[Federal Register Volume 82, Number 229 (Thursday, November 30, 2017)]
[Rules and Regulations]
[Pages 56703-56723]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-25799]



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 Rules and Regulations
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  Federal Register / Vol. 82, No. 229 / Thursday, November 30, 2017 / 
Rules and Regulations  

[[Page 56703]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Parts 210, 215, 220 and 226

[FNS-2017-0021]
RIN 0584-AE53


Child Nutrition Programs: Flexibilities for Milk, Whole Grains, 
and Sodium Requirements

AGENCY: Food and Nutrition Service, USDA.

ACTION: Interim final rule.

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SUMMARY: This interim final rule extends through school year 2018-2019 
three menu planning flexibilities currently available to many Child 
Nutrition Program operators, giving them near-term certainty about 
Program requirements and more local control to serve nutritious and 
appealing meals to millions of children nationwide. These flexibilities 
include: Providing operators the option to offer flavored, low-fat (1 
percent fat) milk in the Child Nutrition Programs; extending the State 
agencies' option to allow individual school food authorities to include 
grains that are not whole grain-rich in the weekly menu offered under 
the National School Lunch Program (NSLP) and School Breakfast Program 
(SBP); and retaining Sodium Target 1 in the NSLP and SBP. This interim 
final rule addresses significant challenges faced by local operators 
regarding milk, whole grains and sodium requirements and their impact 
on food development and reformulation, menu planning, and school food 
service procurement and contract decisions. The comments from the 
public on the long-term availability of these three flexibilities will 
help inform the development of a final rule, which is expected to be 
published in fall 2018 and implemented in school year 2019-2020.

DATES: Effective Date: This interim final rule will become effective 
July 1, 2018.
    Comment Date: To be considered, written comments on this interim 
final rule must be received on or before January 29, 2018.

ADDRESSES: The USDA, Food and Nutrition Service (FNS) invites 
interested persons to submit written comments on this interim final 
rule. Comments may be submitted in writing by one of the following 
methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Regular U.S. mail: Send comments to School Programs 
Branch, Policy and Program Development Division, Food and Nutrition 
Service, P.O. Box 2885, Fairfax, VA 22031-0885.
     Overnight, courier, or hand delivery: School Programs 
Branch, Policy and Program Development Division, Food and Nutrition 
Service, 3101 Park Center Drive, 12th floor, Alexandria, Virginia 
22302.
    All written comments submitted in response to this interim final 
rule will be included in the record and will be made available to the 
public. Please be advised that the substance of the comments and the 
identity of the individuals or entities submitting the comments will be 
subject to public disclosure. FNS will make the written comments 
publicly available via http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Tina Namian, Chief, School Programs 
Branch, Policy and Program Development Division, Food and Nutrition 
Service, 703-305-2590.

SUPPLEMENTARY INFORMATION:

I. Background and Overview

    The National School Lunch Program (NSLP) and School Breakfast 
Program (SBP) provide nutritious and well-balanced meals to millions of 
children daily. Section 9(a)(4) of the Richard B. Russell National 
School Lunch Act, 42 U.S.C. 1758(a)(4), requires that school meals 
reflect the latest Dietary Guidelines for Americans (Dietary 
Guidelines). On January 26, 2012, USDA published a final rule, 
Nutrition Standards in the National School Lunch and School Breakfast 
Programs (77 FR 4088), which updated the school meal requirements 
consistent with the Dietary Guidelines and the recommendations issued 
by the Health and Medicine Division of the National Academies of 
Science, Engineering, and Medicine (formerly, Institute of Medicine) in 
the report School Meals: Building Blocks for Healthy Children.\1\ In 
part, the 2012 regulatory requirements: (1) Allowed flavoring only in 
fat-free milk, effective school year (SY) 2012-2013; (2) established a 
requirement that, effective SY 2014-2015, all grains served in the NSLP 
and SBP must comply with the whole grain-rich requirement (meaning the 
grain product contains at least 50 percent whole grains and the 
remaining grain content of the product must be enriched); and (3) 
required schools to gradually reduce the sodium content of the average 
weekly school meals offered to each grade group in the NSLP and SBP by 
meeting progressively lower sodium targets over a period of 10 years.
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    \1\ See https://www.fns.usda.gov/sites/default/files/SchoolMealsIOM.pdf.
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    USDA subsequently published two additional final rules making 
conforming amendments to the requirements for the service of milk in 
competitive foods sold outside of the school meal programs (National 
School Lunch Program and School Breakfast Program: Nutrition Standards 
for All Foods Sold in School as Required by the Healthy, Hunger-Free 
Kids Act of 2010, on July 29, 2016, 81 FR 50132) and to the Child and 
Adult Care Food Program (CACFP) meal requirements and the Special Milk 
Program for Children (SMP) milk requirements (Child and Adult Care Food 
Program: Meal Pattern Revisions Related to the Healthy, Hunger-Free 
Kids Act of 2010, on April 25, 2016, 81 FR 24348).
    Over the past five years, since the NSLP and SBP regulations were 
updated in 2012, some Program operators have experienced challenges 
with the whole grain-rich requirement and the sodium limits. To address 
these challenges, USDA took administrative steps, such as allowing 
enriched pasta exemptions for SYs 2014-2015 and 2015-2016, to provide 
flexibilities and ease the transition to the updated standards. 
Congress recognized the challenges as well, and, through Section 751 of 
the Consolidated and Further Continuing Appropriations Act, 2015 (Pub. 
L. 113-235), expanded the pasta flexibility to include other grain 
products.
    Through successive legislative action, Congress directed the 
Secretary to allow

[[Page 56704]]

