[Federal Register Volume 71, Number 134 (Thursday, July 13, 2006)]
[Rules and Regulations]
[Pages 39513-39520]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6185]



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 Rules and Regulations
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  Federal Register / Vol. 71, No. 134 / Thursday, July 13, 2006 / Rules 
and Regulations  

[[Page 39513]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Parts 210, 215, 220, 225, 226 and 235

RIN 0584-AD16


Child Nutrition Programs: Uniform Federal Assistance Regulations; 
Nondiscretionary Technical Amendments

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This final rule makes technical changes to the regulations 
governing the National School Lunch Program, the Special Milk Program 
for Children, the School Breakfast Program, the Summer Food Service 
Program, the Child and Adult Care Food Program and State Administrative 
Expense Funds. The United States Department of Agriculture (USDA), Food 
and Nutrition Service (FNS) is revising its grants management 
regulations to bring these entitlement programs and their funds under 
the same regulations that already apply to nonentitlement programs, and 
to identify exceptions to these general rules that apply only to 
entitlement programs. This final rule is intended to update FNS program 
regulations, reflecting the revision of USDA's grants management 
regulations which brought entitlement programs under the same 
regulations that already applied to nonentitlement programs. In 
addition, this final rule also revises references to procurement and 
audit procedures in FNS's program regulations.

DATES: Effective September 11, 2006.

FOR FURTHER INFORMATION CONTACT: Melissa Rothstein, Chief, Program 
Analysis and Monitoring Branch, Child Nutrition Division, Food and 
Nutrition Service, 3101 Park Center Drive, Room 634, Alexandria, VA 
22302, (703) 305-2590.

SUPPLEMENTARY INFORMATION:

Background

    Prior to August 14, 2000, the administrative requirements for 
awards and subawards for all USDA entitlement programs were located in 
7 CFR part 3015, Uniform Federal Assistance Regulations. Those programs 
covered by 7 CFR part 3015 included the National School Lunch Program 
(NSLP), the School Breakfast Program (SBP), the Summer Food Service 
Program (SFSP), the Child and Adult Care Food Program (CACFP), the 
Special Milk Program for Children (SMP), and State Administrative 
Expense Funds (SAE). The corresponding requirements for awards and 
subawards to State and local governmental organizations under USDA 
nonentitlement programs were found at subparts A through D of 7 CFR 
part 3016, Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments. The 
administrative requirements for awards and subawards to 
nongovernmental, non-profit organizations were found at 7 CFR part 
3019, Uniform Administrative Requirements for Grants and Agreements 
With Institutions of Higher Education, Hospitals, and Other Non-Profit 
Organizations.
    On August 14, 2000, USDA published a final rule at 65 FR 49474 
revising the Department's grants management regulations to bring its 
entitlement programs under the same regulations that already applied to 
nonentitlement programs. The rule expanded the scope of 7 CFR part 3016 
and 7 CFR part 3019 to include entitlement programs and deleted 
administrative requirements for awards and subawards under such 
programs from the scope of 7 CFR part 3015. It also established, in 
subpart E to 7 CFR part 3016, certain exceptions to the general 
administrative requirements that apply only to the entitlement 
programs.
    This final rule makes technical changes to the program regulations 
governing the NSLP (7 CFR part 210), SMP (7 CFR part 215), SBP (7 CFR 
part 220), SFSP (7 CFR part 225), CACFP (7 CFR part 226) and SAE (7 CFR 
part 235) by incorporating those changes made in the August 14, 2000 
final rule, and revising references to procurement and audit 
procedures.
    Previously, program regulations required that State agencies, 
school food authorities, sponsors and institutions comply with the 
requirements of 7 CFR part 3015 concerning the procurement of supplies, 
food, equipment and other services with program funds. As a result of 
the August 14, 2000 grants management rule, the requirements for 
procurement procedures are now governed by 7 CFR part 3016 and 7 CFR 
part 3019, as applicable. This final rule changes program regulations 
at 7 CFR part 210.21(c), 7 CFR part 215.14a(c), 7 CFR part 220.16(c), 7 
CFR part 225.17(a), 7 CFR part 226.22(c), 7 CFR part 235.9(a), 7 CFR 
part 235.9(c) and 7 CFR part 235.9(d) to reflect this change.
    Furthermore, program regulations regarding audit procedures 
previously required that State agencies, school food authorities and 
institutions comply with the requirements of 7 CFR part 3015 concerning 
the audit requirements for recipients and subrecipients of the 
Department's financial assistance. This final rule makes technical 
revisions to 7 CFR part 210.22(a), 7 CFR part 215.13(a), 7 CFR part 
220.15(a), 7 CFR part 225.10(a), and 7 CFR part 235.8(a) to replace 
reference to 7 CFR part 3015 with reference to 7 CFR part 3052, Audits 
of State, Local Governments and Nonprofit Organizations.

