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Bush's School-Lunch Plan Could Hurt Food-Service Programs, Officials Say

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By Ellen Flax

Washington--President Bush's proposed budget for the school-lunch program would require students from middle- and upper-income families to pay more for school meals and would lower the price of lunches for poorer students.

School officials and proponents of the school-nutrition program said the proposal, if enacted, would discourage many middle-income children from buying school meals at a time when food-services programs are facing other financial burdens.

The resulting lowered profit margins, they said, might force many schools to consider eliminating their food-services programs altogether.

The Bush proposal would cut funding for school lunches, an entitlement program, by $235 million. No changes are proposed for the school-breakfast program, also an entitlement program, which is slated to receive $606 million.

The proposal comes on top of what already has been a fiscally difficult year for many food-services programs. Changes in the federal commodity-support program, the 1988 summer drought, and this winter's freeze in Florida have led to a dwindling supply of surplus foods, including cheese and meat, that had been donated by the federal government to schools.

Such shortages were first felt by schools last spring, when food-services directors had to scramble to make up for a freeze on free federal cheese supplies. (See Education Week, March 29, 1989.)

Having been without virtually all of these "bonus commodities" since September, schools have had to purchase such goods on the open market--and pass their increased costs on to students in the form of higher lunch prices.

"This has been one of those years where anything that could go wrong has gone wrong," said Robert Honson, director of nutrition service for the Portland, Ore., school district.

According to the Agriculture Department, which administers the school-lunch program, 24.5 million students receive school lunches. A little less than half of the students come from families with yearly incomes that qualify them for free- or reduced-price meals. All meals include a 14-cent federal subsidy.

'An Administrative Nightmare'

Mr. Bush's budget proposes eliminating this subsidy for students who come from families that earn more than 350 percent of the poverty level, or $42,350 for a family of four.

This proposal, which would chisel $127 million from the program, marks a shift in the Administration's policy toward school lunches. Last year, Mr. Bush's 1989 budget omitted a provision in the last Reagan Administration budget to eliminate the subsidy for middle-income students. The Congress had rejected this proposal several times during the Reagan Presidency.

Under Mr. Bush's plan for fiscal 1991, students who come from families that earn less than 130 percent of the federal poverty rate, or about $15,000 for a family of four, would continue to receive school meals free of charge.

Students from families that earn between 130 and 185 percent of the poverty level, or about $22,000 for a family of four, would pay 20 cents for every meal, half of what they are currently charged. Mr. Bush's budget calls for an additional $54 million to pay for this change.

In the next category, students whose families earn between 185 percent and 350 percent of the poverty level would still qualify to purchase lunches that included the 14-cent subsidy. They would, however, have to submit a form to school officials to verify their family income. The usda estimates that 7 million students fall into this category.

Schools would no longer receive this subsidy for meals purchased by the approximately 5 million students who come from families in the highest income group.

Educators said adoption of the proposal would lead to higher prices for students in the highest income group, driving many of them away from the program and, thus, reduc8ing profits. They also said that the requirement to process an additional 7 million income-verification forms would pose an administrative burden for schools.

"The proposal would have a profound effect on schools," said Kevin Dando, a spokesman for the American Food Services Association. "It would be an administrative nightmare."

Congressional aides said they felt it was unlikely that the President's proposal to cut subsidies to middle-class students would be approved.

"I think [the proposal] is pretty much dead in the water," said one aide.

Impact of Commodities Cuts

School officials, meanwhile, said that a sharp drop in the bonus-commodity program has forced them to raise prices and change menus. That program, which began in the early 1980's, was supposed to partially offset the $1 billion cut made to the school-meals program in 1981. But changes in federal commodity policies have eliminated much of the surplus.

During the 1988-89 school year, schools received $324 million in donated commodities, with cheese accounting for $130 million. This academic year, schools will receive $125 million in goods--of which butter will account for $100 million. No cheese will be included.

Later this month, the Senate Agriculture, Nutrition, and Forestry Committee will hold a hearing on the bonus-commodity program.

Mr. Honson of the Portland school district said milk prices have also increased from 11 cents per half-pint to 13.5 cents over the past 18 months, costing an additional $150,000 for the 6 million half-pints he buys yearly.

As a result, he said, school-lunch prices had to be increased by 25 cents, to $1.25 for high-school students. Participation rates, he said, have dropped by 24.5 percent.

"Cheese has been a fact of life for us forever," said Mr. Honson. ''But now, it's no longer cheaper than meat."

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