Requirement for Independent Board of Directors

This management bulletin (MB) provides clarification to Child and Adult Care Food Program (CACFP) agencies regarding the U.S. Department of Agriculture (USDA) requirement for an independent governing board of directors (Board). As defined in Title 7, Code of Federal Regulations, Section 226.2, a governing board meets regularly and has the authority to hire and fire the agency's executive director. Nonprofit agencies are required to establish a functioning Board in order to participate in the CACFP. For-profit agencies and public schools that participate in the CACFP are exempt from this requirement.

The USDA Guidance for Management Plans and Budgets CACFP Handbook (CACFP Handbook), issued in December 2013, provides additional information for establishing an independent governing Board. The CACFP Handbook describes Board responsibilities as follows:

The Board of Directors is responsible for setting policy, fiscal guidance, and ongoing governance. It regularly reviews the organization’s policies, programs, budgets and operations. Decisions are documented in Board minutes which are maintained and available for review.

In addition, the Board should have a screening system to identify any criminal confiscations of Board members and sponsoring organization responsible principals/individuals (RP/I) which would disqualify them from the Program.

Board members must recuse themselves from voting on decisions relating to their own compensation and that of immediate family members and financially related parties.

Note: California Corporations Code, Section 5213 (a), states that Board members may hold more than one office on the Board, unless the articles of incorporation or bylaws provide otherwise; however, no member who is serving as the secretary, the treasurer, or the chief financial officer may concurrently serve as the president or chair of the Board.

Developing an Appropriate Board of Directors

An acceptable Board consists of a majority of members whose livelihood is independent from and who hold no personal financial interest in the agency’s activities, and who are not related to each other or agency personnel. Board members with a personal financial interest in the agency or its activities, or with relatives on the Board or within the agency, may not have the ability to make objective decisions based solely on what is best for the agency.

In order to determine if an agency has an acceptable Board, the California Department of Social Services (CDSS) may inquire with the agency as to whether the Board members have fiscal ties to the agency or are family members. If, however, the agency’s response is not consistent with other information concerning the Board’s membership, the CDSS may request additional clarification.

For more information about the requirements for an independent governing board of directors, please visit the USDA Food and Nutrition Service CACFP Handbooks web page and select Guidance for Management Plans and Budgets.

Questions

If you have any questions regarding this subject, please contact your county’s CACFP specialist. A list of CACFP specialists is available on the Child and Adult Food Care Program Contact List or in the Download Forms section of the Child Nutrition Information and Payment System as Form ID CACFP 01. You can also contact the CACFP Office Technician by email at CACFPinfo@dss.ca.gov to be directed to your specialist.

This institution is an equal opportunity provider.
Esta institución es un proveedor que ofrece igualdad de oportunidades.