Fns-366 A&b

§ 272.2

7 CFR Ch. II (1–1–10 Edition)

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Reconciliation Act of 1996 are effective
August 19, 2002.
(167) Amendment No. 376. The provisions of Amendment No. 376 are effective May 29, 2003 and must be implemented no later than November 1, 2003.
The provisions must be implemented
for all households that newly apply for
Program benefits on or after either the
required implementation date or the
date the State agency implements the
provision prior to the required implementation date. The current change reporting caseload shall be converted to
these provisions no later than the required implementation date in accordance with procedures established by
the State agency. However, for households subject to the reporting requirements at § 273.12(a)(1)(i)(C)(1) or (2) of
this chapter, the State agency has
until January 1, 2004 to convert households to 6 month certification periods.
Monthly reporting households shall be
converted in accordance with § 273.21(r)
of this chapter. For quality control
purposes, any variances resulting from
the implementation of this rule shall
be excluded from error analysis for 120
days from the required implementation
date,
in
accordance
with
§ 275.12(d)(2)(vii) of this chapter.
(168) Amendment No. 394. The interim
and final provisions of Amendment No.
394 are effective May 11, 2005. State
agencies may implement the provisions
anytime after May 11, 2005 but no later
than October 11, 2005.
(169) Amendment No. 395. The provisions of Amendment 395 are effective
December 15, 2003.
(170) Amendment No. 396. The provisions of amendment number 396 are effective April 8, 2005.
(171) Amendment No. 397. The provisions of Amendment No. 397 are effective January 4, 2006. State agencies
may implement the provisions anytime
after the rule is published but no later
than June 5, 2006.
(172) Amendment No. 400. The provisions of Amendment No. 400, regarding
the Employment and Training Program Provisions of the Farm Security
and Rural Investment Act of 2002 are
effective August 8, 2006.
[Amdt. 132, 43 FR 47884, Oct. 17, 1978]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 272.1, see the List of CFR

Sections Affected, which appears in the
Finding Aids section of the printed volume
and on GPO Access.

§ 272.2

Plan of operation.

(a) General purpose and content—(1)
Purpose. State agencies shall periodically plan and budget program operations and establish objectives. When
planning and budgeting for program
operations for the next year, State
agencies shall consider major corrective action objectives, existing program strengths and deficiencies, and
other factors anticipated to impact on
the operation of the State’s Food
Stamp Program and on projected expenditures.
(2) Content. The basic components of
the State Plan of Operation are the
Federal/State Agreement, the Budget
Projection Statement, and the Program Activity Statement. In addition,
certain attachments to the Plan are
specified in this section and in § 272.3.
The requirements for the basic components and attachments are specified in
§ 272.2(c) and § 272.2(d) respectively. The
Federal/State Agreement is the legal
agreement between the State and the
Department
of
Agriculture.
This
Agreement is the means by which the
State elects to operate the Food Stamp
Program and to administer the program in accordance with the Food
Stamp Act of 1977, as amended, regulations issued pursuant to the Act and
the FNS-approved State Plan of Operation. The Budget Projection Statement and Program Activity Statement
provide information on the number of
actions and amounts budgeted for various functional areas such as certification and issuance. The Plan’s attachments include the Quality Control
Sample Plan, the Disaster Plan (currently reserved), the Employment and
Training Plan, the optional Nutrition
Education Plan, the optional plan for
Program informational activities directed to low-income households, the
optional plan for intercepting Unemployment Compensation (UC) benefits
for collecting claims for intentional
Program violations, the Systematic
Alien Verification for Entitlements
(SAVE) Plan, and the plan for the
State
Income
and
Eligibility
Verification System. The State agency

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Food and Nutrition Service, USDA

§ 272.2

shall either include the Workfare Plan
in its State Plan of Operation or append the Workfare Plan to the State
Plan of Operation, as appropriate, in
accordance with § 273.22(b)(3) of this
chapter. The Workfare Plan shall be
submitted separately, in accordance
with § 273.22(b)(1) of this chapter. The
ADP/CIS Plan is considered part of the
State Plan of Operation but is submitted separately as prescribed under
§ 272.2(e)(8). State agencies and/or political subdivisions selected to operate a
Simplified
Application/Standardized
Benefit Project shall include that
Project’s Work Plan in the State Plan
of Operation. The Plan’s attachments
shall also include the Mail Issuance
Loss Reporting Level Plan.
(b) Federal/State Agreement. (1) The
wording of the pre-printed Federal/
State Agreement is as follows:
The State of lll and the Food and Nutrition Service (FNS), U.S. Department of Agriculture (USDA), hereby agree to act in accordance with the provisions of the Food
Stamp Act of 1977, as amended, implementing regulations and the FNS-approved
State Plan of Operation. The State and FNS
(USDA) further agree to fully comply with
any changes in Federal law and regulations.
This agreement may be modified with the
mutual written consent of both parties.

