child care center, emergency shelter, At Risk Afterschool Snack program center or outside-school-hours care center that signs an agreement with DHS to assume final administrative and financial responsibility for operating the CACFP.

Institution —  See "contractor."

Internal Controls —  The policies, procedures, and organizational structure of a contractor designed to reasonably assure that: (a) the CACFP achieves its intended result; (b) CACFP resources are used in a manner that protects against fraud, abuse, and mismanagement and in accordance with law, regulations, and guidance; and (c) timely and reliable CACFP information is obtained, maintained, reported, and used for decision-making.

National Disqualified List —  The list, maintained by the United States Department of Agriculture, of contractors, responsible principals and responsible individuals, and day care homes disqualified from participation in the CACFP.

Nonprofit Food Service —  All food service operations conducted by the contractor principally for the benefit of enrolled individuals from which all CACFP reimbursement funds and funds specifically restricted for food service are used solely for the operations or improvement of the food service.

Operating costs —  Expenses incurred by a contractor in serving meals to individuals under the CACFP.

Principal —  Any individual who holds a management position within, or is an officer of, a contractor or a sponsored center, including all members of the organization's board of directors or the sponsored center's board of directors.

Publicly Funded Program —  Any program or grant funded by public funds including, but not limited to, federal, state, or local government funds.

Responsible Principal or Responsible Individual —  (a) A principal, whether compensated or uncompensated, whom SNP determines to be responsible for a contractor's serious deficiency; (b) any individual employed by, or under contract with, a contractor, whom SNP determines to be responsible for a contractor's serious deficiency; or (c) an uncompensated individual whom SNP determines to be responsible for a contractor's serious deficiency.

Seriously Deficient —  The status of a contractor or a day care home that has been determined to be noncompliant in one or more aspects of its operation of the CACFP.

Sponsoring Organization —  A public or private nonprofit organization that is entirely responsible for the food service in: (a) a center that is a legally distinct entity from the sponsoring organization; (b) two or more centers; or (c) any combination of centers. The term sponsoring organization also includes a for-profit organization of two or more centers that are part of the same legal entity as the sponsoring organization and that are proprietary Title XIX or Title XX centers.

Unaffiliated —  A sponsored facility that is not a part of the same legal entity as the sponsoring organization (see "Sponsoring Organization").

DETAILED INSTRUCTIONS

I. CONTRACTOR INFORMATION

Name of Contracting Agency —  Enter the legal name of the contracting organization that has the ultimate legal responsibility for the agreement with the Texas Department of Human Services (DHS). For-profit organizations that are sole proprietorships or partnerships enter the owner's name followed by "doing business as" (DBA) the name of the organization.

Texas ID Number —  Enter the 14-digit Texas identification number as issued by the comptroller of public accounts. If the request for  ^ a number is still pending, leave blank.

Contract No. —  Enter the seven-digit contractor number assigned by DHS that begins with the pre-printed numerals "75." This is not the same number as the Program/TX number.

Program No. —  Enter the contracting organization's seven-digit TX number. New contractors should leave this space blank.

Mailing Address —  Enter the mailing address of the contracting organization including street, city, state, and ZIP code. Contracting organization staff must ensure that this address and ZIP code are listed with the comptroller of public accounts.

Street Address —  Enter the street address, if different from the mailing address.

Contact Person —  Enter the name of the person DHS should contact concerning this contract.

E-Mail Address —  If the organization contact person has an e-mail address, enter the e-mail address.

FAX No. —  If your organization has a fax machine, enter the number, including the area code.

Telephone No. —  Enter the telephone number, including area code, of the contact person.

Type of Contractor

 ^ Number of centers . . . —  Enter the number of centers in each category. Note: The number entered under child care centers should not include Outside School Hours Care Centers, Head Start Centers, or Proprietary Title XX Centers. If you are also operating the At Risk Afterschool program in a Child Care Center, Outside School Hours Care Center, or Head Start Center, report that operation in the At Risk column in addition to reporting your other care operations in their respective columns.

To be eligible to operate the At Risk Afterschool program in the CACFP, a facility must be located in a low-income area. This means that the care facility/site itself must be located in the attendance zone or area serving a school (elementary, middle, or secondary) in which 50% or more of the school's enrollment is determined eligible to receive free and reduced-price meals. To establish this area eligibility, the At Risk center must attach the following written information to this application:

Example: A map showing the centers located in the school's attendance area, or a letter from the ISD confirming the facility is located in the school's attendance area.

For each center listed, estimate the number of children at each type of center listed in this item who will qualify for the free, reduced, and paid categories at the time of application. Children in At Risk centers and children residing in emergency shelters will be claimed only in the free category.

