Food Banks and USDA TEFAP Reporting: A Practical Compliance Guide

Food banks receiving TEFAP operate under a layered reporting structure: USDA Food and Nutrition Service sets the federal rules in 7 CFR Part 251, the state distributing agency (SDA) translates those rules into a state plan of operation, and the local food bank executes the state plan while producing the source data that rolls up into the SDA’s FNS-667 report to USDA.

This guide walks through what the grantee is actually responsible for, which records drive the reporting, and which gaps show up in single audits.

The TEFAP Reporting Chain

USDA purchases commodity foods and allocates them to states by a formula combining state poverty and unemployment counts. States receive both commodities and administrative funds, which the SDA passes through to eligible recipient agencies (ERAs) - regional food banks, food pantries, and soup kitchens.

The reporting chain is:

• Local ERA to SDA: commodity receipt confirmations, distribution reports, inventory balances, administrative expenditure reports. Frequency set by state plan, typically monthly.
• SDA to USDA FNS: FNS-667 Food Program Reporting System report, filed on the federal reporting cadence (monthly and annually, depending on data category).
• SDA to USDA FNS: the state plan of operation, updated and submitted for USDA approval when the state changes income eligibility thresholds, administrative allowable costs, or distribution policies.

A grantee that wants to know what it owes the SDA reads the state plan of operation, not the federal regulation. The CFR sets the floor; the state plan sets what the ERA actually files.

The Four Records That Drive TEFAP Reporting

1. Commodity receipt log

Every USDA Foods delivery generates a receipt record. Required data elements:

• Date of delivery
• Source (SDA warehouse, contracted carrier, other regional food bank for inter-ERA transfers)
• Commodity code and description (USDA uses a numbered commodity system)
• Quantity in pounds and cases
• Condition at receipt (noting any damaged product, temperature excursions on refrigerated or frozen loads)
• Signature of receiving staff and date
• Storage location assigned

A receipt log with missing commodity codes or signatures cannot be reconciled to the SDA’s delivery records when the state monitor arrives.

2. Household distribution log

For food banks that distribute directly to households (rather than only through partner agencies), each distribution event must be logged with:

• Date of distribution
• Household identifier (name, household ID, or state-assigned identifier)
• Household size (drives the quantity allocation and feeds the per-household pound calculations)
• Commodities and quantities distributed
• Income eligibility reference (link to the household’s self-declaration on file, or categorical eligibility basis)
• Signature of distributing staff

Worked example: a food bank distributes 40 pounds of USDA frozen chicken to 12 four-person households at a Tuesday afternoon distribution. The log must show 12 lines, each tied to a household on file with a current self-declaration, totaling 480 pounds out of frozen chicken inventory. That 480 pounds comes out of the ending inventory in the Tuesday reconciliation.

3. Subrecipient transfer log

Regional food banks passing commodities to partner pantries and soup kitchens must issue a transfer document on every handoff:

• Date of transfer
• Receiving agency name and ERA identifier
• Commodities and quantities transferred
• Signature of receiving agency representative
• Copy retained at the regional food bank; original at the receiving agency

The regional food bank’s inventory decreases by the transfer quantity; the partner agency’s inventory increases by the same quantity and the partner agency takes on the distribution and record-keeping obligations for those pounds.

4. Loss and adjustment report

Inventory rarely reconciles perfectly. Documented losses keep the reconciliation honest:

• Date of loss
• Commodity and quantity
• Cause: spoilage, temperature excursion, pest damage, weighing discrepancy, damaged packaging
• Supervisor authorization signature
• Any corrective action taken

An undocumented variance is treated as missing inventory, which is a finding and typically a repayment demand at the USDA-published per-pound valuation.

The Month-End Reconciliation

The reconciliation equation:

beginning inventory
+ receipts from the SDA
+ receipts from other USDA sources (inter-ERA transfers, CSFP carryover if commingled)
’ distributions to households
’ transfers to subrecipient agencies
’ documented losses
= ending inventory

Each line must tie to the source log. The reconciliation is typically run monthly, aligned with the SDA’s reporting cycle. Tolerance for unexplained variance is usually 1 percent, but state plans vary - check yours.

Worked example: beginning July inventory of 2,000 pounds frozen chicken + 5,000 pounds received from the SDA ’ 4,200 pounds distributed to 1,050 four-person households ’ 400 pounds transferred to two partner pantries ’ 15 pounds documented spoilage = 2,385 pounds ending inventory. If the physical count shows 2,100 pounds, the 285-pound variance (12 percent) is a finding unless a documented cause is produced.

