1. Introduction
This case concerns the limits of administrative discretion when a state agency administers a federal nutrition program. The Indiana Department of Education (DOE) terminated Mt. Zion's Loving Day Care Ministry from the Child and Adult Care Food Program (CACFP) after previously corrected compliance deficiencies recurred. The central question was not whether compliance mattered, but whether the DOE could categorically refuse to consider further corrective efforts when federal guidance permitted their consideration.
Mt. Zion, a church-based nonprofit day care in Indianapolis, had participated in the program since 1999. It served four meals daily to more than one hundred infants and children, many from disadvantaged households. Its fellow petitioners were Bishop Lambert Gates, who chaired the church managing the day care; Patti Jones, responsible for menus, food purchasing, and program reporting; and Sheryl Jennings, responsible for program-related financial management.
The Supreme Court affirmed the trial court’s order reinstating Mt. Zion’s participation. Justice Goff’s lead opinion concluded that the DOE acted arbitrarily by refusing to consider additional corrective efforts, providing insufficient technical assistance, and administering the serious-deficiency process inconsistently.
2. Background and Procedural History
Recurring deficiencies and corrective efforts
Administrative reviews in 2015 and 2018 identified noncompliant meal menus. On both occasions, the DOE offered corrective opportunities, and Mt. Zion corrected the problems.
Following pandemic-related delays, the next review occurred in 2022. The DOE identified missing child-nutrition labels, inadequate whole-grain offerings, missing recipes, insufficient food and milk quantities, and improper treatment of a dessert as a grain. These findings resulted in a serious-deficiency notice.
Mt. Zion submitted a corrective-action plan within two weeks. It explained that pandemic-related difficulties had prevented it from obtaining required labels from Sysco, its third-party food vendor. After the DOE rejected the initial plan, Mt. Zion requested technical assistance. The DOE supplied a guide and template that Mt. Zion already possessed.
A revised plan ultimately satisfied the DOE. Its closure letter stated that Mt. Zion had “fully and permanently corrected” the deficiencies, while also temporarily deferring the serious-deficiency determination. The letter warned that recurrence would trigger proposed termination “without any further opportunity for corrective action.”
Termination despite further remedial measures
A May 2023 review identified recurring labeling and meal-pattern deficiencies. During that review, a telephone conversation involving Mt. Zion, the DOE, and Sysco confirmed that the vendor had failed to supply labels through no fault of Mt. Zion.
The DOE proposed termination and seven-year disqualification of the institution and the individual petitioners. Mt. Zion then hired a CACFP specialist, purchased meal-planning software, sought additional assistance, and made written legal demands for Sysco to provide the labels.
The DOE refused to consider these efforts because its policy barred further corrective action once proposed termination began. An administrative law judge upheld termination, relying on recurring deficiencies and a history of noncompliance dating to 2015.
Judicial review
The trial court reversed, finding the DOE’s unwritten prohibition arbitrary and unlawful. It ordered reinstatement and technical assistance. The Court of Appeals unanimously reversed the trial court. The Supreme Court then granted transfer, vacating the appellate opinion under Indiana Appellate Rule 58(A), and affirmed the trial court’s judgment.
3. Summary of the Opinion
The lead opinion rests on three principal conclusions:
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Discretion required meaningful consideration. Federal regulations required one corrective opportunity, which Mt. Zion received. Nevertheless, federal guidance permitted additional corrective action. A blanket policy refusing to consider it improperly displaced that discretion.
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Technical assistance had to be sufficient for the actual problem. Providing existing templates and general training did not adequately address Mt. Zion’s specific difficulty obtaining nutrition labels.
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Inconsistent administration undermined the termination decision. Earlier recurring deficiencies had generated new corrective opportunities, while the DOE’s assurances of permanent correction and warnings of deferred termination left the continuing effect of old deficiencies unclear.
The opinion did not establish an unconditional right to unlimited corrective opportunities. Its central distinction was between a reasoned refusal to accept further correction and a categorical refusal even to consider it.