Specific Changes

     Revises the definition of 7 CFR part 3015 in 7 CFR parts 
210, 215, 220, 225, 226 and 235.
     Adds definitions of 7 CFR part 3016 and 7 CFR part 3019 to 
7 CFR parts 210, 215, 220, 225, 226 and 235.
     Removes the definition of 7 CFR part 3017 wherever it 
appears, because this definition is no longer applicable.
     Adds a definition of 7 CFR part 3052 to 7 CFR parts 225 
and 226.
     Amends procurement and audit procedures.

Definition of 7 CFR Part 3015

    One of the purposes of this final rule is to revise the definition 
of 7 CFR part 3015 in 7 CFR parts 210, 215, 220, 225, 226 and 235. This 
revision notes the applicability of 7 CFR part 3015 with regards to 
competition for discretionary grants and cooperative agreements, costs 
requiring prior approval, acknowledgement of USDA in support of 
publications and audiovisuals

[[Page 39514]]

produced under USDA programs, intergovernmental review of USDA 
programs, and certain miscellaneous USDA requirements.

Definition of 7 CFR Part 3016

    A new definition, 7 CFR part 3016, is added by this final rule to 7 
CFR parts 210, 215, 220, 225, 226 and 235. 7 CFR part 3016 refers to 
the Department's Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments. Awards and 
subawards to State and local governmental organizations under USDA 
programs are also covered under 7 CFR part 3016.

Definition of 7 CFR Part 3019

    A new definition, 7 CFR part 3019, is added by this final rule to 7 
CFR parts 210, 215, 220, 225, 226 and 235. 7 CFR part 3019 refers to 
the Department's Uniform Administrative Requirements for Grants and 
Agreements with Institutions of Higher Education, Hospitals, and Other 
Non-Profit Organizations. Requirements for awards and subawards to 
nongovernmental, non-profit organizations are also covered under 7 CFR 
part 3019.

Definition of 7 CFR Part 3052

    A new definition, 7 CFR part 3052, is added by this final rule to 7 
CFR parts 225 and 226. 7 CFR part 3052 refers to the Department's 
regulations implementing OMB Circular A-133.

Procurement Procedure

    This final rule amends the procurement procedures outlined in 7 CFR 
part 210.21(c), 7 CFR part 215.14a(c), 7 CFR part 220.16(c), 7 CFR part 
225.17(a) and 7 CFR part 226.22(c) stating that the school food 
authority, sponsor or institution, as applicable, may use its own 
procurement procedures which reflect applicable State and local laws 
and regulations, provided that procurements made with Program funds 
adhere to the standards set forth in 7 CFR part 3016 or 7 CFR part 
3019, as applicable. This final rule also amends 7 CFR part 235.9(a) 
and 7 CFR part 235.9(c) to require State agencies to comply with the 
procurement procedures of 7 CFR part 3016.

Audits

    This final rule amends the audit procedures outlined in 7 CFR part 
210.22(a), 7 CFR part 215.13(a), 7 CFR part 220.15(a), 7 CFR part 
225.10(a), and 7 CFR part 235.8(a). According to these procedures, 
unless otherwise exempt, audits at the State, school food authority and 
institution levels shall be conducted in accordance with Office of 
Management and Budget Circular A-133 and the Department's implementing 
regulations at 7 CFR part 3052.

Executive Order 12866

    This final rule has been determined to be not significant for 
purposes of Executive Order 12866 and therefore has not been reviewed 
by the Office of Management and Budget.

Regulatory Impact Analysis

Need for Action

    This action is needed because of changes to Departmental 
regulations on grants management. The Departmental regulations on 
entitlement programs are now under the same regulations that already 
apply to nonentitlement programs. In addition, this action identifies 
exceptions to these general rules that apply only to entitlement 
programs.

Benefits

    The change simplifies grants management regulations for all 
recipients and is consistent with Departmental policy.

Costs

    These revisions in grants management requirements will have no cost 
to grant recipients.

Regulatory Flexibility Act

    This final rule has been reviewed with regard to the requirements 
of the Regulatory Flexibility Act (5 U.S.C. 601-612). Roberto Salazar, 
Administrator of the Food and Nutrition Service, has certified that 
this rule will not have a significant economic impact on a substantial 
number of small entities. This final rule will affect recipients of 
entitlement programs by placing their grants management requirements 
under the same regulations that already apply to nonentitlement 
programs. Uniform requirements will ease the overall administrative 
burden on recipients.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a 
cost-benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures of $100 million or more in 
any one year by State, local, or tribal governments, in the aggregate, 
or by the private sector, of $100 million or more in any one year. When 
such a statement is needed for a rule, section 205 of the UMRA 
generally requires the Department to identify and consider a reasonable 
number of regulatory alternatives and adopt the least costly, more 
cost-effective or least burdensome alternative that achieves the 
objectives of the rule.
    This final rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) that impose costs on State, local, 
or tribal governments or to the private sector of $100 million or more 
in any one year. This final rule is, therefore, not subject to the 
requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

    The National School Lunch Program, Special Milk Program for 
Children, and School Breakfast Program are listed in the Catalog of 
Federal Domestic Assistance under No. 10.555, 10.556 and 10.553, 
respectively. The Child and Adult Care Food Program, the Summer Food 
Service Program, and the State Administrative Expense Funds are listed 
under No. 10.558, No. 10.559 and No. 10.560, respectively. For reasons 
set forth in the final rule in 7 CFR part 3015, subpart V and related 
Notice (48 FR 29115), these programs are included in the scope of 
Executive Order 12372, which requires intergovernmental consultation 
with State and local officials.

