A1492

An Act concerning the procurement of local food products by school districts, supplementing Title 4 of the Revised Statutes, and making an appropriation.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. As used in this act:

“Baseline levels” or “baselines” means the baseline levels identified by a school district pursuant to paragraph (5) of subsection c. of section 2 of this act.

“Department” means the Department of Agriculture.

“Eligible costs” means the actual, documented costs, which are reimbursable with program grant funds, as provided by subsection f. of section 2 of this act, and which are expended by an eligible school district, by a participating partner school, or by a school food authority operating in the district, in order to implement or undertake the expanded or modified local food procurement policies, practices, standards, processes, systems, or activities described in the district’s proposed local food procurement plan, submitted pursuant to paragraph (5) of subsection c. of section 2 of this act.

“Eligible school district” or “eligible district” means a school district in which all participating partner schools provide subsidized school meals to students who are eligible therefor, and which school district timely submits an attestation form, pursuant to subsection c. of section 2 of this act and in accordance with any relevant attestation deadlines established by the secretary for the program year, as necessary to obtain a pro rata share of reimbursement grant funding annually appropriated, deposited into the Farm to School Local Food Procurement Reimbursement Fund, and dedicated for program purposes.

“Expanded or modified local food procurement policies, standards, processes, systems, or activities” means those policies, standards, processes, systems, or activities, described in an attestation form submitted pursuant to subsection c. of section 2 of this act, which are being newly implemented or undertaken, in an eligible school district or in partner schools therein, specifically in order to increase, above current levels, the total number or type of local foods being procured for students in the district, the meal periods during which such local foods are served to students in the district, or the total number or type of students in the district who are being provided with access to such local foods, during either the school year or the summer months, or both.

“Federal School Breakfast Program” means the same as that term is defined in section 1 of P.L.2022, c.104 (C.18A:33-3.2).

“Ineligible costs” means any costs that do not constitute eligible costs for the purposes of the Farm to School Local Food Procurement Reimbursement Grant Program, including, but not limited to, any costs incurred, by a school or school district, in the sourcing or purchasing of fluid dairy milk, or in association with the district’s ordinary, unexpanded sourcing and procurement of local food products at or below the baseline levels identified in the attestation form submitted pursuant to subsection c. of section 2 of this act.

“Local food” or “local food product” means any raw, whole, or minimally processed fruit, vegetable, herb, meat, seafood, legume, or grain that is 100 percent grown, raised, or caught in the State or in State waters, regardless of the where the distributor of such food is located. “Local food” or “local food product” includes New Jersey canned tomatoes, but does not include fluid dairy milk.

“Local Food for Schools Cooperative Agreement Program” means the federal program, established and administered by the Agricultural Management Service in the United States Department of Agriculture, pursuant to which the Agricultural Management Service is authorized to enter into cooperative agreements, with individual states, in order to provide such states with federal financial assistance, as necessary to enable the procurement thereby of local and regional foods from small businesses, from local and regional farmers and food producers, and from socially disadvantaged farmers and food producers, and the distribution thereby of such local and regional foods, to students at partner schools, as part of the State’s school meal programs.

“Local food procurement partners” means all participating partner schools and school food authorities which: are operating within the boundaries of an eligible school district; are participating in or are benefiting from the implementation of the district’s proposed local food procurement plan; and are entitled to receive a district-authorized and apportioned share of program grant funding awarded to the district in any program year, in order to reimburse the eligible costs being expended by such schools and school food authorities in association with their effectuation or undertaking of new, expanded, or modified local food procurement policies, practices, standards, processes, systems, or activities, consistent with the district’s proposed local food procurement plan.

“Minimally processed” means that a local food product is in its raw or whole state, or has been cut, chopped, sliced, butchered, dried, or frozen, but has not been cooked, heated, canned, or been subject to supplementation with any additives or fillers.

“National School Lunch Program” means the same as that term is defined in section 1 of P.L.2022, c.104 (C.18A:33-3.2).

“Participating partner school” or “partner school” means a school that is identified, by a school district, in an attestation form submitted pursuant to subsection c. of section 2 of this act, and which has agreed to participate in the expanded or modified local food procurement policies, standards, processes, systems, or activities being implemented or undertaken in the district with the use of grant funds awarded under the Farm to School Local Food Procurement Reimbursement Grant Program.

“Program” means the Farm to School Local Food Procurement Reimbursement Grant Program established pursuant to section 2 of this act.