4. Governing Legal Framework
The federal-state program structure
CACFP reimburses participating institutions for qualifying food-service costs. Congress established its nutritional objectives in 42 U.S.C. § 1766, while federal regulations assign program administration to state agencies. In Indiana, that agency is the DOE.
Participating institutions undergo periodic administrative reviews. A serious-deficiency finding generally triggers notice and an opportunity to correct, except where an imminent threat to participants’ health or safety requires different treatment.
If deficiencies are timely corrected, the agency defers the serious-deficiency determination. If they recur, 7 C.F.R. § 226.6(c)(3)(iii)(B)(3) requires immediate notice of an intent to terminate and disqualify. That requirement concerns initiating the termination process; the lead opinion did not treat it as eliminating all subsequent remedial discretion.
The handbook’s significance
The CACFP Handbook advises institutions to continue corrective efforts despite a proposed termination. Its provisions describe opportunities extending to the administrative hearing or the hearing official’s decision, and state that the agency “may (but is not required to)” accept corrective action and defer termination.
The lead opinion consulted the handbook because 7 C.F.R. § 226.6(m)(3)(iv) requires consideration of applicable federal instructions and handbooks that clarify the program without conflicting with its governing provisions. Thus, the handbook informed the scope of permissible discretion; it did not itself create an automatic entitlement to another successful correction period.
Judicial review of agency action
Indiana Code § 4-21.5-5-14(d)(1), (5), as quoted in the opinion, authorizes reversal of agency action that is arbitrary, capricious, an abuse of discretion, otherwise unlawful, or unsupported by a preponderance of the evidence.
The opinion also distinguishes factual findings from legal conclusions: supported agency factfinding receives deference, while courts independently resolve legal questions. The decisive inquiry concerned the legality and rationality of the DOE’s decisionmaking process, not merely whether some deficiencies existed.
5. Precedents Cited and Their Influence
Authorities supporting the lead opinion
255 Morris, LLC v. Ind. Alcohol & Tobacco Comm'n, 93 N.E.3d 1149 (Ind. Ct. App. 2018)
This decision supplied the definition of arbitrary-and-capricious action: a patently unreasonable decision made without considering the facts, in disregard of the circumstances, and without a basis supporting a reasonable person’s agreement. It also supplied the distinction between deference to supported factual findings and independent judicial review of legal conclusions.
Its influence was methodological. The issue was not whether termination was an authorized sanction in general, but whether this termination reflected consideration of the relevant circumstances.
Niz-Chavez v. Garland, 141 S.Ct. 1474 (2021)
The lead opinion invoked this decision’s treatment of the singular phrase “a notice” when interpreting the requirement to provide “an opportunity” for correction. It concluded that the regulations required one corrective opportunity, not repeated opportunities as an automatic entitlement.
This citation limits the decision’s reach. Mt. Zion’s success did not depend on construing the regulations to mandate another corrective period whenever deficiencies recurred. Instead, it depended on the DOE’s failure to consider an additional opportunity that remained legally available.
Munoz-Pacheco v. Holder, 673 F.3d 741 (7th Cir. 2012)
This was the central precedent for the discretion analysis. The quoted principle states that failing to exercise discretion is a legal mistake, and that overlooking relevant evidence is not an exercise of discretion.
Applied here, the DOE’s advance declaration that no further correction would be considered prevented an individualized evaluation of Mt. Zion’s remedial work, vendor difficulties, and prospects of compliance. The lead opinion treated that categorical exclusion as fundamentally different from considering the evidence and finding it insufficient.
Nardi v. King, 253 N.E.3d 1098 (Ind. 2025)
The lead opinion cited this case for reading statutory language logically and consistently with its underlying policy and goals. It used that principle to connect the obligation to provide sufficient technical assistance with CACFP’s objective of maintaining effective food services.
