Indiana Supreme Court says the state was wrong to drop a church day care from the federal child care food program
In a 3 to 2 ruling Oct. 26, the court held that the Indiana Department of Education abused its discretion by refusing to weigh a nonprofit day care's later fixes and by giving it little real help. The day care's place in the program is restored.
Indianapolis. The Indiana Supreme Court ruled Oct. 26 that the Indiana Department of Education abused its discretion when it terminated Mt. Zion's Loving Day Care Ministry, a church-based nonprofit day care on the east side of Indianapolis, from the federal Child and Adult Care Food Program. In a 3 to 2 decision written by Justice Christopher Goff, the court affirmed a Hamilton Superior Court order reinstating the day care, which has taken part in the program since 1999 and serves four meals a day to more than 100 infants and children.
The program, set by the U.S. Department of Agriculture and run in Indiana by the state's education department, reimburses child care centers, day care homes and adult day care centers for meals and snacks. When the state finds a participant "seriously deficient," federal rules require it to offer a chance at corrective action. If the problem comes back after that, the state must move to terminate, and the institution and its officials can be disqualified for seven years.
Labels a vendor did not supply
A 2022 review found the day care seriously deficient, citing among other things missing child nutrition labels for some commercially prepared foods. Mt. Zion said its vendor, Sysco, had not supplied them. The department accepted a revised plan in 2023 but warned that any recurrence would bring termination "without any further opportunity for corrective action." Two months later a new review found the labeling problem again, and a call with Sysco confirmed the vendor had failed to provide the labels at no fault of Mt. Zion, according to the opinion.
The department proposed termination and seven-year disqualifications that August. Under what the court called an unwritten policy, it refused to consider the day care's later efforts, which included hiring a specialist, buying meal planning software and making legal demands of the vendor.
What the ruling says for participants
The majority held that federal rules require only one opportunity to correct, but that the department kept the discretion, described in a USDA handbook, to accept corrective action up to the administrative hearing, and that a blanket refusal to use it was arbitrary and capricious. It also held that a state agency that fails to give an institution sufficient technical assistance should not be able to terminate it. Here the department had sent a guide and a template Mt. Zion already had.
“The serious-deficiency process is designed to keep participating institutions in the program so that children who might otherwise go hungry get fed.”
Justice Mark Massa joined the opinion, and Chief Justice Loretta Rush concurred in the judgment. Justice Geoffrey Slaughter, dissenting, wrote that federal law "does not require further administrative grace; it merely permits it," and that a rule the USDA proposed in February 2024 would change the process in any case. Justice Derek Molter also dissented. The Court of Appeals had ruled for the department in 2025; that opinion was vacated when the Supreme Court took the case.
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