“Program year” means each State fiscal year, commencing on July 1 of each calendar year following the date of enactment of this act, for which moneys appropriated, pursuant to sections 4, 6, or 7 of this act, and deposited into the Farm to School Local Food Procurement Reimbursement Fund, are available for distribution and use by the department, for dedicated program purposes.

“Proposed local food procurement plan” means a plan developed by a school district and submitted to the department, pursuant to paragraph (5) of subsection c. of section 2 of this act, which describes the new, expanded, or modified local food procurement policies, practices, standards, processes, systems, or activities that are proposed to be implemented or undertaken by the district, and by its local food procurement partners, with the assistance of reimbursement grant funding awarded to the district in and for the program year.

“School breakfast program” means the same as that term is defined in section 1 of P.L.2022, c.104 (C.18A:33-3.2).

“School food authority” or “SFA” means the entity that is responsible for providing, or for contracting with appropriate food service management companies or other third-party food service vendors to provide, school meal services to students at one or more participating partner schools in the State, pursuant to, and for the purposes of, the State’s school meal programs.

“School lunch program” means the same as that term is defined in section 1 of P.L.2022, c.104 (C.18A:33-3.2).

“Secretary” means the Secretary of Agriculture.

“Small or mid-sized family farm” means a farm that is categorized, by the United States Department of Agriculture Economic Research Service, as a small family farm having an annual gross cash farm income of less than $350,000, or as a mid-sized family farm having an annual gross cash farm income of not less than $350,000, and not more than $999,999.

“Socially disadvantaged farmer” means a person who is trained to engage in agricultural or horticultural activities and is a member of a socially disadvantaged group.

“Socially disadvantaged group” means a population group whose members have been subjected to prejudice or discrimination on the basis of race, color, national origin, age, disability, or, where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, or participation in any public assistance program, because of their membership in the group or the shared characteristics of the group, and without regard to their individual qualities.

“Subsidized school meals” or “subsidized meals” means school lunch or breakfast, or both, the cost of which is partially or fully subsidized by the State or federal government pursuant to the National School Lunch Program, the federal School Breakfast Program, and the associated provisions of P.L.1974, c.53 (C.18A:33-4 et seq.), P.L.2003, c.4 (C.18A:33-9 et seq.); P.L.2019, c.445 (C.18A:33-21.1), and P.L.2022, c.104 (C.18A:33-3.2 et al.).

“Subsidized student” means the same as that term is defined in section 1 of P.L.2022, c.104 (C.18A:33-3.2).

“Summer Food Service Program” means the federal reimbursement program, established under 42 U.S.C. s.1761 and 7 C.F.R. Part 225, pursuant to which the United States Department of Agriculture is authorized to provide grants-in-aid and other assistance to the states, as may be necessary to help schools, local government agencies, nonprofit organizations, colleges and universities, and summer camps finance the administrative and operational costs of providing meals to children, in low-income areas, during the summer months and other planned periods of school closure.

2. a. The Secretary of Agriculture shall establish and operate a Farm to School Local Food Procurement Reimbursement Grant Program, in accordance with the provisions of this act and within the limits of moneys appropriated therefor pursuant to subsection a. of section 4, and sections 6 and 7, of this act. The purpose and goals of the grant program shall be to provide sufficient and proportional reimbursement financing, to eligible school districts in the State, in order to encourage and enable such districts to initiate, expand, or otherwise modify the local food procurement policies, practices, standards, processes, systems, and activities being employed thereby or undertaken therein, at their own pace, and to whatever extent that such policies, practices standards, processes, systems, and activities are capable of being so initiated, expanded, or modified, as may be necessary to effectuate an increase or expansion in the types or amounts of local foods being procured for students, the meal periods during which local foods are served to students, or the total number or types of students being provided with access to local foods, for the purposes of the National School Lunch Program, the federal School Breakfast Program, the Summer Food Service Program, and any other school meals programs operated during the school year or the summer months, or both.

b. The secretary shall be authorized to annually award a program grant, to each eligible school district that submits an attestation form, pursuant to subsection c. of this section, in accordance with the following minimum and maximum annual funding allowances:

(1) a small school district, which has less than 5,000 students enrolled at partner schools, shall be eligible to receive an annual program grant of not less than $10,000 and not more than $50,000;

(2) a medium-sized school district, which has not less than 5,000 and not more than 10,000 students enrolled at partner schools, shall be eligible to receive an annual program grant of not less than $20,000 and not more than $125,000; and

(3) a large school district, which has 10,000 or more students enrolled at partner schools, shall be eligible to receive an annual program grant of not less than $44,000 and not more than $250,000.

