[Federal Register Volume 62, Number 134 (Monday, July 14, 1997)]
[Notices]
[Pages 37703-37706]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-18522]


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DEPARTMENT OF AGRICULTURE

Food and Consumer Service


National School Lunch, Special Milk, and School Breakfast 
Programs; National Average Payments/Maximum Reimbursement Rates

AGENCY: Food and Consumer Service, USDA.

ACTION: Notice.

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SUMMARY: This Notice announces the annual adjustments to: (1) the 
``national average payments,'' the amount of money the Federal 
Government provides States for lunches, meal supplements and breakfasts 
served to children participating in the National School Lunch and 
School Breakfast Programs; (2) the ``maximum reimbursement rates,'' the 
maximum per lunch rate from Federal funds that a State can provide a 
school food authority for lunches served to children participating in 
the National School Lunch Program; and (3) the rate of reimbursement 
for a half-pint of milk served to nonneedy children in a school or 
institution which participates in the Special Milk Program for 
Children. The payments and rates are prescribed on an annual basis each 
July. The annual payments and rates adjustments for the National School 
Lunch and School

[[Page 37704]]

Breakfast Programs reflect changes in the Food Away From Home series of 
the Consumer Price Index for All Urban Consumers. Pursuant to Pub. L. 
104-193, this Notice also implements a change in the methodology for 
computing the annual adjustments to the ``national average payments'' 
for meals and supplements served to nonneedy children. The annual rate 
adjustment for the Special Milk Program reflects changes in the 
Producer Price Index for Fluid Milk Products. These payments and rates 
are in effect from July 1, 1997 through June 30, 1998.

EFFECTIVE DATE: July 1, 1997.

FOR FURTHER INFORMATION CONTACT: Robert M. Eadie, Chief, Policy and 
Program Development Branch, Child Nutrition Division, FCS, USDA, 
Alexandria, Virginia 22302, (703) 305-2620.

SUPPLEMENTARY INFORMATION: This action is not a rule as defined by the 
Regulatory Flexibility Act (5 U.S.C. Secs. 601-612) and thus is exempt 
from the provisions of that Act.
    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Secs. 3501-3518), no new recordkeeping or reporting requirements have 
been included that are subject to review by the Office of Management 
and Budget.
    This action has been determined to be exempt under Executive Order 
12866.
    These programs are listed in the Catalog of Federal Domestic 
Assistance under No. 10.553, No. 10.555 and No. 10.556, respectively, 
and are subject to the provisions of Executive Order 12372, which 
requires intergovernmental consultation with State and local officials. 
(See 7 CFR Part 3015, Subpart V, and the final rule related notice 
published at 48 FR 29114, June 24, 1983.)

