CHILD AND ADULT CARE FOOD PROGRAM.

SEC. 708. CHILD AND ADULT CARE FOOD PROGRAM. (a) Establishment of Program.—Section 17 of the National School Lunch Act (42 U.S.C. 1766) is amended in the first sentence of subsection (a), by striking “initiate, maintain, and expand” and inserting “initiate and maintain”. (b) Payments to Sponsor Employees.—Paragraph (2) of the last sentence of section 17(a) of the National School Lunch Act (42 U.S.C. 1766(a)) is amended— (1) in subparagraph (B), by striking “and” at the end; (2) in subparagraph (C), by striking the period at the end and inserting “; and”; and (3) by adding at the end the following: “(D) in the case of a family or group day care home sponsoring organization that employs more than one employee, the organization does not base payments to an employee of the organization on the number of family or group day care homes recruited.” . (c) Technical Assistance.—The last sentence of section 17(d)(1) of the National School Lunch Act (42 U.S.C. 1766(d)(1)) is amended by striking “, and shall provide technical assistance” and all that follows through “its application”. (d) Reimbursement of Child Care Institutions.—Section 17(f)(2)(B) of the National School Lunch Act (42 U.S.C. 1766(f)(2)(B)) is amended by striking “two meals and two supplements or three meals and one supplement” and inserting “2 meals and 1 supplement”. (e) Improved Targeting of Day Care Home Reimbursements.— (1) Restructured day care home reimbursements.—Section 17(f)(3) of the National School Lunch Act (42 U.S.C. 1766(f)(3)) is amended by striking “(3)(A) Institutions” and all that follows through the end of subparagraph (A) and inserting the following: “(3) Reimbursement of family or group day care home sponsoring organizations.— “(A) Reimbursement factor.— “(i) In general.—An institution that participates in the program under this section as a family or group day care home sponsoring organization shall be provided, for payment to a home sponsored by the organization, reimbursement factors in accordance with this subparagraph for the cost of obtaining and preparing food and prescribed labor costs involved in providing meals under this section. “(ii) Tier i family or group day care homes.— “(I) Definition of tier i family or group day care home.—In this paragraph, the term ‘tier I family or group day care home’ means— “(aa) a family or group day care home that is located in a geographic area, as defined by the Secretary based on census data, in which at least 50 percent of the children residing in the area are members of households whose incomes meet the income eligibility guidelines for free or reduced price meals under section 9; “(bb) a family or group day care home that is located in an area served by a school enrolling elementary students in which at least 50 percent of the total number of children enrolled are certified eligible to receive free or reduced price school meals under this Act or the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.); or “(cc) a family or group day care home that is operated by a provider whose household meets the income eligibility guidelines for free or reduced price meals under section 9 and whose income is verified by the sponsoring organization of the home under regulations established by the Secretary. “(II) Reimbursement.—Except as provided in subclause (III), a tier I family or group day care home shall be provided reimbursement factors under this clause without a requirement for documentation of the costs described in clause (i), except that reimbursement shall not be provided under this subclause for meals or supplements served to the children of a person acting as a family or group day care home provider unless the children meet the income eligibility guidelines for free or reduced price meals under section 9. “(III) Factors.—Except as provided in subclause (IV), the reimbursement factors applied to a home referred to in subclause (II) shall be the factors in effect on July 1, 1996. “(IV) Adjustments.—The reimbursement factors under this subparagraph shall be adjusted on July 1, 1997, and each July 1 thereafter, to reflect changes in the Consumer Price Index for food at home for the most recent 12-month period for which the data are available. The reimbursement factors under this subparagraph shall be rounded to the nearest lower cent increment and based on the unrounded adjustment in effect on June 30 of the preceding school year. “(iii) Tier ii family or group day care homes.— “(I) In general.— “(aa) Factors.—Except as provided in subclause (II), with respect to meals or supplements served under this clause by a family or group day care home that does not meet the criteria set forth in clause (ii)(I), the reimbursement factors shall be 95 cents for lunches and suppers, 27 cents for breakfasts, and 13 cents for supplements. “(bb) Adjustments.—The factors shall be adjusted on July 1, 1997, and each July 1 thereafter, to reflect changes in the Consumer Price Index for food at home for the most recent 12-month period for which the data are available. The reimbursement factors under this item shall be rounded down to the nearest lower cent increment and based on the unrounded adjustment for the preceding 12-month period. “(cc) Reimbursement.—A family or group day care home shall be provided reimbursement factors under this subclause without a requirement for documentation of the costs described in clause (i), except that reimbursement shall not be provided under this subclause for meals or supplements served to the children of a person acting as a family or group day care home provider unless the children meet the income eligibility guidelines for free or reduced price meals under section 9. “(II) Other factors.—A family or group day care home that does not meet the criteria set forth in clause (ii)(I) may elect to be provided reimbursement factors determined in accordance with the following requirements: “(aa) Children eligible for free or reduced price meals.—In the case of meals or supplements served under this subsection to children who are members of households whose incomes meet the income eligibility guidelines for free or reduced price meals under section 9, the family or group day care home shall be provided reimbursement factors set by the Secretary in accordance with clause (ii)(III). “(bb) Ineligible children.