c. A school district that wishes to obtain a reimbursement grant award under the Farm to School Local Food Procurement Reimbursement Grant Program, for use in any program year, shall submit, in a manner and by a deadline prescribed by the secretary, a program participation attestation form that includes, at a minimum:

(1) a statement certifying the total number of partner schoolsin the districtwhich will be participating in, or directly benefitting from, the local food sourcing and procurement activitiesbeing undertaken therein with program grant funding;

(2) based on the number of students enrolled at all partner schools in the district, as identified pursuant to paragraph (1) of this subsection, a statement certifying the district’s status as a small district, a medium-sized district, or a large district, for the purposes of funding determinations being made pursuant to this section, and identifying the total amount of program grant funding being sought by the district, within the appropriate minimum and maximum funding range established, pursuant to subsection b. of this section, for similarly sized districts;

(3) a statement certifying, and briefly describing, the purposes for which the awarded program grant funds will be used by the district, and by its local food procurement partners, in the upcoming program year;

(4) a statement certifying whether, and to what extent, the district is seeking the department’s discretionary authorization, pursuant to paragraph (2) of subsection f. of this section, in order to enable a portion of the district’s program grant award to be used for technical assistance expense purposes in the upcoming program year, and specifying the proportion of the total requested program funding award, by percentage and dollar amount, which is being sought for such discretionary purposes;

(5) a certified copy of the district’s proposed local food procurement plan, as well as a brief summary describing the district’s current baseline local food sourcing activities and approximate local food budget, if any, and identifying the extent to which farmers have provided local foods to the district’s students during the immediately preceding school year; and

(6) any other information or attachments required by the secretary.

d. (1) Moneys appropriated, deposited in the Farm to School Local Food Procurement Reimbursement Fund, and dedicated for program use in each program year, in accordance with the provisions of this act, shall be proportionally allocated and awarded, to and among all eligible school districts, on an equitable, pro rata basis. The proportional amount of reimbursement grant funding to be awarded to each eligible school district, in each program year, shall be determined by the department, in accordance with a funding formula developed pursuant to subsection e. of this section, and shall be sufficient to reimburse all, or a portion of, the district’s eligible costs at a rate that is proportional to the reimbursement rate applied by the department, in the same program year, to other, similarly sized and situated school districts.

(2) Reimbursement grant funding awarded in each program year, pursuant to this act, shall be distributed directly , and on an installment basis in accordance with section 3 of this act, to each eligible school district, and each such recipient school district shall be authorized to use and to further allocate and disburse the distributed funds, as appropriate and necessary to reimburse the eligible costs expended, during the program year, by the district, and by its local food procurement partners, in association with the implementation of the district’s proposed local food procurement plan.

e. The funding formula developed, for the purposes of subsection d. of this section, shall be designed to:

(1) facilitate the apportionment and allocation, to and among all eligible school districts, of equitable, pro rata shares of funding appropriated, deposited in the Farm to School Local Food Procurement Reimbursement Fund, and available for program purposes in each program year, based upon, and taking into consideration: (a) the size of each district, and the number of participating partner schools therein; (b) the number and percentage of students enrolled at partner schools, in each district, who are eligible for subsidized school meals; (c) whether, and the extent to which, each eligible school district, and participating partner schools therein, are located in a food desert area; (d) whether, and the extent to which, awarded program grant funding is expected to be used by each district, and by the district’s local food procurement partners, in order to facilitate, encourage, or mandate the sourcing and procurement of local food products produced by small or mid-sized family farms or socially disadvantaged farmers in the State; and (e) whether, and how many times, each eligible school district has previously received, and has fully expended, reimbursement grant funding awarded in prior program years; and

(2) provide for proportionally adjusted pro rata shares of available program funding to be allocated, in each program year, to those eligible school districts that: (a) have a high number or percentage of subsidized students enrolled at partner schools and will use awarded grant funds, in full or in part, to increase subsidized students’ access to local foods; (b) are located, or have one or more partner schools located, in a food desert area; (c) will use, or will encourage or require their local food procurement partners to use awarded grant funds to facilitate or mandate the increased sourcing and procurement of local foods produced by small or mid-sized family farms or socially disadvantaged farmers in the State; or (d) were recipients of a program grant award in one or more prior program years, the full amount of which has been exhausted, in compliance with all applicable program requirements , for the reimbursement of eligible costs expended in the relevant program year.

f. (1) Except as otherwise provided by paragraph (2) of this subsection, of the program grant funds annually awarded to an eligible school district, pursuant to this section, 100 percent shall be used to reimburse the costs expended by the district, and by the district’s local food procurement partners, during the program year, in sourcing and procuring the increased types or amounts of local foods that are needed to implement the new, expanded, or modified local food procurement policies, practices, standards, processes, systems, and activities described in the district’s proposed local food procurement plan.