State agencies that administer the NSLP and the SBP to grant individual 
exemptions from the regulatory whole grain-rich requirement in those 
programs, and delay compliance with Sodium Target 2 (Section 743 of the 
Consolidated and Further Continuing Appropriations Act, 2012 (Pub. L. 
112-55); Section 752 of the Consolidated and Further Continuing 
Appropriations Act, 2015 (Pub. L. 113-235); and Section 733 of the 
Consolidated Appropriations Act, 2016 (Pub. L. 114-113)). In addition, 
Section 747 of the Consolidated Appropriations Act, 2017 (Pub. L. 115-
31) (2017 Appropriations Act) provided flexibilities related to 
flavored milk, whole grains, and sodium for SY 2017-2018. Most 
recently, Section 101(a)(1) of the Continuing Appropriations Act, 2018, 
Division D of the Continuing Appropriations Act, 2018 and Supplemental 
Appropriations for Disaster Relief Requirements Act, 2017, Public Law 
115-56, enacted September 8, 2017, extends the flexibilities provided 
by section 747 of the Consolidated Appropriations Act, 2017 through 
December 8, 2017.
    The 2017 Appropriations Act provides authority for exemptions for 
the whole grain-rich requirement through the end of SY 2017-2018, keeps 
Sodium Target 1 in place through the end of SY 2017-2018, and requires 
the Secretary to grant State agencies that administer the NSLP and SBP 
discretion to allow school food authorities (SFAs) that demonstrate a 
reduction in student milk consumption or an increase in milk waste to 
serve flavored, low-fat milk as part of a reimbursable meal or as a 
competitive beverage for sale (as specified in 7 CFR 210.11) through 
the end of SY 2017-2018.
    This interim final rule provides optional flexibilities for SY 
2018-2019 in a manner that is consistent with appropriations 
legislation in effect for SY 2017-2018 and previous administrative 
actions. In addition, this rule provides an opportunity for public 
comments that will inform USDA's development of a final rule on the 
long-term availability of the flexibilities. USDA intends to issue a 
final rule well in advance of school year 2019-2020, when the final 
regulations are expected to take effect.
    In summary, the flexibilities provided by this interim final rule 
for SY 2018-2019 are the following:
     This rule allows Program operators in the NSLP, SBP, SMP, 
and CACFP (the Child Nutrition Programs (CNPs)) the option to offer 
flavored, low-fat (1 percent fat) milk as part of a reimbursable meal 
for students in grades K through 12, and for SMP and CACFP participants 
6 years of age and older. Schools may also offer flavored, low-fat milk 
as a competitive beverage for sale. This optional flexibility expands 
the variety of milk in the CNPs and may encourage children's 
consumption of fluid milk nationwide.
     This rule allows State agencies to continue granting an 
SFA's exemption request to use specific alternative grain products if 
the SFA can demonstrate hardship(s) in procuring, preparing, or serving 
specific products that are acceptable to students and compliant with 
the whole grain-rich requirement. This rule responds to challenges 
experienced by some SFAs with the purchase, preparation, or service of 
products that comply with the whole grain-rich requirement in the NSLP 
and SBP.
     This rule retains Sodium Target 1 as the regulatory limit 
in the NSLP and SBP through the end of SY 2018-2019. Currently, USDA 
anticipates retaining Target 1 in the final rule through at least the 
end of SY 2020-2021 to provide SFAs more time to procure and introduce 
lower sodium food products, allow food industry more time for product 
development and reformulation, and give students more time to adjust to 
school meals with lower sodium content. Also, USDA anticipates that the 
sodium requirement will continue to be reevaluated for consistency with 
the Dietary Guidelines, which are updated every five years, and in 
response to Congressional action, as appropriate. To help inform the 
final rule, USDA seeks public comments on the long-term availability of 
this flexibility and its impact on the sodium reduction timeline 
established in 2012 and, specifically, the impact on Sodium Target 2.
    This rule also includes minor technical corrections that remove 
obsolete dates related to the phased-in implementation of the school 
meal patterns. These technical revisions do not affect the intent or 
content of the regulations.

II. Timeline and Instructions to Commenters

    As noted earlier, Congress has provided mandates regarding 
flavored, low-fat milk, whole grains, and sodium effective for SY 2017-
2018; therefore, this interim final rule is intended to address the 
optional flexibilities in effect for SY 2018-2019. No changes made 
under this interim final rule will extend beyond SY 2018-2019. Comments 
from State agencies, local Program operators, food industry, nutrition 
advocates, parents and other stakeholders on the day-to-day impact of 
these flexibilities will be extremely helpful in the development of the 
final rule. USDA will carefully consider all relevant comments 
submitted during the 60-day comment period for this rule, and intends 
to issue a final rule in fall 2018. USDA is committed to publication of 
a final rule well before implementation in SY 2019-2020. This will 
ensure that stakeholders have ample opportunity to make any necessary 
operational changes.

III. Need for Action

    Legislative action taken by Congress through the annual 
appropriations process, starting with the 2012 fiscal year, provides 
short-term assistance to Program operators facing challenges but does 
not allow enough lead time to have a significant beneficial impact on 
menu planning, procurement, and contract decisions made in advance of 
the school year. To implement recurring appropriations legislation, 
USDA must take additional steps such as developing and disseminating 
implementation memoranda for Program operators. This creates a time lag 
that reduces the potential impact of the flexibilities, and causes 
confusion for Program operators who must keep track of multiple 
memoranda. For example, USDA issued several memoranda in response to 
annual appropriations legislation addressing the whole grain-rich 
requirement. These include SP 20-2015, Requests for Exemption from the 
School Meals' Whole Grain-Rich Requirement for School Years 2014-2015 
and 2015-2016; SP 33-2016, Extension Notice: Requests for Exemption 
from the School Meals' Whole Grain-Rich Requirement for School Year 
2016-2017; and SP 32-2017, School Meal Flexibilities for School Year 
2017-2018.
    When the 114th Congress began, but did not complete, the 
reauthorization process for the CNPs, the House and Senate authorizing 
committees drafted bills granting flexibilities in the three areas 
addressed by this rule--milk, whole grains and sodium. These 
preliminary reauthorization efforts reflected Congress' interest in 
providing stakeholders with additional flexibility in these areas.\2\
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    \2\ The Child Nutrition Programs are generally reauthorized 
every five years. The last reauthorization resulted from the 
Healthy, Hunger-Free Kids Act of 2010 (Pub. L. 111-296).
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    Through this interim final rule, USDA is responding to Program 
operators' need for more flexibility to accommodate menu planning and 
procurement challenges, local operational differences, and community 
preferences. This rule also responds to

[[Page 56705]]

the need for clarity and certainty regarding key requirements and 
flexibilities for the near term. USDA recognizes that all stakeholders 
have made significant efforts to implement the 2012 school meal 
regulations. This interim final rule does not undo their hard work. The 
intent of this rule is to assist Program operators with specific 
challenges that limit their ability to offer nutritious and appealing 
meals that reflect community preferences, and that students enjoy and 
consume.
    This rule signals USDA's commitment to an expeditious rulemaking 
process that will result in a final rule that provides long-term 
certainty on the flexibilities for milk, whole grains, and sodium. As 
explained next, food manufacturers need clarity and certainty prior to 
committing resources for research and product development/
reformulation. School districts also need clarity and certainty in 
order to make menu planning, procurement, and contract decisions in 
advance of the school year.

