[Federal Register Volume 84, Number 170 (Tuesday, September 3, 2019)]
[Rules and Regulations]
[Pages 45873-45877]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-18815]



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 Rules and Regulations
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 This section of the FEDERAL REGISTER contains regulatory documents 
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 to and codified in the Code of Federal Regulations, which is published 
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  Federal Register / Vol. 84, No. 170 / Tuesday, September 3, 2019 / 
Rules and Regulations  

[[Page 45873]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 253

[FNS-2019-0031]
RIN 0584-AE74


Food Distribution Program on Indian Reservations: Revisions to 
the Administrative Match Requirement

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule; request for comments.

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

SUMMARY: Through this rulemaking, the U.S. Department of Agriculture's 
(the Department or USDA) Food and Nutrition Service (FNS) is codifying 
new and revised statutory requirements included in the Agriculture 
Improvement Act of 2018 (the 2018 Farm Bill). First, the Department is 
revising the minimum Federal share of the Food Distribution Program on 
Indian Reservations (FDPIR) administrative costs and State agency/
Indian Tribal Organization (ITO) mandatory administrative match 
requirement amounts. Second, the Department is revising its 
administrative match waiver requirements by allowing State agencies and 
ITOs to qualify for a waiver if the required match share would be a 
substantial burden. Third, the Department is limiting the reduction of 
any FDPIR benefits or services to State agencies and ITOs that are 
granted a full or partial administrative match waiver. Last, the 
Department is allowing for other Federal funds, if such use is 
otherwise consistent with both the purpose of the other Federal funds 
and with the purpose of FDPIR administrative funds, to be used to meet 
the State agency/ITO administrative match requirement.

DATES: 
    Effective Date: This rule is effective September 3, 2019.
    Comment Date: Written comments on this rule must be received on or 
before November 4, 2019.

ADDRESSES: The Food and Nutrition Service (FNS), USDA, invites 
interested persons to submit written comments on this rule. Comments 
may be submitted in writing by one of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Mail: Send comments to Erica Antonson, Branch Chief, Food 
Distribution Division, Food and Nutrition Service, U.S. Department of 
Agriculture, 3101 Park Center Drive, Room 506, Alexandria, Virginia 
22302-1592, (703) 305-2680.
     Email: Send comments to [email protected]. Include Docket 
ID Number FNS-2019-0031, ``Food Distribution Program on Indian 
Reservations: Revisions to the Administrative Match Requirement'' in 
the subject line of the message.
     All written comments submitted in response to this Final 
Rule with Request for Comments will be included in the record and will 
be made available to the public. Please be advised that the substance 
of the comments and the identity of the individuals or entities 
submitting the comments will be subject to public disclosure. FNS will 
make the written comments publicly available on the internet via http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Barbara Lopez, Food and Nutrition 
Service, U.S. Department of Agriculture, 3101 Park Center Drive, Room 
506, Alexandria, Virginia 22302-1592, or by email at 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Public Comment Procedures
II. Background and Discussion of Final Rule With Request for 
Comments
    A. State Agency/ITO Administrative Match Requirement
    B. State Agency/ITO Administrative Match Waiver
    C. Limitation on Reducing Benefits or Services to State 
Agencies/ITOs Granted an Administrative Match Waiver
    D. Use of Other Federal Funds To Meet the State Agency/ITO 
Administrative Match
III. Procedural Matters

I. Public Comment Procedures

    Your written comments on this rule should be specific, should be 
confined to issues pertinent to the rule, and should explain the 
reason(s) for any change you recommend or oppose. Where possible, you 
should reference the specific section or paragraph of the rule you are 
addressing. This rule is effective upon publication. If the Department 
determines that comments received change any provisions of this rule, 
the Department will publish a new final rule in the Federal Register. 
Comments must be received on or before the comment period (see DATES) 
to be assured of consideration.
    Executive Order 12866 requires each agency to write regulations 
that are simple and easy to understand. We invite your comments on how 
to make these regulations easier to understand, including answers to 
questions such as the following:
    (1) Are the requirements in the regulation clearly stated?
    (2) Does the rule contain technical language or jargon that 
interferes with its clarity?
    (3) Does the format of the rule (e.g., grouping and order of 
sections, use of heading, and paragraphing) make it clearer or less 
clear?
    (4) Would the rule be easier to understand if it was divided into 
more (but shorter) sections?
    (5) Is the description of the rule in the preamble section entitled 
``Background and Discussion of Final Rule with Request for Comments'' 
helpful in understanding the rule? How could this description be more 
helpful in making the rule easier to understand?