(2) Notwithstanding the provisions of paragraph (1) of this subsection to the contrary, the department, acting on a discretionary and individual case basis, may authorize up to 20 percent of the grant funds annually awarded to an eligible school district, pursuant to this section, to be used for reimbursement of the costs that are expended , during the program year, by the district and the district’s local food procurement partners, for technical assistance expenditures that are deemed, in department’s discretion, to be necessary to facilitate the effective implementation of the new, expanded, or modified local food procurement policies, practices, standards, processes, systems, and activities described in the district’s proposed local food procurement plan; provided, however, that the use of program grant funds for such technical assistance expenditures, and the percentage and dollar amount of the total program grant funding award which is to be made available to a district, for such purposes, shall be authorized and determined, in the department’s discretion, only in a case where the school district has included, in the attestation form submitted pursuant to subsection c. of this section, for the relevant program year, a statement certifying the need for such technical assistance funding and identifying, by percentage and dollar amount, the proportion of the total grant funding award being requested for discretionary allocation and use for such purposes.

g. Grant moneys awarded pursuant to the Farm to School Local Food Procurement Reimbursement Grant Program shall not be used to reimburse any ineligible costs, and shall not be used to reimburse any eligible costs that are already being paid for or reimbursed with other State or federal funds. In any case where another State or federal agency or program is providing funding for eligible costs expended by the district, or by its local food procurement partners, in association with the implementation of the district’s proposed local food procurement plan or any of the new, expanded, or modified local food procurement policies, practices, standards, processes, systems, or activities described therein, the total eligible costs that are reimbursable under the Farm to School Local Food Procurement Reimbursement Grant Program shall be reduced by the amount of the other State or federal contributions.

h. (1) A school district receiving a program grant award, pursuant to this section, shall be required to prepare and submit , on a monthly, quarterly, or other periodic installment basis throughout the program year, as specified by department rule or regulation, an invoice and accounting statement documenting the eligible costs expended by the district, and by its local food procurement partners, during the relevant accounting period.

(2) The periodic invoice and accounting statements required, pursuant to this subsection, shall be submitted in a form and manner, and at a frequency and by the deadlines, prescribed by secretary, and shall include:

(a) the name and address of, or other contact information for, each farm or other local food producer that supplied local food products to the school district , or to its local food procurement partners, during the relevant accounting period;

(b) appropriate receipts, photos, or other documentation verifying the expenditures invoiced, in the statement, for the relevant accounting period;

(c) a brief explanation setting forth the basis upon which such invoiced expenditures should be deemed to constitute eligible costs for the purposes of program reimbursement; and

(d) any other relevant information required by the secretary.

i. Reimbursement payments authorized pursuant to this section shall be requested by grant award recipients, and issued by the department, using a reliable and efficient automated system that is specifically designed, or is otherwise capable of being used, for program-related expense invoicing and tracking purposes. The commissioner shall be authorized either to develop and implement a new automated system or to modify and utilize an existing automated system, as necessary to facilitate the submission of reimbursement claims and the issuance of reimbursement payments under the program, in accordance with the requirements of this section.

3. a. Reimbursement grant funds awarded to an eligible school district, under the program, shall not be disbursed to the recipient district in a single, lump-sum payment, but shall be disbursed to the school district on a rolling, term-limited, monthly, quarterly, or other periodic installment basis, as specified by department rule or regulation, over the course of a single program year and using a draw-down process that provides for reimbursement checks to be issued within 120 days after the district submits a periodic invoice and accounting statement for the relevant accounting period, as required by subsection h. of section 2 of this act. Each installment payment authorized and issued, pursuant to this section, shall be sufficient in amount, within the limits of funding annually allocated to the district in its program grant award, to reimburse the eligible costs documented in the district’s most recent periodic invoice and accounting statement.

b. Reimbursement grant funds disbursed to a school district, pursuant to this section, may be further apportioned, allocated, and distributed, by the recipient district, to and among the district’s local food procurement partners, in order to reimburse the eligible costs expended thereby during the relevant accounting period, as documented in the district’s most recent invoice and accounting statement.

