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Office of P-20 Education Policy
Child Nutrition Program Administration
89 Washington Avenue, Room 375 EBA, Albany, NY 12234
Phone: (518) 473-8781 Fax: (518) 473-0018

School Business Officials School Food Service Directors/Managers Food Service Management Companies
Frances N. O'Donnell, Coordinator
Sunday, April 3, 2011
SFA Responsibilities when Contracting with a Food Service Management Company

When contracting with a Food Service Management Company (FSMC), a school food authority (SFA) has several fiduciary responsibilities that must periodically take place during the term of the contract to ensure the fiscal integrity of its child nutrition programs, for example: administrative oversight, monitoring, reviewing invoices and record keeping.

It is imperative that the SFA understands and accepts the responsibilities of the contract which it has signed. The SFA will be held responsible for areas of monitoring and subsequent fiscal action found during a Coordinated Review Effort (CRE) review since the New York State Education Department agreement to administer the programs is with the SFA. The SFA will be responsible and must recoup all of the improperly paid federal and State funds from the FSMC for certain program violations related to menu planning, meal service, etc.

Administrative oversight includes, but is not limited to the SFA reviewing and auditing monthly operating statements and invoices, which must adhere to the selected format described in the contract between the SFA and the FSMC. Invoices must list all products purchased and the accompanying dollar amounts of rebates, discounts and credits. All reported expenditures must be allocable, allowable costs that are incurred solely for the SFA’s on-site operations, not corporate or administrative costs. These allowable direct costs must be supported by source documentation (i.e., food and supply invoices, payroll records, benefits/taxes, insurance, permits) and maintained by the SFA.

Payment to the FSMC is limited to the extent of annual program income which is defined as monies generated by sales of meals to children, accrued State and federal reimbursement, and student and adult a la carte sales, less the annual guaranteed return to the district, if applicable. The FSMC cannot be paid during July and August when the SFA is not participating in a Summer Food Service Program, or not claiming reimbursement for the School Breakfast Program or the National School Lunch Program. If employees work for 10 months (e.g. September – June) their health benefits need to be pro-rated for the 10 months they are actually working. The SFA is only required to pay the FSMC the direct costs incurred per meal, which may be below the contractual per meal bid price for the month. State and federal reimbursement funds can only be held in the School Food Service account, hence SFA monthly overpayment to the FSMC cannot occur.

Questions regarding Contracting with School Food Service Management Companies should be directed to Jamie McMillian or Linda St. Pierre  (518) 473-8781.


USDA Nondiscrimination Statement

In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, sex, disability, age, or reprisal or retaliation for prior civil rights activity in any program or activity conducted or funded by USDA. 

Persons with disabilities who require alternative means of communication for program information (e.g. Braille, large print, audiotape, American Sign Language, etc.), should contact the Agency (State or local) where they applied for benefits. Individuals who are deaf, hard of hearing or have speech disabilities may contact USDA through the Federal Relay Service at (800) 877-8339.  Additionally, program information may be made available in languages other than English.

To file a program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, (AD-3027) found online at:, and at any USDA office, or write a letter addressed to USDA and provide in the letter all of the information requested in the form. To request a copy of the complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by:

(1)     mail: U.S. Department of Agriculture
         Office of the Assistant Secretary for Civil Rights
         1400 Independence Avenue, SW
         Washington, D.C. 20250-9410;

(2)     fax: (202) 690-7442; or

(3)     email:

This institution is an equal opportunity provider.


For Nondiscrimination Statement translations, click here.

Los demás programas de asistencia nutricional del FNS, las agencias estatales y locales, y sus beneficiarios secundarios, deben publicar el siguiente Aviso de No Discriminación:

De conformidad con la Ley Federal de Derechos Civiles y los reglamentos y políticas de derechos civiles del Departamento de Agricultura de los EE. UU. (USDA, por sus siglas en ingles), se prohíbe que el USDA, sus agencias, oficinas, empleados e instituciones que participan o administran programas del USDA discriminen sobre la base de raza, color, nacionalidad, sexo, discapacidad, edad, o en represalia o venganza por actividades previas de derechos civiles en algún programa o actividad realizados o financiados por el USDA.

Las personas con discapacidades que necesiten medios alternativos para la comunicación de la información del programa (por ejemplo, sistema Braille, letras grandes, cintas de audio, lenguaje de seas americano, etc.), deben ponerse en contacto con la agencia (estatal o local) en la que solicitaron los beneficios. Las personas sordas, con dificultades de audición o discapacidades del habla pueden comunicarse con el USDA por medio del Federal Relay Service [Servicio Federal de Retransmisión] al (800) 877-8339. Además, la información del programa se puede proporcionar en otros idiomas.

Para presentar una denuncia de discriminación, complete el Formulario de Denuncia de Discriminación del Programa del USDA, (AD-3027) que está disponible en linea en: y en cualquier oficina del USDA, o bien escriba una carta dirigida al USDA e incluya en la carta toda la información solicitada en el formulario. Para solicitar una copia del formulario de denuncia, llame al (866) 632-9992. Haga llegar su formulario lleno o carta al USDA por:

(1)     correo: U.S. Department of Agriculture
         Office of the Assistant Secretary for Civil Rights
         1400 Independence Avenue, SW
         Washington, D.C. 20250-9410;

(2)     fax: (202) 690-7442; o

(3)     correo electró

Esta institución es un proveedor que ofrece igualdad de oportunidades.