Being removed from the Child & Adult Care Food Program (CACFP) causes serious, long-lasting consequences for your business. CACFP termination not only disrupts your ability to provide nutritious meals, but it also stops you from receiving reimbursement you depend on.
It’s critical to understand what CACFP termination involves and how to avoid it if you’re at risk.
Why CACFP Termination Happens
It’s typically the result of serious, uncorrected problems. Some common reasons include:
- Poor Record-Keeping – including financial documentation, menus, and meal attendance records
- Non-Compliant Expense Records – using CACFP money for unallowable expenses or not having all receipts for your purchases.
- Failure to Submit Correction Documents on Time – Not submitting corrective documentation to your sponsor or state agency by required deadlines.
- Lack of Corrective Action – Neglecting to permanently resolve issues and operate within Program compliance.
The CACFP Termination Process
Termination doesn’t usually happen overnight. Here’s how – and with opportunities to still correct problems along the way:
1️⃣ Serious Deficiency Determination – Your sponsor or state agency identifies major noncompliances and prepares to notify you.
2️⃣ Notice of Serious Deficiency – Your sponsor or state agency sends you an official notice listing the areas of noncompliance.
3️⃣ Corrective Action – You’re allowed time to fix the issues. You must submit a detailed corrective action plan (CAP) for each area of noncompliance.
4️⃣ Notice of Proposed Termination – If problems aren’t corrected and your CAP doesn’t demonstrate a permanent way to keep them from recurring, your sponsor or state agency will send a notice proposing termination. You have the right to appeal.
5️⃣ Final Termination and Disqualification – If you lose the appeal – or fail to make one at all – your termination from CACFP becomes final.
Consequences of CACFP Termination
CACFP termination isn’t just a setback—it has serious, far-reaching consequences.
- Financial Liability – If you purchased unallowable items with CACFP funds, you may be required to pay those funds back to your sponsor or state agency.
- Loss of CACFP Meal Reimbursement – You’ll no longer receive funding to serve nutritious meals, which could have a major financial impact.
- Placement on National Disqualified List (NDL) – Once on the NDL, your center – and any applicable staff – can no longer participate in CACFP or other federal nutrition programs.
- Reputation Damage – Getting terminated from a federally funded program could harm your business’s reputation, making it more challenging to gain trust and obtain future opportunities.
Want more info about the National Disqualified List? Check out our other blog post here.
Can You Be Reinstated After Termination?
Yes, but it isn’t automatic or easy. Here’s what you need to do:
- Repay Funds – If financial issues were a factor, you must settle any outstanding debts/repayments to the sponsor or state agency.
- Submit a Reinstatement Request – You must formally request reinstatement and prove your issues have been permanently resolved.
- Get State Agency Approval – The state agency must approve your request in order for you to be reinstated in CACFP.
- Wait the Required Time Period – Your center and applicable staff are placed on the NDL for at least 7 years, unless appropriate corrective action is taken and all Program debts are repaid.
How to Avoid CACFP Termination
Proactive measures to stay in compliance are key, especially when it comes to managing financial aspects of the Program.
Here are some strategies to help keep your center in good standing:
- Responsibly Manage CACFP Funds – Ensure all funds are used for allowable expenses only, avoid overspending, and track reimbursements and expenses carefully.
- Take Corrective Actions Seriously – Address issues immediately – especially those related to financial management. This includes correcting inaccurate financial statements and expense records.
- Stay on Top of Recordkeeping – Keep accurate and up-to-date records, including receipts, financial statements, meal records, and attendance records.
- Participate in Training – Ensure all staff are properly trained in CACFP guidelines to prevent mistakes.
- Ask for Help – If issues arise, fix them quickly by working closely with your sponsor or state agency. If you’re not sure about a Program rule, reach out for guidance before mistakes become serious violations.
Protect Your Reimbursement
CACFP termination is serious—but it doesn’t have to happen. Whether you’re already facing a serious deficiency or just want peace of mind that you’re on the right track, we can help.
If you ever receive a Notice of Serious Deficiency, don’t wait – act immediately to fix the issues. Remember, your CACFP reimbursement is on the line. Ask for help before things escalate further.
At CACFP Solutions, we’ve helped dozens of centers get back into compliance, avoid costly mistakes, and stay in good standing with the state agency. Don’t wait until it’s too late—get expert support now so you can continue serving meals with confidence.
👉 CLICK HERE to schedule a free call with our team and get the guidance you need to move forward.