NET OFF INVOICE (NOI) and FEE-for-SERVICE (FFS)
Annette McBride, Administrator | Minnesota Food Distribution Program
February 13, 2018Leading for educational excellence and equity, every day for every one. |
education.state.mn.us 1
USDA COMMODITIES STAKEHOLDERS
• Government
• USDA
• State Distributing Agencies
• Industry
• Processors
• Distributors
• Brokers
• Agriculture
• Farmers and Farm Associations such as:
• Agricultural Councils, Trade Organizations. Agricultural Promoters
• Community
• Recipient Agencies (RA)
• Food Banks
• Food pantries and meal sites
• Other community-based organizations
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ENTITLEMENT
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ENTITLEMENT
School Year July-June NSLP Entitlement ESTIMATE!
PRIOR YEAR LUNCHES
XJULY RATE
+12% FUNDING
+/-PRIOR YEAR BALANCE
=TOTAL ENTITLEMENT $
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CLiCS SPONSOR PROFILE
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CLiCS SPONSOR PROFILE
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ENTITLEMENT ACT AND REGULATIONS
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USDA COMMODITY PROGRAMS
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• USDA Regular Commodities or Brown Box
• Department of Defense (DoD) Fresh Produce
• Net Off Invoice (NOI)
• Fee-for-Service (FFS)
NET OFF INVOICE (NOI)
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NET OFF INVOICE (NOI)
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RECIPIENT AGENCY
• Pays distributor commercial price, minus USDA foods value per case, when allocation balance exists
• USDA foods drawdown occurs when product is invoiced by distributor
• Distributor invoices at the commercial price when there is no allocation balance
NET OFF INVOICE (NOI)
PROCESSOR
• Receives Raw USDA Foods And Processes Into End Products
• Sells To Distributor At Commercial Price
• Reimburses Distributor the USDA Foods value per case when proof of delivery had occurred.
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NET OFF INVOICE (NOI)
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DISTRIBUTOR
• Pays Commercial Price To Processor
• Controls Inbound Inventory
• Track and update pound balances in Distributor system, communicate pound balances with third party tracking system and/or other processor system
• Displays USDA Foods Value per case on Invoice
• Receives Reimbursement From Processor for the USDA Foods value per case
NET OFF INVOICE (NOI)
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COMMODITY CALCULATOR
Many Processors and other Industry partners offer Commodity Calculators
Select the items you want to serve
• Enter the number of portions needed each time it’s served
• Enter the frequency it’s on the menu
• The calculator tells you how much to divert
NET OFF INVOICE (NOI)
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How Much To Divert
number of portions to be served
X number of serving occurrences for the year
= total number of servings
÷ servings per case = number of cases
X pounds DF per case = number pounds to divert for each item
Ʃ all products = amount to divert
NET OFF INVOICE (NOI)
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NET OFF INVOICE (NOI)
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NET OFF INVOICE (NOI)
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FEE-FOR-SERVICE (FFS)
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FEE-FOR-SERVICE (FFS)
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RECIPIENT AGENCY
• Pays Processor The Processing Fees: Labor, Packaging, Actual Processing, Shipment To Their Requested Location
• Pays Distributor Contracted Delivery Price
• RA controls inbound inventory of finished product
• USDA Foods Drawdown occurs upon delivery to requested location
FEE-FOR-SERVICE (FFS)
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PROCESSOR
• Receives Raw USDA Foods And Processes Into End Products
• Ships Finished Product To RA’s Requested Location
• Sells To Distributor At $0 Cost
• Invoices RA For Processing Fees
FEE-FOR-SERVICE (FFS)
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DISTRIBUTOR
• Receives finished goods at $0 from the Processor
• Only distributes product to specific RAs
• Does Not order Inbound Inventory
• Tracks Cases In Distributors’ own system
• Invoices RA contracted Delivery fee per case
FEE-FOR-SERVICE (FFS) and NET OFF INVOICE (NOI)
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MANAGING PROCESSOR INVENTORY
• TRACK YOUR BALANCES
• If you need more than you diverted, or have excess pounds at a Processor, work with other stakeholders
FEE-FOR-SERVICE (FFS) and NET OFF INVOICE (NOI)
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MAXIMIZE USDA FOODS UTILIZATION
• Carefully analyze the best use of entitlement dollars
• Entitle is an asset only when it is used
• Entitlement is meant to save 20 percent of your food cost
• New diversions should be the amount you need minus any remaining balance from the previous year already at the Processor
USDA FORECASTING
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HELPFUL WEBSITES
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ProcessorLink
K12 Foodservice
American Commodity Distribution Association (ACDA)
United States Dept. of Agriculture (USDA)
MN Dept of Education
American Commodity Distribution Association (ACDA)
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Thank You!Minnesota Food Distribution Program
Nutrition, Health and Youth [email protected]
651-582-8526 or 800-366-8922
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