to such commodities. If the commodities are declared unfit for human consumption in accordance with §250.13(f) of this chapter, they shall be disposed of as provided for under that section. When out-of-condition commodities do not create a hazard to other food at the same location, they shall not be disposed of until FNSRO or the responsible commodity contractor approves. When circumstances require prior disposal of a commodity, the quantity and manner of disposition shall be reported to the appropriate FNSRO. If any damaged or out-of-condition commodities are inadvertently issued to a household and are rejected or returned by the household because the commodities were unsound at the time of issuance and not because the household failed to provide proper storage, care or handling, the State agency shall replace the damaged or out-of-condition commodities with the same or similar kind of commodities which are sound and in good condition. The State agency shall account for such replacements on its monthly inventory report. (Approved by the Office of Management and Budget under control number 0584-0071) (44 U.S.C. 3506) [44 FR 35928, June 19, 1979, as amended at 47 FR 746, Jan. 7, 1982. Redesignated by Amdt. 1, 47 FR 14137, Apr. 2, 1982, and further redesignatedat 64 FR 73384, Dec. 30, 1999.] § 253.11 Administrative funds for State agencies. (a) Payments. Within the limitation of funds available to carry out the provisions of this part, FNS shall, beginning with fiscal year 1980, make available to each State agency 75 percent of approved administrative costs. Any approval for payment of funds in excess of 75 percent shall be based on compelling justification that such additional amounts are necessary for the effective operation of the Food Distribution Program on an Indian reservation. Compelling justification may include, but not be limited to, such factors as the need for a larger Federal contribution during a State agency's first year of operation of the program, and the need to assure that no State agency currently operating the program receives a level of funding that would cause a diminution of program services. Ad ministrative costs must be included in annual or revised budget information submitted by the State agency to FNS for approval prior to the contribution of Federal funds. Administrative costs must be allowable under part 277 of this chapter. (b) Use of funds by State agencies. Any funds received under this section shall be used for any costs which are allowable under part 277 of this chapter and which are incurred in operating the Food Distribution Program for households on a reservation. The value of services rendered by volunteers, part 277 notwithstanding, shall be allowable to meet the matching administrative costs requirements for the Food Distribution Program. In no event shall such funds be used to pay any portion of such expenses if reimbursement or payment therefor is claimed or made available from any other Federal source. State agencies shall also adhere to the provisions of part 277 of this chapter, as apply to the Food Distribution Program, which establish: (1) Uniform requirements for the adminstration of funds to State agencies; and (2) Principles for determining costs applicable to activities assisted by the Food Stamp Program funds provided to State agencies. The provisions of part 277 are generally adaptable to this section and the appropriate provisions shall be used in complying with paragraphs (b) and (f) of this section. (c) Application for funds. (1) Any State agency administering a Food Distribution Program that desires to receive administrative funds under this section shall submit form SF-424, "Application for Federal Assistance," to the appropriate FNS Regional Office at least three months prior to the beginning of a Federal fiscal year. The application shall include budget information, reflecting by category of expenditure the State agency's best estimate of the total amount to be expended in the administration of the program during the fiscal year. FNS may require that detailed information be submitted by the State agency to support or explain the total estimated amounts shown for each budget cost category. As required by 7 CFR part 3015, Subpart V, agencies of State government shall submit the application for Federal assistance to the State clearinghouse before submitting it to the FNSRO. ITOS shall not be subject to this requirement. (2) Approval of the application by FNS shall be a prerequisite to the payment of any funds to State agencies. (d) Availability of funds. (1) FNS shall review and evaluate the budget information submitted by the State agency in relationship to the State agency's plan of operation and any other factors which may be relevant to FNS' determination as to whether the estimated expenditures itemized by budget category are reasonable and justified. FNS shall give written notification to the State agency of (i) its approval or disapproval of any or all of the itemized expenditures, (ii) the amount of funds which will be made available, and (iii) the period for which funds are available. (2) FNS shall review and evaluate applications submitted by State agencies for administrative funds available under this section in the following order of priority and shall give preference in making payments of funds under this section in the same order of priority: (i) Applications from State agencies which desire