2. Prior participation —  Indicate if you are a sponsoring organization. If you are a sponsoring organization, indicate if your organization participated in the CACFP-CCC before October 1, 2003. If "Yes," give the dates of participation. Indicate if the facilities you sponsor are affiliated or unaffiliated. If you sponsor unaffiliated facilities, answer the question concerning prior participation.

Note: A nonprofit organization may sponsor both affiliated and unaffiliated facilities. A for-profit organization may only sponsor affiliated facilities.

Indicate if you experienced a break in service. If "Yes," give the dates and complete this Item. If "No," go to Item 3. A sponsoring organization that has not previously participated in the CACFP or who participated before October 1, 2003, but experienced a break in service may not sponsor an unaffiliated facility that participated in the CACFP at any time during the 12 months before the date this application is submitted to DHS. You must certify whether or not the unaffiliated facilities that you sponsor have not participated in the CACFP at any time during the 12 months before the date you submitted this application to DHS.

3. – 7. —  Self-explanatory.

8. Cash vs. commodities . . . —  Indicate your preference for cash-in-lieu or commodities. If you are applying to participate in the At Risk Afterschool program only, this option is not available to you and you must check "Not Applicable."

SECTION II. MANAGEMENT PLAN

1. – 3. —  Self-explanatory.

Notes:

4. Separate charge for meals . . . —  Indicate whether the tuition or monthly participation fee excludes the cost of meals. If yes, complete and submit Form 4515, Free and Reduced Price Meal Policy Statement.

5.  —  A. Staffing – Complete the chart by describing the qualifications you require for the person(s) that performs required CACFP functions.

B. Sponsoring Organizations Only – If you are a sponsoring organization, you must maintain written policies and procedures that assign CACFP responsibilities and duties and ensure compliance with civil rights requirements.

6. – 9. —  Self-explanatory.

10. Staffing for Monitoring, Sponsoring Organization Only —  You must demonstrate that you have an adequate number of staff to conduct required monitoring. Indicate if you sponsor 25 or more centers. If "Yes," you must complete the attached "Sponsoring Organization Monitoring Staff Information" form to verify that you have the required number of staff in terms of Full-Time Equivalents (FTEs) for the number of sponsored centers.

11. – 15. —  Self-explanatory.

SECTION III. BUDGET

1. Percentage of CACFP Reimbursement . . . —  Indicate in the space provided the percentage of the CACFP reimbursements you are requesting to use for allowable administrative costs. Note: The withholding of a percentage of the CACFP reimbursement for allowable administrative costs only applies to a sponsoring organization.

The budget is composed of the amounts for the cost categories listed below:

1 Labor Costs — Salaries, Wages, Taxes, and Benefits
2 Food
3 Facilities and Space
4 Supplies and Equipment
5 Purchased Services
6 Financial Costs
7 Media costs
8 Organization Costs
9 Other Costs
10 Unaffiliated Center Costs

The amounts listed for the cost categories cannot be considered unless the respective amounts are justified and explained on the budget justification pages. Use as many pages as necessary.

Note: DHS determines the allowability of expenditures based on appropriate state and federal regulations and guidelines outlined in the CACFP-CCC Handbook.

1A. — Nonprofit Food Service Administration — Budget Justification

Position and CACFP Duties — Enter the titles of the positions. These should match the names on your organizational chart. Enter a brief description of the CACFP administrative duties performed.

  1. Number of Personnel in this Position — Enter the number of administrative staff per position, such as Director 1, Assistant Director 2, Clerical Support 2.
  2. Annual Base Salary — Enter the annual base salary for all staff in the designated position.
  3. Additional Labor Costs and Benefits — Enter the name of the benefit, such as FICA, health insurance, retirement, and the detailed computations justifying the amounts budgeted.
  4. Total Base Salary and Benefits — Add columns 2 and 3 to arrive at this total.
  5. Number of Hours Worked Daily — Enter the total number of hours worked daily.
  6. Number of Hours Spent in Food Service Duties — Enter the total number of hours spent daily in food service duties.
  7. Portion of Total Salary and Benefits Paid from Nonprofit Food Service Account — Enter the total salary and benefits paid from the nonprofit food service account.

TOTAL ADMINISTRATIVE LABOR COSTS — Enter the total for all costs in column 7.

Use time distribution reports as the basis for estimating the labor hours for staff who do not work in food service 100% of the time. When labor is claimed each month it must be actual and not an estimate.

1B. — Nonprofit Food Service Operation — Budget Justification

Position and CACFP Duties — Enter the titles of the positions. These should match the names on your organizational chart. Enter a brief description of the CACFP food service operation duties performed.

