Food for Your Business

The Importance of the Child and Adult Care Food Program

What federal program fits the following description?

  • “A quality improvement resource for providers” (National Association for Family Child Care position paper, "Best Practices for Family Child Care Union Organizing")
  • “An important way to augment the quality of programs serving low-income children” (Midwest Child Care Research Consortium study)
  • “One of the major factors associated with quality care" (Families and Work Institute study)
  • “Gives children "nutritionally superior" meals as compared to children not on the program” (U.S. Department of Agriculture report)
  • Pays a provider up to $983 per year per child

Of course we are talking about the Child and Adult Care Food Program, which was started in 1968 and is administrated by the US Department of Agriculture. Approximately 150,000 family child care providers participate in this program and serve nutritional meals to about 900,000 children each day.

The Food Program is a major key to good children's nutrition, makes child care more affordable to low income parents, significantly improves the after-tax income of providers, assists in preparing children to enter school ready to learn, and helps working families work.

So why are only about 50% of licensed family child care providers participating on the Food Program?

Here are three possible reasons:

  1. "If I join the Food Program I'll pay more in taxes." 

    True. But you will pay these higher taxes out of the reimbursements received from the Food Program and have money left over. For every $1,000 you get from the Food Program you will keep about $600 - $700 after taxes. Therefore, you are always better off financially by participating in the Food Program. Providers who join the Food Program can continue to deduct their food expenses in exactly the same way as before. In other words, providers on the Food Program can still deduct the cost of the food served to the children for whom they are now receiving reimbursements. The only difference between a provider not on the Food Program and one who is on the program is that one on the Food Program has more money in her pocket at the end of the year. See, The Tax Consequences of Food Program Participation.
  2. "The Food Program is not worth it because of the all the paperwork."

    This is false. Participating in the Food Program does mean spending some extra time filling out paperwork. The real question is whether you are being paid a reasonable amount to do this extra work. Let's look at an example. If you cared for four children, served one breakfast, one lunch, and one snack per child per day, and spent an average of three hours a week on the Food Program paperwork, how much would you be earning per hour for this work? If you received the lower Tier II reimbursement rate from the Food Program, you would be earning $12.13 per hour and $25.00 per hour if you received the higher Tier I rate. Can you think of any other job that will pay you this much and still allow you to care for children?
  3. "I don't like outside people coming into my home and telling me what to do."

    Understandable, but there are many benefits for being on the Food Program that you should consider before making a decision not to participate. In addition to the significant financial benefits to you, being on the Food Program will give you reassurance that you are serving nutritious food that will improve the health of the children in your care. The Food Program offers training that will help you with planning meals and recipes as well as offering support and access to other resources that will help you teach children about healthy eating habits and food safety. Yes, representatives from the Food Program will visit your home several times a year to monitor the meals you are serving and to answer your questions, but the benefits to you and the children should outweigh most providers' concerns.

There are other reasons why providers don't participate on the Food Program. Some providers have the parents bring all meals to their program, and other providers feel that the nutritional guidelines of the program are too narrow. Although there may be some good reasons why a few providers don't participate, the vast majority of providers would be much better off on the Food Program. When you join the Food Program, you will make more money (after taxes), you are fairly compensated for the extra work you must do, and the children in your care will get nutritious food.

All regulated providers are eligible to participate in the Food Program (some states now allow license-exempt providers to participate). Those on the Food Program receive a monthly reimbursement for serving up to three nutritious meals and snacks each day. The reimbursement rates from July 1, 2014 through June 30,2015 for the higher Tier I are: $1.31 breakfast, $2.47 lunch/snack, and $0.73 snack. The reimbursement rates for the lower Tier II are: $0.48 breakfast, $1.49 lunch/snack, and $0.20 snack. (All of these rates are higher in Alaska and Hawaii; see Child and Adult Care Food Program for details.) You may receive the higher Tier I rate if your family is low income, you live in a low-income area, or you serve low-income children. To find out if you qualify for the Tier I rate, contact your local Food Program sponsor.

I strongly recommend that all providers join the Food Program and remain on it as long as they are in business. Being on the Food Program is a sign of professionalism and it shows your concern for the nutritional health of children. It's a benchmark of quality that benefits you and the children in your care.

How Do I Join the Food Program? 

There are local Food Program sponsors in every state that will be happy to sign you up. In some parts of the country there are several sponsors serving the same geographic area, so you may have to choose between different sponsors. All sponsors must follow the same federal guidelines and pay you the same amount. Some sponsors may offer additional services that you should ask about. To find out the names of the sponsor or sponsors in your area, contact your local Child Care Resource and Referral agency. If you don't know how to reach this agency, visit http://www.naccrra.net to find the list of agencies in your state.

If you have questions about the Food Program, contact Tom Copeland at tcopeland@nafcc.org / 801-886-2322 (ex 321)

Photo Credit: Facethia Hogue

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