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under section (6)(b)(2)(B) of Executive Order 13132. FNS has 
considered the impact of this rule on State and local governments and 
has determined that this rule does not have Federalism implications. 
This final rule does not impose substantial or direct compliance costs 
on State and local governments. Therefore, under Section 6(b) of the 
Executive Order, a federalism summary impact statement is not required.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This final rule is intended to have preemptive 
effect with respect to any State or local laws,

[[Page 39515]]

regulations or policies which conflict with its provisions or which 
would impede its full implementation. This final rule is not intended 
to have retroactive effect unless that is specified in the DATES 
section of this preamble. Prior to any judicial challenge to the 
provisions of this final rule or the application of its provisions, all 
applicable administrative procedures must be exhausted.

Civil Rights Impact Analysis

    FNS has reviewed this final rule in accordance with the Department 
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify and 
address any major civil rights impacts the final rule might have on 
minorities, women, and persons with disabilities. After a careful 
review of the rule's intent and provisions, FNS has determined that 
this final rule will not in any way limit or reduce participants' 
ability to participate in the Child Nutrition Programs on the basis of 
an individual's or group's race, color, national origin, sex, age, or 
disability. FNS found no factors that would negatively and 
disproportionately affect any group of individuals.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35; see 5 
CFR 1320) requires that the Office of Management and Budget (OMB) 
approve all collections of information by a Federal agency before they 
can be implemented. Respondents are not required to respond to any 
collection of information unless it displays a current valid OMB 
control number. This final rule does not contain any information 
collection requirements subject to approval by OMB under the Paperwork 
Reduction Act of 1995. Existing information collections have been 
approved under the following OMB control numbers: For the National 
School Lunch Program--0584-0006; for the Special Milk Program for 
Children--0584-0005; for the School Breakfast Program--0584-0012; for 
the Summer Food Service Program--0584-0280; for the Child and Adult 
Care Food Program--0584-0055; and for State Administrative Expense 
Funds--0584-0067.

Government Paperwork Elimination Act

    FNS is committed to compliance with the Government Paperwork 
Elimination Act (GPEA), which requires Government agencies to provide 
the public the option of submitting information or transacting business 
electronically to the maximum extent possible. This rule does not 
require the submission of additional information.

Public Participation

    This action is being finalized without prior notice or public 
comment under authority of 5 U.S.C. 553(b)(3)(A) and (B) because it 
only revises references to procurement and audit procedures in the 
Child Nutrition Programs. Thus, the Department has determined in 
accordance with 5 U.S.C. 553(b) that Notice of Proposed Rulemaking and 
Opportunity for Public Comments is unnecessary and contrary to the 
public interest and, in accordance with 5 U.S.C. 553(d), finds that 
good cause exists for making this action effective without prior public 
comment.

List of Subjects

7 CFR Part 210

    Children, Commodity School Program, Food assistance programs, 
Grants programs--social programs, National School Lunch Program, 
Nutrition, Reporting and recordkeeping requirements, Surplus 
agricultural commodities.

7 CFR Part 215

    Food and nutrition, Food assistance programs, Grants programs--
education, Grant programs--health, Infants and children, Milk, 
Reporting and recordkeeping.

7 CFR Part 220

    Children, Food assistance programs, Grant programs--social 
programs, Nutrition, Reporting and recordkeeping requirements, School 
Breakfast Program.

7 CFR Part 225

    Food and nutrition, Food assistance programs, Grant programs--
health, Infants and children, Labeling, Reporting and recordkeeping 
requirements.

7 CFR Part 226

    Accounting, Aged, Day care, Food and Nutrition, Food assistance 
programs, Grant programs. Grant programs--health, American Indians, 
Individuals with disabilities, Infants and children, Intergovernmental 
relations, Loan programs, Reporting and recordkeeping requirements, 
Surplus agricultural commodities.

7 CFR Part 235

    Food and Nutrition Service, Food assistance programs. Grant 
programs--education; Grant programs--health, Infants and children, 
Reporting and recordkeeping requirements, School Breakfast and Lunch 
Programs.

0
Accordingly, 7 CFR parts 210, 215, 220, 225, 226 and 235 are amended as 
follows:

PART 210--NATIONAL SCHOOL LUNCH PROGRAM

0
1. The authority citation for 7 CFR part 210 continues to read as 
follows:

    Authority: 42 U.S.C. 1751-1760, 1779.


0
2. In Sec.  210.2:
0
a. Revise the definition of 7 CFR part 3015;
0
b. Remove the definition of 7 CFR part 3017; and
0
c. Add new definitions, 7 CFR part 3016 and 7 CFR part 3019 in 
alphabetical order.
    The additions and revision read as follows:


Sec.  210.2  Definitions.

