Budgeting for the Child and Adult Care Food Program (CACFP) is crucial for ensuring financial integrity and efficient operation. This comprehensive guide outlines the key aspects of CACFP budgeting, based on the USDA’s guidance, and provides essential information for institutions participating in the program.

Understanding CACFP Budgeting

The CACFP is a federally funded program that reimburses institutions for providing nutritious meals to eligible children and adults. Effective budgeting is necessary to manage the funds received and ensure compliance with federal regulations.

Key Components of CACFP Budgeting

1. Allowable Costs

• Direct Costs: Expenses directly related to the operation of the program, such as food purchases, kitchen equipment, and labor costs.
• Indirect Costs: Shared costs that support the program, like administrative salaries and facility maintenance. Institutions must have an approved indirect cost plan.
• Allocable Costs: Costs that can be attributed to the CACFP portion of the institution’s overall expenses.

2. Unallowable Costs

• Costs that cannot be charged to the program include entertainment, fines, penalties, and costs that are not necessary for the CACFP’s operation.

3. Operating and Administrative Costs

• Operating Costs: These include the direct expenses of serving meals, such as food and labor.
• Administrative Costs: Expenses for managing the program, including salaries of administrative staff, office supplies, and training.

4. Income and Funds Management

• Institutions must accurately track income received from CACFP reimbursements and other sources. Proper fund management ensures that the program’s financial operations are transparent and accountable.

Steps in Budget Development and Approval

1. Developing the Budget

• Institutions must prepare a detailed budget outlining projected costs and expected income. This budget should reflect the institution’s operational plan and compliance with CACFP guidelines.

2. Evaluating the Budget

• State agencies review the submitted budgets to ensure they are reasonable, allowable, and necessary for the operation of the program.

3. Approving or Denying the Budget

• After evaluation, the budget is either approved or returned with feedback for revisions. Institutions must address any concerns and resubmit their budget for final approval.

4. Revising or Amending the Budget

• Institutions may need to revise their budgets during the year to reflect changes in operations or funding. Any amendments must be approved by the state agency.

Fiscal Record Review

Institutions must maintain accurate financial records to document compliance with CACFP requirements. Regular audits and reviews by state agencies help ensure that funds are used appropriately and that institutions adhere to federal guidelines.

Conclusion

Effective budgeting is vital for the successful management of the CACFP. By understanding and adhering to the guidelines for allowable costs, managing income and expenses, and maintaining transparent records, institutions can ensure they provide nutritious meals to participants while complying with federal regulations. Implementing robust financial practices will help maintain the integrity and sustainability of the CACFP.

Reference: Handbook