Free and Reduced-price School Meals for Low- Income Students

The majority of the meals served through the NSLP and SBP are provided  for free or at a reduced price to low-income students. Student Meal Fees and Federal Reimbursements in a District ERP Program

While a typical school district participating in the NSLP or SBP collects  fees from eligible students who receive reduced-price meals, districts with  ERP programs have chosen to provide free meals to reduced-price-eligible  students and bear the cost of the reduced-price fees that these students  otherwise would have paid (for a comparison of fees and reimbursements  for districts with and without an ERP lunch program, see fig. Some States and Districts Eliminated the Reduced-price Fee to Increase Participation or Reduce Hunger

Acting on their own initiative, at least 5 states and 35 school districts  eliminated the reduced-price fee for breakfast, lunch, or both meals in  school year 2008-2009, primarily to increase participation or reduce  hunger. One State and Most Districts That Eliminated the Reduced-price Fee Reported Increased Participation, Which Partially Offset Program Costs

		One State and Most Districts with ERP Programs Reported Increased Participation, and Most Districts Observed No Effect on Administrative Errors

One state official and SFA officials in most districts we surveyed reported  that their ERP programs have increased the rate of participation among  students who are eligible for reduced-price meals. Further, in the four  districts that implemented their ERP programs in school year 2007-2008  and provided participation data—2 of these districts had ERP programs  for breakfast and lunch, and 2 districts limited their ERP programs to  breakfast—the increase in the breakfast participation rate (2 to 11  percentage points) and lunch participation rate (7 to 10 percentage points)  among reduced-price-eligible students was greater than the national  change in these participation rates (less than a 1 percentage point change  each for breakfast and lunch). While increased federal reimbursements partially offset program costs for  the state and district ERP programs that experienced increased  participation, all 5 state ERP programs used state appropriations to cover  their remaining program costs, and districts used a variety of revenue  sources to manage their remaining program costs. Supportive State Legislators and District School Boards Helped Establish ERP Programs, but Fiscal Challenges Could Hinder Program Continuation

		Support from State Legislators, Nonprofit Organizations, District School Boards, and Superintendents Helped Establish ERP Programs

Supportive legislators and nonprofit organizations played a major role in  establishing ERP programs at the state level, and support from school  boards and superintendents was a major factor in establishing programs at  the district level. Officials from all 5 state programs indicated that dedicated state  appropriations were a primary source of ERP funding, and officials from  four of these states indicated that a loss of state funding would be a threat  to the continuation of their programs. USDA did not provide written comments. However, FNS provided us with  technical comments that helped clarify our report’s findings, which we  incorporated where appropriate. Appendix I: Objectives, Scope, and Methodology

To provide a better understanding of the experiences of states and school  districts with programs that eliminated the reduced-price fee (known as  ERP programs), this report presents information on the following  questions: (1) What is known about the state and local jurisdictions that  have eliminated the reduced-price fee for the school lunch or breakfast  programs? Survey of District-level SFA Officials

We also conducted a Web-based survey of SFA officials in 51 school  districts initially identified as having implemented these programs. Because the universe of  districts with ERP programs is unknown, the results of our survey cannot  be generalized to all districts with ERP programs. The questionnaire asked SFA officials about the number  of students eligible for reduced-price meals; the meals and grades covered  by the ERP programs; the reasons they implemented these programs; the  duration of these programs; the effects of the programs on participation,  errors, and costs; the factors that helped or hindered program  implementation; and whether or not they plan to continue the ERP  programs in the future.
Why GAO Did This Study

In fiscal year 2008, about 31 million children participated in the National School Lunch Program and more than 10 million children participated in the School Breakfast Program each school day. The U.S. Department of Agriculture's (USDA) Food and Nutrition Service (FNS) spent $11.7 billion on the school meal programs in that year. The majority of school meals are provided for free or at a reduced price to low-income students. Some states and school districts have chosen to implement programs that eliminate the reduced-price fee (known as ERP programs) and instead provide free meals to students eligible for the reduced fee. GAO was asked to provide information on (1) what is known about the states and districts that have eliminated the reduced-price fee for school meals, (2) the experiences of states and districts that have ERP programs with respect to participation, errors, and costs, and (3) the factors that may help or hinder the establishment or continuation of ERP programs. To obtain this information, GAO interviewed FNS officials, interviewed officials from state- and district-level programs, and conducted a Web-based survey of the 35 districts identified as having ERP programs. However, because the universe of ERP programs is unknown, survey results cannot be generalized to all districts with ERP programs. USDA did not provide formal written comments, but FNS provided technical comments, which were incorporated where appropriate.

What GAO Found

GAO identified 5 states and an additional 35 school districts in 19 other states that eliminated the reduced-price fee for school meals, primarily to increase participation or reduce hunger. States and districts eliminated reduced-price fees for either breakfast or lunch or, in some cases, for both meals. Further, some ERP programs included all grades, and some covered only the early school years. One state- and most district-level officials GAO interviewed or surveyed reported that ERP programs have increased the rate of participation among students who are eligible for reduced-price meals. Participation may increase for a number of reasons; however, for those districts that implemented ERP programs in the most recently completed school year (2007-2008) and provided participation data, their average increase in the participation rate among reduced-price-eligible students was greater than the national change in this rate over the same year. ERP programs involve additional costs to states and districts, as they bear the cost of the reduced-price fees that these students otherwise would have paid. For the state and district ERP programs that experienced increased participation, FNS reimbursements, and thus federal costs, also increased. While the increased reimbursements partially offset program costs, state ERP programs covered their remaining costs with state funds and districts used a variety of revenue sources. The majority of district-level officials reported that their districts experienced benefits from the ERP programs, such as a decrease in the burden on staff to collect unpaid meal fees from reduced-price-eligible students who received school meals but who charged these meals and built up a balance of unpaid meal fees. State officials GAO interviewed cited support from legislators and nonprofit organizations in establishing ERP programs in state law. Supportive school boards and superintendents were a major factor in establishing district-level programs. Most state officials indicated that a loss of state funding would threaten program continuation, while some district-level officials indicated they would try to raise additional revenue or reduce expenditures to cover program costs. As of late 2008, officials from all 5 states and most district-level ERP programs planned to continue their programs.