* * * * *
    7 CFR part 3015 means the Uniform Federal Assistance Regulations 
published by the Department to implement certain policies applicable to 
all Department programs. The applicable provisions deal with 
competition for discretionary grants and cooperative agreements, costs 
requiring prior approval, acknowledgement of Department support in 
publications and audiovisuals produced under Department programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under 
Department programs.
* * * * *
    7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations under Department programs.
* * * * *


Sec.  210.3  [Amended]

0
3. In Sec.  210.3:
0
a. Amend the third sentence of paragraph (b) by removing the words 
``part 235; part 245; parts 15, 15a, 15b, and 3015 of Departmental 
regulations'' and adding in their place the words

[[Page 39516]]

``parts 235 and 245 of this chapter; parts 15, 15a, 15b, 3015 and 3016 
of this title''; and
0
b. Amend the second sentence of paragraph (d) by removing the words 
``part 245; parts 15, 15a, 15b, and 3015 of Departmental regulations'' 
and adding in their place the words ``part 245 of this chapter; parts 
15, 15a, 15b, and 3016 or 3019, as applicable, of this title''.


Sec.  210.5  [Amended]

0
4. In Sec.  210.5:
0
a. Amend the second sentence of paragraph (a) by removing the words ``7 
CFR part 3015'' and adding in their place the words ``7 CFR part 
3016''.

0
b. Amend the last sentence of paragraph (d)(3) by removing the words 
``7 CFR part 3015'' and adding in their place the words ``7 CFR part 
3016''.


Sec.  210.9  [Amended]

0
5. In Sec.  210.9, amend paragraph (b)(4) by removing the words ``7 CFR 
part 3015'' and adding in their place the words ``7 CFR part 3015 and 7 
CFR part 3016, or 7 CFR part 3019, as applicable''.


Sec.  210.19  [Amended]

0
6. In Sec.  210.19, amend the second sentence of paragraph (a)(2) by 
removing the words ``, as applicable, 7 CFR part 3015'' and adding in 
their place the words ``7 CFR part 3015 and 7 CFR part 3016, or 7 CFR 
part 3019, as applicable''.

0
7. In Sec.  210.21,
0
a. Amend the first sentence of paragraph (a) by removing the words ``7 
CFR part 3015'' and adding in their place the words ``7 CFR part 3016 
or 7 CFR part 3019, as applicable,''.
0
b. Amend the first sentence of paragraph (b) by removing the words ``7 
CFR part 3015'' and adding in their place the words ``this part and 7 
CFR part 3015, 7 CFR part 3016 and 7 CFR part 3019, as applicable,''.
0
c. Revise paragraph (c).
    The revision reads as follows:


Sec.  210.21  Procurement.

* * * * *
    (c) Procurement procedure. State agencies or school food 
authorities may use their own procedures for procurement with program 
funds to the extent that:
    (1) Procurements by public school food authorities comply with 
applicable State and local laws and the standards set forth in 7 CFR 
part 3016; and
    (2) Procurements by nonprofit private school food authorities 
comply with the standards set forth in 7 CFR part 3019.
* * * * *

0
8. In Sec.  210.22, revise paragraph (a) to read as follows:


Sec.  210.22  Audits.

    (a) General. Unless otherwise exempt, audits at the State and 
school food authority levels shall be conducted in accordance with 
Office of Management and Budget Circular A-133 and the Department's 
implementing regulations at 7 CFR part 3052. For availability of the 
OMB Circular mentioned in this paragraph, please refer to 5 CFR 1310.3.
* * * * *


Sec.  210.24  [Amended]

0
9. In Sec.  210.24, amend the first sentence by removing the words 
``Sec.  3015.103 of this title'' and adding in their place the words 
``7 CFR part 3016 and 7 CFR part 3019, as applicable''.


Sec.  210.25  [Amended]

0
10. In Sec.  210.25:
0
a. Amend the third sentence by removing the words ``the Department's 
Uniform Federal Assistance Regulations, 7 CFR part 3015, subpart N'' 
and adding in their place the words ``7 CFR part 3016''; and
0
b. Amend the fourth sentence by adding, after the word ``provisions'', 
the words ``, or the parallel provisions of 7 CFR part 3019, as 
applicable,''.

PART 215--SPECIAL MILK PROGRAM FOR CHILDREN

0
1. The authority citation for 7 CFR part 215 continues to read as 
follows:

    Authority: 42 U.S.C. 1772 and 1779.


0
2. In Sec.  215.2:
0
a. Revise paragraph (x-1);
0
b. Remove paragraph (x-2);
0
c. Redesignate paragraph (x-4) and (x-5) as paragraphs (x-5) and (x-6), 
respectively; and
0
d. Add new paragraphs (x-2) and (x-4).
    The additions and revision read as follows:


Sec.  215.2  Definitions.

