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Proposed Rule: Procurement Requirements for the National School Lunch, School Breakfast and Special Milk Programs

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This rule proposes to amend the regulations governing procedures related to the procurement of goods and services in the National School Lunch Program, School Breakfast Program and Special Milk Program to remedy deficiencies identified in audits and program reviews.

This proposal makes changes in three areas: the school food authority’s responsibility for proper procurement procedures and contracts; prohibitions on the school food authority’s use of nonprofit school food service account funds for costs resulting from improper procurements and contracts; and the state agency’s review and approval of school food authority procurement procedures and contracts.

The proposed rule also makes technical amendments to the Special Milk Program and School Breakfast Program regulations to make the procurement and contract requirements and consequences for failing to take corrective action in these regulations consistent with the National School Lunch Program regulations and adds the definitions of contractor and nonprofit school food service account to the National School Lunch Program, Special Milk Program and School Breakfast Program regulations.

These changes are intended to promote free and open competition in school food authority procurements, clarify state agency rights and ensure that only allowable contract costs are paid with nonprofit school food service account funds

12/30/2004