to continue a Food Distribution Program now in operation, (ii) Applications from State agencies, in the order received, which FNS determines are immediately capable of effectively and efficiently administering the Program, and (iii) Applications from other States agencies, in the order received. bursing Office (RDO). The Standard (3) The advance by Treasury check (4) Any State agency receiving payi ment under the Letter of Credit meth od or the advance by Treasury chei method shall have in place and in oper ation, a financial management syste which meets the standards for fun: control and accountability prescribe in part 277 of this chapter, as amended The State agency shall demonstrate c a continuing basis its willingness and ability to have and to function wit procedures that will minimize the tim lapse between the transfer of funds a its disbursement to meet obligation For any State agency which does meet the requirement of this par graph, the reimbursement by Treasury check method shall be the preferred method for FNS to make payments | that State agency. (f) Accounting for funds. Each Sta agency which receives administrati funds under this section shall establis and maintain an effective system fiscal control and accounting pro dures. Expenditures and accountabil of such funds shall be in accorda with the appropriate provisions of pr 277. The accounting procedures ma tained by the State agency shall such as to accurately reflect the ceipt, expenditure and current balan of funds provided by FNS and to fac tate the prompt preparation of repor required by FNS. The accounting p Icedures shall also provide for segret tion of costs specifically identifiable the Food Distribution Program free any other costs incurred by the Sta agency. Any budget revisions by State agency which require the tra fer of funds from an approved cost ca egory to another shall be in accordan with the budget revision procedures (e) Method of payment to State agencies. (1) Payments are made to State agencies through a Letter of Credit or an advance by Treasury check. The Letter of Credit funding method shall be used by FNS except when the advances to be made within a 12 month period are estimated to be less than $120,000. However, FNS may, at its option, reimburse a State agency by Treasury check regardless of the amount in response to a valid claim submitted by the State agency. (2) The Letter of Credit funding method shall be done in conjunction with Treasury Department procedures, Treasury Circular No. 1075 and through an appropriate Treasury Regional Dis 534 a RC forth in OMB Circular No. A-102, Attachment K, and shall be approved by FNS prior to any transfer of funds. 270 (g) Return, reduction, and reallocation of funds. (1) FNS may require State agencies to return prior to the end of the fiscal year any or all unobligated funds received under this section, and may reduce the amount it has apportioned or agreed to pay to any State agency if FNS determines that: (1) The State agency is not administering the Food Distribution Program in accordance with its plan of operation approved by FNS and the provisions of this part, or (ii) The amount of funds which the State agency requested from FNS is in excess of actual need, based on reports ip of expenditures and current projections of Program needs. (iii) Circumstances or conditions jusratify the return reallocation or transfer chof funds to accomplish the purpose of this part. its (2) The State agency shall return to FNS within 90 days following the close of each Federal fiscal year any funds received under this section which are unobligated at that time. (h) Records, reports, audits. (1) The State agency shall: (i) Keep such accounts and records as may be necessary to enable FNS to determine whether there has been compliance with this section, and (ii) Adhere to the retention and custodial requirements for records set forth in §277.4 of this chapter. (2) The State agency receiving funds either through a Treasury RDO Letter of Credit system or Treasury check shall submit quarterly reports to FNS on Form SF-269, "Financial Status Report," by the 30th day after close of the reporting quarter and shall submit such other reports as may be required by FNS. (3) The appropriate provisions of part 277 are adaptable to this section for additional guidance. (Approved by the Office of Management and [44 FR 35928, June 19. 1979, as amended at 47 (a) Exercises governmental jurisdiction means the exercise of authorities granted to ITOS under the Oklahoma Indian Welfare Act of 1936 or by BIA regulations (25 CFR part 81 et. seq.). (b) FNS service area means the areas over which FNS has approved the food distribution program in Oklahoma, excluding urban places unless approved by FNS under 254.5(b). (c) Food Distribution Program means a food distribution program for households on Indian reservations administered pursuant to section 4(b) of the Food Stamp Act and 1304(a) of Pub. L. 97-98. (d) Indian tribal household means a household in which at least one household member is recognized as a tribal member by any Indian tribe, as defined in § 253.2(d) of this title. (e) Indian tribal organization (ITO) means (1) any Indian tribe, band, or group organized under the Oklahoma Indian Welfare Act of 1936, and which has a tribal organization approved by the Bureau of Indian Affairs; (2) a tribal organization established and approved under Federal regulations issued