The school lunch and school breakfast programs are among the largest of these programs. Any child at a participating school may purchase a meal through the school meals programs. These processes comprise only a small part of the federal school meal programs’ administrative requirements. Costs for Providing, Accepting, and Reviewing Applications for Free and Reduced-Price Meals

For school year 2000-01, the estimated application process costs at the federal and state levels were much less than 1 cent per program dollar, and the median cost at the local level was 1 cent per program dollar. In this way, eligible children can receive free or reduced-price school meals without being delayed by the verification process. The federal and state level costs were incurred for providing oversight and administering funds for reimbursement throughout the school year. In comparison, FNS administered $8 billion and the region administered $881 million in the school meals program. State agencies are responsible for operating a system to reimburse school food authorities for the meals served to children. To calculate these costs we: (1) divided the school program dollars by the school food authority program dollars; (2) multiplied the resulting amount by the total school food authority costs for each process—application, verification, and meal counting and reimbursement claiming—to determine the portion of the costs for each process at the school food authority that was attributable to each selected school; (3) added these costs to the total costs for each of the schools; and (4) divided the resulting total amount by the program dollars for each selected school to arrive at the cost per program dollar at the local level for each school.
What GAO Found

Each school day, millions of children receive meals and snacks provided through the National School Lunch and National School Breakfast Programs. Any child at a participating school may purchase a meal through these school meal programs, and children from households that apply and meet established income guidelines can receive these meals free or at a reduced price. The federal government reimburses the states, which in turn reimburse school food authorities for each meal served. During fiscal year 2001, the federal government spent $8 billion in reimbursements for school meals. The Department of Agriculture's Food and Nutrition Service, state agencies, and school food authorities all play a role in these school meal programs. GAO reported that costs for the application, verification, and meal counting and reimbursement processes for the school meal programs were incurred mainly at the local level. Estimated federal and state-level costs during school year 2000-2001 for these three processes were generally much less than 1 cent per program dollar administered. At the local level--selected schools and the related school food authorities--the median estimated cost for these processes was 8 cents per program dollar and ranged from 3 cents to 16 cents per program dollar. The largest costs at the local level were for counting meals and submitting claims for reimbursement. Estimated costs related to the application process were the next largest, and estimated verification process costs were the lowest of the three.