II. Background and Discussion of Final Rule With Request for Comments

    In the following discussion and regulatory text, the term ``State 
agency,'' as defined at 7 CFR 253.2, is used to include ITOs authorized 
to administer FDPIR and the Food Distribution Program for Indian 
Households in Oklahoma (FDPIHO) in accordance with 7 CFR parts 253 and 
254. The term ``FDPIR'' is used in this rulemaking to refer 
collectively to FDPIR and FDPIHO.
    The 2018 Farm Bill (Pub. L. 115-334) was signed into law on 
December 20, 2018. Section 4003 included FDPIR-specific provisions and 
modified Section 4(b) of the Food and Nutrition Act (FNA) (7 U.S.C. 
2013(b)). This rule

[[Page 45874]]

codifies new and revised statutory requirements included in the 2018 
Farm Bill by amending FDPIR regulations at 7 CFR part 253. Upon 
publication, this rulemaking makes the following changes: (1) Revises 
the required minimum Federal share of FDPIR administrative costs and 
State agency/ITO mandatory administrative match amounts; (2) allows 
State agencies/ITOs to qualify for an administrative match waiver if 
their required match share would be a substantial burden; (3) limits 
the reduction of FDPIR benefits or services to State agencies/ITOs that 
are granted a full or partial administrative match waiver; and (4) 
allows for other Federal funds to be used to meet the State agency/ITO 
administrative match requirement, if such use is otherwise consistent 
with the purpose of the other Federal funds. The amendments are 
discussed in more detail below.
    The Administrative Procedure Act (APA) at 5 U.S.C. 553(a)(2) 
specifically exempts rules involving grants and benefits from notice-
and-comment requirements, giving the Department the authority to issue 
final rules in grants and benefits programs, like FDPIR.\1\ The 
Department does, however, retain the discretion to issue a final rule 
with a request for comments, and FNS welcomes comments on the specified 
sections below. The Department is issuing this final rule with request 
for comments in order to ensure that the provisions in this rulemaking 
apply to the next FDPIR administrative grant cycle, fiscal year (FY) 
2020, which begins October 1, 2019. State agencies and ITOs that 
administer FDPIR benefit from the timely implementation of these 
provisions as they have a direct and positive impact on individual 
State agency and ITO grant allocations to operate the program. The 
Department determined that prolonging the implementation of these 
provisions would negatively impact State agencies and ITOs that 
administer the FDPIR by delaying their ability to utilize the new 
flexibilities provided for in the 2018 Farm Bill. As previously stated, 
if the Department, upon consideration of the comments received, decides 
to amend any provisions of the rule, the Department will publish a new 
final rule in the Federal Register with an explanation of the changes.
---------------------------------------------------------------------------

    \1\ Previous USDA practice pursuant to the Statement of Policy 
published on July 24, 1971 (36 FR 13804) was to utilize APA notice-
and-comment rulemaking procedures regardless of the APA's stated 
exceptions, but that memo was rescinded in 2013. 78 FR 64194 (Oct. 
28, 2013).
---------------------------------------------------------------------------

A. State Agency/ITO Administrative Match Requirement

    Under Federal regulations at 7 CFR 253.11(b) and (c), the 
Department provides 75 percent of FDPIR administrative funds and State 
agencies/ITOs are required to contribute the remaining 25 percent in 
matching funds, unless a match waiver is granted by the Department. The 
State agency/ITO administrative match requirement may be a cash or non-
cash (i.e., in-kind) contribution, per 7 CFR 253.11(c)(1).
    Section 4003 of the 2018 Farm Bill modified Section 4(b)(4) of the 
FNA (7 U.S.C. 2013(b)(4)) to require the Department to pay not less 
than 80 percent of State agencies and ITOs' administrative costs in 
FDPIR. Therefore, the corresponding State agency/ITO administrative 
match requirement would be a maximum of 20 percent. This rule amends 7 
CFR 253.11(b) and (c)(1) and (2) to increase the Federal share of FDPIR 
administrative costs from 75 to 80 percent. This rule also amends 7 CFR 
253.11(c)(1) and (2) to reduce the State agency/ITO match requirement 
from 25 to 20 percent.
    The corresponding State agency/ITO match requirement for FY 2019 
FDPIR administrative grants is 25 percent as those grants precede this 
rulemaking. At the time this rulemaking goes into effect (see DATES), 
the revised Federal share of 80 percent and revised State agency/ITO 
administrative match requirement amount of 20 percent, as described in 
this rulemaking, will apply to new FDPIR administrative grants only 
starting in FY 2020. FDPIR administrative grants for FY 2019 that have 
a period of performance through September 30, 2020 will retain the 
Federal share of 75 percent and the State agency/ITO administrative 
match requirement amount of 25 percent. This rulemaking applies to FY 
2020 FDPIR administrative grants and to FDPIR administrative grants 
annually thereafter.
    The Department does not request comments on the minimum amount of 
the Federal share, as the 80 percent is specified in statute. However, 
rulemaking is necessary to implement the 80 percent provision because 
the Department must exercise discretion in determining the inextricably 
related issues of changes to the standard for receiving an 
administrative match waiver, the prohibition on reducing benefits and 
services to State agencies and ITOs in receipt of the administrative 
match waiver, and the determination of what other Federal funds may 
count towards the 20 percent State agency/ITO administrative match 
requirement. This issue is discussed below.

