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CSFP Section 3

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CSFP Procedures Manual Section 3: Agreements

3.1 Agreement Structure

  1. Lead Agency Agreement.
    1. Food Assistance (FA) enters into a written Agreement (Subaward) directly with a CSFP Lead Agency. The Lead Agency is responsible for program implementation at the local level within the county(ies) stated in the Agreement. CSFP USDA Foods may be distributed at sites that are owned, operated, or sponsored by the Lead Agency or, with the permission of the Lead Agency, its Sub Agency(ies). The Lead Agency must submit a complete list of these CSFP distribution sites using the Lead Agency Site List (AGR-2385) to FA annually.
    2. Lead Agency CSFP distribution sites may include:
      1. Lead Agency Owned Sites:
        1. Lead Agency owned food pantries, located on the Lead Agency’s property. These are typically permanent sites.
        2. Lead Agency owned mobile food pantry delivery programs.
      2. Lead Agency Operated Sites:
        1. Temporary or permanent sites that are run by the Lead Agency or one of their volunteers at a non-Lead Agency owned location. This includes an apartment building, community center, temporarily staffing a distribution at a senior center, or a food pantry.
        2. This does not include distributions out of mobile food pantries or mobile delivery programs.
      3. Lead Agency Sponsored Sites:
        1. An organization or tribe that may not meet all eligibility criteria or perform all aspects of the Sub Agency Agreement, serves as a CSFP distribution site, is a separate entity from the Lead Agency, and is sponsored by the Lead Agency. As the sponsor, the Lead Agency assumes responsibility for program compliance and risk; the sponsored project/site gives up autonomy in exchange for borrowing the credibility of the sponsor’s 501(c)(3) status.
        2. The Lead Agency as the fiscal sponsor should have a written agreement that clearly outlines the respective CSFP roles and responsibilities of the Lead Agency and sponsored site.
        3. The sponsored site is not run by the Lead Agency’s staff or owned by the Lead Agency. It is run by the sponsored site, but the Lead Agency is taking legal responsibility under the CSFP program. FA will hold the Lead Agency solely responsible for the sponsored site.
  2. Sub Agency Agreement.
    1. The Lead Agency contracts directly with an eligible Sub Agency to provide program resources. The Agreement is between the Lead Agency and the eligible Sub Agency. Included in the Agreement is the requirement that the Sub Agency include in their Sub Agency Site List (AGR-2387), all Sub Agency Owned, Operated and Sponsored sites that operate under this Agreement.
    2. At the sole discretion of the Lead Agency and with their approval, additional sites may be added to the Sub Agency Site List (AGR-2387).
    3. Sub Agency sites may fall into any of the following categories:
      1. Sub Agency Owned Sites:
        1. Sub Agency owned food pantries, located on the Sub Agency’s main property. These are typically permanent sites.
        2. Sub Agency owned mobile food pantries and meal delivery programs.
      2. Sub Agency Operated Sites:
        1. Temporary or permanent sites that are run by the Sub Agency or one of their volunteers at a non-Sub Agency owned location. This includes an apartment building, community center, temporarily staffing a distribution at a senior center, or food pantry.
        2. This does not include distributions out of mobile food pantries or delivery programs.
      3. Sub Agency Sponsored Sites:
        1. An organization or tribe that may not meet all eligibility criteria or perform all aspects of the Sub Agency Agreement, serves as a CSFP distribution site, is a separate entity from the Sub Agency, and is sponsored by the Sub Agency. By listing the sponsored site in the Sub Agency Site List (AGR-2387), the Sub Agency becomes the fiscal sponsor and assumes responsibility for program compliance and risk; the sponsored project/site gives up autonomy in exchange for borrowing the credibility of the sponsor’s 501(c)(3) status.
        2. The Sub Agency as the fiscal sponsor should have a written agreement that clearly outlines the respective CSFP roles and responsibilities of the Lead Agency and sponsored site.
