“Schools tackle rising cost of giving more kids subsidized meals” by Emily Gersema – Aug. 11, 2008 – The Arizona Republic
Thousands of Arizona children from low-income families eat free or discount lunches every day at school, and food-service managers say that number is surging this year, posing a problem for school districts that have to absorb the extra costs.
The depressed economy is pushing thousands of families into government assistance programs that they thought they would never need, such as free and reduced-price school lunches. And as more children eat government-paid meals, school food-service programs find themselves increasingly shouldering the costs for much of the food.
Food-service directors say that’s because federal reimbursement rates have not kept pace with the recent leaps in inflation. They’re waiting for Congress to grant a bigger reimbursement, but that’s unlikely to happen anytime soon in this election year.
In the meantime, federal officials are urging school cafeterias to rein in growing expenses while continuing to serve meals that meet nutrition standards. Nationwide, more than 31 million children eat the U.S. Department of Agriculture’s free or discount lunches at school. Some 633,000 of those kids live in Arizona – more than 55 percent of the students enrolled in schools statewide.
Numbers rising in Ariz.
In the past five years, Arizona, which ranks 15th nationally in overall enrollment, has added 115,000 kids to the federal lunch program – a steady and predictable increase. This year will be different, though. School food-service directors believe that the previous rate of increase in enrollment will look like a gradual trek up a steady slope turned into a steep climb up Everest.
They cite a couple of factors.
For years, districts have been under pressure to enroll as many eligible children as possible into the lunch program because of scrutiny by federal and congressional auditors, as well as advocacy groups. Congress authorizes funding for the meals based on the estimated number of eligible children, regardless of whether they’re all enrolled.
The program, which dates back to the late 1960s, is meant to ensure that all children can get a nutritious meal. If most eligible children aren’t signed up, the backlash is two-fold: the government appears to be wasting money, and advocacy groups accuse the agency of letting children go hungry. School food-service directors are dealing with other pressures, but the economic downturn is what worries them most. Districts that have never reported large numbers of low-income children now are seeing an influx.
Five years ago, Gilbert Public Schools reported that 16 percent of its students were getting either free or reduced-price lunches. In April this year, the district was serving those meals to more than 7,500 children – nearly 20 percent of its 38,500 students.
“I expect a lot more kids this year,” said Debbie McCarron, director of food services for Gilbert Public Schools.
At the same time, she and other district food managers know their costs are already going up.
USDA annually increases the reimbursement rate it pays schools to cover the cost of the federal meals scheme. The increase is designed to adjust for inflation, but this year, food prices have been difficult to predict. According to the U.S. Consumer Price Index, in the first six months of this year food expenses rose at a rate of 8.7 percent – a much larger increase than the 5.6 percent reported for the whole of 2007.
USDA announced this summer it would pay about a dime more than last year’s per-meal subsidy, paying a maximum of $2.34 per meal for a discount lunch and $2.74 for a free one. Mary Szafranski, who oversees school food-service issues for the state Department of Education, said the problem is that in this economy “the money buys less food.”
School food-service directors nationwide have pointed out this issue to USDA, which is waiting for Congress to renew the child nutrition programs for 2009.
With food costs propelled higher by ballooning transportation and fuel expenses, food-service representatives will lobby Congress for increased reimbursement over the next several months. But some districts facing potential budget shortfalls can’t wait for new legislation and are coming up with strategies to keep their costs in check while still fulfilling the nutrient requirements set by USDA.
Pinching pennies
School food services are self-sustaining. They don’t get any money from their district’s state-funded budgets to stock and run their cafeterias, but they rely mostly on USDA reimbursements and the lunch money that districts collect from students who don’t qualify for federal aid.
To cover the gap between costs and reimbursement, many districts have approval from their school boards to raise the lunch and breakfast rates for paying students, or have begun charging more for a la carte items.
District food-service directors who lost the fight to raise cafeteria prices have had to be more innovative. They have either stopped serving more expensive packaged goods, such as yogurt or pudding, or limited the number of days they offer them.
They also have begun taking advantage of the inexpensive items that USDA channels into the food-assistance programs, usually after bailing out farmers drowning in bumper crops.
Janine Smith, president of the School Nutrition Association of Arizona, said the organization is advising food-service managers to re-examine their practices to save money in all aspects of their operations without hurting their meals’ nutritional content.
Loretta Zullo, who directs food and nutrition services for Mesa Public Schools, said the governing board denied her request to let cafeterias raise their rates, so she and her staff have been examining their food purchases to see if they could replace more expensive items with cheaper ones. Some have either been cut from the menu or reduced to a few times a month.
With 72,000 students, Mesa is the state’s largest school district and has cafeterias at 86 sites serving breakfast and lunch. Zullo said juice used to be offered daily but will appear in the cafeteria just two breakfasts a week.
Olives used to be a regular feature at lunch and now will be an occasional treat. For every item a service cuts or swaps, cafeterias save more money – and hope kids might even like the changes. “They’re probably going to like these waffle things better than the muffin,” Zullo said.
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