—In the case of meals or supplements served under this subsection to children who are members of households whose incomes do not meet the income eligibility guidelines, the family or group day care home shall be provided reimbursement factors in accordance with subclause (I). “(III) Information and determinations.— “(aa) In general.—If a family or group day care home elects to claim the factors described in subclause (II), the family or group day care home sponsoring organization serving the home shall collect the necessary income information, as determined by the Secretary, from any parent or other caretaker to make the determinations specified in subclause (II) and shall make the determinations in accordance with rules prescribed by the Secretary. “(bb) Categorical eligibility.—In making a determination under item (aa), a family or group day care home sponsoring organization may consider a child participating in or subsidized under, or a child with a parent participating in or subsidized under, a federally or State supported child care or other benefit program with an income eligibility limit that does not exceed the eligibility standard for free or reduced price meals under section 9 to be a child who is a member of a household whose income meets the income eligibility guidelines under section 9. “(cc) Factors for children only.—A family or group day care home may elect to receive the reimbursement factors prescribed under clause (ii)(III) solely for the children participating in a program referred to in item (bb) if the home elects not to have income statements collected from parents or other caretakers. “(IV) Simplified meal counting and reporting procedures.—The Secretary shall prescribe simplified meal counting and reporting procedures for use by a family or group day care home that elects to claim the factors under subclause (II) and by a family or group day care home sponsoring organization that sponsors the home. The procedures the Secretary prescribes may include 1 or more of the following: “(aa) Setting an annual percentage for each home of the number of meals served that are to be reimbursed in accordance with the reimbursement factors prescribed under clause (ii)(III) and an annual percentage of the number of meals served that are to be reimbursed in accordance with the reimbursement factors prescribed under subclause (I), based on the family income of children enrolled in the home in a specified month or other period. “(bb) Placing a home into 1 of 2 or more reimbursement categories annually based on the percentage of children in the home whose households have incomes that meet the income eligibility guidelines under section 9, with each such reimbursement category carrying a set of reimbursement factors such as the factors prescribed under clause (ii)(III) or subclause (I) or factors established within the range of factors prescribed under clause (ii)(III) and subclause (I). “(cc) Such other simplified procedures as the Secretary may prescribe. “(V) Minimum verification requirements.—The Secretary may establish any minimum verification requirements that are necessary to carry out this clause.” . (2) Grants to states to provide assistance to family or group day care homes.—Section 17(f)(3) of the National School Lunch Act (42 U.S.C. 1766(f)(3)) is amended by adding at the end the following: “(D) Grants to states to provide assistance to family or group day care homes.— “(i) In general.— “(I) Reservation.—From amounts made available to carry out this section, the Secretary shall reserve $5,000,000 of the amount made available for fiscal year 1997. “(II) Purpose.—The Secretary shall use the funds made available under subclause (I) to provide grants to States for the purpose of providing— “(aa) assistance, including grants, to family and day care home sponsoring organizations and other appropriate organizations, in securing and providing training, materials, automated data processing assistance, and other assistance for the staff of the sponsoring organizations; and “(bb) training and other assistance to family and group day care homes in the implementation of the amendment to subparagraph (A) made by section 708(e)(1) of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. “(ii) Allocation.—The Secretary shall allocate from the funds reserved under clause (i)(I)— “(I) $30,000 in base funding to each State; and “(II) any remaining amount among the States, based on the number of family day care homes participating in the program in a State during fiscal year 1995 as a percentage of the number of all family day care homes participating in the program during fiscal year 1995. “(iii) Retention of funds.—Of the amount of funds made available to a State for fiscal year 1997 under clause (i), the State may retain not to exceed 30 percent of the amount to carry out this subparagraph. “(iv) Additional payments.—Any payments received under this subparagraph shall be in addition to payments that a State receives under subparagraph (A).” . (3) Provision of data.—Section 17(f)(3) of the National School Lunch Act (42 U.S.C. 1766(f)(3)), as amended by paragraph (2), is amended by adding at the end the following: “(E) Provision of data to family or group day care home sponsoring organizations.— “(i) Census data.—The Secretary shall provide to each State agency administering a child and adult care food program under this section data from the most recent decennial census survey or other appropriate census survey for which the data are available showing which areas in the State meet the requirements of subparagraph (A)(ii)(I)(aa). The State agency shall provide the data to family or group day care home sponsoring organizations located in the State. “(ii) School data.— “(I) In general.