  1. Number of Personnel in this Position — Enter the number of staff per position, such as Cook 1, Caregiver 12, Janitor 1.
  2. Annual Base Salary — Enter the annual base salary for all staff in the designated position.
  3. Additional Labor Costs and Benefits — Enter the name of the benefit, such as FICA, health insurance, retirement, and the detailed computations justifying the amounts budgeted.
  4. Total Base Salary and Benefits — Add columns 2 and 3 to arrive at this total.
  5. Number of Hours Worked Daily — Enter the total number of hours worked daily.
  6. Number of Hours Spent in Food Service Duties — Enter the total number of hours spent daily in the food service duties.
  7. Portion of Total Salary and Benefits Paid from Nonprofit Food Service Account — Enter the total salary and benefits paid from the nonprofit food service account.

TOTAL OPERATION LABOR COSTS — Enter the total for all costs in column 7.

Use time distribution reports as the basis for estimating the labor hours for staff who do not work in food service 100% of the time. When labor is claimed each month it must be actual and not an estimate.

2. – 9. —  Complete the chart based on the expenses paid from nonprofit food service funds. You must specifically identify each item and explain how each cost was calculated. Transfer the total for each line item to page 10.

10. — Costs for Unaffiliated Centers —  Complete the chart based on the information provided in Form 1538, Budget Section, for each unaffiliated center. Transfer the totals in columns 10A and 10B from this section to Item 11A  ^ . Note: If all of the centers you sponsor are affiliated, mark the box provided for N/A — All centers are affiliated.

11A. — Estimated Annual Nonprofit Food Service Costs —  Enter for each of the cost categories the amount budgeted for the food service from the respective budget justification pages.

11B. — 1. —  Enter the total costs of nonprofit food service (the total of Item 11A, Columns A plus B).

11B. — 2. —  Enter your projected annual CACFP reimbursement for the program year (PY). Use the following worksheet for determining this amount:

Reimbursement Projection Worksheet

The amount of the monthly CACFP reimbursement is based on the number of meals served to eligible children and the ratio of children in each eligibility category (free, reduced-price, or paid). To project your CACFP reimbursement, you will need the following:

The Eligibility Category is based on family size and income and on receipt of certain benefits. In general:

FREE CATEGORY — Children from families receiving food stamps, Medicaid, Supplemental Security Income (SSI), or who have very low financial resources.

REDUCED-PRICE CATEGORY — Children from families that have moderate financial resources.

PAID CATEGORY — Children from families that have adequate financial resources or did not submit Form 1531, Application for Meals.

Note: You must have a completed Form 1531 on file for every child categorized as free or reduced-price.

To estimate the amount of reimbursement, follow these steps:

STEP 1. Compute the claiming percentage:

Example: You have 235 enrolled children. 160 are free, 35 are reduced-price, and 40 are paid.

FREE — 160 divided by 235 = .680 or 68%
REDUCED-PRICE — 35 divided by 235 = .148 or 15%
PAID — 40 divided by 235 = .170 or 17%


STEP 2. Multiply the claiming percentage by the current rates. This gives a revised rate.
Note: The rates and numbers in these instructions are for examples only. When you figure your claiming percentage, you must use the reimbursement rates currently in effect.

Rates of Reimbursement for July 1, 2001, to June 30, 2002:

- Breakfast Lunch/Supper Supplement
Free 1.15 2.09 .57
Reduced-Price .85 1.69 .28
Paid .21 .20 .05


STEP 3. Add the revised rates together. This gives the blended rate for the meal type.

        Breakfast     Lunch/Supper     Supplement
.68 1.15 =   .782     .68 2.09 = 1.421     .68   .57 =   .387    
.15   .85 =   .127     .15 1.69 =   .253     .15   .28 =   .042    
.17   .21 =   .035     .17   .20 =   .034     .17   .05 =   .008    
=   .944     =  1.708 * =   .437    

* Add the current rate for cash-in-lieu of commodities (.1550) to this amount: 1.708 + .155 = 1.863


STEP 4. Multiply the blended rate times the estimated number of meal types served in one month. This gives the estimated monthly amount of reimbursement for the meal type.

The following number and types of meals were served during the month:
Breakfast 4,400; Lunch 4,158; and Supplement 4,796

Breakfast = 4,400    .944 = $4,153.60
Lunch = 4,158 1.863 = $7,746.35
Supplement = 4,796    .437 = $2,095.85

$4,153.60 + $7,746.35 + $2,095.85 = $13,995.80 (estimated monthly amount)


STEP 5. Multiply the estimated monthly amount by 12 to arrive at the estimated yearly amount.

$13,995.80 12 = $167,949.60 (estimated annual CACFP reimbursement)

11B. — 3. —  Enter the total of other income to the nonprofit food service account.

11B. — 4. —  Enter the total of lines 2 and 3.

CERTIFICATION

An authorized official of the contracting organization must sign and date the form. This must be someone authorized on Form 4508, Certificate of Authority. Enter the name and title of the official in the spaces provided.

FOR DHS USE ONLY —  DHS will enter the effective date of the change.