This authority supported the conclusion that an agency should not terminate an institution while failing to provide the assistance intended to help it comply. That interpretive move became a principal point of disagreement in Justice Slaughter’s dissent.
The displaced appellate decision
Indiana Dep't of Educ. v. Mt. Zion's Loving Day Care Ministry, 273 N.E.3d 418 (Ind. Ct. App. 2025)
The Court of Appeals concluded that the DOE did not have to offer additional corrective opportunities after deferral. It also rejected the argument that termination was limited to institutions unwilling or incapable of correction, and found no obligation to provide further assistance after corrective opportunities ended.
Granting transfer vacated that opinion. Nevertheless, its reasoning remained important to the disagreement: Justice Molter expressly adopted Judge Bailey’s appellate analysis, while Justice Slaughter would have denied transfer or summarily affirmed the appellate opinion.
Authorities supporting Justice Slaughter’s dissent
Marshall v. City of Chicago, 762 F.3d 573 (7th Cir. 2014)
Justice Slaughter relied on the proposition that denying a motion can be as much an exercise of discretion as granting it. He viewed the DOE’s refusal to allow additional correction as a permissible discretionary choice, not a failure to make one.
This authority exposes the central disagreement: whether the DOE made an authorized negative decision or improperly replaced individualized discretion with an inflexible policy.
Magwood v. Patterson, 561 U.S. 320 (2010)
Justice Slaughter cited this decision against replacing statutory text with speculation about congressional intent. In his view, CACFP’s beneficial purpose could not create a defense to termination that Congress had not expressly provided.
The citation directly challenges the lead opinion’s use of program objectives to connect insufficient technical assistance with the invalidity of termination.
McGirt v. Oklahoma, 591 U.S. 894 (2020), and Oklahoma v. Castro-Huerta, 597 U.S. 629 (2022)
Justice Slaughter quoted McGirt v. Oklahoma for the principle that future plans are not current law. He invoked it to challenge reliance on an unadopted federal regulatory proposal. The reference to Oklahoma v. Castro-Huerta identified that McGirt v. Oklahoma had been limited on other grounds; it supplied no separate CACFP rule.
6. Analysis of the Legal Reasoning
Permissive authority does not necessarily permit categorical nonconsideration
The lead opinion acknowledged the handbook’s permissive language. Its reasoning was that permission to accept further correction necessarily left room for meaningful evaluation, while the DOE’s blanket prohibition foreclosed that evaluation altogether.
Mt. Zion’s specialist, software purchase, demands to its vendor, and repeated assistance requests were therefore legally relevant. The agency did not have to find these measures successful, but, under the lead opinion’s approach, it could not dismiss them solely because termination had already been proposed.
The vendor’s responsibility and the absence of danger to children strengthened that conclusion. Neither circumstance erased the institution’s compliance duties. Rather, they made a reasoned assessment especially important before imposing a seven-year exclusion affecting both the provider and the children it served.
“Sufficient” assistance requires attention to the identified obstacle
The lead opinion relied principally on 42 U.S.C. § 1766(k), which requires participating states to provide sufficient technical assistance, together with regulatory duties to correct program irregularities. It also referred to the assistance provisions in § 1766(u)(3).
The administrative law judge found that written assistance and training had occurred, but did not determine whether they were sufficient. The lead opinion treated that omission as significant: the existence of assistance does not establish its adequacy.
Sending familiar materials did little to address the vendor-labeling problem. The DOE representative’s testimony that she would not have offered guidance on working with the vendor reinforced the conclusion that assistance had not been directed toward the actual obstacle.
The strongest interpretive step was treating insufficient assistance as an impediment to termination even though the regulations did not expressly make assistance a prerequisite. Justice Slaughter disputed both that consequence and the statutory foundation. He emphasized that § 1766(u)(3)(A) imposes duties on the federal Secretary and concerns nutritional compliance, including interpreting labels, rather than requiring the DOE to help obtain them.