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PROVISIONS
The State agrees to: 1. Administer the program in accordance with the provisions contained in the Food Stamp Act of 1977, as
amended, and in the manner prescribed by
regulations issued pursuant to the Act; and
to implement the FNS-approved State Plan
of Operation.
2. Comply with Title VI of the Civil Rights
Act of 1964 (Pub. L. 88–352), section 11(c) of
the Food Stamp Act of 1977, as amended, the
Age Discrimination Act of 1975 (Pub. L. 94–
135) and the Rehabilitation Act of 1973 (Pub.
L. 93–112, sec. 504) and all requirements imposed by the regulations issued pursuant to
these Acts by the Department of Agriculture
to the effect that, no person in the United
States shall, on the grounds of sex, race,
color, age, political belief, religion, handicap, or national origin, be excluded from participation in, be denied the benefits of, or be
otherwise subject to discrimination under
the Food Stamp Program.
3. (For States with Indian Reservations
only). Implement the Program in a manner
that is responsive to the special needs of
American Indians on reservations and consult in good faith with tribal organizations
about that portion of the State’s Plan of Op-

eration pertaining to the implementation of
the Program for members of the tribe on reservations.
FNS agrees to: 1. Pay administrative costs
in accordance with the Food Stamp Act, implementing regulations, and an approved
Cost Allocation Plan.
2. Carry-out any other responsibilities delegated by the Secretary in the Food Stamp
Act of 1977, as amended.
Date lllllllllllllllllllll
Signature llllllllllllllllll
(Governor or Authorized Designee)
Date lllllllllllllllllllll
Signature llllllllllllllllll
(Regional Administrator, FNS)

(2) The State agency may propose alternative language to any or all the
provisions listed in paragraph (b)(1) of
this section. The alternative language
is subject to approval by both parties
before signature.
(c) Budget Projection Statement and
Program Activity Statement. (1) The
State agency shall submit to FNS for
approval a Budget Projection Statement and Program Activity Statement
in accordance with the submittal dates
in § 272.2(e).
(i) The Budget Projection Statement
solicits projections of the total costs
for major areas of program operations.
The Budget Projection Statement shall
be submitted annually and updated as
necessary through the year. The Budget Projection Statement shall contain
projections for each quarter of the next
Federal fiscal year. The State agency
shall submit with the Budget Projection Statement a narrative justification documenting and explaining the
assumptions used to arrive at the projections. The narrative shall cover such
subjects as: The number and salary
level of employees; other factors affecting personnel costs including anticipated increases in pay rates or benefits, and reallocations of staff among
units or functions, insofar as these
might result in cost increases or decreases; costs for purchasing, leasing,
and maintaining equipment and space,
especially as concerns any upcoming,
one-time-only purchases of new capital
assets such as ADP equipment, renegotiation of leases, changes in depreciation rates or procedures, relocation of
offices, maintenance and renovation
work, and inflation; issuance system
costs,
including
renegotiation
of