—A State agency administering the school lunch program under this Act or the school breakfast program under the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.) shall provide to approved family or group day care home sponsoring organizations a list of schools serving elementary school children in the State in which not less than ½ of the children enrolled are certified to receive free or reduced price meals. The State agency shall collect the data necessary to create the list annually and provide the list on a timely basis to any approved family or group day care home sponsoring organization that requests the list. “(II) Use of data from preceding school year.—In determining for a fiscal year or other annual period whether a home qualifies as a tier I family or group day care home under subparagraph (A)(ii)(I), the State agency administering the program under this section, and a family or group day care home sponsoring organization, shall use the most current available data at the time of the determination. “(iii) Duration of determination.—For purposes of this section, a determination that a family or group day care home is located in an area that qualifies the home as a tier I family or group day care home (as the term is defined in subparagraph (A)(ii)(I)), shall be in effect for 3 years (unless the determination is made on the basis of census data, in which case the determination shall remain in effect until more recent census data are available) unless the State agency determines that the area in which the home is located no longer qualifies the home as a tier I family or group day care home.” . (4) Conforming amendments.—Section 17(c) of the National School Lunch Act (42 U.S.C. 1766(c)) is amended by inserting “except as provided in subsection (f)(3),” after “For purposes of this section,” each place it appears in paragraphs (1), (2), and (3). (f) Reimbursement.—Section 17(f) of the National School Lunch Act (42 U.S.C. 1766(f)) is amended— (1) in paragraph (3)— (A) in subparagraph (B), by striking the third and fourth sentences; and (B) in subparagraph (C)(ii), by striking “conduct outreach” and all that follows through “may become” and inserting “assist unlicensed family or group day care homes in becoming”; and (2) in the first sentence of paragraph (4), by striking “shall” and inserting “may”. (g) Nutritional Requirements.—Section 17(g)(1) of the National School Lunch Act (42 U.S.C. 1766(g)(1)) is amended— (1) in subparagraph (A), by striking the second sentence; and (2) in subparagraph (B), by striking the second sentence. (h) Elimination of State Paperwork and Outreach Burden.—Section 17 of the National School Lunch Act (42 U.S.C. 1766) is amended by striking subsection (k) and inserting the following: “(k) Training and Technical Assistance.—A State participating in the program established under this section shall provide sufficient training, technical assistance, and monitoring to facilitate effective operation of the program. The Secretary shall assist the State in developing plans to fulfill the requirements of this subsection.” . (i) Records.—The second sentence of section 17(m) of the National School Lunch Act (42 U.S.C. 1766(m)) is amended by striking “at all times” and inserting “at any reasonable time”. (j) Unneeded Provision.—Section 17 of the National School Lunch Act is amended by striking subsection (q). (k) Effective Date.— (1) In general.—Except as provided in paragraph (2), the amendments made by this section shall become effective on the date of enactment of this Act. (2) Improved targeting of day care home reimbursements.—The amendments made by paragraphs (1) and (4) of subsection (e) shall become effective on July 1, 1997. (3) Regulations.— (A) Interim regulations.—Not later than January 1, 1997, the Secretary of Agriculture shall issue interim regulations to implement— (i) the amendments made by paragraphs (1), (3), and (4) of subsection (e); and (ii) section 17(f)(3)(C) of the National School Lunch Act (42 U.S.C. 1766(f)(3)(C)). (B) Final regulations.—Not later than July 1, 1997, the Secretary of Agriculture shall issue final regulations to implement the provisions of law referred to in subparagraph (A). (l) [42 U.S.C. 1766 note] Study of Impact of Amendments on Program Participation and Family Day Care Licensing.— (1) In general.—The Secretary of Agriculture, in conjunction with the Secretary of Health and Human Services, shall study the impact of the amendments made by this section on— (A) the number of family day care homes participating in the child and adult care food program established under section 17 of the National School Lunch Act (42 U.S.C. 1766); (B) the number of day care home sponsoring organizations participating in the program; (C) the number of day care homes that are licensed, certified, registered, or approved by each State in accordance with regulations issued by the Secretary; (D) the rate of growth of the numbers referred to in subparagraphs (A) through (C); (E) the nutritional adequacy and quality of meals served in family day care homes that— (i) received reimbursement under the program prior to the amendments made by this section but do not receive reimbursement after the amendments made by this section; or (ii) received full reimbursement under the program prior to the amendments made by this section but do not receive full reimbursement after the amendments made by this section; and (F) the proportion of low-income children participating in the program prior to the amendments made by this section and the proportion of low-income children participating in the program after the amendments made by this section. (2) Required data.—Each State agency participating in the child and adult care food program under section 17 of the National School Lunch Act (42 U.S.C. 1766) shall submit to the Secretary of Agriculture data on— (A) the number of family day care homes participating in the program on June 30, 1997, and June 30, 1998; (B) the number of family day care homes licensed, certified, registered, or approved for service on June 30, 1997, and June 30, 1998; and (C) such other data as the Secretary may require to carry out this subsection. (3) Submission of report.—Not later than 2 years after the date of enactment of this section, the Secretary of Agriculture shall submit the study required under this subsection to the Committee on Economic and Educational Opportunities of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate.