CACFP Overclaim Policy - FY2006 - Policy Memo 1 - Overclaim repayment, interest, and appeal requirements

Oct 10, 2026

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Regulatory Communication outlines Illinois State Board of Education requirements for Child and Adult Care Food Program (CACFP) institutions regarding overclaim policy. It defines disregard thresholds for overpayments under Public Law 108-265, specifies when full debt repayment is required within 30 calendar days after an Overclaim Notice, and explains interest charges using the Current Value of Funds Rate. It also covers installment repayment interest, administrative appeal rights within 15 days, and waiver rules for interest amounts $50 or less.

LanguageEnglish

CategoryHealthcare

FormatPDF

Pages2

Reading Time5 min

AccessFree to download

Regulatory Communication Overview

Disregard Threshold

Repayment Requirements

Interest Charges

Appeal Rights

Contact Information

Illinois State Board of Education Funding and Disbursement Services Regulatory Communication Program: Child and Adult Care Food Program Date: May 2006 Policy Year/Number: FY2006—Policy Memo 1 Source: United States Department of Agriculture—Food and Nutrition Services Reference: 7CFR 226 . 14(a) Required Date for Implementation: Immediately Topic: Overclaim policy and assessing interest on overclaims not repaid within 30 days. Target Audience: Child and Adult Care Food Program Institutions Purpose: To provide Child and Adult Care Food Program institutions with the United States Department of Agriculture’s (USDA) requirements for waiving certain overclaims and assessing interest on overclaims not repaid within 30 days. Fiscal action can be taken on any sponsor that fails to comply with the regulatory requirements for participation in the Child and Adult Care Food Program. An overclaim can be assessed on a sponsor as a result of a program review, program audit, financial audit (including but not limited to Single Audit/A-133, or desk audit), or a federal audit (i.e. OIG audit) . Disregard Threshold Beginning October 1, 2004, the Child Nutrition Reauthorization Act of 2004 (Public Law 108-265) allows a disregard threshold for overpayments to child or adult care institutions participating in the Child and Adult Care Food Program (CACFP) . A disregard threshold in the amount of $600.00 will be placed on each overclaim notice assessed as a result of program reviews or program audits. However, no overpayment is to be disregarded where there is substantial evidence of violations of criminal law or civil fraud statutes. Overpayments may also occur as a result of downward revised claims filed after all claims for the fiscal year have been paid or from advance payments in excess of claim earnings. Based on State policy, a disregard threshold in the amount of $50.00 will be placed on each overclaim notice assessed as a result of downward revised claims or excess advances. Repayment Requirements If your entity incurs a fiscal overclaim/overpayment that must be assessed (i.e. greater than $600.00 for review or audit or greater than $50 for downward claim revision or excess advances), the entire debt must be repaid in full within 30 calendar days from the date of the Overclaim Notice. You must submit a check for the full amount of the overclaim within 30 calendar days from the date of the Overclaim Notice. The check should be made payable to the Illinois State Board of Education and mailed to the following address: Illinois State Board of Education, Funding & Disbursement Services (E320), 100 North First Street, Springfield, IL 62777. -OVER- Interest Charges Payment is due in full within 30 calendar days from the date of the Overclaim Notice letter. If not paid in full within 30 calendar days, interest at the Current Value of Funds Rate (currently 2.000% per year) as set by the Federal Government will be charged on any overclaim balance beginning with the date of the Overclaim Notice letter. Based on State policy, any interest charges that are $50 or less will be waived. ISBE will calculate any interest charges and notify you when and how to repay such interest. If you request to repay an overclaim in installment payments, interest will be charged on the unpaid balance each month. Any requests for an installment plan must be submitted to this office in writing for consideration. Appeal Rights If your entity disagrees with any of the findings that resulted in the fiscal overclaim, your entity has the right, by Federal Regulation, to obtain a fair and impartial administrative appeal hearing. The request for an appeal hearing must be filed in writing within 15 calendar days from the date of receipt of your Overclaim Notice. Detailed hearing procedures will be included with the overpayment notice when appropriate. If you appeal the payment demand, we will stop all collection activities; however, interest wi

FAQs

What disregard threshold amounts apply to CACFP overclaims starting October 1, 2004?

A $600 threshold applies to overclaim notices from program reviews or program audits, except where there is substantial evidence of criminal law violations or civil fraud. A $50 threshold applies to overclaim notices from downward revised claims or excess advances based on State policy.

How long does a CACFP institution have to repay an assessed overclaim?

The entire debt must be repaid in full within 30 calendar days from the date of the Overclaim Notice, including submitting a check for the full amount to the Illinois State Board of Education address provided.

When can interest be waived, and what happens if an institution appeals?

Interest on the overclaim balance begins if not paid in full within 30 calendar days, but interest charges of $50 or less are waived under State policy. If an appeal is filed within 15 calendar days, collection activities stop while interest continues to accrue; if the decision is reduced or denied, interest on amounts no longer due is waived.

Oct 10, 2026

Uploaded by Blitz