B. State Agency/ITO Administrative Match Waiver

    FDPIR regulations at 7 CFR 253.11(c)(2) allow State agencies and 
ITOs to request an administrative match waiver to reduce or eliminate 
their match requirement in the event that a State agency/ITO is unable 
to meet the match requirement. In its request, the State agency/ITO 
must provide compelling justification and include a summary statement 
and recent financial documents. Section 4003 of the 2018 Farm Bill adds 
a provision at Section 4(b)(4)(B)(i) of the FNA (7 U.S.C. 
2013(b)(4)(B)(ii)) to codify the existing regulation to allow State 
agencies and ITOs to submit a match waiver request if they are 
financially unable to meet the State agency/ITO administrative match 
requirement. Section 4003 of the 2018 Farm Bill also provides a new 
provision in Section 4(b)(4)(B)(ii) of the FNA to allow State agencies 
and ITOs to qualify for the administrative match waiver if funding 
their share of the costs would be a substantial burden for the State 
agency/ITO.
    The Department interprets substantial burden to mean the State 
agency/ITO would be substantially negatively impacted if it is required 
to provide the full or partial share of administrative funds. For 
example, an ITO may submit an administrative match waiver request 
demonstrating substantial burden by detailing how providing its share 
of the administrative match requirement would deplete the Tribe's 
reserves to a level that would have a substantial negative impact on 
the Tribe.
    The Department has also determined that the submission of a waiver 
request and corresponding documents for review cannot, in and of 
itself, constitute a substantial burden for purposes of qualifying for 
the administrative match waiver. For example, if an ITO submits an 
administrative match waiver request based solely on the difficulty of 
collecting compelling justification as a reason to qualify for the 
waiver under the substantial burden standard, then the Department would 
deny the administrative match waiver request.
    The Department has determined that, in order to approve an 
administrative match waiver request based on substantial burden, the 
State agency must submit compelling justification to the FNS Regional 
Office for review and approval, similar to the current process as 
outlined at 7 CFR 253.11(c)(2). To apply for a waiver of the 
administrative

[[Page 45875]]

match based on substantial burden, the State agency/ITO must submit a 
signed letter from the leadership of a State agency or, in the case of 
an Indian Tribal Organization, a signed letter from the Tribal Council, 
describing why providing the match would be a substantial burden for 
the State agency/ITO along with supporting documentation, as needed.
    This rulemaking revises the existing regulatory requirements at 7 
CFR 253.11(c)(2) introductory text and (c)(2)(i) and (ii) to allow for 
an administrative match waiver request to be submitted under financial 
burden or substantial burden.
    Under the revised 7 CFR 253.11(c)(2), this rule adds language on 
how a State agency/ITO can qualify for the administrative match waiver 
based on compelling justification submitted for either of the two 
standards, the existing financial burden standard and the new 
substantial burden standard. Under the revised 7 CFR 253.11(c)(2)(i), 
this rule keeps the existing regulatory requirement in 7 CFR 
253.11(c)(2) that a State agency/ITO must submit a summary statement 
and recent financial documents showing that the State agency/ITO is 
unable to meet the matching requirement and that additional 
administrative funds are necessary for the effective operation of the 
program. Under the revised 7 CFR 253.11(c)(2)(ii), this rule adds new 
language to allow a State agency/ITO to submit a signed letter from the 
leadership of a State agency or, in the case of an Indian Tribal 
Organization, a signed letter from the Tribal Council, describing the 
State agency/ITO's substantial burden along with supporting 
documentation, as needed, to qualify for the administrative match 
waiver based on substantial burden. This option is in lieu of the 
summary statement and financial documentation currently required under 
7 CFR 253.11(c)(2) for waiver requests based on financial inability to 
meet the match requirement.
    The Department requests comments on this section of the rulemaking.