* * * * *
    (x-1) 7 CFR part 3015 means the Uniform Federal Assistance 
Regulations published by the Department to implement certain policies 
applicable to all Department programs. The applicable provisions deal 
with competition for discretionary grants and cooperative agreements, 
costs requiring prior approval, acknowledgement of Department support 
in publications and audiovisuals produced under Department programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    (x-2) 7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under 
Department programs.
* * * * *
    (x-4) 7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations under Department programs.
* * * * *

0
3. In Sec.  215.3, the first sentence of paragraph (d) is revised to 
read as follows:


Sec.  215.3  Administration.

* * * * *
    (d) Each State agency desiring to take part in the Program shall 
enter into a written agreement with the Department for the 
administration of the Program in the State in accordance with the 
provisions of this part, 7 CFR parts 235, 245, 15, 15a, 15b and, as 
applicable, 7 CFR part 3015, 7 CFR part 3016 and 7 CFR part 3019, and 
with FNS Instructions. * * *
* * * * *

0
4. In Sec.  215.13:
0
a. Revise paragraph (a);
0
b. Remove paragraph (b) and redesignate paragraphs (c) and (d) as 
paragraphs (b) and (c), respectively; and
0
c. Amend newly designated paragraph (b) by removing the word ``OA'' 
wherever it appears and adding in its place the word ``OIG''.
    The revision reads as follows:


Sec.  215.13  Management evaluations and audits.

    (a) Unless otherwise exempt, audits at the State and school food 
authority/child care institution levels shall be conducted in 
accordance with Office of Management and Budget Circular A-133 and the 
Department's implementing regulations at 7 CFR part 3052. For 
availability of the OMB Circular mentioned in this paragraph, please 
refer to 5 CFR 1310.3.
* * * * *

0
5. In Sec.  215.14a:
0
a. Amend the first sentence of paragraph (a) by removing the words 
``the Office of Management and Budget

[[Page 39517]]

(OMB) Circular A-102 and the Department's Uniform Federal Assistance 
Regulations, 7 CFR part 3015, subpart S (46 FR 55658)'' and adding in 
their place the words ``this part and 7 CFR part 3015, 7 CFR part 3016 
and 7 CFR part 3019, as applicable,'';
0
b. Amend the first sentence of paragraph (b) by removing the words 
``OMB Circular A-102 and 7 CFR part 3015'' and adding in their place 
the words ``this part and 7 CFR part 3015, 7 CFR part 3016 and 7 CFR 
part 3019, as applicable''; and
0
c. Revise paragraph (c).
    The revision reads as follows:


Sec.  215.14a  Procurement standards.

* * * * *
    (c) Procurement procedure. State agencies, school food authorities 
or child care institutions may use their own procedures for procurement 
with Program funds to the extent that:
    (1) Procurements by public school food authorities/child care 
institutions comply with applicable State or local laws and the 
standards set forth in this part and in 7 CFR part 3016 and 7 CFR part 
3019, as applicable; and
    (2) Procurements by nonprofit private school food authorities/child 
care institutions comply with standards set forth in 7 CFR part 3019.
* * * * *


Sec.  215.15  [Amended]

0
6. In Sec.  215.15:
0
a. Amend the third sentence by removing the words ``the Department's 
Uniform Federal Assistance Regulations, 7 CFR part 3015, subpart N'' 
and adding in their place the words ``7 CFR part 3016''.
0
b. Amend the fourth sentence by adding, after the word ``provisions'', 
the words ``, or the parallel provisions of 7 CFR part 3019, as 
applicable,''.

PART 220--SCHOOL BREAKFAST PROGRAM

0
1. The authority citation for 7 CFR part 220 continues to read as 
follows:

    Authority: 42 U.S.C. 1773, 1779, unless otherwise noted.


0
2. In Sec.  220.2:
0
a. Revise paragraph (x-1);
0
b. Remove paragraph (x-2);
0
c. Redesignate paragraph (x-4) as paragraph (x-5); and
0
d. Add new paragraphs (x-2) and (x-4).
    The additions and revision read as follows:


 Sec.  220.2  Definitions.

* * * * *
    (x-1) 7 CFR part 3015 means the Uniform Federal Assistance 
Regulations published by the Department to implement certain policies 
applicable to all Department programs. The applicable provisions deal 
with competition for discretionary grants and cooperative agreements, 
costs requiring prior approval, acknowledgement of Department support 
in publications and audiovisuals produced under Department programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    (x-2) 7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under 
Department programs.
* * * * *
    (x-4) 7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations under Department programs.
* * * * *

0
3. In Sec.  220.3, revise the first sentence of paragraph (e) to read 
as follows:


Sec.  220.3  Administration.

* * * * *
    (e) Each State agency desiring to take part in any of the programs 
shall enter into a written agreement with the Department for the 
administration of the Program in the State in accordance with the 
provisions of this part, 7 CFR parts 235, 245, 15, 15a, 15b and, as 
applicable, 7 CFR part 3015, 7 CFR part 3016 and 7 CFR part 3019, and 
with FNS Instructions.* * *
* * * * *


Sec.  220.13  [Amended]

0
4. In Sec.  220.13, amend the second sentence of paragraph (i) by 
removing the words ``, as applicable, the cost principles contained in 
OMB Circular A-87 and 7 CFR part 3015'' and adding in their place the 
words ``7 CFR part 3015, and 7 CFR part 3016 or 7 CFR part 3019, as 
applicable''.

