Child nutrition programs help our nation’s children get the food they need to learn, grow, and thrive—especially children in low-income households. The largest programs—the National School Lunch Program (NSLP) and the School Breakfast Program (SBP)—provide nutritionally balanced, free, and low-cost meals to millions of children each day at school. Under the NSLP and SBP, close to 30 million children receive school lunch each day. Schools then receive federal reimbursements for every free, reduced-price, or full price meal served through a fixed reimbursement structure and strict eligibility criteria. And, unlike other district budget items or federal programs, school meals are run like a business and they depend heavily on federal reimbursements for school meals. The long-standing problem of school meal access and reimbursements, lunch shaming, lunch debt, and the stigmatization of children having to prove they are hungry and worthy of meals means millions of children lose out. It’s past time to abandon burdensome reimbursement and eligibility requirements and fully fund universal school meals for every child so that our programs are flexible and robust to meet children’s needs, not the other way around.
Federal school meal reimbursements are too low to meet children’s needs.
Even under normal circumstances, school nutrition programs operate on razor thin margins. Schools have to spend their own money upfront, serve the meals, and then fill out lengthy paperwork to even get reimbursement from the federal government. For the 2020- 2021 school year, the reimbursement rate for the average free lunch is $3.51, which is a fraction of the actual costs incurred – time spent, ingredients purchased, and labor needed – in preparing the meals to ensure that federal standards are met. . While geography, labor, fuel, and food vary tremendously between school districts, there is no question that the cost to produce school meals is astonishing, does not keep up with demand, and according to the USDA, far exceeds the amount schools are paid back. The USDA’s 2019 study on meal costs shows that schools spent an average of $3.81, but were only reimbursed $3.32 for the average free lunch subsidy. For breakfast, the average cost was $2.72 compared to the average breakfast subsidy of $1.88. This means schools must make money to cover these costs for which they are not reimbursed by selling snacks, a la carte options, and full-priced meals just to cover their basic operating costs. Even then, total revenues covered just 97 percent of total costs—meaning most school nutrition programs operated at a deficit even before the pandemic.
School nutrition programs can’t keep up during COVID-19.
While the USDA provided waiver flexibility to extend free meals for all kids during the 2020-2021 school year, children are still not receiving meals at a high enough rate and schools are reeling from financial losses. What’s worse, schools are incurring additional costs related to changes in school meal programs and COVID relief packages did not provide nearly enough emergency funding to help schools cover them during prolonged closures. As a result, school meal programs are incurring significant unexpected and unreimbursed costs for new necessities like:
- Bags, boxes, and other packing materials for take home and Grab ’n Go meals;
- Additional off-campus storage and refrigeration space along meal delivery routes;
- Increased labor to pack and deliver food;
- Personal protective equipment (PPE) and hazard pay for frontline workers risking their lives to keep children fed; and
- Delivery and transportation services.
Many schools have even stepped up to serve as community feeding sites and meet the needs of entire families—not just students—in response to rising unemployment, poverty, and hunger. Major public schools in New York City, for example, have been providing free meals to all residents since April. Nationwide, a third of school meal programs (33 percent) are offering free meals to adults as well as children. Schools are feeding entire communities and families with little upfront financial help from the federal government—and they’re going broke in the process. According to the Urban School Food Alliance, a number of large urban school districts are incurring roughly $300,000 in additional weekly expenses not covered by existing reimbursements.
At the same time, school meal programs are also losing revenue as participation and revenue decline due to the pandemic. In the first two months of the pandemic alone, schools served nearly 400 million fewer meals than they served at that time the year before. By this fall, nearly all schools (93 percent) were serving fewer meals than usual and a majority (54 percent) were serving less than half the meals typically served. In addition to lost revenue for school meal programs, this reduced participation shows us that the children who likely most needed the food to learn, grow, and thrive were not getting the nutrition they needed.
School meal programs need urgent relief and children need universal meals.
With costs rising and revenues declining due to COVID-19, school meal programs are now suffering devastating losses. More than half of school districts (54 percent) reported financial losses in the 2019-2020 school year and nearly a third did not have sufficient reserve funds to cover them. Of the 844 districts that suffered financial losses in the 2019-2020 school year, the average loss was $150,000. Financial losses ranged from $9,000 to $8.4 million, with the largest and poorest districts hit hardest. Combined, school nutrition programs lost a total of $483.5 million last year due to the pandemic—leaving them severely strapped. With a majority of school meal programs under water at the end of the 2019-2020 school year, even more—nearly two-thirds (62 percent)—anticipate financial losses for the 2020-2021 school year.
These deficits have already had catastrophic consequences for school nutrition workers and programs. As of September, half of schools had reassigned nutrition staff; a quarter had reduced worker hours; and nearly 8 percent had been forced to lay off employees. Some have also cut worker pay and benefits, despite the fact that school nutrition staff were already poorly paid and denied basic benefits like paid sick leave and health insurance prior to the pandemic. Some schools are even tapping into general education funds or turning to private donations just to stay afloat. The current business model of our school meal programs must be undone and changed from the ground up.
Without immediate action, school meal programs will be unable to weather this crisis and continue operations in the years to come. Schools desperately and urgently need financial relief to mitigate the losses they have experienced during COVID-19 and children need to have consistent and nutritious food, regardless of income or status. To sustain these essential nutrition programs to meet our children’s needs and prevent even deeper cuts in school budgets, Congress must provide additional, unrestricted funding to ensure school meal providers can cover their operating costs during and beyond this pandemic. While in the short-term, Congress has provided emergency funding for child nutrition programs to help offset the financial loss, it is simply not enough. To ensure schools can afford to feed all children in need, Congress should:
- Create a dedicated and unrestricted emergency funding stream to help schools cover unanticipated costs and mitigate financial losses in the future during a pandemic or economic downturn; and
- Enact universal free school meals to all children. Children should never have to prove they are worthy of nutritious food and schools should never have to go broke to serve them. Switching from the current reimbursement model to a universal model will ensure school meal programs are fully funded upfront and enable them to meet the needs of all children. Existing benefit and eligibility criteria are inflexible to the growing needs of children and families, especially in periods of economic downturn. Extending free meals to all students after the pandemic ends will eliminate the financial and administrative burdens of processing new applications and enable school meal programs to recover from losses incurred during this crisis.
As we look ahead to a new Congress and a new administration, we must seize our opportunity to learn from this crisis and reimagine child nutrition programs to better serve our children’s needs and to help schools stay afloat. For more information on our child nutrition priorities, click here.
This blog post was written by Austin Sowa and Emma Mehrabi.