Farm Bill E&T Implementing Memo
June 21, 2002
Subject: Implementing Information and Instructions:
Food Stamp Employment and Training Provisions of the Farm Security and
Rural Investment Act of 2002
To: Regional Administrators All Regions
On May 13, 2002, President Bush signed into law the "Farm Bill,"
the Farm Security and Rural Investment Act of 2002 (Pub. L 107–171).
Title IV of the Farm Bill, the Food Stamp Reauthorization Act of 2002,
includes Section 4121, Employment and Training Program, which was effective
upon enactment. Section 4121 immediately and significantly impacts the
Food Stamp Employment and Training (E&T) Program funding provisions
of the Food Stamp Act of 1977 (7 U.S.C. §2025) (the Act). This memorandum
contains additional information and implementing instructions that must
be transmitted to State agencies as soon as possible.
Farm Bill Provisions
Section 4121 of the Farm Bill reauthorizes the E&T Program through
fiscal year (FY) 2007 and sets the basic amount of unmatched Federal funding
at $90 million a year for FY 2002–FY 2007. Section 4121 also:
- provides for an additional amount—up to $20 million—to
reimburse State agencies that guarantee to serve all their at-risk able–bodied
adults without dependents (ABAWDs) in the last month of their 3 month
- eliminates the additional $75 million authorized under the Balanced
Budget Act of 1997;
- rescinds carryover funds not obligated by State agencies before May
- eliminates the use of funds requirement, the maintenance of effort
requirement (MOE), and slot rates; and
- removes the $25 cap on participant reimbursements for transportation
and other expenses necessary for participation in E&T.
Implementing Information and Instructions
- The 80 percent use of funds (80/20) requirement is eliminated, effective
May 13, 2002. State agencies may now spend their 100 percent Federal
E&T funds without earmarking at least 80 percent to serve ABAWDs.
- The MOE requirement is eliminated. Since the Farm Bill removed the
Balanced Budget Act portion of each State agency’s E&T grant,
State agencies have access to their entire grants and are no longer
required to expend a specified amount of State funds.
- The maximum reimbursement rates for offering and filling qualifying
education/training and workfare opportunities for Able Bodies Adults
Without Dependents (ABAWDs) (slot rates) are eliminated, retroactive
to October 1, 2001.
- We have available $145 million in unspent carryover funding from FY
2001 that will be used to reimburse State agency 100 percent E&T
administrative expenditures and obligations incurred before May 13,
2002. For purposes of determining actual rescission amounts, State agencies
must use the definition of "obligation" that they have established
and used in the past. Using the available $145 million in unspent carryover
permits us to retain as much of the $90 million Farm Bill allocation
as possible for carryover into FY 2003. This will provide a significant
reserve of 100percent funding for use in FY 2003 and beyond.
- For the FY 2002 grants, we used the same formula used since FY 1998
to allocate the $90 million. Each affected State agency’s share
of the allocation is reduced proportionally to ensure that every State
agency receives a minimum $50,000 E&T grant, as required by section
16(h)(1)(D) of the Act. The attached chart contains a breakdown of the
revised $90 million FY 2002 E&T allocation.
- In addition to the basic $90 million a year, the Farm Bill authorizes
the Secretary to allocate up to $20 million a year to reimburse State
agencies for services to ABAWDs. To qualify for a share of this additional
funding, a State agency must make and comply with a commitment to offer
a position in a qualifying education/training or workfare program to
all ABAWD applicants and recipients in the last month of their 3 months
of food stamp eligibility who do not qualify for an exception, a waiver,
or an exemption from the time limit. In FY 2002 seventeen State agencies
guaranteed to serve at–risk ABAWDs. If, in light of Farm Bill
changes, these State agencies plan to discontinue the guarantee for
the balance of FY 2002 please notify us as quickly as possible. If other
State agencies plan to operate under the guarantee in FY 2003, they
should begin now to incorporate the guarantee in their FY 2003 State
- To ensure that the 80 percent use of funds requirement was met by
State agencies prior to enactment of the Farm Bill on May 13, 2002,
a close–out FNS–583, E&T Program Activity Report, is
required. State agencies are to submit their third quarter FNS–583
reports as usual. However, items 9A, 9B, 10A, 10B, 11, and 12 must reflect
participation and expenditure data through May 12, 2002, only. Data
from May 13, through June 30, 2002, should be included on the fourth
quarter FNS–583 report. We realize this task is a difficult one,
but the report is essential. State agencies should use their best estimates
when completing the close–out FNS–583 and maintain sufficient
records to substantiate their numbers.
- While State agencies are not required to submit an additional SF–269
Report to satisfy Farm Bill requirements, they are required to report
cumulative 100 percent E&T obligations from October 1,2001, through
May 12, 2002, separately in their third quarter FY 2002 SF–269
Report. The main body of the report is to be completed inclusive of
the full quarter, and the outlays and unliquidated obligations reported
through May 12, 2002, are to be recorded in the "Remarks"
section. States may arrive at the reported obligations through any reasonable
means. However, their methodology will be subject to Food Nutrition
Service or single audit review.
We understand that the amounts included in the third quarter SF–269
Report is an initial reporting of pre–Farm Bill obligations and
we anticipate revisions to those figures. State agencies should continue
to include the revisions in the "Remarks" section of the fourth
quarter FY 2002 and subsequent submissions. States agencies must be
made aware that, while the prior year funds are no longer available
for obligation against current expenses, they do remain available for
upward adjustments of prior year obligations and for legitimate, previously
unacknowledged obligations occurring from October 1, 2001 through May
12, 2002. All obligations reported for that period remain subject to
the use of funds requirement. Headquarters Food Stamp Program (FSP)
review and approval requirements after the 2 year regulatory period
will remain in place for upward adjustments of prior year claims.
For the immediate future, there will be three separate "IPAS"
accounts for 100 percent E&T funds. The first account will contain
all funds originating in appropriation years prior to FY 2002. These
funds will be available only for obligations occurring at the State
level before May 13, 2002. The second account will contain all funds
originating during the balance of FY 2002 after May 13, 2002, and all
subsequent fiscal years, exclusive of the $20 million in E&T incentive
funds authorized in the Farm Bill. This will be an "X account"
and will be available for post–Farm Bill program operating expenses.
The third account will contain the $20 million of 1–year money
provided in the Farm Bill for States that commit to serve all of their
at–risk ABAWD population.
Each of these accounts will be subject to close–out requirements.
Financial Management Accounting Division, in conjunction with the FSP,
will develop and transmit specific guidance on the close–out process
by September 30, 2002.
- As of May 13, 2002, expenditures of State funds for transportation
and other participant expenses—excluding dependent care—will
be reimbursed from Federal funds at the 50 percent rate.
If you have any questions, contact Micheal Atwell at 703–305–2449.
/S/ Thomas O'Connor, for
Acting Deputy Administrator
Food Stamp Program
Attachment (Revised FY 2002 E&T
cc: Program Directors, FSP, all Regions
Financial Management Directors, all Regions
Administrator, Financial Management
Director, Budget Division
Director, Accounting Division
Director, Grants Management