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A novel way to fix school lunch: Charge for it.


A new idea to put better food on the tray: Charge more. (Melina Mara / The Washington Post)

It's a big week for school lunch reformers. Secretary of Agriculture Tom Vilsack came out in support of a ban on junk food from school vending machines. Michelle Obama unveiled her coordinated federal initiative to fight childhood obesity that, among other things, will support creative ways to pay for more healthful food in schools.

Banning junk food and wrangling more money (the latter is the solution to most things in Washington) are sexy proposals. Just the kind that 60 senators could get behind when the spotlight is fixed on childhood obesity. But two new reports suggest that there's another way to improve school lunch: Stop subsidizing meals for students who can already afford to pay.

First, a quick refresher in School Lunch 101. Public schools are allocated a certain amount of money for each lunch they serve that meets federal nutrition standards. Districts receive the highest reimbursement for meals served free or at a reduced price to children whose household income is below 185 percent of the poverty line. They also receive a small amount for students whose household income is above that level and who pay for meals.

It only makes sense that school districts would price the so-called paid meals at a level which, when combined with the federal meal subsidy, covers the cost of producing the meal. But individual school districts set the prices, and, local politics being what they are, the price doesn't get raised that often. The result: Students who can afford to pay for school lunch pay less than it costs to produce a hot meal, and government money allocated for low-income students makes up the difference.

According to an analysis by the Center for Budget and Policy Priorities, schools received an average of $1.81 (including the government subsidy) for a paid meal in 2004-2005. That's 81 percent of what the federal government pays for the same meal for a low-income student. It's 79 percent of the $2.28 that schools said it cost to produce a tray of, say, chicken nuggets, milk and canned green beans.

Why not just mandate that schools use federal reimbursement money only for free- and reduced-price meals? The Department of Agriculture, which regulates school meals, has been reluctant to restrict food service directors' flexibility with their budgets. A school might use lunch revenues, for example, to defray the costs of a much-needed breakfast program. The authors of the CBPP report, Zoe Neuberger and Tina Fritz Namian, argue, however, that some restrictions are needed:

"By placing some parameters on school food budgets as part of the reauthorization legislation [that will be passed this year], Congress could generate funds for the meals programs and ensure that federal funds are spent on the purposes that it intends."

The numbers bear that out. An analysis of the 20 largest school districts this school year revealed that if districts charged $2.43 per lunch -- a price that would bring paid meals in line with what the federal government reimburses for each meal -- they would increase their revenues by more than $55 million this year alone. That is as much revenue as districts would receive if the government increased its reimbursement by 11 cents, or 4.5 percent, per lunch.

Another study from the non-partisan, non-profit Campaign for Better Nutrition (pdf ) in San Francisco estimates that increasing the price of paid meals could increase the effective reimbursement rate by 18 cents per meal.

"If they don't fix the money situation, there's no guarantee that any new federal dollars will actually go to improving school meals," said Colleen Kavanagh, executive director of the Campaign for Better Nutrition.

So what should be done?

Both reports recommend that Congress mandate that federal dollars be used only to cover the costs of regulated meals served in the lunch line. And sources say there is serious discussion on the Hill about how and if to include this in this year's child nutrition reauthorization. The CBPP goes one step further, recommending that Congress require that, over time, school districts that charge low prices gradually increase the price for paid meals. (Kavanagh worries that would make meals too expensive for students just above the reduced-price cut-off.)

"The idea here is very simple: to put in place commonsense initiatives and solutions that empower families and communities to make healthy decisions for their kids," Michelle Obama told the U.S. Conference of Mayors in Washington this month.

Let's see if this counts as one of them.

-- Jane Black

By Jane Black  |  February 10, 2010; 10:00 AM ET
Categories:  Food Politics  | Tags: Jane Black, school lunch  
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Comments

Interesting, charge 2.43/lunch? My kids already pay $3.00/lunch in Howard Cty. That's a regular middle-school lunch. I haven't noticed an improvement in quality when I ate with them last semester. Although I could chose water instead of milk--great for lactose-intolerant me, but nutritionally better? Maybe that 2.43 amount doesn't apply in this area.

Posted by: GirlScoutMom | February 10, 2010 11:52 AM | Report abuse

Do these studies assume that the same number of people who buy lunch now will continue to buy at a higher price point? If so, then they're ignoring some basic principles of supply and demand, and likely overreporting the financial benefit of raising prices.

The concept makes perfect sense to me: schools should charge what it costs to make the meal, rather than having the poorer kids effectively subsidize the wealthier. But our lunches are already over $3, even in elementary school. And even though we can easily afford it, for some reason, the $3 threshold makes me hesitate more than, say, $2 or $2.50 would. As a result, we almost never buy lunch at school -- which is not a bad thing, as they are generally not worth the money in the first place.

If you want people to buy lunch, you need to approach it like a business would: look for the sweet spot, the knee of the curve, the point where you can maximize how much you charge while minimizing the number of people you push away because it costs too much. Or come up with something else that will entice the wealthier families to pay more money -- fresher food, better quality, etc. But don't just assume that you have a captive audience that will pay whatever you charge, for whatever you decide to sell.

Posted by: laura33 | February 10, 2010 12:43 PM | Report abuse

School lunch is still one of the best bargains around. No way can people pack lunches for $2.50, which is what my son pays in Anne Arundel County. I would absolutely pay more ($3.00 or $4.00 is not much for a hot lunch) if he could get something besides a fried chicken sandwich or pizza, which is what they serve every single day. He usually gets multiple side dishes -- the cafeteria ladies let him have one of each thing they have that day because most kids don't even take the sides -- so he gets a fruit cup and applesauce and green beans and whatever else they have. It's all out of a can, so it's not particularly healthy, but he's a teenage boy, he will eat anything. And I'd rather have him eat canned fruit than chips or french fries, so we're OK.

Posted by: margaret6 | February 10, 2010 2:09 PM | Report abuse

"No way can people pack lunches for $2.50, which is what my son pays in Anne Arundel County."

Actually, I did the math myself, and figured that we pay a lot less than that to pack ourselves -- DD likes soy butter or cream cheese sandwiches or roll-ups, which run maybe $0.30-.40 (presuming 10 sandwiches for one $2 loaf of bread and way more filling than I actually use); a banana is about a quarter, or a tub of applesauce is about $0.35; a box of juice is $0.30; and the candy is left over from Halloween or gift bags. All told, about a buck -- more if I give her a cheese stick ($0.25) or Fig Newtons, less if she has some form of leftovers.

Of course, she's also not a teenage boy -- makes a difference. :-)

Posted by: laura33 | February 10, 2010 2:21 PM | Report abuse

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