0
5. In Sec.  220.15:
0
a. Revise paragraph (a);
0
b. Remove paragraph (b) and redesignate paragraphs (c) and (d) as 
paragraphs (b) and (c), respectively; and
0
c. Amend newly redesignated paragraph (b) by removing the word ``OA'' 
each time it appears and adding in its place the word ``OIG''.
    The revision reads as follows:


Sec.  220.15  Management evaluations and audits.

    (a) Unless otherwise exempt, audits at the State and institution 
levels shall be conducted in accordance with Office of Management and 
Budget Circular A-133 and the Department's implementing regulations at 
7 CFR part 3052. For availability of the OMB Circular mentioned in this 
paragraph, please refer to 5 CFR 1310.3.
* * * * *

0
6. In Sec.  220.16:
0
a. Amend the first sentence of paragraph (a) by removing the words 
``the Office of Management and Budget (OMB) Circular A-102 and the 
Department's Uniform Federal Assistance Regulations, 7 CFR part 3015, 
subpart S (46 FR 55658)'' and adding in their place the words ``7 CFR 
part 3016 or 7 CFR part 3019, as applicable,'';
0
b. Amend the first sentence of paragraph (b) by removing the words 
``OMB Circular A-102 and 7 CFR 3015'' and adding in their place the 
words ``7 CFR part 3016 or 7 CFR part 3019, as applicable''; and
0
c. Revise paragraph (c).
    The revision reads as follows:


Sec.  220.16  Procurement standards.

* * * * *
    (c) Procurement procedure. State agencies or school food 
authorities may use their own procedures for procurement with program 
funds to the extent that:
    (1) Procurements by public school food authorities comply with 
applicable State or local laws and standards set forth in 7 CFR part 
3016; and
    (2) Procurements by nonprofit private school food authorities 
comply with standards set forth in 7 CFR part 3019.
* * * * *


Sec.  220.18  [Amended]

0
7. In Sec.  220.18:
0
a. Amend the third sentence by removing the words ``the Department's 
Uniform Federal Assistance Regulations, 7 CFR part 3015, subpart N'' 
and adding in their place the words ``7 CFR part 3016''; and
0
b. Amend the fourth sentence by adding, after the word ``provisions'', 
the words ``, or the parallel provisions of 7 CFR part 3019, as 
applicable,''.

[[Page 39518]]

PART 225--SUMMER FOOD SERVICE PROGRAM

0
1. The authority citation for 7 CFR part 225 is revised to read as 
follows:

    Authority: Secs. 9, 13 and 14, Richard B. Russell National 
School Lunch Act, as amended (42 U.S.C. 1758, 1761 and 1762a).


0
2. In Sec.  225.2, new definitions, 7 CFR part 3015, 7 CFR part 3016, 7 
CFR part 3019, and 7 CFR part 3052, are added in alphanumerical order.
    The additions read as follows:


Sec.  225.2  Definitions.

* * * * *
    7 CFR part 3015 means the Uniform Federal Assistance Regulations 
published by the Department to implement certain policies applicable to 
all Department programs. The applicable provisions deal with 
competition for discretionary grants and cooperative agreements, costs 
requiring prior approval, acknowledgement of Department support in 
publications and audiovisuals produced under Department programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under 
Department programs.
    7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations under Department programs.
    7 CFR part 3052 means the Department's regulations implementing OMB 
Circular A-133. (To obtain the OMB circular referenced in this 
definition, see 5 CFR 1310.3.)
* * * * *


Sec.  225.7  [Amended]

0
3. In Sec.  225.10, amend paragraph (a) by removing the first sentence 
and by revising the second sentence, to read as set forth below.
0
4. In Sec.  225.7, amend the first sentence of paragraph (f) by 
removing the words ``the Department's Uniform Financial Assistance 
Regulations (7 CFR part 3015)'' and adding in their place the words ``7 
CFR part 3015, and 7 CFR part 3016 or 7 CFR part 3019, as 
applicable,''.


Sec.  225.10  Audits and management evaluations.

    (a) * * * Unless otherwise exempt, audits at the State and sponsor 
levels shall be conducted in accordance with OMB Circular A-133 and the 
Department's implementing regulations at 7 CFR part 3052. (To obtain 
the OMB circular referenced in this paragraph, see 5 CFR 1310.3.) * * *
* * * * *

0
5. In Sec.  225.17:
0
a. Revise paragraph (a);
0
b. Amend paragraph (b) by removing the words ``7 CFR part 3015'' and 
adding in their place the words ``7 CFR part 3016 or 7 CFR part 3019, 
as applicable''.
0
c. Amend the introductory text of paragraph (d) by removing the words 
``all sponsors are'' and adding in their place the words ``each sponsor 
is'' and by removing the words ``7 CFR part 3015'' and adding in their 
place the words ``7 CFR part 3016 or 7 CFR part 3019, as applicable''.
    The revision reads as follows:


Sec.  225.17  Procurement standards.

