This report responds to the legislative requirement of PL 110-246 to assess the effectiveness of state and local efforts to directly certify children for free school meals. Under direct certification, children are determined eligible for free school meals without the need for household applications by using data from other means-tested programs.

The Improper Payments Information Act of 2002 requires all federal agencies to calculate the amount of erroneous payments in federal programs and to periodically conduct detailed assessments of vulnerable program components. 

The Improper Payments Information Act of 2002 requires all federal agencies to calculate the amount of erroneous payments in federal programs and to periodically conduct detailed assessments of vulnerable program components. This is the fourth wave of a program assessment of the family day care homes in the Department of Agriculture's CACFP.

This is the fourth in a series of annual reports that examines administrative error incurred during the local educational agency’s approval process of applications for free and reduced-price meals in the National School Lunch Program. 

Program errors and the risk of erroneous payments in the National School Lunch Program (NSLP) and School Breakfast Program (SBP) continue to be a concern. Slightly more than one in five students were certified inaccurately or erroneously denied benefits in school year (SY) 2005-06. New data estimates the gross cost of school meals erroneous payments due to certification error at about $935 million while other operational errors represent about $860 million. 

This is the second in a series of annual reports assessing administrative errors associated with school food authorities’ approval of applications for free and reduced-price school meals. In school year 2005/06, more than 96 percent of students who were approved for meal benefits on the basis of an application were receiving the correct level of meal benefits, based on the information in the application

files. 

In 1991 and 1998, FNS conducted national studies of WIC vendors to determine the extent of vendor violation of program rules. After the 1998 study, FNS issued regulations to correct vendor practices. The 2005 study replicates the 1998 study to determine whether the regulations were effective, and to measure the frequency of vendor violations and the degree to which vendors charge accurate prices for WIC transactions.

From July to September 2002, FNS reviewed the free and reduced price eligibility determination process (i.e., application, verification, reapplication, meal ticket status) for each of 3,474 applications selected for verification in 14 large school food authorities in the 2001-02 school year. These SFAs enroll nearly one million children, among whom 45 percent were approved for free meals and 7 percent were approved for reduced price meals as of Oct. 31, 2001.

Food stamps are intended for food. When individuals sell their benefits for cash it violates the spirit and intent of the Food Stamp Program as well as the law. This practice, known as trafficking, diverts food stamp benefits away from their purpose. It reduces intended nutritional assistance and undermines public perceptions of the integrity and utility of the program. To combat trafficking, the Food and Nutrition Service conducts undercover investigations of authorized food stores. In addition, the agency has developed powerful new EBT-based administrative tools to identify and sanction traffickers.

FNS published “The WIC Vendor Management Study, 1998” in July 2001 which examined, in part, the extent to which retail grocers, defined as WIC “vendors” were violating program rules and regulations. The 1998 study is a follow-up to the “WIC Vendor Issues Study, 1991” published by FNS in May 1993.