C. Limitation on Reducing Benefits or Services to State Agencies/ITOs 
Granted an Administrative Match Waiver

    Current FDPIR regulations at 7 CFR 253.11(c)(2) provide the FNS 
Regional Office with discretion on whether to provide additional 
Federal administrative funds above the required Federal share when a 
State agency/ITO is granted a match waiver. For example, if the FNS 
Regional Office waives a State agency/ITO's current 25 percent match 
requirement, the FNS Regional Office may provide the State agency/ITO 
with only 75 percent of its requested funding level or make up the 
difference by supplementing this amount with additional Federal funds, 
up to the State agency/ITO's total requested funding level, or 100 
percent. The FNS Regional Office decision regarding additional Federal 
funds is often dependent on funding availability and currently may not 
account for whether any funding gap would lead to a reduction of FDPIR 
benefits or services at the State agency/ITO level.
    Section 4003 of the 2018 Farm Bill adds a new provision at Section 
4(b)(4)(C) of the FNA (7 U.S.C. 2013(b)(4)(C)), prohibiting the 
Secretary from reducing FDPIR benefits or services to State agencies 
and ITOs that are granted an administrative match waiver. The 
Department interprets this limitation to mean that the same level of 
program benefits or services must be maintained.
    This rulemaking adds a new 7 CFR 253.11(c)(3) to require the FNS 
Regional Office to not reduce any benefits or services to State 
agencies/ITOs in receipt of an administrative match waiver.
    The Department requests comments on this section of the rulemaking.

D. Use of Other Federal Funds To Meet the State Agency/ITO 
Administrative Match

    Current FDPIR regulations at 7 CFR 253.11(c)(1) allow for the State 
agency/ITO administrative match requirement to be met with cash or non-
cash contributions, including in-kind contributions. Furthermore, 7 CFR 
253.11(c)(1)(v) provides that such contributions may not be paid for by 
the Federal Government under another assistance agreement unless 
authorized under the other agreement and its subject laws and 
regulations. Section 4003 of the 2018 Farm Bill adds a new provision at 
Section 4(b)(4)(D) of the FNA (7 U.S.C. 2013(b)(4)(D)) to allow for 
other Federal funds to be used towards meeting the State agency/ITO 
administrative match requirement, if that use is otherwise consistent 
with the purpose of the other Federal funds.
    In addition, the Department has determined that existing 
regulations at 7 CFR 253.11(c)(1)(i), (iii), (iv), and (vi) apply to 
the use of other Federal funds because matching funds must be 
verifiable; not be contributed for another Federally-assisted program 
unless authorized by Federal legislation; be necessary and reasonable 
to accomplish program objectives; be allowable costs under 7 CFR part 
277; and be included in the approved budget.
    The Department has also determined that a State agency/ITO seeking 
to use other Federal funds towards its FDPIR administrative match must 
demonstrate that such use is not prohibited by law for those funds to 
be used to meet a Federal match of another program. For example, an ITO 
has AmeriCorps VISTA volunteers, who are paid from another Federal 
source, working at the food distribution center in support of FDPIR 
operations. The ITO could submit the salary of the AmeriCorps VISTA 
volunteers as an in-kind contribution towards their administrative 
match requirement. By contrast, the salary of AmeriCorps VISTA 
volunteers working for an ITO on a project unrelated to FDPIR could not 
be used as an in-kind contribution towards their administrative match 
requirement.
    This rulemaking, therefore, requires State agencies and ITOs 
seeking to use other Federal funds to meet their State agency/ITO 
administrative match requirement to submit documentary evidence for 
review and approval by the FNS Regional Office that details the source, 
value, and purpose of those other Federal funds. This rule revises 7 
CFR 253.11(c)(1) to allow for the use of other Federal funds, requires 
documentary evidence to be submitted on the source, value, and purpose 
of those other Federal funds, and requires approval by the FNS Regional 
Office for those funds to be used towards the State agency/ITO 
administrative match. The rule also removes 7 CFR 253.11(c)(1)(ii) as 
the provision is already captured under part 277, removes existing 
regulation at Sec.  253.11(c)(1)(v) which prohibits the use of Federal 
funds, redesignates Sec.  253.11(c)(1)(iii), (iv), and (vi) to Sec.  
253.11(c)(1)(ii), (iii), and (iv), and revises newly redesignated Sec.  
253.11(c)(1)(iii) (formerly Sec.  253.11(c)(1)(iv)) to add an ``and''.
    The Department requests comments on this section of the rulemaking.

