2023 Position Paper: Reimbursement Rate

Make permanent the National School Lunch and School Breakfast Program (NSLP/SBP) reimbursement rate increase provided in the bipartisan Keep Kids Fed Act (PL 117-158).

School meal programs have always operated on extremely tight budgets. Inflation, compounded by persistent supply chain disruptions and labor shortages, have been dramatically increasing costs for schools. In a recent SNA survey of school nutrition directors nationwide, increasing costs was the top challenge cited by nearly all respondents (99.8%), with 88.5% indicating costs are a significant challenge.

More than 90% of respondents also cited challenges with menu item shortages, discontinued menu items and supply shortages. As manufacturers and distributors reduced the number of products and services they offer, the ensuing scramble to secure foods and supplies drove up costs for school meal programs. Meanwhile, nationwide labor shortages required meal programs, which often compete with local restaurants for employees, to increase pay or offer bonuses to attract employees. 92.9% of school nutrition programs report challenges with staff shortages.

School meal programs are expected to be self-sustaining, covering their expenses with federal reimbursements and cafeteria sales. Recognizing cost challenges, Congress raised the School Year 2022/23 NSLP/SBP reimbursement rates by 40 cents per lunch and 15 cents per breakfast as part of the bipartisan Keep Kids Fed Act (PL 117-158).

Nearly all respondents (99.2%) expressed concern about reimbursement adequacy when these additional funds expire in July 2023, and 80.7% expressed serious concerns. Despite these additional funds, 56.6% of school nutrition directors reported the higher reimbursement rate fails to cover the cost of producing school lunch; 54.7% cited the school breakfast rate as inadequate.

Losing these additional funds would undoubtedly increase meal program losses and cut into education budgets, limiting funds for teachers, textbooks, technology and other resources to support learning. Losses will jeopardize efforts to sustain menu enhancements, increase fresh, locally grown options and expand services, such as breakfast in the classroom, summer meal, afterschool snack and supper programs.

To protect the viability of school meal programs and their work to meet students’ nutritional needs, SNA’s 2023 Position Paper urges Congress to make permanent the Keep Kids Fed Act’s increased reimbursements.