Product Development Challenges

    USDA acknowledges that the flexibilities granted through annual 
appropriations do not provide food manufacturers the certainty they 
need to engage in product development and reformulation in support of 
the whole grain-rich and sodium requirements. Manufacturers must 
overcome numerous challenges before some of the school meal products 
are widely acceptable to children and schools or commercially 
available. As explained in the preamble to the 2012 final rule, 
Nutrition Standards in the National School Lunch and School Breakfast 
Programs (77 FR 4088, 4097-98), exceeding Target 1 requires product 
reformulation and innovation in the form of new technology and/or food 
products and can present significant challenges to school lunch 
providers.
    Commenters advised USDA in 2012 that food providers need time for 
product development and testing, and schools need time for procurement 
changes, menu development, sampling, and fostering student acceptance. 
(See 77 FR 4097). Through informal conversations with 300 food 
manufacturers over the past three years at each of the annual National 
Restaurant Association Shows, FNS senior policy officials learned that 
product research and reformulation involves numerous steps over a 
period of several years. Food manufacturers indicated that it takes at 
least two to three years to reformulate and develop food products that 
support new requirements. The process involves innovation of new 
products, product research and development, testing, commercialization, 
launch, and marketing of the new products. Food manufacturers have also 
noted several specific barriers to meeting the lower sodium targets, 
including a low level of demand for these products outside of the 
school audience, the cost and time involved in reformulating existing 
products, and challenges with replacing sodium in some foods given its 
functionality (e.g., adding flavor or preserving food). They have also 
indicated that a significant investment of time and resources is 
necessary to effect even marginal sodium reductions.
    Regular interaction with food manufacturers at the National 
Restaurant Association Show and other events, such as the School 
Nutrition Association Annual Conference, reveals that innovations for 
grain products can also take several years and involve steps similar to 
those needed to reformulate products lower in sodium. The formulation 
and processing of foods made with whole grains differ from and can be 
more challenging to manufacture than those made with refined grains. 
Manufacturers are challenged with developing technologies to help 
overcome consumers' sensory barriers (taste and texture), while 
optimizing the flavor, color, and texture of foods made with whole 
grain ingredients. Manufacturers have indicated that in the past when 
companies reformulated products early, they incurred significantly more 
costs, such as research and development, product testing, and creating 
new labels, as opposed to those who took a ``wait and see'' approach. 
Therefore, because manufacturers perceive uncertainty about the whole 
grain-rich requirement and the possibility of further meal pattern 
changes resulting from legislative activity, USDA understands they are 
not currently investing time or resources to develop new whole grain-
rich products.
    While product-specific information is proprietary, the overwhelming 
and consistent message is that the food industry needs consistency and 
certainty of the regulatory requirements. In addition, ample lead time 
and predictability about the regulatory requirements must be promptly 
provided to food manufacturers to enable them to offer products to 
schools that support the meal patterns and nutrition standards. While 
this interim final rule is intended to provide certainty for the near 
term, input from the food industry and school food service staff will 
be important to help USDA develop a final rule providing reasonable 
certainty regarding Program requirements and flexibilities.

Menu Planning and Procurement Cycles

    SFAs also need ample lead time and certainty about regulatory 
requirements and flexibilities in order to make menu planning, 
procurement, and contract decisions in advance of the school year; 
therefore, it is urgent that USDA clarifies the regulatory requirements 
that impact these processes. The menu, which must reflect the meal 
patterns and nutrition standards established by Program regulations, 
drives the procurement process and must be completed first. The menu 
and standardized recipes help SFAs determine the types of food products 
to purchase. Menu planners must make many advance decisions involving, 
first, availability of USDA Foods entitlement commodities, and then 
soliciting, procuring, ordering, processing, and planning for the 
delivery of food. Planning in advance saves time, helps avoid 
repetitive tasks, reduces labor, and implements cost-effective 
inventory management, according to the Institute for Child Nutrition 
(ICN).\3\
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    \3\ The Institute for Child Nutrition, which is housed at the 
University of Mississippi, was authorized by Congress in 1989 to 
improve the operation of CNPs through research, education and 
training, and information dissemination pursuant to section 21 of 
the Richard B. Russell National School Lunch Act, 42 U.S.C. 1769b-1.
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    Once menu planning is complete, SFAs need lead time to screen 
products, forecast food quantities needed, write product 
specifications, create solicitation documents, announce the 
solicitation, and award the contract. As shown in the following chart, 
due to the numerous steps involved, ICN estimates that the entire 
procurement process may take up to a year to complete, beginning in 
August of the previous school year. Public comments from local 
operators and their State agencies will enable USDA to develop a final 
rule that provides long-term certainty regarding Program requirements 
and flexibilities, which will help SFAs conduct procurement more 
efficiently.

[[Page 56706]]



       Procurement Timeline for School Food Service Operators \4\
------------------------------------------------------------------------
             Month(s)                              Task(s)
------------------------------------------------------------------------
August-September..................   Begin preparing for
                                     procuring items. Planning
                                     approximately one year in advance
                                     provides sufficient time for
                                     preparation for all parties in the
                                     food chain.
October-December..................   Write specifications.
                                     Project USDA Foods needs.
                                     Conduct screen test.
                                     Fall and winter breaks may
                                     impact timeline.
January...........................   Develop solicitation
                                     document. Include pertinent
                                     information about the district;
                                     date and time for pre-solicitation
                                     conference and solicitation
                                     submission; scope of work; time
                                     period for the solicitation; any
                                     common legalities; ability for
                                     price escalations; name brand
                                     items; substitutions; discounts,
                                     rebates, and applicable credits;
                                     communication instructions with the
                                     district prior to the closing date;
                                     solicitation evaluation criteria.
                                     Plan accordingly to have
                                     solicitation document and agenda
                                     item at school board meeting.
                                     Modify proposal based on
                                     legal counsel's directives.
                                     Remember fall and winter breaks may
                                     impact the timeline.
February-March....................   Propose solicitation
                                     document to school board.
                                     Follow internal procedures.
                                     Communicate to distributors
                                     and manufacturer and publicly
                                     announce the solicitation.
                                     Publicize the solicitation
                                     document.
                                     Conduct the solicitation
                                     meeting.
                                     Allow a minimum of four
                                     weeks for vendors to respond.
                                     Evaluate solicitations
                                     based on pre-established criteria
                                     and select vendors.
April-May.........................   Receive School Board
                                     approval for the selection of
                                     vendor.
                                     Provide information to
                                     distributor and/or manufacturer.
                                     Allow longer time for
                                     specialty items and name brand
                                     items.
June..............................   Communicate with
                                     stakeholders, determine delivery
                                     dates, and discuss school opening
                                     logistics.
July-August.......................   Receive product for
                                     upcoming school year.
------------------------------------------------------------------------

    Fluid milk is an integral part of the procurement cycle as it is 
ordered for millions of preschoolers and students nationwide through 
the CNPs. According to USDA's Agriculture Marketing Service, fluid milk 
processors require certainty around school meal program milk needs at 
the beginning of the school procurement cycle to ensure that they can 
bid appropriately and successfully to supply schools with the desired 
types of milk in appropriate packaging. Specifically, schools must be 
in a position to specify fat content required for both flavored and 
unflavored milk so that processors can provide bids with accurate and 
appropriate pricing. The fat content of milk is a significant 
determinant of cost. In addition, providing flavored, low-fat milk 
requires processors to modify package labeling and, potentially, adjust 
other aspects of flavored milk formulation associated with the change 
in fat content. These changes require planning and adequate lead time 
to provide a product in a timely and cost-efficient manner.
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    \4\ See Procurement in the 21st Century, Institute of Child 
Nutrition, 2015, (http://www.nfsmi.org/documentlibraryfiles/PDF/20151009032855.pdf).
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Operational Challenges

