Dive Brief:

• As school districts’ meal programs report significant financial shortfalls due to the pandemic, the U.S. Department of Agriculture announced Friday it will pump about $750 million of additional funding into school meals nationwide this school year. Schools will now receive 22% more for school lunch reimbursements than under normal conditions, according to USDA. 
• USDA’s extra funding looks to help school meal programs keep pace with food and operational costs just as districts grapple with supply chain issues impacting their food service departments. 
• While praising USDA’s latest assistance, some school nutrition experts and advocates agree long-term solutions are still needed to avoid a potential collapse of school meal programs. 

Dive Insight:

Some solutions include balancing the supply chain and providing emergency funding to help school meal programs return to a profitable model, said Elizabeth Campbell, a registered dietitian and senior director of legislative and government affairs for the Academy of Nutrition and Dietetics. 

The previous increase in reimbursement rates was insufficient for child nutrition programs funded by the USDA, Campbell said. At the start of the 2021-22 school year, the lunch reimbursement rate for schools was 15% higher than the standard reimbursement rate. 

Just half of 1,212 surveyed districts in the fall of 2021 by the School Nutrition Association found the prior increase sufficient to cover costs.

USDA has currently approved an extension of universal free meals from the beginning of the pandemic through the 2021-22 school year, but advocates agree universal meals for school-aged children should be a permanent policy decision. 

It’s important to look at food as a significant part of education, said Lisa Davis, senior vice president of Share Our Strength. The national organization runs the nonprofit campaign No Kid Hungry, which aims to end child hunger. 

“If kids are coming to school hungry, they aren’t going to be able to learn,” Davis said. “With so many kids and families that are financially challenged, we need to make sure that our schools are continu[ing] to be empowered to help make sure those kids get those nutritious building blocks.”

Yet if funding isn’t sustained for school meal programs in the future, it’s possible food quality will drop or even the whole system could collapse, Campbell said. 

Campbell expressed concern about vendors pulling out of the school food service market, noting some have already done so and this could cause a "domino effect."

“That would be detrimental to the health of the country, certainly in food security,” Campbell said.

USDA’s higher reimbursement rates for school meals is a “brilliant approach,” said Crystal FitzSimons, director of school and out-of-school time programs at the Food Research and Action Center. Food insecurity has also skyrocketed among children as the pandemic initially caused major job and wage loss for families, she said. 

“People are definitely thinking about school nutrition finances and how do we make sure that these programs continue because they are so critical to students' learning and success,” FitzSimons said. 

The financial success of food service programs depends on student participation rates, too, she said. 

The National School Lunch Program served meals to 29.6 million children in fiscal year 2019, according to USDA. As schools pivoted to remote learning in 2020, that number dropped to 22.6 million children served in FY 2020. FitzSimons said preliminary USDA data shows the downward trend might have continued into FY 2021. 

On top of that, USDA’s waiver authority to provide funding flexibility for school meals is set to expire June 30. Schools still have a need for these extended waivers for the next school year, FitzSimons added. 

“We know that having the waivers end in the middle of the summer food program is going to be a challenge for schools and community-based organizations,” she said.

But it’s possible Congress could extend the USDA’s waiver authority as soon as February by including it in an omnibus spending bill, FitzSimons said.