Consistency and notice matter independently of substantive compliance
The DOE’s warning against future corrective opportunities was explicit. Nevertheless, the lead opinion found broader ambiguity in describing deficiencies as permanently corrected while preserving a deferred termination process of uncertain duration.
Earlier recurring deficiencies had generated fresh opportunities to correct. Later, the agency relied on that same historical pattern to support termination. The concern was therefore not simply whether Mt. Zion received a warning, but whether the agency coherently explained when past deficiencies remained operative.
Justice Slaughter considered the explicit warning sufficient. The disagreement concerns the clarity of the overall administrative framework, not merely the wording of one sentence. The opinion did not announce a separate constitutional due-process holding.
The proposed regulation was corroborative, not governing law
A February 2024 federal proposal acknowledged uncertainty in “fully and permanently corrected” and contemplated vacating, rather than merely deferring, termination after successful correction. Under that proposed system, later recurrence would initiate a new serious-deficiency process.
The lead opinion expressly recognized that the proposal did not govern the DOE’s conduct. It nevertheless considered the proposal supportive of its concerns about ambiguity. Justice Slaughter regarded this reliance as misplaced because a proposed change cannot establish what existing law already requires. The supplied opinion does not establish that the proposal became final.
7. Potential Impact and Limits
Administrative decisionmaking
The decision gives CACFP administrators a strong reason to document consideration of corrective measures submitted after proposed termination. A reasoned explanation for rejecting those measures is materially different from asserting that they can never be considered.
It also encourages agencies to tailor technical assistance to identified compliance barriers and to explain how deferred deficiencies affect later reviews.
Future institutional challenges
Providers challenging termination may focus on excluded remedial evidence, unresolved requests for targeted help, and inconsistent treatment of previous corrections. Evidence of genuine remedial efforts and third-party obstacles may be particularly important.
The case does not make vendor fault a universal defense, excuse meal-pattern violations, or guarantee repeated opportunities to cure. Nor does it prevent termination following a lawful, adequately supported decision.
Broader administrative law
The reasoning may be persuasive where an agency possesses remedial discretion but uses a rigid policy to avoid considering relevant circumstances. Its reach remains qualified by the fragmented vote and the particular combination of federal regulations, handbook provisions, and assistance obligations involved here.
Future courts should distinguish the binding disposition from broader propositions supported only by the two-justice lead opinion. The concurrence in the judgment supplies no additional explanation from which to identify agreement on every rationale.
8. Complex Concepts Simplified
- Arbitrary and capricious
- A decision lacking a reasonable connection to the relevant facts and circumstances—not simply a decision with which a court disagrees.
- Abuse of discretion
- Using legally granted decisionmaking authority improperly, including, under the lead opinion’s approach, refusing to consider matters that the governing framework permits the agency to evaluate.
- Serious deficiency
- A program-compliance classification that triggers corrective procedures and possible exclusion. It does not necessarily mean that children face immediate physical danger.
- Deferred determination
- A finding placed on hold rather than erased. Here, that distinction allowed earlier deficiencies to retain consequences after correction.
- Proposed termination
- The beginning of an exclusion process, not necessarily its final outcome.
- Technical assistance
- Practical help with program compliance. The disputed question was whether general materials were enough when a provider requested help with a specific recurring problem.
- Concurrence in the judgment
- Agreement with the result without necessarily endorsing the opinion’s reasoning.
- Vacatur on transfer
- The procedural consequence by which the intermediate appellate opinion was displaced when the Supreme Court accepted the case.
9. Conclusion
The Supreme Court restored Mt. Zion’s CACFP participation. The lead opinion’s central lesson is that lawful discretion requires more than invoking a categorical policy: agencies should consider relevant corrective efforts, provide assistance responsive to actual compliance problems, and administer deferred deficiencies coherently.
The decision does not promise unlimited corrective opportunities. Its broader significance lies in the distinction between a reasoned refusal and a refusal to reason—subject to the important limitation that only two justices joined the full rationale.