c. Except as otherwise provided by subsection e. of this section:

(1) any program grant funds that are awarded to a school district, but which remain unclaimed by the district at the end of the annual disbursement period established pursuant to subsection a. of this section, shall be reclaimed by the secretary, at that time, and redeposited into the Farm to School Local Food Procurement Reimbursement Fund for the fund’s dedicated purposes; and

(2) any program grant funds that are disbursed, to an eligible school district, through a periodic installment payment authorized in any program year pursuant to subsection a. of this section, but which are not used, allocated, or distributed, by the school district, for the reimbursement of eligible costs identified in its associated invoice and accounting statement, shall, at the end of such program year, be reclaimed by the secretary and redeposited into the Farm to School Local Food Procurement Reimbursement Fund for the fund’s dedicated purposes.

d. Nothing in this section, or in any other provision of law, rule, or regulation, shall be deemed to prohibit an eligible school district that receives a program grant in one year from applying for another program grant in any subsequent program year.

e. (1) Any eligible school district that receives a program grant award shall be prohibited from engaging in the roll-over of the awarded grant funds, from one program year to the next, except as may be otherwise expressly authorized by the department pursuant to paragraph (2) of this subsection.

(2) Whenever a school district receives a program grant award and is unable to use all of the awarded grant funds in a single program year, due to a hardship beyond the district’s control, including, but not limited to, a natural disaster, or a significant transition or turnover in the financial management or staffing of the food service authorities, providers, or vendors that facilitate local food sourcing or procurement services in the district, the secretary may, upon application by the school district, authorize any remaining grant fund balance to be rolled-over and used by the district, for the same purposes, in the next program year, subject to the same rolling disbursement requirements established by subsection a. of this section. Any school district applying for roll-over funding, pursuant to this subsection, shall submit documentation sufficient to establish, to the secretary’s satisfaction, that the district’s failure to expend the full amount of the grant award, during the program year in which the awarded grant funds were disbursed pursuant to subsection a. of this section, is the result of a reasonable, valid, and unexpected hardship outside the district’s control.

4. a. The department and Legislature shall take appropriate action, to the greatest extent practicable, to facilitate the uninterrupted, seamless, and continuous operation of the Farm to School Local Food Procurement Reimbursement Grant Program, and the annual appropriation and availability of dedicated funding sufficient for the program’s purposes, from one program year to the next. To that end, and following the expenditure of funds initially appropriated for program purposes, pursuant to sections 6 and 7 of this act:

(1) the department shall include, in each annual budget request submitted to the Legislature, a request for the appropriation of funds in an amount, not exceeding $4,500,000, which is deemed by the department to be sufficient to support and continue program operations and facilitate the achievement of program goals and the proportional financing of individual program grant awards, in the next upcoming program year; and

(2) the Legislature shall annually appropriate, from the General Fund to the Department of Agriculture, for deposit into the Farm to School Local Food Procurement Reimbursement Fund, for the dedicated purposes set forth in subsection c. of section 5 of this act, a sum of moneys, not in excess of $4,500,000, which sum is consistent with the sum requested in the department’s annual program appropriations request, submitted pursuant to paragraph (1) of this subsection, and is sufficient to enable the department to continue operating the program and financing the issuance of proportional reimbursement grant awards to all eligible school districts thereunder, in the upcoming program year, in accordance with the provisions of this act and the rules and regulations adopted pursuant thereto.

b. In, and for the purposes of, each annual appropriations request submitted pursuant to paragraph (1) of subsection a. of this section, the department shall identify:

(1) the total amount of moneys previously appropriated to the department and deposited into the Farm to School Local Food Procurement Reimbursement Fund, for the program’s purposes, in each preceding program year and cumulatively, over the program’s lifetime;

(2) the total amount of moneys previously deposited in the fund which remain unexpended and available for appropriation and use in an upcoming program year;

(3) the estimated number, and the proposed minimum, maximum, mean, and average dollar amounts, of individual program grant awards that are expected to be financed with newly appropriated funds in the upcoming program year;

(4) the total amount of federal funding received, in the preceding year, and the total amount of federal funding expected to be received, in the upcoming year, pursuant to the Local Food for Schools Cooperative Agreement Program or any other similar federal program or law, for the purposes of facilitating the State’s procurement of local or regional foods for use by participating partner schools; and

(5) any other data or information required by department rule or regulation.

c. The department shall, to the greatest extent practicable:

(1) maximize the receipt and use of federal funds that are made available to the State, under the Local Food for Schools Cooperative Agreement Program or other, similar federal programs or laws, for the purposes of procuring local or regional food products under the Farm to School Local Food Procurement Reimbursement Grant Program; and

(2) fully expend, in each year, and for the purposes of the Farm to School Local Food Procurement Reimbursement Grant Program, all federal funding that has been annually allocated to the State, pursuant to the Local Food Local Food for Schools Cooperative Agreement Program or other, similar federal programs or laws, to facilitate the State-level procurement of local or regional foods for schools, before moving to expend any State-level funding that has been appropriated and allocated, for the grant program’s use and purposes, in the same program year.

d. The department shall annually submit a written program status report to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature, contemporaneously with its submission of an annual program appropriations request pursuant to paragraph (1) of subsection a. of this section. Each such annually submitted program status report shall include, at a minimum, the following information:

(1) an update on the program’s ongoing implementation status and operations, including, but not limited to, information identifying the total number of program years during which the program has been operating with dedicated funding, and indicating whether, and to what extent, there has been any interruption or disruption in program operations or in program grant award disbursements, or any significant reduction in the amount of funding appropriated for dedicated program purposes, during any prior program year, and the reasons therefor;

(2) an update on the development and implementation status, and the ongoing use and effectiveness of, the department’s program funding formula, developed pursuant to subsections d. and e. of section 2 of this act, including, but not limited to, information describing whether, how, and to what extent, the funding formula has been designed, or is, has been, or will be applied in practice, to facilitate the funding determinations required by section 2 of this act;

(3) information identifying the number and percentage of eligible school districts that received upwardly adjusted pro rata shares of program funding in each program year, as authorized by paragraph (2) of subsection e. of section 2 of this act, and the basis upon which, and the minimum, maximum, mean, and average dollar amounts by which, such pro rata shares were upwardly adjusted;

(4) an assessment as to whether, how, and the extent to which, the Farm to School Local Food Procurement Grant Program has been successful, in each preceding program year and cumulatively, over the full term of program operations, in facilitating and incentivizing the implementation and undertaking of new, expanded, or modified local food procurement policies, practices, standards, processes, and activities, by and in eligible school districts in the State, consistent with the goals and purposes of this act;

(5) a summary of the methods and approaches that are being used to maximize the federal funding that is made available for the program’s purposes, as required by subsection c. of this section; and

(6) the secretary’s findings and recommendations regarding the necessity and benefits of continuing program operations, and of ensuring the continued appropriation and dedication of funding therefor, in the upcoming program year.

5. a. There is established in the Department of Agriculture a special, non-lapsing fund to be known as the Farm to School Local Food Procurement Reimbursement Fund. The moneys in the fund are dedicated, and shall only be used for the purposes set forth in subsection b. of this section. The fund shall be credited with:

(1) all moneys appropriated for program purposes pursuant to subsection a. of section 4, and pursuant to sections 6 and 7, of this act;

(2) all moneys carried forward pursuant to subsection d. of this section;

(3) all interest received from the investment of moneys in the fund; and

(4) any other moneys which may, from time to time, otherwise become available for the purposes of the fund.

b. Moneys deposited in the fund shall be held in interest-bearing accounts in public depositories, as defined pursuant to section 1 of P.L.1970, c.236 (C.17:9-41), and may be invested or reinvested in such securities as are approved by the State Treasurer, pending the disbursement of program grant awards, in each program year, pursuant to this act. Any interest or other income earned on moneys deposited into the fund, through investments or deposits made pursuant to this paragraph, shall be credited to the fund as provided by subsection a. of this section.

c. (1) Moneys deposited in the fund shall be used only for the purposes of financing reimbursement grant awards issued to eligible school districts, under the Farm to School Local Food Procurement Grant Program, in accordance with the provisions of this act and the rules and regulations adopted pursuant thereto, except that, of the total amount of moneys annually deposited and available in the fund, for use in any program year, up to 15 percent of such total amount, but not more than $500,000, may be used to finance the administrative costs, set forth in paragraph (2) of this subsection, which are annually incurred by the department in establishing the program and in commencing and continuing program operations as provided by this act.

