Contracting with a Food Service Management Company (FSMC)

An FSMC is an organization that performs one or more activities of the food service operation on behalf of a school nutrition program sponsor. These activities may include any or all of the following services: meal preparations, bookkeeping, menu development, and maintenance of program documents.

FSMC contracts are valid for up to one year from the date that they are signed by all parties and may be renewed for up to four additional one-year terms. Federal regulations require that Sponsors annually submit all new contracts, corresponding RFP documents, and/or annual contract extensions to the Arizona Department of Education (ADE), Health and Nutrition Services Office.

Federal regulations require that all purchases of goods and services using food service revenues follow federal procurement regulations. Specifically, sponsors must adhere to a competitive bidding process, and FSMC contracts must include federally required Provisions. In addition, the sponsor is responsible for preparing all solicitation documents.

The Arizona Department of Education (ADE) has created a Template Request for Proposal and Template RFP Rubric for soliciting a Food Service Management Company. It is Required that Sponsors use these documents for their Solicitation process. Mandatory training is required before beginning the formal procurement process. Please contact the Contracts Management Officer for more information.

Contract Amendments

Per the CFRs, the duration of a contract can be no longer than one-year. Annual contract amendments are allowable as long as they do not exceed four (4) additional one-year extensions from the original contract period. Contracts must not contain automatic renewal provisions. Any provisions, including adjustments to payments that will be used for contract amendment, must be stated in the contract and the IFB or RFP, as applicable. While contract amendments are permitted, a SFA is not required to renew the contract for an additional year and should do so only after careful evaluation of the FSMC’s performance and a determination that the renewal will benefit the SFA.

ADE must review and approve the contract amendment prior to obtaining signatures from both parties. Keep in mind, any changes to the contract cannot result in a material change. In order to approve the amendment, the SFA must provide ADE with the following documents:

  • Food Service Management Company (FSMC) Contract Amendment Checklist; This is the Template Contract Amendment Checklist that Sponsors use to ensure they meet all the CFR provisions when they submit their contract amendment to ADE.
  • Fixed–Fee Contract Amendment; This is the contract amendment template that Sponsors use to extend their Fixed-Fee FSMC contract for additional twelve months.
  • Cost-Reimbursable Contract Amendment; This is the contract amendment template that Sponsors use to extend their cost-reimbursable FSMC contract for additional twelve months.
  • Signed copy of Certification of Independent Price Determination; and
  • Signed copy of the Certification Regarding Lobbying.
  • Fixed-Fee Pricing Summary (if applicable);
  • Fixed-Fee Contract Amendment Financial Worksheet (if applicable);
  • Cost-Reimbursable Pricing Summary (if applicable);
  • Cost-Reimbursable Contract Amendment Financial Worksheet (if applicable);
  • Schedule of Terms of FSMC Guarantee form (if applicable);

Once ADE has approved the contract amendment, the SFA must send ADE the signed copy within ten (10) days.

For more information please contact:

Veronica Cramer Contracts Management Officer Health and Nutrition Services (602) 364-1965 [email protected]