Administrative Costs in the Child and Adult Care Food Program: Results of an Exploratory Study of the Reimbursement System for Sponsors of Family Child Care Homes

By Iris Pettigrew, JoAnn Kuchak, and Linda Ghelfi. ERS project representative: Joanne Guthrie

Contractor and Cooperator Report No. (CCR16) 51 pp, March 2006

Providers of child day care services operating out of their homes may be reimbursed for meals and snacks served to participating children through USDA's Child and Adult Care Food Program (CACFP). To participate, these homes must be sponsored by a public or private organization that recruits the homes, trains them to follow CACFP rules, monitors compliance with the rules, and handles meal reimbursement claims and payments. CACFP reimburses sponsors for the administrative expenses incurred in conducting these activities. In 1996, Congress instituted a meal reimbursement system to better target benefits to low-income providers and children. The system created new administrative tasks for sponsors and a need for more time to be spent on some of the tasks conducted previously. This situation has raised concerns as to the adequacy of reimbursements. The decline in the number of CACFP sponsors—a 6 percent drop between 1995 and 2001—has further added to the concern. To address the issue, this study explores the administrative cost reimbursement system for CACFP sponsors that oversee the family child care homes portion of the CACFP. Costs reported by sponsors on average were about 5 percent higher than allowable reimbursement amounts. The report also presents and discusses alternative administrative reimbursement systems used by other Federal programs.

This study was conducted by Resource Network International and ORC Macro under a research contract with the Economic Research Service. The views expressed are those of the authors and not necessarily those of ERS or USDA.

Keywords: Child and Adult Care Food Program, CACFP, tiering, food assistance programs, reimbursements, administration, monitoring, Food Assistance and Nutrition Research Program, FANRP, ERS, USDA

In this report ...

Chapters are in Adobe Acrobat PDF format.

• Abstract and Executive Summary, 82 kb
• Introduction, 39 kb
• Necessary Sponsor Functions, 39 kb
• Sponsor Characteristics, Costs, Reimbursements, and Budgets, 180 kb
• Sponsor Pretest Results, 46 kb
• Wage and Office Space Benchmarks, 121 kb
• Alternative Administrative Cost Reimbursement System Results, 68 kb
• Summary and Implications, 30 kb
• Appendix A: Sponsor Activities By Major Administrative Function, 27 kb

• Entire Document, 1,035 kb

Updated date: March 6, 2006