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§ 272.2

7 CFR Ch. II (1–1–10 Edition)

issuing agent fees and plans to change
issuance systems; changes in caseload
and factors contributing to increases
or decreases in the number of participants; recertifications, including the
anticipated impact of economic conditions (and in particular unemployment) and seasonality; cost implications of corrective action plans; anticipated changes in program regulations
and operating guidelines and instructions; training needs; travel costs; and
adjustments in insurance premiums.
The narrative should cover as many of
the items listed above, and any other
items deemed relevant by the State
agency, that will have a significant impact on costs. The State agency is not
required to discuss every item in the
list in every submission of a Budget
Projection Statement. The narrative
should concentrate on items that account for increases or decreases in
costs from the preceding submissions.
(ii) The Program Activity Statement,
to be submitted annually, solicits a
summary of program activity for the
State agency’s operations during the
preceding fiscal year.
(2) The organizational outline submitted in 1982 as an attachment to the
Program Activity Statement shall be
considered the basic outline. Henceforth, changes to this outline shall be
provided to FNS as they occur. The
outline contains the following information:
(i) The position of the head of the
State agency responsible for administering the Food Stamp Program in
relation to the overall State organizational structure, i.e., the Program Director in relation to the Commissioner
of Welfare;
(ii) A description of the organizational structure through which the
State agency will administer and operate the Food Stamp Program, including whether the Program is State,
county, locally, or regionally-administered; whether the workers have single
Food Stamp Program or multi-program
functions; and the title and position of
the individual or panel designated as
the hearing authority and whether officials conduct both fair and fraud hearings.
(iii) A description of the funding arrangement by which State, county, and

local jurisdictions will contribute to
the State agency portion of administrative costs;
(iv) The position within the State organizational structure of the Performance Reporting System (PRS) coordinator, including whether the PRS coordinator is full or part-time, and is responsible for direct supervision over
Quality Control or Management Evaluation or if these functions are handled
separately, and whether quality control reviewers have single Food Stamp
Program or multi-program review responsibilities;
(v) The position of the training coordinator and whether this is a full or
part-time position; and
(vi) The organizational entity responsible for corrective action.
(3) Additional attachments. Attached
for informational purposes (not subject
to approval as part of the plan submission procedures) to the Program Activity Statement and submitted as required in paragraph (e)(3) of this section shall be the agreements between
the State agency and the United States
Postal Service for coupon issuance, and
between the State agency and the Social Security Administration for supplemental income/food stamp joint application processing and for routine
user status.
(d) Planning documents. (1) The following planning documents shall be
submitted:
(i) Quality Control Sampling Plan as
required by § 275.11(a)(4);
(ii) Disaster Plan as required by
§ 280.6 (currently reserved), or certification that a previously submitted Disaster Plan has been reviewed and remains current;
(iii) Nutrition Education Plan if the
State agency elects to request Federal
Food Stamp Program administrative
matching funds to conduct nutrition
education programs as discussed in
paragraph (d)(2) of this section.
(iv) A plan for the State Income and
Eligibility Verification System required by § 272.8.
(v) Employment and Training Plan as
required in § 273.7 (c)(6).
(vi) ADP/CIS Plan as required by
§ 272.10.

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Food and Nutrition Service, USDA

§ 272.2

(vii) A plan for the Systematic Alien
Verification for Entitlements (SAVE)
Program as required by § 272.11(e).
(viii) Mail Issuance Loss Reporting
Level Plan required by § 276.2(b)(4), for
the State agency using mail issuance,
shall contain the unit level of reporting mail issuance losses for the upcoming fiscal year as elected by the State
agency. If a State agency does not revise its Plan by August 15 in any given
year, FNS shall continue to require reporting and to assess liabilities for the
next fiscal year at the level last indicated by the State agency. If the agency has selected the unit provided for in
§ 276.2(b)(4)(ii), a listing of the issuance
sites or counties comprising each administrative unit within the State
agency shall also be included in the
Plan.
(ix) A plan for Program informational activities as specified in
§ 272.5(c).
(x) A plan for intercepting UC benefits for collecting claims for intentional program violations as specified
in § 272.12 if the State agency elects to
use that procedure.
(xi)–(xii) [Reserved]
(xiii) If the State agency chooses to
implement the optional provisions
specified in (273.11(k), (l), (o), (p), and
(q) of this chapter, it must include in
the Plan’s attachment the options it
selected, the guidelines it will use, and
any good cause criteria under paragraph (o). For § 273.11(k) of this chapter, the State agency must identify
which sanctions in the other programs
this provision applies to. The State
agency must also include in the plan a
description of the safeguards it will use
to restrict the use of information it
collects in implementing the optional
provision contained in § 273.11(p) of this
chapter.
(xiv) The State agency’s disqualification
plan,
in
accordance
with
§ 273.7(f)(3) of this chapter.
(xv) If the State agency chooses to
implement the provisions for a work
supplementation or support program,
the work supplementation or support
program plan, in accordance with
§ 273.7(l)(1) of this chapter.
(2) Nutrition Education Plan. If submitted, the Nutrition Education Plan
shall contain:

