[Federal Register Volume 71, Number 132 (Tuesday, July 11, 2006)]
[Notices]
[Pages 39051-39053]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6131]


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DEPARTMENT OF AGRICULTURE

Food and Nutrition Service


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

AGENCY: Food and Nutrition Service, USDA.

ACTION: Notice.

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SUMMARY: This Notice announces the annual adjustments to the ``national 
average payments,'' the amount of money the Federal Government provides 
States for lunches, afterschool snacks and breakfasts served to 
children participating in the National School Lunch and School 
Breakfast Programs; to 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 to 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 Breakfast Programs reflect changes in the Food Away 
From Home series of the Consumer Price Index for All Urban Consumers. 
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, 2006 through June 30, 
2007.

DATES: These rates are effective from July 1, 2006 through June 30, 
2007.

FOR FURTHER INFORMATION CONTACT: Mr. William Wagoner, Section Chief, 
School Programs Section, Policy and Program Development Branch, Child 
Nutrition Division, Food and Nutrition Service, USDA, 3101 Park Center 
Drive, Room 640, Alexandria, VA 22302 or phone (703) 305-2590.

SUPPLEMENTARY INFORMATION:

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 that 
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, published by the Bureau of Labor Statistics of the 
Department of Labor.
    For the period July 1, 2006 through June 30, 2007, 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 
14.5 cents. This reflects a decrease of 6.08 percent in the Producer 
Price Index for Fluid Milk Products from May 2005 to May 2006 (from a 
level of 169.4 in May 2005 to 159.1 in May 2006).
    As a reminder, schools or institutions with pricing programs that 
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 Richard B. Russell 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 lunches and afterschool snacks served 
to children participating in the National School Lunch Program and 
breakfasts served to children participating in the School Breakfast 
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

[[Page 39052]]

Labor. The changes in the national average payment rates for schools 
and residential child care institutions for the period July 1, 2006 
through June 30, 2007 reflect a 3.16 percent increase in the Consumer 
Price Index for All Urban Consumers during the 12-month period May 2005 
to May 2006 (from a level of 192.6 in May 2005 to 198.7 in May 2006). 
Adjustments to the national average payment rates for all lunches 
served under the National School Lunch Program, breakfasts served under 
the School Breakfast Program, and afterschool snacks served under the 
National School Lunch Program are rounded down to the nearest whole 
cent.
    Lunch Payment Levels--Section 4 of the Richard B. Russell 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 
Richard B. Russell 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 Richard 
B. Russell National School Lunch Act (42 U.S.C. 1759(a)) 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 Richard B. Russell 
National School Lunch Act (42 U.S.C. 1757 and 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.
    Afterschool Snack Payments in Afterschool Care Programs--Section 
17A of the Richard B. Russell National School Lunch Act (42 U.S.C. 
1766a) establishes National Average Payments for free, reduced price 
and paid afterschool snacks as part of the National School Lunch 
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 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 afterschool snack rates, and the breakfast rates are in 
effect from July 1, 2006 through June 30, 2007. 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 2004-05, the payments for meals served are: 
Contiguous States--paid rate--23 cents, free and reduced price rate--23 
cents, maximum rate--31 cents; Alaska--paid rate--37 cents, free and 
reduced price rate--37 cents, maximum rate--48 cents; Hawaii--paid 
rate--27 cents, free and reduced price rate--27 cents, maximum rate--35 
cents.
    In school food authorities which served 60 percent or more free and 
reduced price lunches in School Year 2004-05, payments are: Contiguous 
States--paid rate--25 cents, free and reduced price rate--25 cents, 
maximum rate--31 cents; Alaska--paid rate--39 cents, free and reduced 
price rate--39 cents, maximum rate--48 cents; Hawaii--paid rate--29 
cents, free and reduced price rate--29 cents, maximum rate--35 cents.
    Section 11 National Average Payment Factors--Contiguous States--
free lunch--217 cents, reduced price lunch--177 cents; Alaska--free 
lunch--351 cents, reduced price lunch--311 cents; Hawaii--free lunch--
253 cents, reduced price lunch--213 cents.
    Afterschool Snacks in Afterschool Care Programs--The payments are: 
Contiguous States--free snack--65 cents, reduced price snack--32 cents, 
paid snack--06 cents; Alaska--free snack--106 cents, reduced price 
snack--53 cents, paid snack--09 cents; Hawaii--free snack--77 cents, 
reduced price snack--38 cents, paid snack--07 cents.

