42 U.S. Code § 1769c - Compliance and accountability
Each State educational agency shall coordinate the compliance and accountability activities described in paragraph (1) in a manner that minimizes the imposition of additional duties on local food service authorities.
In this paragraph, the term “selected local educational agency” means a local educational agency that has a demonstrated high level of, or a high risk for, administrative error, as determined by the Secretary.
In addition to any review required by subsection (a) or paragraph (1), each State educational agency shall conduct an administrative review of each selected local educational agency during the review cycle established under subsection (a).
In carrying out a review under subparagraph (B), a State educational agency shall only review the administrative processes of a selected local educational agency, including application, certification, verification, meal counting, and meal claiming procedures.
Subject to subparagraphs (B) and (C), if the local educational agency fails to meet administrative performance criteria established by the Secretary in both an initial review and a followup review under paragraph (1) or (3) or subsection (a), the Secretary may require the State educational agency to retain funds that would otherwise be paid to the local educational agency for school meals programs under procedures prescribed by the Secretary.
The amount of funds retained under subparagraph (A) shall equal the value of any overpayment made to the local educational agency or school food authority as a result of an erroneous claim during the time period described in subparagraph (C).
A State educational agency may retain not more than 25 percent of an amount recovered under paragraph (4), to carry out school meals program integrity initiatives to assist local educational agencies and school food authorities that have repeatedly failed, as determined by the Secretary, to meet administrative performance criteria.
A local educational agency that has demonstrated a high level of, or a high risk for, administrative error associated with certification, verification, and other administrative processes, as determined by the Secretary, shall ensure that the initial eligibility determination for each application is reviewed for accuracy prior to notifying a household of the eligibility or ineligibility of the household for free or reduced price meals.
Subject to standards established by the Secretary, the system used to review eligibility determinations for accuracy shall be conducted by an individual or entity that did not make the initial eligibility determination.
Once the review of an eligibility determination has been completed under this paragraph, the household shall be notified immediately of the determination of eligibility or ineligibility for free or reduced price meals.
There is authorized to be appropriated for purposes of carrying out the compliance and accountability activities referred to in subsection (c) $10,000,000 for each of fiscal years 2011 through 2015.
In calculating the fine for a school food authority or school, the Secretary shall base the amount of the fine on the reimbursement earned by school food authority or school for the program in which the violation occurred.
 So in original. No par. (2) has been enacted.
 So in original. Probably means subpars. (A) and (B) of par. (1) of subsec. (a).
The Child Nutrition Act of 1966, referred to in subsecs. (a)(1) and (e)(1)(A), (2)(A), is Pub. L. 89–642, Oct. 11, 1966, 80 Stat. 885, which is classified generally to chapter 13A (§ 1771 et seq.) of this title. For complete classification of this Act to the Code, see Short Title note set out under section 1771 of this title and Tables.
Those Acts, referred to in subsec. (a)(1), mean the Richard B. Russell National School Lunch Act, which was in the original “this Act” and was translated to read “this chapter”, and the Child Nutrition Act of 1966. See above.
A prior section 1769c, act June 4, 1946, ch. 281, § 22, as added Nov. 10, 1978, Pub. L. 95–627, § 9, 92 Stat. 3623, directed a study of menu choice, prior to repeal by Pub. L. 99–500, title III, § 371(b), Oct. 18, 1986, 100 Stat. 1783–368, and Pub. L. 99–591, title III, § 371(b), Oct. 30, 1986, 100 Stat. 3341–372; Pub. L. 99–661, div. D, title V, § 4501(b), Nov. 14, 1986, 100 Stat. 4080.
2010—Subsec. (a). Pub. L. 111–296, § 207(1), added subsec. (a) and struck out former subsec. (a). Prior to amendment, text read as follows: “There shall be a unified system prescribed and administered by the Secretary for ensuring that local food service authorities that participate in the school lunch program under this chapter comply with the provisions of this chapter. Such system shall be established through the publication of regulations and the provision of an opportunity for public comment, consistent with the provisions of section 553 of title 5.”
Subsec. (b)(1). Pub. L. 111–296, § 207(2), added subpars. (A) to (D) and struck out former subpars. (A) and (B) which read as follows:
“(A) require that local food service authorities comply with the provisions of this chapter; and
“(B) ensure such compliance through reasonable audits and supervisory assistance reviews.”
Subsec. (b)(6). Pub. L. 111–296, § 304, added par. (6).
Subsec. (d). Pub. L. 111–296, § 408, substituted “$10,000,000 for each of fiscal years 2011 through 2015” for “$6,000,000 for each of fiscal years 2004 through 2009”.
Subsec. (e). Pub. L. 111–296, § 303, added subsec. (e).
2004—Subsec. (b)(3) to (5). Pub. L. 108–265, § 126(b)(1), added pars. (3) to (5).
Subsec. (d). Pub. L. 108–265, § 127, substituted “$6,000,000 for each of fiscal years 2004 through 2009” for “$3,000,000 for each of the fiscal years 1994 through 2003”.
1998—Subsec. (d). Pub. L. 105–336 substituted “2003” for “1996”.
1994—Subsec. (d). Pub. L. 103–448 substituted “fiscal years 1994 through 1996” for “fiscal years 1990, 1991, 1992, 1993, and 1994”.
Amendment by section 126(b)(1) of Pub. L. 108–265 effective July 1, 2005, and amendment by section 127 of Pub. L. 108–265 effective June 30, 2004, see section 502(a), (b)(4) of Pub. L. 108–265, as amended, set out as an Effective Date note under section 1754 of this title.