    (a) State agencies and sponsors shall comply with the requirements 
of 7 CFR part 3016 or 7 CFR part 3019, as applicable, concerning the 
procurement of supplies, food, equipment and other services with 
Program funds. These requirements ensure that such materials and 
services are obtained for the program efficiently and economically and 
in compliance with applicable laws and executive orders. Sponsors may 
use their own procedures for procurement with Program funds to the 
extent that:
    (1) Procurements by public sponsors comply with applicable State or 
local laws and the standards set forth in 7 CFR part 3016; and
    (2) Procurements by private nonprofit sponsors comply with 
standards set forth in 7 CFR part 3019.
* * * * *


Sec.  225.18  [Amended]

0
6. In Sec.  225.18, amend paragraph (a) by removing the words ``the 
Department's Uniform Federal Assistance Regulations (7 CFR part 3015), 
subpart N'' and adding in their place the words ``7 CFR part 3016 or 7 
CFR part 3019, as applicable''.

PART 226--CHILD AND ADULT CARE FOOD PROGRAM

0
1. The authority citation for 7 CFR part 226 continues to read as 
follows:

    Authority: Secs. 9, 11, 14, 16, and 17, Richard B. Russell 
National School Lunch Act, as amended (42 U.S.C. 1758, 1759a, 1762a, 
1765 and 1766).


0
2. In Sec.  226.2:
0
a. New definitions, 7 CFR part 3015, 7 CFR part 3016, 7 CFR part 3019, 
and 7 CFR part 3052, are added in alphabetical order; and
0
b. The definition of Uniform Federal Assistance Regulations is removed.
    The additions read as follows:


Sec.  226.2  Definitions.

* * * * *
    7 CFR part 3015 means the Uniform Federal Assistance Regulations 
published by the Department to implement certain policies applicable to 
all Department programs. The applicable provisions deal with 
competition for discretionary grants and cooperative agreements, costs 
requiring prior approval, acknowledgement of Department support in 
publications and audiovisuals produced under Department programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under USDA 
programs.
    7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations.
    7 CFR part 3052 means the Department's regulations implementing OMB 
Circular A-133. (To obtain the OMB circular referenced in this 
definition, see 5 CFR 1310.3.)
* * * * *

0
3. In Sec.  226.4, revise paragraph (j) to read as follows:


Sec.  226.4  Payments to States and use of funds.

* * * * *
    (j) Method of funding. FNS shall authorize funds for State agencies 
in accordance with 7 CFR part 3016.
* * * * *


Sec.  226.7  [Amended]

0
4. In Sec.  226.7:

[[Page 39519]]

0
a. Amend the first sentence of paragraph (b) by removing the words ``as 
delineated in the Uniform Federal Assistance Regulations, at 7 CFR part 
3015'' and adding in their place the words ``in accordance with 7 CFR 
part 3015, 7 CFR part 3016 and 7 CFR part 3019, as applicable''; and
0
b. Amend the first sentence of paragraph (m) by removing the words 
``the Uniform Federal Assistance Regulations, 7 CFR part 3015'' and 
adding in their place the words ``7 CFR part 3015, 7 CFR part 3016 and 
7 CFR part 3019, as applicable''.


Sec.  226.10  [Amended]

0
5. In Sec.  226.10, amend paragraph (b)(4) by removing the words ``the 
Department's Uniform Federal Assistance Regulations (7 CFR part 3015)'' 
and adding in their place the words ``7 CFR part 3016 or 7 CFR part 
3019, as applicable''.
0
6. In Sec.  226.22:
0
a. Revise paragraph (c); and
0
b. Revise the second sentence of paragraph (l)(5).
    The revisions read as follows:


Sec.  226.22  Procurement standards.

* * * * *
    (c) Institutions may use their own procedures for procurement with 
Program funds to the extent that:
    (1) Procurements by public institutions comply with applicable 
State or local laws and standards set forth in 7 CFR part 3016;
    (2) Procurements by private nonprofit institutions comply with 
standards set forth in 7 CFR part 3019; and
    (3) All procurements comply with the procurement requirements in 
paragraphs (d) through (m) of this section.
* * * * *
    (l) * * *
    (5) * * * These requirements are found in Sec.  3015.175. * * *
* * * * *


Sec.  226.24  [Amended]

0
7. Amend Sec.  226.24 by removing the words ``the Department's Uniform 
Federal Assistance Regulations (7 CFR part 3015)'' and adding in their 
place the words ``7 CFR part 3016 or 7 CFR part 3019, as applicable''.


Sec.  226.25  [Amended]

0
8. In Sec.  226.25, amend paragraph (a) by removing the words ``the 
Uniform Federal Assistance Regulations'' and adding in their place the 
words ``7 CFR part 3016 or 7 CFR part 3019, as applicable''.