    This interim final rule seeks to address the operational challenges 
experienced by some Program operators regarding their ability to offer 
nutritious and appealing meals that are consistent with the Dietary 
Guidelines and conform to local operational differences and community 
preferences. It provides schools with specific, optional flexibilities 
for SY 2018-2019 that will help children gradually adjust to and enjoy 
school meals that are aligned with science-based recommendations. This 
rule places more control in the hands of local Program operators to 
make specific menu and procurement decisions that reflect local tastes, 
preferences and circumstances, empowering them in ways that may 
increase both participation in the meal programs and food consumption 
by children. It is important to stress that the flexibilities are 
optional, intended as additional tools for schools across the country 
to provide meals that make sense for their communities. States and 
Program operators may opt to use some or all of these flexibilities and 
some schools may not use any.
    During the initial years of implementation of the 2012 school meal 
regulations, nearly one third of SFAs reported challenges finding 
products to meet the updated nutrition standards.\5\ According to USDA 
administrative data, the largest decrease in NSLP lunch participation 
(-3 percent) occurred in school year 2012-2013, which was the first 
year of implementation. This decrease was primarily driven by a 
substantial decrease in the paid lunch participation category. While 
paid lunch participation had been decreasing since 2008, the drop in 
school year 2012-2013 was the largest decrease in over 20 years (-10 
percent). There were other changes implemented during this timeframe, 
most notably the requirement to incrementally increase paid lunch 
prices; however, some of the drop may have been due to students 
choosing not to participate due to the updated meal standards. Paid 
lunch participation continues to decline but at a slower rate in recent 
years. Total participation remained relatively stable for the past 
three years.\6\
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    \5\ FNS SN-OPS report: https://www.fns.usda.gov/special-nutrition-program-operations-study-school-year-2013-14. J. Murdoch 
et al. (2016). Special Nutrition Program Operations Study, SY 2013-
14 Report. Prepared by 2M Research Services, LLC. Alexandria, VA: 
U.S. Department of Agriculture, Food and Nutrition Service. Project 
Officers: Toija Riggins and John Endahl. Available online at: 
www.fns.usda.gov/research-and-analysis.
    \6\ The annual change in total participation has been less than 
1% for FY 2014, FY2015, and FY 2016.
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    USDA recognizes that many Program operators have had great success 
in implementing the updated meal patterns and nutrition standards. We 
applaud their efforts and encourage them to continue their successful 
school food service practices. For these Program operators, as well as 
those who continue to have challenges, publication of this interim 
final rule ensures that the flexibilities described above will be 
available for the near term. If there is continued Congressional action 
in these

[[Page 56707]]

areas, USDA will provide additional guidance. Public comments, 
operational experience, and any Congressional directives will help 
inform USDA's development of a final rule that will provide more 
certainty with regard to the milk, whole grain, and sodium 
requirements.

IV. Discussion of Meal Pattern Flexibilities

Milk Flexibility

    The 2015-2020 Dietary Guidelines recommend consumption of fat-free 
(skim) and low-fat (1 percent fat) dairy products as an important 
source of beneficial nutrients. The current regulatory provisions on 
fluid milk for the affected CNPs (NSLP, SMP, SBP, and CACFP) require 
Program operators to offer fat-free or low-fat milk \7\ and restrict 
the use of flavored milk to fat-free milk.
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    \7\ Program operators in the CACFP and SMP are required to serve 
unflavored milk to children through age five, whole milk for 
children age one, and low-fat or fat-free milk for children age two 
through five.
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    This interim final rule will allow NSLP, SBP, SMP, and CACFP 
operators the option to serve flavored, low-fat milk, including as a 
competitive beverage for sale in schools, in SYs 2018-2019. Under this 
rule, NSLP and SBP operators that choose to exercise this option are 
not required to demonstrate a reduction in student milk consumption or 
an increase in milk waste, but are expected to incorporate this option 
into the weekly menu in a manner consistent with the dietary 
specifications for these programs. For consistency across CNPs, this 
interim final rule allows flavored, low-fat milk in the SMP and CACFP 
for participants six years of age and older, in SY 2018-2019. This 
flexibility is intended to encourage children's consumption of fluid 
milk in the CNPs and to ease administrative burden for Program 
operators participating in multiple CNPs. This flexibility is 
consistent with the flexibility regarding flavored, low-fat milk 
mandated by Congress for the SY 2017-2018.
    This rule addresses concerns raised by Program operators and 
industry partners about declining daily milk consumption among Program 
participants. Declining milk consumption is a specific concern for 
children and adolescents because milk is a key source of calcium and 
vitamin D, which are nutrients necessary for optimizing bone health.\8\ 
Recent Centers for Disease Control and Prevention (CDC) survey data 
show that among adolescents attending U.S. high schools, self-reported 
daily milk consumption did not change significantly during 2007-2011, 
then decreased significantly from 2011-2015.\9\
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    \8\ Golden NH, Abrams SA, and AAP Committee on Nutrition. 
Optimizing Bone Health in Children and Adolescents, Pediatrics 
2014;134;e1229; originally published online September 29, 2014.
    \9\ Miller et al, ``Trends in Beverage Consumption Among High 
School Students--United States, 2007-2015.'' Morbidity and Mortality 
Weekly Report/February 3, 2017/Vol. 66/No. 4.
---------------------------------------------------------------------------

    Additionally, FNS collected data on milk consumption during the 
school meals as part of the School Nutrition and Meal Cost Study 
conducted in SY 2014-2015. The study has not yet been released but a 
review of preliminary tables from this study compared to the same data 
from the previous study using comparable methodology in SY 2004-2005 
suggests a decline in milk consumption during lunch among NSLP 
participants from SY 2004-2005 (from 75 percent to 66 percent). The 
decline was observed in elementary, middle, and high school students. 
We plan to release the updated data from School Nutrition Meal Cost 
Study in early 2018.
    Fluid milk is a required component in all school meals, and also 
must be served in the SMP and CACFP. Some studies suggest that the 
availability of flavored milk products influences student decisions 
about, and consumption of, milk in school.\10\ The research on the 
impact of lowering the fat content of flavored milk is limited. Only 
one study looked at milk intake before and after the new standards and 
the focus was on the amount of milk consumed among those selecting 
milk, not whether there was a change in the percentage of children 
selecting milk.\11\ However, prior to implementation of the 2012 final 
rule, Nutrition Standards in the National School Lunch and School 
Breakfast Programs (77 FR 4088), flavored, low-fat milk was the most 
frequently purchased milk by public school districts.\12\ It was also 
among the most commonly offered varieties of milk in NSLP menus (63 
percent).\13\ Based on this information, offering the additional 
variety of flavored, low-fat milk across the CNP may increase student 
milk consumption.
---------------------------------------------------------------------------