        3. The sponsored site is not run by the Sub Agency’s staff or owned by the Sub Agency. It is run by the sponsored site, but the Sub Agency is taking legal responsibility under the CSFP program. The Lead Agency will hold the Sub Agency solely responsible for the sponsored site.
    4. Note: Unless using the CSFP Sub Agency Agreement (AGR-2320) template without modification, the Lead Agency must first obtain approval from FA. FA’s review for approval will be limited to assuring that the revised Sub Agency Agreement contains the minimal substantive terms that FA considers necessary for CSFP.
    5. Lead Agencies are encouraged to seek their own legal advice to determine the adequacy of the FA provided template.
    6. Sub Agency Agreements and Fiscal Sponsorship.
      1. Fiscal Sponsorship is an arrangement between an existing 501(c)(3) nonprofit and a project, program, or even another nonprofit. The sponsor extends its tax-exempt status to the project (food pantry or meal program) so the project can receive food and/or funding. The Fiscal Sponsor provides fiduciary oversight, financial management, and other administrative services to strengthen the ability for charitable projects to succeed. The Fiscal Sponsor assumes responsibility for compliance and risk; the sponsored project gives up autonomy in exchange for borrowing the credibility of the sponsor’s 501(c)(3) status.
      2. If not in conflict with their contracting policies and procedures, Lead Agencies may sign a Sub Agency Agreement with an organization that is fiscally sponsored.
      3. Below are considerations but do not constitute legal advice.
        1. A Fiscal Sponsor must meet all Sub Agency Agreement eligibility guidelines (see Section 3.1.B, Sub Agency Agreement for more details):
          1. Have the required status:
            1. 501(c)(3) federal tax-exempt status (and thus includes the activity in its annual IRS Form 990 reporting). This would include the Sponsor’s EIN; or
            2. A federally-recognized Tribe; or
            3. Be a church as defined by the IRS (Alternate 501(c)(3) Church Verification Form (AGR-2241)).
          2. Have a Unique Entity Identification (UEI) number in the System of Award Management (SAM).
          3. Have WA Secretary of State non-profit corporation status, if not a public agency or federally recognized tribe.
          4. Not be suspended or debarred from participating in any federal or state transactions.
          5. As required by the Lead Agency:
            1. Insurance coverage.
        2. A Fiscal Sponsor handles all financial administration, controlling the funds and assets. A sponsored activity/program typically has no board of directors, no tax return, and no bank account, except petty cash. A fiscal sponsor provides all audit, fiscal, and other verification forms required by the Sub Agency Agreement to the Lead Agency.
      4. Note: To execute a Sub Agency Agreement, a sponsored organization/pantry may only have one sponsor. It is not appropriate to mix-and-match compliance roles, using one nonprofit’s tax-exempt status and another organization’s insurance coverage, with a few possible exceptions (such as if a food distribution site is located in a building insured by another entity). On the other hand, one sponsor can have multiple sponsored activities/sites. Fiscal Sponsors hold tremendous responsibility. They must ensure that their program and any sponsored projects comply with FA rules and requirements.
      5. When working with sponsored projects, the Lead Agency should engage the Fiscal Sponsor as the organization with which it holds the Sub Agency Agreement. The Fiscal Sponsor’s legal name, Tax ID, SAM, etc., should be listed on the Sub Agency Agreement. The Lead Agency should know who has signature permissions for the Fiscal Sponsor and whether an MOU is in place with the sponsored project (as necessary).
      6. Fiscal sponsorship situations and the level of involvement the Sponsor has chosen to provide may differ case to case. Regardless, the Lead Agency should endeavor to reduce risk to itself, the program, the participating organizations and provide a framework for success in administering CSFP. If a Lead Agency has questions about fiscal sponsorship, contact the Regional Representative assigned to your agency.
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CSFP Procedures Manual Table of Contents
Section 2 Section 4
Revision History
Section 3 Revision 2025-04-23