Procedural Matters

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this rule 
as not a major rule, as defined by 5 U.S.C. 804(2).

Executive Order 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety

[[Page 45876]]

effects, distributive impacts, and equity). Executive Order 13563 
emphasizes the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility.
    This final rule with request for comments has been determined to be 
not significant and was reviewed by the Office of Management and Budget 
(OMB) in conformance with Executive Order 12866.

Regulatory Impact Analysis

    This rule has been designated as not significant by the Office of 
Management and Budget; therefore, no Regulatory Impact Analysis is 
required.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies 
to analyze the impact of rulemaking on small entities and consider 
alternatives that would minimize any significant impacts on a 
substantial number of small entities. Pursuant to that review, it has 
been certified that this rule would not have a significant impact on a 
substantial number of small entities. While there may be some burden/
impact on State agencies and ITOs that administer FDPIR, the impact is 
not significant due to this rule providing a reduction in the State 
agency/ITO administrative match requirement. This rulemaking also 
provides flexibilities in meeting this requirement.

Executive Order 13771

    Executive Order 13771 directs agencies to reduce regulation and 
control regulatory costs and provides that the cost of planned 
regulations be prudently managed and controlled through a budgeting 
process.
    This rule is not an E.O. 13771 regulatory action because it is not 
significant under E.O. 12866.

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 by State, local, or tribal 
governments, in the aggregate, or the private sector, of $146 million 
or more (when adjusted for inflation; GDP deflator source: Table 1.1.9 
at https://apps.bea.gov/iTable/iTable.cfm) 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 most cost effective or least 
burdensome alternative that achieves the objectives of the rule.
    This final rule with request for comments does not contain Federal 
mandates (under the regulatory provisions of Title II of the UMRA) for 
State, local, and tribal governments or the private sector of $146 
million or more in any one year. Thus, the rule is not subject to the 
requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

    The program addressed in this section is listed in the Catalog of 
Federal Domestic Assistance under No. 10.567 and is subject to 
Executive Order 12372, which requires intergovernmental consultation 
with State and local officials. (See 2 CFR chapter IV.)

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.
    The Department has determined that this rule does not have 
federalism implications. This 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, Civil Justice Reform

    This final rule with request for comments has been reviewed under 
Executive Order 12988, Civil Justice Reform. This rule is not intended 
to have preemptive effect with respect to any State or local laws, 
regulations, or policies which conflict with its provisions or which 
would otherwise impede its full and timely implementation. This rule is 
not intended to have retroactive effect unless so specified in the 
Effective Dates section of the final rule. Prior to any judicial 
challenge to the provisions of the final rule with request for 
comments, all applicable administrative procedures must be exhausted.

Civil Rights Impact Analysis

    FNS has reviewed this final rule with request for comments in 
accordance with USDA Regulation 4300-004, ``Civil Rights Impact 
Analysis,'' to identify any major civil rights impacts the rule might 
have on program participants on the basis of age, race, color, national 
origin, sex, or disability. After a careful review of the rule's intent 
and provisions, FNS has determined that this rule is not expected to 
affect the participation of protected individuals in FDPIR.

Executive Order 13175

    Executive Order 13175 requires Federal agencies to consult and 
coordinate with Tribes on a government-to-government basis on policies 
that have Tribal implications, including regulations, legislative 
comments or proposed legislation, and other policy statements or 
actions that have substantial direct effects on one or more Indian 
Tribes, on the relationship between the Federal Government and Indian 
Tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian Tribes. In 2019, the Department 
engaged in a series of consultative and coordinated sessions with 
elected Tribal leaders and Tribal representatives from the FDPIR 
community to discuss these provisions. Reports from the consultative 
sessions will be made part of the USDA annual reporting on Tribal 
Consultation and Collaboration. USDA is unaware of any current Tribal 
laws that could be in conflict with this rule.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR 
1320) requires the Office of Management and Budget (OMB) to 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 rule contains information collection requirements that have been 
approved by OMB under OMB# 0584-0594 Food Programs Reporting System 
(FPRS). This rule, however, does not impact these information 
collection requirements and therefore they are not subject to review 
and approval by the Office of Management and Budget under the Paperwork 
Reduction Act of 1995.