PART 235--STATE ADMINISTRATIVE EXPENSE FUNDS

0
1. The authority citation for 7 CFR part 235 continues to read as 
follows:

    Authority: Secs. 7 and 10 of the Child Nutrition Act of 1966, 80 
Stat. 888, 889, as amended (42 U.S.C. 1776, 1779).


0
2. In Sec.  235.2:
0
a. Revise paragraph (q-1);
0
b. Remove paragraph (q-2);
0
c. Redesignate paragraph (q-4) as paragraph (q-5); and
0
d. Add a new paragraphs (q-2) and (q-4).
    The revision and additions read as follows:


Sec.  235.2  Definitions.

* * * * *
    (q-1) 7 CFR part 3015 means the Uniform Federal Assistance 
Regulations published by the Department to implement certain policies 
applicable to all Department programs. The applicable provisions deal 
with competition for discretionary grants and cooperative agreements, 
costs requiring prior approval, acknowledgement of Department support 
in publications and audiovisuals produced under USDA programs, 
intergovernmental review of Department programs under Executive Order 
12372, and certain miscellaneous Department requirements.
    (q-2) 7 CFR part 3016 means the Department's Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments. 7 CFR part 3016 covers requirements for awards and 
subawards to State and local governmental organizations under 
Department programs.
* * * * *
    (q-4) 7 CFR part 3019 means the Department's Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. 7 CFR part 
3019 covers requirements for awards and subawards to nongovernmental, 
nonprofit organizations under Department programs.
* * * * *

0
3. In Sec.  235.3, revise the first sentence of paragraph (b) to read 
as follows:


Sec.  235.3  Administration.

* * * * *
    (b) Each State agency desiring to receive payments under this part 
shall enter into a written agreement with the Department for the 
administration of the child nutrition programs in accordance with the 
applicable requirements of this part, 7 CFR parts 210, 215, 220, 225, 
226, 245, 15, 15a, 15b, 3015, and 3016. * * *
* * * * *

0
4. In Sec.  235.8:
0
a. Revise paragraph (a);
0
b. Remove paragraphs (b) and (d) and redesignate paragraphs (c) and (e) 
as paragraphs (b) and (c), respectively;
0
c. Amend the first sentence of newly redesignated paragraph (b) by 
removing the word ``OA'' and adding in its place the word ``OIG''; and
0
d. Amend newly redesignated paragraph (c) by removing the word ``OA'' 
wherever it appears and adding in its place the word ``OIG''.
    The revision reads as follows:


Sec.  235.8  Management evaluations and audits.

    (a) Unless otherwise exempt, audits at the State level shall be 
conducted in accordance with Office of Management and Budget Circular 
A-133, and the Department's implementing regulations at 7 CFR part 
3052. (To obtain the OMB circular referenced in this definition, see 5 
CFR 1310.3.)
* * * * *

0
5. In Sec.  235.9:
0
a. Amend the first sentence of paragraph (a) by removing the words 
``the Office of Management and Budget (OMB) Circular A-102 and the 
Department's Uniform Federal Assistance Regulations, 7 CFR part 3015, 
subpart S (46 FR 55658)'' and adding in their place the words ``7 CFR 
part 3016'';
0
b. Remove the second sentence of paragraph (a);
0
c. Amend the first sentence of paragraph (b) by removing the words 
``OMB Circular A-102 and 7 CFR part 3015'' and adding in their place 
the words ``7 CFR part 3016'';
0
d. Revise paragraph (c); and
0
e. Amend paragraph (d) by removing the words ``OMB Circular A-102 and 7 
CFR part 3015, subpart R (46 FR 55654)'' and adding in their place the 
words ``7 CFR part 3016''.
    The revision reads as follows:


Sec.  235.9  Procurement and property management standards.

* * * * *
    (c) Procurement procedure. The State agency may use its own 
procurement procedures which reflect applicable State laws and 
regulations, in accordance with 7 CFR part 3016.
* * * * *


Sec.  235.11  [Amended]

0
6. In Sec.  235.11:
0
a. Amend the third sentence of paragraph (a) by removing the words ``,

[[Page 39520]]

as applicable, the provisions of Office of Management and Budget 
Circular A-102, Attachments F and G and 7 CFR part 3015, subparts G and 
H'' and adding in their place the words ``the provisions of 7 CFR part 
3016'';
0
b. Amend the first sentence of paragraph (b)(5)(v) by removing the 
words ``7 CFR part 3015, subpart L'' and adding in their place the 
words ``7 CFR part 3016''; and
0
c. Amend paragraph (d) by removing the words ``the Department's Uniform 
Federal Assistance Regulations, 7 CFR part 3015 subpart N'' and adding 
in their place the words ``7 CFR part 3016''.

    Dated: July 5, 2006.
Roberto Salazar,
Administrator, Food and Nutrition Service.
[FR Doc. 06-6185 Filed 7-12-06; 8:45 am]
BILLING CODE 3410-30-P