Administrative Fund Reporting

TEFAP administrative funds have allowable cost categories defined by the state plan of operation, which must align with 2 CFR Part 200 Subpart E. Typical allowable categories:

• Storage, including refrigeration and freezer operating costs
• Transportation between the SDA warehouse, the regional food bank, and subrecipient agencies
• Handling and warehousing labor
• Eligibility determination activity
• Civil rights training
• Equipment purchases (with prior SDA approval, typically above a dollar threshold)

Personnel costs charged to TEFAP administrative funds require time allocation documentation under 2 CFR 200.430 when staff work across multiple programs. A food bank operating TEFAP, EFSP (FEMA), CDBG (HUD), and private foundation programs must allocate shared staff time based on actual effort, not a static budget allocation.

Unallowable costs show up in almost every administrative fund finding: board meeting expenses, fundraising costs, general organizational overhead not connected to TEFAP operations, and bad debt.

Civil Rights Compliance

7 CFR 251.6(a) requires TEFAP ERAs to comply with the USDA nondiscrimination statement and Section 504, Title VI, and the Age Discrimination Act. Documentation the SDA monitor will check:

• “And Justice for All” poster displayed in public view at every distribution site
• Complaint procedure posted and communicated, with a named contact
• Annual civil rights training for all staff and volunteers involved in TEFAP activities, with sign-in sheets and training content retained
• Participant data collection as required by the state plan - many states require race and ethnicity data (collected on a voluntary basis, with the self-identification option) for program participants

A missing poster or undocumented training is the simplest finding an SDA monitor can write. It should never appear.

Subrecipient Monitoring for Regional Food Banks

A regional food bank that distributes TEFAP commodities to partner pantries is a pass-through entity under 2 CFR 200.332. The regional food bank is responsible for:

• Written subagreement with each partner agency, establishing TEFAP compliance obligations
• Annual or periodic on-site monitoring visit covering inventory, distribution records, civil rights compliance, and storage conditions
• Corrective action tracking when monitoring identifies deficiencies
• Training provision for partner agency staff on TEFAP requirements

A regional food bank with 50 partner pantries owes 50 monitoring visits per year or on the state-required frequency. A missed monitoring visit is a direct finding against the regional food bank. Inadequate records at a partner pantry, once identified, become the regional food bank’s finding because it is the pass-through entity.

Single Audit Interaction

TEFAP commodities count as federal award expenditure at the USDA-published per-pound value. Combined with administrative funds, the TEFAP federal expenditure often pushes a mid-sized food bank over the $1,000,000 single audit threshold (raised from $750,000 for fiscal years ending September 30, 2025 or later) under 2 CFR 200.501. The auditor will pull the TEFAP program as a major program if it exceeds the Type A threshold (usually the larger of $750,000 or 3 percent of total federal awards).

Single audit testing of TEFAP focuses on:

• Allowable costs testing against the state plan’s allowable administrative categories
• Cash management (draw timing relative to expenditure)
• Eligibility - does the ERA maintain income eligibility determinations for distributed commodities?
• Reporting - do the commodity reports to the SDA tie to the underlying logs?
• Subrecipient monitoring - has the ERA monitored its pass-through partners?

Common single audit findings: inadequate subrecipient monitoring, missing income eligibility forms, administrative costs outside the state plan’s allowable list, and commodity reconciliation variances.

Record Retention

7 CFR 251.10(b) and 2 CFR 200.334 require TEFAP records to be retained for three years from the date the final expenditure report is submitted for the federal fiscal year in which the records were generated. Longer retention applies if litigation, a claim, or an audit is open. State plans can impose longer retention.

Practical retention list:

• Commodity receipt logs
• Household distribution logs
• Subrecipient transfer logs
• Loss and adjustment reports
• Administrative expenditure records
• Civil rights training records and complaint logs
• Monitoring reports and corrective action documentation
• Monthly reconciliation worksheets
• Reports submitted to the SDA

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DEFINITION

TEFAP

The Emergency Food Assistance Program - USDA Food and Nutrition Service program that supplies commodity foods and administrative funds to states, which distribute through eligible recipient agencies (food banks, pantries, soup kitchens) to low-income households. Authorizing statute: 7 U.S.C. 7501 et seq.

DEFINITION

State Distributing Agency (SDA)

The state agency (usually the department of agriculture, social services, or education) that holds the TEFAP agreement with USDA and distributes commodity and administrative funds to local eligible recipient agencies. The SDA sets state-specific reporting requirements within federal regulations.

DEFINITION

FNS-667

The Food Program Reporting System report that SDAs file with USDA FNS on TEFAP commodity and administrative activity. Local food banks feed source data to the SDA; the SDA aggregates and files FNS-667.

DEFINITION

Eligible Recipient Agency (ERA)

A public or nonprofit organization approved by the SDA to receive and distribute TEFAP commodities. Regional food banks are typically ERAs that also act as pass-through entities to subrecipient pantries and soup kitchens.

DEFINITION

Commodity shrinkage

Inventory loss from causes such as spoilage, damage, temperature excursion, or weighing discrepancy. Must be documented with date, commodity type, quantity, cause, and supervisor sign-off to avoid classification as missing inventory.