iPhone steps adding back calories no matter the step count

I am trying to understand why my iphone steps add back calories that I can eat no matter the step count or my activity level settings. For example, if I have it set as "active", my calorie goal is 1700. The very first steps for the day start adding calories to my goal. So, say, at 100 steps for the day, my calorie goal is now 1703. And so on and so forth. If I set it to sedentary, my goal would be 1200, plus my 100 steps for 1203.

If set on active, my steps goal would be 10,000. So if I understand correctly, at the end of the day, if I have not reached 10k steps, then there should be no added calories. But at the very end of the day, say I have taken 5k steps, it will still add 60 or so calories to my allowed calories for the day (and on other activity levels, it still adds the exact same amount). I just don't understand why if I've reached only half of my activity level steps for the day at midnight, it is still adding calories.

Basically it seems to me that MFP is looking at my iphone steps as deliberate exercise outside of my selected activity level. I had thought that wasn't the point. Can anyone clarify?