    \10\ Patterson J, Saidel M. The removal of flavored milk in 
schools results in a reduction in total milk purchases in all 
grades, K-12. J Am Diet Assoc . 2009; 109(9): A97; Quann E, Adams D. 
Impact on Milk Consumption and Nutrient Intakes From Eliminating 
Flavored Milk in Elementary Schools. Nutrition Today. 2013; 48:127-
134.
    \11\ Yon BA, Johnson RK. New School Meal Regulations and 
Consumption of Flavored Milk in Ten US Elementary Schools, 2010 and 
2013. Prev Chronic Dis 2015.
    \12\ U.S. Department of Agriculture, Food and Nutrition Service, 
Office of Research and Analysis, School Food Purchase Study-III, by 
Nick Young et al. Project Officer: John R. Endahl, Alexandria, VA: 
March 2012, p. 175.
    \13\ U.S. Department of Agriculture, Food and Nutrition Service, 
Office of Research and Analysis, School and Nutrition 
DietaryAssessment Study IV, Vols. I and II, by Mary Kay Fox and John 
Hall, et al. Project Officer, Fred Lesnett. Alexandria, VA: November 
2012. Download report at: www.fns.usda.gov/ora/https://www.fns.usda.gov/sites/default/files/SNDA-IV_Findings_0.pdf.
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    With the implementation of the 2012 final rule on school meals, 
NSLP and SBP meal requirements limited flavor to fat-free milk to help 
schools meet weekly saturated fat and calorie limits, as flavored, fat-
free milk contains no saturated fat and approximately 20-40 calories 
less per 8 fluid ounces than flavored, low-fat milk.\14\ The calorie 
difference is almost entirely due to a difference in fat content. 
Calories from added sugar vary by only 1-2 calories between the fat-
free and low-fat flavored milk varieties.
---------------------------------------------------------------------------

    \14\ https://supertracker.usda.gov; data based on the Food and 
Nutrient Database for Dietary Studies (FNDDS), and the Food Patterns 
Equivalents Database (FPED).
---------------------------------------------------------------------------

    Data from a recent survey of school food service professionals 
suggests that roughly a third of schools are well within the weekly 
calorie maximums for school meals and some are below the weekly calorie 
minimums.\15\ Given the experience of these schools, coupled with the 
marked decreases in daily milk consumption among high school students 
across the Nation and the nutritional value of milk for children and 
adolescents, USDA has determined that it is consistent with the 
objective of encouraging milk consumption to reduce potential limits on 
fluid milk by providing schools flexibility to offer flavored, low-fat 
milk in addition to flavored, fat-free milk. Comments on this interim 
final rule will help inform USDA's decision regarding the long-term 
availability of this milk flexibility.
---------------------------------------------------------------------------

    \15\ J. Murdoch et al. (2016). Special Nutrition Program 
Operations Study, SY 2013-14 Report. Prepared by 2M Research 
Services, LLC. Alexandria, VA: U.S. Department of Agriculture, Food 
and Nutrition Service.
---------------------------------------------------------------------------

Whole Grain-Rich Flexibility

    The 2012 final rule Nutrition Standards in the National School 
Lunch and School Breakfast Programs (77 FR 4088) revised the NSLP and 
SBP meal patterns to require that, beginning SY 2014-2015, all grains 
in the school menu meet the FNS whole grain-rich criteria (a product 
must contain at least 50 percent whole grains and the remaining grain 
content of the product must be enriched). Due to reported limitations 
on the availability of certain products that met the whole grain-rich 
criteria at that time, FNS allowed State agencies the option to provide 
certain exemptions to this requirement in SY

[[Page 56708]]

2014-2015. As noted earlier, successive legislative action in 2012, 
2015, and 2016 has impacted full implementation of the whole grain-rich 
requirement. More recently, Congress extended through SY 2017-2018 the 
option allowing State agencies that administer the NSLP and SBP to 
grant whole grain-rich exemptions to SFAs that request them and 
demonstrate hardship in procuring or preparing specific products that 
meet the established criteria and are acceptable to students. This 
interim final rule allows State agencies to continue to grant whole 
grain-rich exemptions through SY 2018-2019, thus providing certainty 
about this flexibility for the near term.
    Although this rule retains the whole grain-rich regulatory 
requirement, extending the exemptions for SY 2018-2019 will give 
Program operators that continue to experience challenges the 
opportunity to plan and serve meals that are economically feasible and 
acceptable to their students and communities. Since certain regional 
foods are not yet widely available in acceptable whole grain-rich 
varieties, granting more local control through the whole grain-rich 
exemption can help ensure that culturally appropriate foods are 
available to the student population. Pasta, bread, and tortillas are 
among the most common food items for which exemptions have been 
requested, and other regionally popular products, such as grits and 
breakfast biscuits, are also reported. For SY 2016-2017, 49 State 
agencies indicated that they are offering exemptions to SFAs for 
specific food items. Reports from State agencies indicated that 
approximately 2,500 SFAs were approved for such exemptions. This was an 
increase of approximately 10 percent in the number of approvals for 
exemptions over the previous school year, providing further indication 
of the need for continuing the option for State agencies to grant 
exemptions to local SFAs.
    Given the challenges expressed by SFAs and the reported increase in 
exemption approvals, continued and consistent flexibility in meeting 
the whole grain-rich requirement is necessary. Therefore, this rule 
extends through SY 2018-2019 the State agency's discretion to grant an 
exemption from the whole grain-rich requirements if requested by SFAs 
that demonstrate hardship in providing specific products that meet the 
whole grain-rich criteria and as long as at least 50 percent of the 
grains served are whole grain-rich. Hardships may include those caused 
by lack of availability in the market, financial concerns, an increase 
in plate waste, lack of student acceptability, and others.
    USDA believes the food industry will continue efforts to develop 
more acceptable, affordable products that are appealing to students. 
Through interaction with industry at multiple food shows, including the 
National Restaurant Association's Annual Show, USDA has learned that 
manufacturers are continuing their efforts to expand their product 
lines for schools. For instance, whole grain-rich pizza crust and 
different types of breads, such as whole grain-rich pita and flatbread, 
are now available to schools. Continuing the State agency's option to 
offer whole grain-rich flexibility will enable SFAs experiencing 
challenges to more effectively develop menus and procure foods that are 
acceptable to students. It also provides manufacturers additional time 
to develop whole grain-rich food products that are suitable for 
reheating and hot holding in the food service facility and result in 
more acceptable meals for students. This will assist schools in 
sustaining student participation, encouraging meal consumption, and 
limiting food waste. USDA will evaluate school and food industry 
progress over time and consider public comments in order to develop a 
final rule that address the whole grain-rich exemptions.
    As a reminder, State agencies that elect to consider whole grain-
rich exemption requests by SFAs for specific items are required to 
develop procedures for accepting and evaluating SFA requests for such 
exemptions. Because this exemption has been available for several 
years, many State agencies have already developed such procedures based 
on FNS guidance (SP 32-2017, School Meal Flexibilities for SY 2017-18; 
May 22, 2017). Therefore, most State approval procedures are already in 
place and no changes to those procedures are required by this rule. 
Additional guidance will be provided to State agencies that have not 
already developed such procedures.