by the Bureau of Indian Affairs; or (3) an intertribal council authorized by eligible tribes to act in behalf of the tribes to operate the program. (f) Overissuance means the dollar value of commodities issued to a household that exceeds the dollar value of commodities it was eligible to receive. (g) State agency means the ITO of an Indian tribe, determined by the Department to be capable of effectively administering a Food Distribution Program, or an agency of State government, which enters into an agreement with FNS for the distribution of commodities on an Indian reservation. (h) Urban place means a town or city with a population of 10,000 or more. [49 FR 32756, Aug. 16, 1984, as amended at 59 FR 1449, Jan. 11, 1994; 64 FR 73385, Dec. 30, 1999] § 254.3 Administration by an ITO. (a) Applicability of part 253. All of the provisions of part 253 are herein incorporated and apply to part 254, except as specifically modified by part 254. (b) Section 253.4 Administration, does not apply and is replaced by §254.3. (c) Federal administration. Within the Department of Agriculture, the Food and Nutrition Service (FNS), shall be responsible for the Food Distribution Program. FNS shall have the power to determine the amount of any claim and to settle and adjust any claim against an ITO. (d) ITO administration. The ITO, acting as State agency, shall be responsible for the Food Distribution Program within the approved FNS service areas if FNS determines the ITO capable of effective and efficient administration. (e) Qualification as an ITO. The ITO of a tribe in Oklahoma must document to the satisfaction of FNS that the ITO meets the definition of an ITO in § 254.2, is organized under the provisions of the Oklahoma Indian Welfare Act of 1936 or has a tribal organization established and approved under BIA regulations. (The information collection requirements contained in paragraph (e) were approved by the Office of Management and Budget under control number 0584-0316) § 254.4 Application by an ITO. (a) Application to FNS Regional Office. An ITO which desires to participate in the Food Distribution Program shall file an application with the FNS Regional Office. The application shall also provide other information requested by FNS, including but not limited to, the tribe's qualification as a reservation as described in §254.2, paragraph (f). Properly addressed applications shall be acknowledged by the FNS Regional Office in writing within five working days of receipt. FNS shall promptly advise ITOS of the need for additional information if an incomplete application is received. (b) Tribal capability. (1) In determining whether the ITO is potentially capable of effectively and efficiently administering a Food Distribution Program in an FNS Service area, allowing for fulfillment of that potential through training and technical assistance, FNS shall consult with other sources such as the BIA, and shall consider the ITO experience, if any, in operating other government programs, as well as its management and fiscal capabilities. Other factors for evaluation include, but are not limited to, the ITO's ability to: (i) Order and properly store commodities, (ii) Certify eligible households, (iii) Arrange for physical issuance of commodities, (iv) Keep appropriate records and submit required reports, (v) Budget and account for administrative funds, (vi) Determine the food preferences of households, and (vii) Conduct on-site reviews of certification and distribution procedures and practices. (2) FNS shall make a determination of potential ITO capability within 60 days of receipt of a completed application for the Food Distribution Program. FNS may, however, extend the period for determination of ITO capability if FNS finds that a given ITO's eligibility under §254.3 is difficult to establish. (3) FNS shall, if requested by an ITO which has been determined by FNS to be potentially capable of administering a Food Distribution Program, provide the ITO's designees with appropriate training and technical assistance to prepare the ITO to take over program administration. In determining what training and technical assistance are necessary, FNS shall consult with the ITO and other sources, such as the BIA. (c) Most capable tribe. In cases where two or more applicant tribe(s) have overlapping boundaries, FNS shall select the tribe most capable of administering a FDP within that service area. (The information collection requirements contained in paragaph (a) were approved by the Office of Management and Budget under control number 0584-0316) § 254.5 Household eligibility. (a) Certification procedures. All applicant households shall be certified in accordance with the eligibility and cer tification provisions in §253.6 and § 253.7. (b) Urban places. No household living in an urban place in Oklahoma shall be eligible for the Food Distribution Program on Indian Reservations. However, an ITO can request the Department to grant individual exemptions from this limitation upon proper justification submitted by the ITO as determined by FNS. (c) Eligible households. Only Indian tribal households, as defined in §254.2, may be eligible for the Food Distribution Program in FNS service areas. (The information collection requirements contained in paragraph (a) were approved by the Office of Management and Budget under control number 0584-0316) [49 FR 32756, Aug. 16, 1984, as amended at 64 FR 1098, Jan. 8, 1999] |