Background

    Special Milk Program for Children--Pursuant to section 3 of the 
Child Nutrition Act of 1966, as amended (42 U.S.C. 1772), the 
Department announces the rate of reimbursement for a half-pint of milk 
served to nonneedy children in a school or institution which 
participates in the Special Milk Program for Children. This rate is 
adjusted annually to reflect changes in the Producer Price Index for 
Fluid Milk Products (Code 0231), published by the Bureau of Labor 
Statistics of the Department of Labor.
    For the period July 1, 1997 to June 30, 1998, the rate of 
reimbursement for a half-pint of milk served to a nonneedy child in a 
school or institution which participates in the Special Milk Program is 
12.50 cents. This reflects an increase of 1.19 percent in the Producer 
Price Index for Fluid Milk Products (Code 0231) from May 1996 to May 
1997 (from a level of 133.8 in May 1996 to 135.4 in May 1997).
    As a reminder, schools or institutions with pricing programs which 
elect to serve milk free to eligible children continue to receive the 
average cost of a half-pint of milk (the total cost of all milk 
purchased during the claim period divided by the total number of 
purchased half-pints) for each half-pint served to an eligible child.
    National School Lunch and School Breakfast Programs--Pursuant to 
Sections 11 and 17A of the National School Lunch Act, (42 U.S.C. 1759a 
and 1766a), and Section 4 of the Child Nutrition Act of 1966, (42 
U.S.C. 1773), the Department annually announces the adjustments to the 
National Average Payment Factors and to the maximum Federal 
reimbursement rates for meals and supplements served to children 
participating in the National School Lunch Program. Adjustments are 
prescribed each July 1, based on changes in the Food Away From Home 
series of the Consumer Price Index for All Urban Consumers, published 
by the Bureau of Labor Statistics of the Department of Labor. The 
changes in the national average payment rates for schools and 
residential child care institutions for the period July 1, 1997 through 
June 30, 1998 reflect a 2.83 percent increase in the Price Index during 
the 12-month period May 1996 to May 1997 (from a level of 152.00 in May 
1996 to 156.3 in May 1997).
    Section 704(b) of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, Pub. L. 104-193, enacted August 22, 1996, 
amends Sec. 11(a)(3)(B) of the National School Lunch Act (42 U.S.C. 
1759a(a)(3)(B)) and changes the method for computing the annual 
adjustments to the national average payment rates for meals and 
supplements served to nonneedy children. Effective July 1, 1997, the 
annual adjustments to the payment rates for paid meals under Section 4 
of the National School Lunch Act (42 U.S.C. 1753), and paid supplements 
under Section 17(c) of the National School Lunch Act (42 U.S.C. 
1766(c)), authorized under Section 11(a)(3)(B) of the National School 
Lunch Act, will be rounded down to the nearest whole cent. The annual 
adjustments to the Section 4 payments for free and reduced price meals 
and to the Section 17(c) payments for free and reduced price 
supplements, were unchanged by Pub. L. 104-193 and are rounded up or 
down to the nearest one-fourth cent.
    Lunch Payment Levels--Section 4 of the National School Lunch Act 
(42 U.S.C. 1753) provides general cash for food assistance payments to 
States to assist schools in purchasing food. The National School Lunch 
Act provides two different Section 4 payment levels for lunches served 
under the National School Lunch Program. The lower payment level 
applies to lunches served by school food authorities in which less than 
60 percent of the lunches served in the school lunch program during the 
second preceding school year were served free or at a reduced price. 
The higher payment level applies to lunches served by school food 
authorities in which 60 percent or more of the lunches served during 
the second preceding school year were served free or at a reduced 
price.
    To supplement these Section 4 payments, Section 11 of the National 
School Lunch Act provides special cash assistance payments to aid 
schools in providing free and reduced price lunches. The Section 11 
National Average Payment Factor for each reduced price lunch served is 
set at 40 cents less than the factor for each free lunch.
    As authorized under Sections 8 and 11 of the National School Lunch 
Act (42 U.S.C. 1757, 1759a), maximum reimbursement rates for each type 
of lunch are prescribed by the Department in this Notice. These maximum 
rates are to ensure equitable disbursement of Federal funds to school 
food authorities.

Meal Supplement Payments in Afterschool Care Programs

    Section 17A of the National School Lunch Act (42 U.S.C. 1766a) 
authorizes elementary and secondary schools to be reimbursed for meal 
supplements as part of the National School Lunch Program if they meet 
the following requirements: (1) operate school lunch programs under the 
National School Lunch Act; (2) sponsor afterschool care programs; and 
(3) were participating in the Child and Adult Care Food Program as of 
May 15, 1989. The reimbursement rates for supplements served in 
Afterschool Care Programs under the National School Lunch Program are 
the same as the rates for supplements served in centers under the Child 
and Adult Care Food Program.
    Breakfast Payment Factors--Section 4 of the Child Nutrition Act of 
1966 (42 U.S.C. 1773) establishes National Average Payment Factors for 
free, reduced price and paid breakfasts served under the School 
Breakfast Program and additional payments for free and reduced price 
breakfasts served in schools determined to be in ``severe

[[Page 37705]]

need'' because they serve a high percentage of needy children.

Revised Payments

    The following specific Section 4, Section 11 and Section 17A 
National Average Payment Factors and maximum reimbursement rates for 
lunch, the after-school supplement rates and breakfast rates are in 
effect from July 1, 1997 through June 30, 1998. Due to a higher cost of 
living, the average payments and maximum reimbursements for Alaska and 
Hawaii are higher than those for all other States. The District of 
Columbia, Virgin Islands, Puerto Rico and Guam use the figures 
specified for the contiguous States.