Sodium Flexibility

    The 2012 final rule Nutrition Standards in the National School 
Lunch and School Breakfast Programs (77 FR 4088) also established 
average weekly sodium limits for school meals. In order to reduce the 
sodium content of meals consistent with the report by the Health and 
Medicine Division of the National Academies of Science, Engineering, 
and Medicine and the Dietary Guidelines recommendations, the 2012 final 
rule established two intermediate sodium targets and a final target 
that were calculated based on the sodium recommendation from the 2010 
Dietary Guidelines, which were subsequently reinforced by the 2015-2020 
Dietary Guidelines.
    To facilitate sodium reduction over a 10-year period, the current 
regulations, established in 2012, require compliance with Sodium Target 
1 beginning July 1, 2014 (SY 2014-2015), Target 2 beginning July 1, 
2017 (SY 2017-2018), and the Final Target beginning July 1, 2022 (SY 
2022-2023). Based on Program operators' certification of compliance 
with the 2012 updated meal pattern requirements, USDA anticipates that 
nearly all schools have begun the process of reducing the sodium 
content of school meals. To facilitate this change, USDA makes a wide 
variety of low-sodium food products available to Program operators 
through USDA Foods. However, USDA understands that sodium reduction in 
school meals must be consistent with broader, overall reductions in the 
food supply and reductions in children's consumption patterns outside 
of school. The most recent available data from the CDC indicates that, 
in 2009-2012, approximately 92 percent of school-age children in the 
United States exceeded the 2015-2020 Dietary Guidelines upper intake 
level for dietary sodium.\16\
---------------------------------------------------------------------------

    \16\ See https://www.cdc.gov/mmwr/preview/mmwrhtml/mm6452a1.htm.
---------------------------------------------------------------------------

    While USDA recognizes the importance of reducing the sodium content 
of school meals, reaching this objective will likely require a more 
gradual process than the planned 10 years to accommodate the individual 
challenges of SFAs and their access to new products lower in sodium. 
Factors such as sodium preferences and consumption patterns suggest 
that retaining Target 1 is appropriate and necessary to ensure student 
consumption of school meals and adequate nutrient intake.
    Therefore, this interim final rule retains Sodium Target 1 for an 
additional school year--from July 1, 2018, through June 30, 2019 (SY 
2018-2019)--which has an impact on the overall sodium reduction 
timeline established in current regulations. However, this sodium 
flexibility is consistent with previous Congressional actions directing 
USDA to maintain Sodium Target 1 for the near term. While USDA 
anticipates retaining Sodium Target 1 as the regulatory limit in the 
final rule through at least the end of SY 2020-2021, the Department 
seeks public comments on the long-term availability of this flexibility 
and suggestions on how to best address the overall sodium requirement 
in school

[[Page 56709]]

meals. In the future, USDA will also reevaluate the sodium and other 
school meal requirements in light of the 2020 Dietary Guidelines. 
Section 9(a)(4) of the Richard B. Russell National School Lunch Act, 42 
U.S.C. 1758(a)(4), requires that school meals reflect the latest 
Dietary Guidelines.
    USDA will continue to engage with the public, health advocates, 
nutrition professionals, schools, and the food industry to gather 
ongoing input on needs and challenges associated with managing sodium 
levels in school meals. In addition, USDA will continue to expand the 
availability of low-sodium products offered through USDA Foods; develop 
recipes that assist with sodium reduction; and provide menu planning 
resources, technical assistance, and information to schools through the 
FNS What's Shaking? sodium reduction initiative and the FNS Team Up for 
School Nutrition Success initiative.

V. Summary

    This interim final rule provides continued flexibility in SY 2018-
2019 in three specific menu planning areas--milk, whole grains, and 
sodium. Implementation of this interim final rule will allow all CNP 
operators the discretion to offer flavored, low-fat milk as an 
allowable milk type in the reimbursable meal or as a competitive 
beverage for sale in schools in SY 2018-2019. It also will provide 
State agencies with the authority to continue granting exemptions to 
the whole grain-rich requirement in SY 2018-2019 for schools 
demonstrating hardship. Finally, by retaining Sodium Target 1 as the 
regulatory limit through SY 2018-2019 and inviting public comments, 
this interim final rule will allow children more time to adjust to 
school meals with less sodium content. Additionally, this interim rule 
will provide schools and manufacturers with additional time and 
predictability to make appropriate menu and product changes. 
Throughout, USDA will continue to encourage steady progress on sodium 
reduction in school meals and provide technical assistance to Program 
operators.
    USDA will conduct a thorough review of all public comments on the 
three flexibilities addressed in this interim final rule and submitted 
within the comment period. Stakeholders and the public are encouraged 
to provide comments that will assist USDA in developing a final rule on 
the long-term availability of the milk, whole grains, and sodium 
flexibilities.

Issuance of an Interim Final Rule and Effective Date

    USDA, under the provisions of the Administrative Procedure Act at 5 
U.S.C. 553(b)(B), is issuing this as an interim final rule and finds 
for good cause that, in this limited instance, use of prior notice and 
comment procedures for issuing this time-limited interim final rule is 
impracticable.
    Following enactment of the Healthy, Hunger-Free Kids Act of 2010, 
Public Law 111-296, and USDA's codification of effecting regulations 
beginning in 2012, Program operators have experienced hardships due to 
persistent uncertainties regarding nutrition requirements as a result 
of repeated short-term Congressional legislative directives and 
responsive USDA implementation. As noted in the preamble to this 
rulemaking, for each of the five intervening school years, Congress has 
directed USDA to provide exemptions and flexibilities for codified 
nutrition standards relative to whole grain-rich products, sodium 
levels, and most recently, flavored fluid milk, consistent with 
specific legislative provisions. See Consolidated and Further 
Continuing Appropriations Act, 2012 (Pub. L. 112-55) enacted November 
18, 2011, Consolidated and Further Continuing Appropriations Act, 2015 
(Pub. L. 113-235) enacted December 16, 2014, Consolidated and Further 
Continuing Appropriations Act, 2016 (Pub. L. 114-113) enacted December 
18, 2015, and Consolidated Appropriations Act, 2017 (Pub. L. 115-31) 
enacted May 5, 2017. Most recently, Section 101(a)(1) of the Continuing 
Appropriations Act, 2018, Division D of the Continuing Appropriations 
Act, 2018 and Supplemental Appropriations for Disaster Relief 
Requirements Act, 2017, Public Law 115-56, enacted September 8, 2017, 
extends the flexibilities provided by section 747 of the Consolidated 
Appropriations Act, 2017. Following each legislative directive, USDA 
timely authored implementing memoranda, notifying affected stakeholders 
of the availability of exemptions and flexibilities and facilitating 
utilization despite the inopportune timing.\17\ This repetitive 
legislative action manifests a clear Congressional message to USDA: The 
current regulatory provisions limiting fluid milk, whole grain-rich, 
and sodium options in the CNPs are causing operational challenges and 
need further consideration.
---------------------------------------------------------------------------

    \17\ Because the three flexibilities provided for in the 
Consolidated Appropriations Act, 2017 remain in effect through June 
30, 2018, at this time it is not necessary for FNS to promulgate an 
implementing memorandum.
---------------------------------------------------------------------------

