This memorandum provides guidance to state distributing agencies and recipient agencies on the use of market basket analysis in procuring processed end products for USDA Foods in Schools and commercial goods for the National School Lunch Program, School Breakfast Program, Summer Food Service Program, and Child and Adult Care Food Program. 

The purpose of this audit guidance policy memorandum is to clarify the options available to state distributing agencies or recipient agencies in assigning value to USDA donated foods for audit purposes.

FD-119 provides clarification for the option to combine the solicitation of procurement of end products and commercial food products. Some school food authorities  may solicit bids for procurement of end products in their solicitation for procurement of commercial food products from commercial distributors, rather than conducting two separate solicitations. 

Effective Oct.1, 2008, institutions receiving funds through the child nutrition programs may apply an optional geographic preference in the procurement of unprocessed locally grown or locally raised agricultural products.

The purpose of this policy memorandum is to provide guidance in ensuring compliance with requirements in Subpart D of 7 CFR Part 250 with respect to crediting for, and use of donated foods in contracts with food service management companies (FSMCs).

The attached memorandum is Food Distribution Policy Memo FD-110, which clarifies requirements in crediting for, and use of, USDA donated foods in contracts with food service management companies, and provides guidance to ensure compliance with such requirements in the first and final years of such contracts.

This general USDA Foods guidance memorandum provides instructions on how to reconcile the physical inventory conducted at a distributing agency- or subdistributing agency-level storage facility with the book inventory required to be maintained for that facility.