Recipient agencies (RAs) may use contracts with the food processing industry to convert commodity foods into more convenient and usable forms. This may provide more varied and higher quality meals, reduce labor and waste and stabilize costs through portion control.

State and federal auditors  require that recipient agencies (RAs) submit copies of shipping invoices once the products are received. This ensures all products that are  diverted and charged to the state’s entitlement and the recipient agencies (RAs) planned assistance level are  received. Due to the amount of staff time required to order and track these shipments, the Commodity Distribution Unit (CDU) requires that a full truck be sold before an order is placed. The Commodity Distribution Unit (CDU) will not order unless the broker or processor can provide lists and amounts to be charged to individual RAs planned assistance levels. The Commodity Distribution Unit (CDU) does not allow RAs to backhaul from the warehouse in McAlester. The Commodity Distribution Unit (CDU) does not deliver processed items.

The recipient agency (RA) must keep inventory records on processed items. If the products are listed with other purchased items, they must have a designation code or mark of some kind for tracking. Once a processed item is received by the recipient agency (RA), there a form must be completed and submitted to the Commodity Distribution Unit (CDU). This form can be found on the OKDHS Web site.

A processing contract is a written agreement with a commercial food processor to provide a service or a product made partially or wholly from food donated by USDA. The Commodity Distribution Unit (CDU) and the USDA must approve all processing contracts. The processors may sign a contract any time during the year, but all contracts expire June 30. The contract can be extended for one year at a time, not to exceed two extensions before a new contract is required. The Commodity Distribution Unit (CDU) processing specialist notifies all processors when USDA releases a new survey. There are capped amounts set by USDA for categories of products.

Note: The recipient agency (RA) pays the cost of processing directly to the processor.

A large variety of products can be processed from donated food. Some examples are:

• bread products from flour, nonfat dry milk, shortening, rolled wheat and oats, raisins, and peanut butter and granules;
• pizza from flour, cheese, tomato paste, and oil;
• ice cream and frozen yogurt from nonfat dry milk;
• Mayonnaise and salad dressing from soybean oil;
• pre-cooked, portion-controlled meatballs, beef patties, and meat loaves from ground beef or ground pork or both; and
• pre-cooked, portion-controlled nuggets, patties, and roasts from chicken or turkey.

Recipient agencies (RAs) in Oklahoma may participate in processing. The Commodity Distribution Unit (CDU) can have the commodity shipped directly, commonly referred to as “diverted,” to the processing plant. The processor produces a finished product and ships it directly to the recipient agency (RA).

Contact Judy Rider, Judy.Rider@OKDHS.org, (405) 522-1747, for information about this program.