(i) The number and positions of staff
that will be conducting nutrition education;
(ii) Description of activities in the
nutrition education program; and
(iii) Assurance that nutrition education programs for which USDA provides Food Stamp Program administrative matching funds are conducted exclusively for the benefit of Food Stamp
Program applicants and participants
and do not duplicate USDA’s Expanded
Food and Nutrition Education Program’s efforts in the State.
(e) Submittal requirements. States
shall submit to the appropriate FNS
Regional Office for approval each of
the components of the Plan of Operation for approval within the timeframes established by this paragraph.
Approval or denial of the document
may be withheld pending review by
FNS. However, if FNS fails to either
approve, deny, or request additional information within 30 days, the document is approved. If additional information is requested, the State agency
shall provide this as soon as possible,
and FNS shall approve or deny the
Plan within 30 days after receiving the
information.
(1) The Federal/State agreement
shall be signed by the Governor of the
State or authorized designee and shall
be submitted to FNS within 120 days
after publication of these regulations
in final form and shall remain in effect
until terminated.
(2) The Budget Projection Statement
and Program Activity Statement shall
be signed by the head of the State
agency or its chief financial officer and
submitted as follows:
(i) The Budget Projection Statement
shall be submitted annually, no later
than August 15 of each year.
(ii) The Program Activity Statement
shall be submitted annually, not later
than 45 days after the end of the State
agency’s fiscal year. The first report is
due 45 days after the end of the State’s
1981 fiscal year. The first report is not
required to contain information that is
not currently captured by the State
agency’s information system. State
agencies shall amend their data gathering systems so that all items can be
completed on the second report, due for
the 1982 fiscal year.

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§ 272.2

7 CFR Ch. II (1–1–10 Edition)

(3) Changes to the organizational
outline required by § 272.2(c)(2) and the
agreements with other agencies outlined in § 272.2(c)(3)(ii) shall be provided
to FNS as changes occur. The attachments outlined in § 272.2(c)(3)(i) shall be
submitted annually with the Program
Activity Statement.
(4) The Quality Control Sampling
Plan shall be signed by the head of the
State agency and submitted to FNS
prior to implementation as follows:
(i) According to the timeframes specified in paragraph (e)(4)(ii) of this section, prior to each annual review period each State agency shall submit
any changes in their sampling plan for
FNS approval or submit a statement
that there are no such changes. These
submittals shall include the statement
required by § 275.11(a)(2), if appropriate.
The Quality Control Sampling Plan in
effect for each State agency as of the
beginning of Fiscal Year 1984 shall be
considered submitted and approved for
purposes of this section, provided that
the State agency has obtained prior
FNS approval of its sampling plan.
(ii) Initial submissions of and major
changes to sampling plans and changes
in sampling plans resulting from general changes in procedure shall be submitted to FNS for approval at least 60
days prior to implementation. Minor
changes to approved sampling plans
shall be submitted at least 30 days
prior to implementation.
(5) Disaster Plan. [Reserved]
(6) The Nutrition Education Plan
shall be signed by the head of the State
agency and submitted prior to funding
of nutrition education activities when
the State agency elects to request Federal administrative matching funds to
conduct Nutrition Education Programs. The plan shall then be submitted annually no later than August
15. The initial submission may be for a
period of less than or more than a year
in order to meet the August 15 deadline.
(7) Where applicable, State agencies
shall consult (on an ongoing basis)
with the tribal organization of an Indian reservation about those portions
of the State Plan of Operation pertaining to the special needs of the
members of the tribe.