(2) The administrative costs that are reimbursable with appropriated program funds, as provided by paragraph (1) of this subsection, shall include, but need not be limited to, any administrative costs that are incurred by the department in:

(a) hiring and employing at least one full-time staff person and other personnel, as necessary to properly administer and manage the grant program and provide relevant program-related information and assistance to eligible school districts thereunder;

(b) providing relevant outreach, information, and training to farmers who are engaged, or who plan to engage, in the sale or donation of local food products to schools and school districts for program purposes;

(c) acquiring, maintaining, and repairing relevant technology, equipment, and computer programs, as necessary to establish, implement, and successfully operate the program and facilitate the annual pro rata allocation, awarding, and periodic disbursement of available program grant funding thereunder; and

(d) monitoring and evaluating the ongoing implementation and operational status of the program, as well as its outcomes, costs, benefits, and ongoing and future funding needs, and reporting program-related data, assessments, and updates to the Governor and Legislature, and to members of the public, as necessary to implement the provisions and effectuate the purposes of this act.

d. Any moneys deposited in the Farm to School Local Food Procurement Reimbursement Fund and remaining unexpended at the end of the program year shall be carried forward and dedicated for the program’s use and purposes in future program years, as provided in subsection b. of this section, subject to legislative appropriation.

6. There is appropriated from the General Fund, to the Department of Agriculturefor deposit into the Farm to School Local Food Procurement Reimbursement Fund, the sum of $4,000,000, which shall be dedicated solely for use, by the department, in financing initial grant awards to eligible school districts, under the Farm to School Local Food Procurement Reimbursement Grant Program, in the first program year commencing on or after the effective date of this section. The sums appropriated to the department, pursuant to this section, for the financing of initial program grant awards, shall be supplemental, and shall be appropriated in addition, to any sums that are otherwise appropriated thereto pursuant to, and on or after the effective date of, section 7 of this act, for the purposes of financing the department’s initial program-related administrative expenses.

7. In addition to the sums required to be appropriated for initial program grant awards pursuant to section 6 of this act, there is appropriated from the General Fund to the Department of Agriculture, the sum of $500,000, which shall be dedicated solely for the department’s use in financing the administrative costs, as set forth in paragraph (2) of subsection c. of section 5 of this act, which are incurred in association with the department’s initial establishment of the Farm to School Local Food Reimbursement Grant Program, pursuant to this act, and its commencement of initial program operations thereunder, in and for the first program year.

8. a. Section 7 of this act shall take effect immediately.

b. Sections 1 through 6 of this act shall take effect on the first day of the thirteenth month next following the date of enactment, or on January 1 of the second full calendar year next following the date of enactment, whichever date is later, except that the Department of Agriculture shall take anticipatory administrative action, in advance of such effective date, and using the funds appropriated pursuant to section 7 of this act, as may be necessary to establish the Farm to School Local Food Procurement Reimbursement Grant Program and otherwise implement the provisions, and effectuate the purposes, of this act.

9. This act shall take effect immediately.

STATEMENT

This bill would require the Secretary of Agriculture (secretary) to establish and operate a Farm to School Local Food Procurement Reimbursement Grant Program (program). The purpose of the program is to provide sufficient reimbursement financing to eligible school districts in the State, as necessary to allow such districts to implement or undertake new, expanded, or modified local food procurement policies, practices, standards, processes, systems, and activities at their own pace, and to whatever extent that such policies, standards, processes, systems, and activities are capable of being so expanded or modified, as may be necessary to increase the types or amounts of local foods being procured for students, the meal periods during which such local foods are served to students, or the total number or type of students being offered such local foods, during either the school year or the summer months, or both. A school district is eligible for a program grant if all of the schools participating in, or directly benefitting from, the district’s new, expanded, or modified local food procurement policies, standards, processes, systems, or activities (i.e., “participating partner schools”) are schools that provide subsidized meals to eligible students.

A school district that wishes to obtain a program grant is required to submit, to the secretary, an attestation form that includes:

(1) a statement certifying the total number of participating partner schools in the district;

(2) a statement certifying the district’s status as a small district, a medium-sized district, or a large district, as defined by the bill, and identifying the total amount of program grant funding being sought by the district, within the appropriate minimum and maximum funding range established under the bill for similarly sized districts;

(3) a statement certifying, and briefly describing, the purposes for which the awarded program grant funds will be used in the upcoming program year;

(4) a statement certifying whether, and to what extent, the district is seeking the Department of Agriculture’s (department) discretionary authorization, as provided by the bill, in order to enable a portion of the district’s program grant award to be used for technical assistance expense purposes in the upcoming program year, and specifying the proportion of the total requested program funding award, by percentage and dollar amount, which is being sought for such discretionary purposes;

(6) any other information or attachments required by the secretary.

