You asked for (1) background on the federal elderly nutrition and Nutrition Services Incentive (NSIP) programs, (2) an explanation of the change in calculating the funding formula that resulted in reduced NSIP funding for this fiscal year, and (3) information on potential additional federal cuts for elderly nutrition programs.

SUMMARY

The federal Older Americans Act (OAA) provides federal funding to states for, among other purposes, elderly nutrition programs, which provide meals for seniors over age 60 at specified congregate meal sites or home-delivered meals (“meals on wheels”) for those too frail to come to the sites. This money comes from the federal Administration on Aging (AoA) to the Connecticut Department of Social Services (DSS), which distributes it to the federally required regional area agencies on aging (AAAs) on the same basis as other OAA funds. The AAAs contract with community providers in ther regions to provide the services.

NSIP, administered by the AoA and the U. S. Department of Agriculture, provides supplemental funding for these programs. The NSIP allocation to states is a proportional share of the annual appropriation based on the number of meals served in the prior year; DSS uses the same formula to distribute the funds to the AAAs. A 2003 federal prohibition on counting meals paid for by third parties has had its first effects in Connecticut for FFY 2006, resulting in a $ 491,000 reduction for the state. However, DSS has made up the shortfall for this year by transferring money from the federal Social Services Block Grant it receives.

Recent federal appropriations passed for the OAA elderly nutrition programs and NSIP were initially slightly higher than last year, but were later reduced by 1% for FFY 06. The state's own funding for these programs in FY 06 remains slightly higher than last year.

ELDERLY NUTRITION PROGRAM

The Administration on Aging's (AoA) Elderly Nutrition Program provides grants for nutrition services to older people throughout the country. Authorized under Title IIIC of the federal OAA, the program is intended to improve the diets of seniors age 60 and older and to offer them opportunities to socialize and create informal support networks.

The program provides for (1) congregate meals provided in a variety of group settings, such as senior centers, churches, or elderly housing complexes, and (2) home-delivered meals (known as “meals on wheels”) for frail homebound seniors who cannot get to the congregate sites. The congregate meal programs enable participants to make positive social contacts with other seniors at the group meal sites. Through the program, seniors can also learn to plan and prepare nutritious meals that are economical and healthy.

The program has no means test for participation, but services are targeted to seniors with the greatest economic or social need, with special attention given to low-income minorities and rural seniors. Other people who are eligible for the program are a spouse of any age, disabled people under age 60 who live in elderly housing facilities where congregate meals are served, disabled people who live at home and accompany older people to meals, and nutrition service volunteers.

OAA Title IIIC funding comes from the federal AoA to the state unit on aging, which in Connecticut is the DSS's Bureau of Aging, Community, and Social Work (Bureau of ACSW). The Bureau's Aging Services Division distributes the money to the state's five regional AAAs according to a federal distribution formula. The AAAs then make grants to community providers in their regions to furnish the meals.

The AoA's funding formula is based on each state's relative share of the population aged 60 and over, but no state receives less than it received in FFY 2000 and all states receive a portion of any increase in appropriations over the 2000 level. States must provide a 15% match in order to receive the federal funds.

The OAA requires states to distribute their funds to area agencies through an intrastate funding formula, which is based on the distribution of the elderly population among the regions and weighted for those segments of the elderly population with special needs (2002-2005 Connecticut State Plan on Aging, p. 11).

Connecticut statute specifies that DSS must distribute federal funds for this purpose to the AAAs according to federal rules, and requires 60% of state funds to be allocated the same way, but it allows 40% of state funds for elderly nutrition to be allocated at the DSS commissioner's discretion based on need (CGS §17b-422).

NSIP FUNDS SUPPLEMENT OAA TITLE IIIC FUNDS

NSIP is intended to provide incentives to states and tribes to effectively deliver nutritious meals to older adults. Under this program, state units on aging funded through Title III of the OAA may receive grants of cash from the AoA and commodities from the USDA to support OAA elderly nutrition programs.

Until 2003, NSIP was administered by the U. S. Department of Agriculture (USDA). In 2003, Public Law 108-7 amended the OAA to transfer the NSIP from the USDA to the AoA within the Department of Health and Human Services (HHS). AoA already administered the other OAA programs. There is no state match requirement for these funds.

NSIP ALLOCATION FORMULAS

Originally, the USDA reimbursed states approximately $ 0. 58 per meal, depending on how much money Congress appropriated for the purpose, according to Roxanne Aaron-Selph, director of the Aging Services Division in the Bureau of ACSW. This money could be used as cash or to purchase USDA entitlement commodities (commodities for which cash is traded, as opposed to bonus commodities, which are free). If commodities were purchased, the cash amount was reduced by their value. Even after AoA assumed administration of the program, commodities purchased still come through USDA and their value is deducted from the cash.

Under AoA administration of NSIP, money is no longer awarded on a per meal basis. Instead, the annual appropriation is distributed to states proportionally according to the number of meals served during the prior year. The state uses the same system for distributing its NSIP funding among AAAs. Thus, if nutrition providers under an area agency served 600,000 meals of 3 million total meals served in the state during FFY 2004 , the AAA would receive 20% of the state allocation (less the value of any entitlement commodities ordered), according to Aaron-Selph.

According to Aaron-Selph, the state's federal NSIP allocation was reduced by $ 491,000 in FFY 06 as a result of a change in calculating number of meals served for their federal funding formula. These reductions however are not a result of an actual reduction in federal appropriations. Rather, they result from a 2003 ruling prohibiting counting meals provided to recipients that are paid for by third parties in calculating how many meals they provide annually. These total meals served are used to figure the next year's federal funding and this is the first year that the 2003 ruling has affected Connecticut.

DSS, however, has eliminated this federal shortfall's effect for this year by shifting money from the federal Social Services Block Grant it receives to make up the difference. This was a one-time transfer, so the same problem could occur again next year depending on the number of meals served this year.

NEW FEDERAL FUNDING CUTS

Congress appropriated slightly more for these programs in the FFY 06 Labor-HHS- Education Appropriations bill, But then the Defense Appropriations bill, signed by the President on December 30, 2005, made a 1% across-the-board cut for discretionary spending programs (including these), as seen in Table 1 below, which brings the funding below FFY 05 levels.

Table 1: Initial Federal Elderly Nutrition Program Appropriations and Final Cuts for FFY 06

Source: National Association of Area Agencies on Aging

Specific amounts for each state for FFY 06 are not yet available, but Douglas Buck in the Aging Services Division provided us with the following federal funding data for Connecticut for the prior two years (see Table 2). He cautioned that this was the initial funding and sometimes money is later transferred as needs change.

Table 2: Federal Funding for Connecticut Elderly Nutrition Program Meals: FY' 04 & FY' 05

*Figures do not include commodities, which were relatively small amounts.

Source: Department of Social Services

DSS and the AAAs have entered only into six-month contracts for these services for FFY 06 because of the uncertainty of the federal funding.

SUPPLEMENTARY STATE FUNDING FOR ELDERLY NUTRITION PROGRAM

The FY 06 state elderly nutrition appropriation is $ 2. 246 million, which is $ 65,000 more than the $ 2. 181 million appropriated and spent in FY 2005, according to Neil Ayers of the Office of Fiscal Analysis.

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