    Recently, USDA has come to understand that the cumulative impact of 
the unpredictable legislative mandates on Program operators has 
substantially harmed their ability to accomplish fundamental 
administrative responsibilities ranging from advance menu planning, to 
school district budgeting and competitive procurement of allowable 
foods. As noted elsewhere in this rulemaking, Program operators begin 
procurement for a school year as early as the previous autumn, after 
assessing the availability of USDA Foods entitlement commodities and 
respecting the time and labor required for a fulsome procurement 
process. Perhaps most importantly, procurement process timing for 
school meal products is locally determined so as to meet the 
administrative and planning needs of Program operators.
    The successive legislative exemptions and flexibilities for whole 
grain-rich products and sodium targets significantly impaired Program 
operators' timely completion of competitive procurements of affected 
products. Most recently, USDA understands that the exemptions and 
flexibilities provided by Public Law 115-31, enacted May 5, 2017, could 
not be effectively incorporated into Program operators' regular 
procurement processes and menu planning for the 2017-2018 school year, 
which began July 1, 2017. It is likely that some Program operators were 
thus deprived of the intended legislated opportunities. Similarly, at 
this time, many Program operators have already initiated menu-planning 
for SY 2018-2019, which begins July 1, 2018, with these exemptions and 
flexibilities in place. Expediting the availability of the three 
flexibilities for the entire 2018-2019 school year by way of this 
interim final rule, then, is essential insofar as it provides local 
Program operators timely notice of the opportunity to utilize the 
flexibilities in menu-planning for the upcoming school year. Consistent 
with USDA's understanding, use of an interim final rule to provide 
sufficient notice of the flexibilities available during SY 2018-2019, 
rather than a proposed rulemaking, is essential in meeting the needs of 
local Program operators.
    With that in mind, USDA has determined that schools and other local 
Program operators need reliable nutrition standards in place in order 
to procure compliant products in the near term through SY 2018-2019 and 
beyond. Given the realities and time sensitivity of the local 
procurement

[[Page 56710]]

process, this interim final rule, with a final rule planned for 
publication in fall 2018, is the most effective method for securing 
that reliability. Current flexibilities affecting nutrition standards 
for fluid milk, whole grain-rich, and sodium have been accomplished 
administratively and are legislatively driven. Without that legislative 
directive, the Secretary would not have the authority to extend or 
waive regulatory nutrition standards in the affected programs. See 42 
U.S.C. 1760(l). The sole method for USDA to relieve the hardship, 
providing certainty prior to the local-level decision-making for SY 
2018-2019, is by amending these regulatory standards through issuance 
of this interim final rule. USDA intends to provide reliable and 
conclusive regulatory support for local procurement decision-makers at 
schools and other Program operators prior to the beginning of the local 
procurement process for SY 2019-20.
    The interim final rule reflects Congressional direction and 
provides Program operators certainty in local-level procurement and 
menu planning operations during SY 2018-19. To that end, this interim 
final rule aims to maintain the whole grain-rich and sodium standards 
that Congress has consistently enunciated, continue the fluid milk 
options legislatively directed for the current school year with slight 
modifications, and provide the urgent relief stakeholders need. 
Finally, this interim final rule presents a framework which will 
benefit from public comments received. In turn, those comments will 
advise the framework of the final rule, which USDA plans to publish in 
fall 2018.
    Also, based on its ongoing engagement with industry partners USDA 
believes the critical clarity provided by this interim final rule is 
necessary for manufacturers, producers, and vendors to develop and 
produce the products needed by Program operators to meet CNP 
objectives. Legislative and regulatory uncertainty has reduced research 
and development of CNP-compliant food and beverage products. 
Implementation of this interim final rule, with the intent to publish a 
final rule in fall 2018, provides the certainty needed to stimulate 
research and development of cost-effective, CNP-compliant products so 
Program operators can meet the need of America's children. Finally, 
this interim final rule affords food industry stakeholders an 
opportunity to comment and aid the Department in developing a final 
rule that will address these flexibilities for future school years.
    Consequently, this interim final rule providing for the three menu 
planning flexibilities discussed above, will enable Program operators, 
including schools, day care centers, and family day care homes, to 
exercise the increased options provided in this de-regulatory 
rulemaking, increase integrity and accuracy of their local procurement 
processes and menu planning in the near term. In addition, the interim 
final rule will provide food suppliers with additional clarity needed 
to encourage research and develop cost-effective, customized products 
compliant with CNP standards and responsive to the unique needs of 
Program operators and America's children. Similarly, the interim rule 
affords the public, including program operators, food suppliers, and 
other engaged stakeholders, an opportunity to provide meaningful 
comments aiding the Department during the development of a final rule 
which we intend to publish in fall 2018.

Procedural Matters

Executive Order 12866 and 13563
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This interim final rule has been determined to be 
significant and was reviewed by the Office of Management and Budget 
(OMB) in conformance with Executive Order 12866.

Regulatory Impact Analysis

    A regulatory impact analysis (RIA) must be prepared for major rules 
with economically significant effects ($100 million or more in any one 
year). USDA does not anticipate that this interim final rule is likely 
to have an economic impact of $100 million or more in any one year, and 
therefore, does not meet the definition of ``economically significant'' 
under Executive Order 12866. The RIA for the 2012 final rule, Nutrition 
Standards in the National School Lunch and School Breakfast Programs, 
(77 FR 4088), underscores the importance of recognizing the linkage 
between poor diets and health problems such as childhood obesity. In 
addition to the impacts on the health of children, the RIA also cites 
information regarding the social costs of obesity and the additional 
economic costs associated with direct medical expenses of obesity. The 
RIA for the 2012 rule did not estimate individual health benefits that 
could be directly attributed to the change in the final rule: ``Because 
of the complexity of factors that contribute both to overall food 
consumption and to obesity, we are not able to define a level of 
disease or cost reduction that is attributable to the changes in meals 
expected to result from implementation of the rule. As the rule is 
projected to make substantial improvements in meals served to more than 
half of all school-aged children on an average school day, we judge 
that the likelihood is reasonable that the benefits of the rule exceed 
the costs, and that the final rule thus represents a cost-effective 
means of conforming NSLP and SBP regulations to the statutory 
requirements for school meals.'' \18\
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    \18\ See https://www.gpo.gov/fdsys/pkg/FR-2012-01-26/pdf/2012-1010.pdf.
---------------------------------------------------------------------------

    To the extent in which the specific flexibilities in this interim 
final rule allow Program operators still facing challenges to more 
efficiently operate within the meal patterns established in 2012, we 
expect the health benefits in this rule to be similar to the overall 
benefits of improving the diets of children cited in the RIA for the 
final meal standard rule. An analysis assessing the costs and benefits 
of this action is presented below.
    As explained above, this interim final rule provides optional 
flexibilities to the meal patterns established in 2012 by allowing for 
a more gradual implementation of the whole grain-rich and sodium 
requirements, as well as offering an additional low-fat milk option. 
USDA anticipates minimal if any costs associated with the changes to 
the school meal standards due to the discretionary nature of the 
additional flexibilities. The overall meal components, macro nutrient, 
and calorie requirements remain unchanged and Program operators may 
choose to utilize the additional flexibilities offered in this interim 
final rule within these constraints. Further, we do not anticipate this 
interim final rule will deter the significant progress made to date 
\19\ by State and local operators, USDA, and industry manufacturers to 
achieve healthy palatable meals for students.
---------------------------------------------------------------------------