National School Lunch Program Payments

    Section 4 National Average Payment Factors--In school food 
authorities which served less than 60 percent free and reduced price 
lunches in School Year 1995-96, the payments for meals served are: 
Contiguous States--paid rate: 18 cents; free and reduced price rate: 
18.25 cents; maximum rate: 26 cents; Alaska--paid rate: 29 cents; free 
and reduced price rate: 29.50 cents; maximum rate: 40 cents; Hawaii--
paid rate: 21 cents; free and reduced price rate: 21.25 cents; maximum 
rate: 30 cents.
    In school food authorities which served 60 percent or more free and 
reduced price lunches in School Year 1995-96, payments are: Contiguous 
States--paid rate: 20 cents; free and reduced price rate: 20.25 cents; 
maximum rate: 26 cents; Alaska--paid rate: 31 cents; free and reduced 
price rate: 31.50 cents; maximum rate: 40 cents; Hawaii--paid rate: 23 
cents; free and reduced price rate: 23.25 cents; maximum rate: 30 
cents.
    Section 11 National Average Payment Factors--Contiguous States--
free lunch: 170.75 cents; reduced price lunch: 130.75 cents; Alaska--
free lunch: 276.50 cents; reduced price lunch: 236.50 cents; Hawaii--
free lunch: 199.75 cents; reduced price lunch: 159.75 cents.
    Meal Supplements in Afterschool Care Programs--The payments are: 
Contiguous States--free supplement: 51.75 cents; reduced price 
supplement: 26.00 cents; paid supplement: 4 cents; Alaska--free 
supplement: 84.00 cents; reduced price supplement: 42.00 cents; paid 
supplement: 7 cents; Hawaii--free supplement: 60.75 cents; reduced 
price supplement: 30.25 cents; paid supplement: 5 cents.

School Breakfast Program Payments

    For schools ``not in severe need'' the payments are: Contiguous 
States--free breakfast: 104.50 cents; reduced price breakfast: 74.50 
cents; paid breakfast: 20 cents; Alaska--free breakfast: 165.75 cents; 
reduced price breakfast: 135.75 cents; paid breakfast: 29 cents; 
Hawaii--free breakfast: 121.25 cents; reduced price breakfast: 91.25 
cents; paid breakfast: 22 cents.
    For schools in ``severe need'' the payments are: Contiguous 
States--free breakfast: 124.50 cents; reduced price breakfast: 94.50 
cents; paid breakfast: 20 cents; Alaska--free breakfast: 197.75 cents; 
reduced price breakfast: 167.75 cents; paid breakfast: 29 cents; 
Hawaii--free breakfast: 144.50 cents; reduced price breakfast: 114.50 
cents; paid breakfast: 22 cents.

Payment Chart

    The following chart illustrates: the lunch National Average Payment 
Factors with the Sections 4 and 11 already combined to indicate the per 
meal amount; the maximum lunch reimbursement rates; the reimbursement 
rates for meal supplements served in afterschool care programs; the 
breakfast National Average Payment Factors including ``severe need'' 
schools; and the milk reimbursement rate. All amounts are expressed in 
dollars or fractions thereof. The payment factors and reimbursement 
rates used for the District of Columbia, Virgin Islands, Puerto Rico 
and Guam are those specified for the contiguous States.

BILLING CODE 3410-30-P

[[Page 37706]]

[GRAPHIC] [TIFF OMITTED] TN14JY97.015



    Authority: Sections 4, 8, 11 and 17A of the National School 
Lunch Act, as amended, (42 U.S.C. 1753, 1757, 1759a, 1766a) and 
sections 3 and 4(b) of the Child Nutrition Act, as amended, (42 
U.S.C. 1772 and 42 U.S.C. 1773(b)).

    Dated: July 9, 1997.
William E. Ludwig,
Administrator.
[FR Doc. 97-18522 Filed 7-11-97; 8:45 am]
BILLING CODE 3410-30-C