Each school district submitting an attestation form, as provided by the bill, is authorized to receive a grant award in the upcoming program year, in an amount consistent with the following minimum and maximum annual funding allowances: (1) for a small school district, which has less than 5,000 students enrolled at partner schools, an annual program grant of not less than $10,000 and not more than $50,000; (2) for a medium-sized school district, which has not less than 5,000 and not more than 10,000 students enrolled at partner schools, an annual program grant of not less than $20,000 and not more than $125,000; and (3) for a large school district, which has 10,000 or more students enrolled at partner schools, an annual program grant of not less than $44,000 and not more than $250,000.

Grants under the program are to be allocated and awarded, on an equitable, pro rata basis, to and among eligible school districts in the State, within the limits of moneys annually appropriated or otherwise made available to the department. Moneys appropriated by the Legislature, for these purposes, are to be deposited in the Farm to School Local Food Procurement Reimbursement Fund (newly established by the bill). The proportional amount of reimbursement grant funding which is to be awarded to each eligible school district, in each program year, is to be determined by the department, in accordance with a funding formula developed thereby, and is to be sufficient to reimburse all, or a portion of, the district’s eligible costs at a rate that is proportional to the reimbursement rate applied by the department, in the same program year, to other, similarly sized and situated school districts. The funding formula that is developed and used, by the department, for these purposes, is also required to provide for a proportional adjustment in the pro rata shares that are allocated, in each program year, to school districts that: (1) have a high number or percentage of subsidized students enrolled at partner schools and will use awarded grant funds to increase subsidized students’ access to local foods; (2) are located, or have one or more partner schools located, in a food desert area; (3) will use or encourage or require their local food procurement partners (i.e., all partner schools and school food authorities participating in the district’s local food procurement program) to use the awarded grant funds to facilitate or mandate the increased sourcing and procurement of local foods produced by small or mid-sized family farms or socially disadvantaged farmers in the State; or ( 4) were recipients of a program grant award in one or more prior program years, the full amount of which has been exhausted, in compliance with all applicable program requirements.

Although the bill generally provides for 100 percent of the program funds, annually awarded to each eligible district, to be used solely for the purpose of reimbursing the eligible costs that are expended in association with the sourcing and procurement of the increased types or amounts of local foods served in the district, during the program year, the bill also permits the department, acting on a discretionary and individual case basis, and upon the documented request of an eligible school district, to authorize the school district to use up to 20 percent of the funds annually awarded thereto for the purpose of reimbursing technical assistance expenditures that are deemed, by the department, to be necessary to facilitate the effective implementation of the district’s proposed local food procurement plan.

The bill prohibits a school district from using awarded program grant funds to reimburse any ineligible costs, or to reimburse any eligible costs that are already being paid for or reimbursed with other State or federal funds. The bill further requires the department, to the greatest extent practicable, to: 1) maximize the receipt and use of federal funds that are made available to the State, under the Local Food for Schools Cooperative Agreement Program or other, similar federal programs or laws, for the purposes of procuring local or regional food products under the program; and 2) fully expend, in each year, and for the purposes of the program, all federal funding that has been annually allocated to the State for such purposes, whether pursuant to the Local Food Local Food for Schools Cooperative Agreement Program or otherwise, to facilitate the State-level procurement of local or regional foods for schools, before moving to expend any State-level funding that has been appropriated and allocated, for those purposes, in the same program year.

Except as otherwise provided by the bill, any program grant funds that are awarded to a school district, but which remain unclaimed or unexpended at the end of the annual disbursement period, are to be reclaimed by the secretary and used to finance future grant awards under the program. Although the bill authorizes eligible school districts to apply for program funds in multiple program years, the bill prohibits the roll-over of awarded, but unused, program grant funds, from one program year to the next, except in the case of hardship beyond the district’s control

The bill provides for an initial appropriation of $4,500,000, from the General Fund to the department, in order to facilitate the program’s initial establishment and finance the first year of program operations. Of that initial amount, the bill provides for $4,000,000 to be deposited into the Farm to School Local Food Procurement Reimbursement Fund, newly established by the bill, and dedicated for use in the financing of grant awards under the program, and it provides for an additional $500,000 to be appropriated, to the department, for use in financing the administrative costs associated with the department’s initial establishment of, and commencement of initial operations under, the program.

The bill further requires the department to include, in each annual budget request submitted in each year next following the program’s initial establishment, and provides for the Legislature to annually approve, a request for the appropriation of funds in an amount, not exceeding $4.5 million, which is deemed by the department to be sufficient to support and continue the reimbursement program in the next upcoming program year.