(8) ADP/CIS Plan. The ADP/CIS Plan
shall be signed by the head of the State
agency and submitted to FNS by October 1, 1987. State agencies which require additional time to complete their
ADP/CIS plan may submit their plan in
two phases as described in § 272.10(a)(2),
with the first part of the plan being
submitted October 1, 1987. State agencies requiring additional time shall
submit the second part of their plans
by January 1, 1988. If FNS requests additional information to be provided in
the State agency ADP/CIS Plan or if
FNS requests that changes be made in
the State agency ADP/CIS Plan, State
agencies must comply with FNS comments and submit an approvable ADP/
CIS Plan within 60 days of their receipt
of the FNS comments but in no event
later than March 1, 1988. Requirements
for the ADP/CIS plan are specified in
§ 272.10.
(9) The Employment and Training
Plan shall be submitted as specified
under § 273.7(c)(8).
(f) Revisions. Revisions to any of the
planning documents or the Program
and Budget Summary Statement shall
be prepared and submitted for approval
to the appropriate FNS Regional Office
in the same manner as the original
document. However, revisions to the
budget portion of the Budget Projection Statement and Program Activity
Statement shall be submitted as follows:
(1) Program funds. (i) For program
funds, State agencies shall request
prior approvals promptly from FNS for
budget revisions whenever:
(A) The revision indicates the need
for additional Federal funding;
(B) The program budget exceeds
$100,000, and the cumulative amount of
transfers among program functions exceeds or is expected to exceed five percent of the program budget. The same
criteria apply to the cumulative
amount of transfers among functions
and activities when budgeted separately for program funds provided to a
subagency, except that FNS shall permit no transfer which would cause any
Federal appropriation, or part thereof,
to be used for purposes other than
those intended;

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Food and Nutrition Service, USDA

§ 272.3

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(C) The revisions involve the transfer
of amounts budgeted for indirect costs
to absorb increases in direct costs; or
(D) The revisions pertain to the addition of items requiring prior approval
by FNS in accordance with the provisions of the applicable cost principles
specified in part 277 appendix A of the
regulations.
(ii) No other changes to the Program
fund budget require approval from
FNS. Examples of changes which do
not require Federal approval are: The
use of State agency funds to accomplish program objectives over and
above the State agency minimum share
included in the approved Program
budget; and the transfer of amounts
budgeted for direct costs to absorb authorized increases in indirect costs.
(iii) The requirements of paragraph
(f)(1)(i)(B) of this section may be
waived by FNS provided that:
(A) No different limitation or approval requirement may be imposed;
and,
(B) FNS shall not permit a transfer
which would cause any Federal appropriation, or part, thereof, to be used for
purpose other than those intended.
(2) Authorized funds exceeding State
agency needs. When it becomes apparent that the funds authorized by the
Letter of Credit will exceed the needs
of the State agency, FNS will make appropriate adjustments in the Letter of
Credit in accordance with part 277.
(3) Method of requesting approvals.
When requesting approval for budget
revisions, State agencies shall use the
same format as the Budget Projection
Statement used in the previous submission. However, State agencies may request by letter the approvals required
by paragraph (f)(1)(i)(D) of this section.
(4) Notification of approval or disapproval. Within 30 days from the date
of receipt of the request for budget revisions, FNS shall review the request
and notify the State agency whether or
not the budget revisions have been approved. If the revision is still under
consideration at the end of 30 days,
FNS shall inform the State agency in
writing as to when the decision will be
made.
[Amdt. 156, 46 FR 6315, Jan. 21, 1981]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 272.2, see the List of CFR

Sections Affected, which appears in the
Finding Aids section of the printed volume
and on GPO Access.

§ 272.3 Operating
forms.

guidelines

(a) Coverage of operating guidelines.
State agencies shall prepare and provide to staff responsible for administering the Program written operating
procedures. In those States which have
State regulations that outline these
Operating Procedures, these are equivalent to Operating Guidelines. Other
examples of Operating Guidelines are
manuals, instructions, directives or
transmittal memos. The following categories shall be included in the Operating Guidelines:
(1) Certification of households, including but not limited to:
(i) Application processing;
(ii) Nonfinancial eligibility standards;
(iii) Financial criteria and the eligibility determination;
(iv) Actions resulting from eligibility
determinations;
(v) Determining eligibility of special
situation households as specified in
§ 273.11;
(vi) Additional certification functions such as processing changes during certification periods and reporting
requirements for households;
(vii) Lost benefits/claims against
households;
(viii) Fair/fraud hearings;
(ix) A list of Federal and State energy assistance programs that qualify
for the resource and income exclusions
discussed
in
§§ 273.8(e)(14)
and
273.9(c)(11) and how these payments are
identified as being eligible for the exemption;
(x) Work registration and employment and training requirements.
(2) Issuance, accountability, and reconciliation;
(3) The Performance Reporting System, including instructions or directives for conducting quality control
and management evaluation reviews
and the quality control sample plan;
(4) A description of the training program, including a listing of the organizational component which conducts
training, to whom and how often training is provided;

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