E-Government Act Compliance

    The Department is committed to complying with the E-Government Act 
of 2002 (Pub. L. 107-347) to promote the use of the internet and other 
information technologies to provide increased opportunities for citizen

[[Page 45877]]

access to Government information and services, and for other purposes.

List of Subjects in 7 CFR Part 253

    Administrative practice and procedure, Food assistance programs, 
Grant programs, Indians, Social programs, Surplus agricultural 
commodities.

    Accordingly, 7 CFR part 253 is amended as follows:

PART 253--ADMINISTRATION OF THE FOOD DISTRIBUTION PROGRAM FOR 
HOUSEHOLDS ON INDIAN RESERVATIONS

0
1. The authority citation for 7 CFR part 253 continues to read as 
follows:

    Authority:  91 Stat. 958 (7 U.S.C. 2011-2036).


0
2. In Sec.  253.11:
0
a. Revise paragraphs (b) and (c)(1) introductory text;
0
b. Remove paragraphs (c)(1)(ii) and (v);
0
c. Redesignate paragraphs (c)(1)(iii), (iv), and (vi) as paragraphs 
(c)(1)(ii), (iii), and (iv);
0
d. Revise newly redesignated paragraph (c)(1)(iii) and paragraph 
(c)(2); and
0
e. Add paragraph (c)(3).
    The revisions and addition read as follows:


Sec.  253.11   Administrative funds.

* * * * *
    (b) Allocation of administrative funds to State agencies. Prior to 
receiving administrative funds, State agencies must submit a proposed 
budget reflecting planned administrative costs to the appropriate FNS 
Regional Office for approval. Planned administrative costs must be 
allowable under part 277 of this chapter. To the extent that funding 
levels permit, the FNS Regional Office allocates to each State agency 
administrative funds necessary to cover no less than 80 percent of 
approved administrative costs.
    (c) * * *
    (1) Unless Federal administrative funding is approved at a rate 
higher than 80 percent of approved administrative costs, in accordance 
with paragraph (c)(3) of this section, each State agency must 
contribute 20 percent of its total approved administrative costs. Cash 
or non-cash contributions, including third party in-kind contributions, 
and the value of services rendered by volunteers, may be used to meet 
the State agency matching requirement. Funds provided from another 
Federal source may be used to meet the State agency matching 
requirement, provided that such use is consistent with the purpose of 
those funds and complies with this subsection. To use funds from 
another Federal source, the State agency must submit documentation for 
approval to the FNS Regional Office which shows the source, value, and 
purpose of those funds. In accordance with part 277 of this chapter, 
such contributions must:
* * * * *
    (iii) Be allowable under part 277 of this chapter; and
* * * * *
    (2) Upon request from a State agency, an FNS Regional Office may 
approve a waiver reducing a State agency's matching requirement below 
20 percent. To request a waiver, the State agency must submit 
compelling justification for the waiver to the appropriate FNS Regional 
Office. Compelling justification is based on either financial inability 
to meet the match requirement or the match requirement imposing a 
substantial burden. The request for the match waiver must be submitted 
with the following and in accordance with other FNS instructions:
    (i) For a waiver based on financial inability, a summary statement 
and recent financial documents showing that the State agency is unable 
to meet the 20 percent matching requirement and that additional 
administrative funds are necessary for the effective operation of the 
program; or
    (ii) For a waiver based on substantial burden, a signed letter from 
the leadership of the State agency or, in the case of an Indian Tribal 
Organization, from the Tribal Council, describing why meeting the 20 
percent matching requirement would impose a substantial burden on the 
State agency, and why additional administrative funds are necessary for 
the effective operation of the program, along with supporting 
documentation, as needed.
    (3) The FNS Regional Office may not reduce any benefits or services 
to State agencies that are granted a waiver.
* * * * *

    Dated: August 26, 2019.
Pamilyn Miller,
Administrator, Food and Nutrition Service.
[FR Doc. 2019-18815 Filed 8-30-19; 8:45 am]
 BILLING CODE 3410-30-P