2024 Position Paper: Increase School Meal Reimbursements

Permanently increase federal reimbursement rates for the National School Lunch and School Breakfast Program (NSLP/SBP) by 40 cents per lunch and 15 cents per breakfast. 

Schools receive approximately $4.30 in federal reimbursement for each free lunch they serve. For less than the average price of a latte, schools must prepare a complete meal (milk, fruit, vegetable, lean protein and whole grain) and cover labor, supplies, equipment and all other costs.

USDA data confirmed the average cost of producing school meals pre-pandemic far exceeded federal per-meal reimbursements, and the average meal program operated at a small deficit. During the pandemic, Congress and USDA provided critical assistance to sustain these historically underfunded school meal programs.

Today, as school meal programs grapple with a new normal of persistently high costs, this diminishing safety net will soon vanish. Additional Keep Kids Fed Act reimbursements expired in July 2023 and Supply Chain Assistance funds end in September 2024.

In a recent SNA survey of school meal program directors:

• Virtually all (99.3%) reported challenges with increasing costs, with 83.9% indicating that costs are a significant challenge.
• Fewer than 1 in 5 indicated the current reimbursement rate is sufficient to cover the cost of producing a lunch.
• 6% flagged concerns about the financial sustainability of their programs in just three years.

Persistent procurement challenges in the specialized K-12 market compound high food costs. With 87.2% of school nutrition directors citing challenges with menu item shortages, limited stock is driving up prices. Additionally, 90.5% of school meal programs grapple with staff shortages. Labor shortages require meal programs, which compete with local restaurants for employees, to increase pay or offer bonuses to attract employees.

School meal programs are expected to be self-sustaining, covering their expenses with federal reimbursements and cafeteria sales. Increased reimbursements are crucial to cover costs, enhance menus and support hiring and retention. Without additional support, meal program losses will cut into education budgets, limiting funds for teachers, textbooks, technology and other resources to support learning.

SNA’s 2024 Position Paper urges Congress to permanently increase federal reimbursement rates for the National School Lunch and School Breakfast Program (NSLP/SBP) by 40 cents per lunch and 15 cents per breakfast.