School Breakfast Program Payments

    For schools ``not in severe need'' the payments are: Contiguous 
States--free breakfast--131 cents, reduced price breakfast--101 cents, 
paid breakfast--24 cents; Alaska--free breakfast--208 cents, reduced 
price breakfast--178 cents, paid breakfast--35 cents; Hawaii--free 
breakfast--152 cents, reduced price breakfast--122 cents, paid 
breakfast--27 cents.
    For schools in ``severe need'' the payments are: Contiguous 
States--free breakfast--156 cents, reduced price breakfast--126 cents, 
paid breakfast--24 cents; Alaska--free breakfast--249 cents, reduced 
price breakfast--219 cents, paid breakfast--35 cents; Hawaii--free 
breakfast--182 cents, reduced price breakfast--152 cents, paid 
breakfast--27 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 
lunch amount; the maximum lunch reimbursement rates; the reimbursement 
rates for afterschool snacks 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.

[[Page 39053]]



 School Programs Meal, Snack and Milk Payments to States and School Food
         Authorities--Expressed in Dollars or Fractions Thereof
               [Effective from July 1, 2006-June 30, 2007]
------------------------------------------------------------------------
                                    Less than      60% or      Maximum
 National school lunch program *       60%          more         rate
------------------------------------------------------------------------
Contiguous States:
    Paid.........................         0.23         0.25         0.31
    Reduced price................         2.00         2.02         2.17
    Free.........................         2.40         2.42         2.57
Alaska:
    Paid.........................         0.37         0.39         0.48
    Reduced price................         3.48         3.50         3.75
    Free.........................         3.88         3.90         4.15
Hawaii:
    Paid.........................         0.27         0.29         0.35
    Reduced price................         2.40         2.42         2.60
    Free.........................         2.80         2.82         3.00


------------------------------------------------------------------------
                                            Non-severe
        School breakfast program               need         Severe need
------------------------------------------------------------------------
Contiguous States:
    Paid................................            0.24            0.24
    Reduced price.......................            1.01            1.26
    Free................................            1.31            1.56
Alaska:
    Paid................................            0.35            0.35
    Reduced price.......................            1.78            2.19
    Free................................            2.08            2.49
Hawaii:
    Paid................................            0.27            0.27
    Reduced price.......................            1.22            1.52
    Free................................            1.52            1.82


------------------------------------------------------------------------
                                          All      Paid
         Special milk program             milk     milk      Free milk
------------------------------------------------------------------------
Pricing programs without free option..    0.145      N/A             N/A
Pricing programs with free option.....      N/A    0.145           (\1\)
Nonpricing programs...................    0.145      N/A             N/A


------------------------------------------------------------------------
 
------------------------------------------------------------------------
         Afterschool Snacks Served in Afterschool Care Programs
------------------------------------------------------------------------
Contiguous States:
    Paid................................................            0.06
    Reduced price.......................................            0.32
    Free................................................            0.65
Alaska:
    Paid................................................            0.09
    Reduced price.......................................            0.53
    Free................................................            1.06
Hawaii:
    Paid................................................            0.07
    Reduced price.......................................            0.38
    Free................................................            0.77
------------------------------------------------------------------------
* Payment listed for Free and Reduced Price Lunches include both section
  4 and section 11 funds.
\1\ Average cost per \1/2\ pint of milk.

    This action is not a rule as defined by the Regulatory Flexibility 
Act (5 U.S.C. 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. 
3507), no new recordkeeping or reporting requirements have been 
included that are subject to approval from the Office of Management and 
Budget.
    This action is exempted from review by the Office of Management and 
Budget under Executive Order 12866.
    National School Lunch, School Breakfast and Special Milk Programs 
are listed in the Catalog of Federal Domestic Assistance under No. 
10.555, No. 10.553 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.)

    Authority: Sections 4, 8, 11 and 17A of the Richard B. Russell 
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 5, 2006.
Roberto Salazar,
Administrator, Food and Nutrition Service.
[FR Doc. 06-6131 Filed 7-10-06; 8:45 am]
BILLING CODE 3410-30-P