    \19\ FNS National Data Bank Administrative Data: 99.7% of 
lunches served in FY2016 received the performance based 
reimbursement for compliance with the meal standards.
---------------------------------------------------------------------------

    These changes are also promulgated in the context of significant 
progress

[[Page 56711]]

made to date by State and local operators, USDA, and industry 
manufacturers to achieve healthy appealing meals for students. The USDA 
Special Nutrition Program Operations Studies for SYs 2012-2013 and 
2013-2014 suggest that, as with any major change, there were some 
challenges. For example, food costs, student acceptance, and the 
availability of product meeting the standards were the primary 
challenges anticipated in implementing the whole grain-rich requirement 
in full. As industry has increased the variety and quality of their 
offerings, SFAs are finding this requirement has become easier to 
fulfil, so these early studies may not be representative of current 
status.\20\ That said, there are still some Program operators 
struggling with certain requirements, and regional differences 
sometimes result in less acceptance of some foods. Based on current 
exemption data, SFAs in 49 States have requested a waiver for exemption 
of products not meeting the whole grain-rich criteria. For these 
reasons, we expect that the flexibilities extended in this interim 
final rule will be needed and used primarily by the schools still 
facing challenges to planning and offering healthy meals that students 
will eat and make sense for their communities.
---------------------------------------------------------------------------

    \20\ See https://www.fns.usda.gov/school-nutrition-program-operations-study-school-year-2012-13 and see https://www.fns.usda.gov/special-nutrition-program-operations-study-school-year-2013-14.
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    Local operators struggling with one or all of these requirements 
may choose to adopt any of the options to balance current and future 
resources in preparing healthy meals. The flexibilities for flavored 
milk and the whole grain-rich requirement, and the additional time to 
implement sodium reduction provide certainty for Program operators for 
the near term to effectively procure food for appealing and healthy 
menus. The public comments on this interim final rule will be 
particularly critical in assisting the process to establish a long-term 
approach to these flexibilities.
    Flexibility to offer flavored, low-fat (1 percent fat) milk: The 
regulatory impact analyses for the 2012 final rule, Nutrition Standards 
in the National School Lunch and School Breakfast Programs (77 FR 
4088), did not estimate the separate costs of including specifically 
flavored, low-fat milk as an option to meet the milk variety 
requirement. Nonfat, flavored milk is currently an allowable option and 
the addition of flavored, low-fat at local discretion should not impact 
overall costs. Local operators may choose to incorporate the new 
options of milk into their current menus as they deem appropriate for 
their calorie ranges and available resources. There may be some cases 
in which flavored, low-fat milk is slightly more expensive and for some 
it might be slightly less expensive than the varieties currently 
permitted by regulations established in 2012, but any overall 
difference in cost is likely to be minimal.
    Flexibility to exempt certain schools from the whole grain-rich 
requirements: The 2012 final rule, Nutrition Standards in the National 
School Lunch and School Breakfast Programs (77 FR 4088), revised the 
meal patterns of both the NSLP and the SBP to require that all grains 
provided in the programs meet FNS whole grain-rich criteria by SY 2014-
2015. Due to limitations on the availability of products that meet the 
whole grain-rich criteria at that time, State agencies were allowed to 
provide certain exemptions to this requirement in SY 2014-2015. 
Congress directed the Secretary through successive legislative action 
\21\ to continue to allow State agencies that administer the NSLP and 
the SBP to grant an exemption from the regulatory whole grain-rich 
requirement in the meal programs through SY 2017-2018. SFAs must 
demonstrate hardship in procuring specific products that meet the whole 
grain-rich criteria, which are acceptable to students and compliant 
with the whole grain-rich requirements. State agencies have developed 
procedures for accepting and evaluating exemption requests based on FNS 
guidance (SP 33-2016, Extension Notice: Requests for Exemption from the 
School Meals' Whole Grain-Rich Requirement for School Year 2016-2017, 
April 29, 2016). As specified in this guidance, the exemptions must be 
based on demonstrated hardship, such as financial hardship, limited 
product availability, unacceptable product quality, and/or poor student 
acceptability.
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    \21\ Section 752 of the Consolidated and Further Continuing 
Appropriations Act, 2015 (Pub. L. 113-235), Section 733 of the 
Consolidated Appropriations Act, 2016 (Pub. L. 114-113), and Section 
747 of the Consolidated Appropriations Act, 2017 (Pub. L. 115-31).
---------------------------------------------------------------------------

    Currently, less than 15 percent of SFAs (2,868/19,530) request the 
whole grain-rich exemption. Aside from the administrative costs of 
requesting and recording exemptions, we do not estimate any costs 
associated with extending the whole grain-rich exemption option, given 
that this is a discretionary provision. The extent to which SFAs will 
continue to utilize this option will vary greatly; individual Program 
operators will need to balance resources, product availability, and 
student acceptability.
    The RIA for the 2012 final rule, Nutrition Standards in the 
National School Lunch and School Breakfast Programs (77 FR 4088), 
estimated an overall small net cost savings when factoring in the whole 
grain-rich requirement and the overall reduction in total refined 
grains offered. The net savings was the result of the overall reduction 
in refined grains served due to the restrictions on the maximum number 
of weekly grain servings offered and limits on calories and sodium.\22\ 
The final rule RIA estimated that after ``FY 2014, when the rule's 100 
percent whole grain-rich requirement takes effect, the added cost of 
serving higher priced whole grain products about equals the savings 
from a reduction in grains products served.'' \23\
---------------------------------------------------------------------------

    \22\ Flexibilities for the weekly restriction of grains and 
meat/meal alternate servings were made permanent in the final rule, 
``Certification of Compliance With Meal Requirements for the 
National School Lunch Program Under the Healthy, Hunger-Free Kids 
Act of 2010'' (79 FR 325), published on January 3, 2014. There were 
no costs associated with the additional flexibilities on the weekly 
grain and meat/meat alternate servings due to the fact program 
operators still needed to comply with the calorie and sodium 
requirements, which provide limited flexibility for SFAs to greatly 
exceed the maximum recommendations.
    \23\ https://www.gpo.gov/fdsys/pkg/FR-2012-01-26/pdf/2012-1010.pdf.
---------------------------------------------------------------------------

    Forty-nine States indicated to USDA that they are offering whole 
grain-rich exemptions to approximately 2,500 SFAs for SY 2016-2017. 
This was an increase of approximately 10 percent. That said, the 
individual costs/savings to the SFAs are estimated to be minimal with 
the extension of the exemption options. Any additional costs associated 
with a whole grain-rich product would be offset with the overall 
reduction in refined grain offerings. We also expect that as more 
products become available, any differential costs associated with whole 
grain-rich products will normalize in the market. The availability of 
whole grain-rich products through USDA Foods and the commercial market 
has increased significantly since the implementation of the meal 
standards and continues to progress, providing new and affordable 
options for local operators to integrate into menus.
    Extending Sodium Target 1 through SY 2018-2019: In the RIA for the 
2012 final rule, Nutrition Standards in the National School Lunch and 
School Breakfast Programs (77 FR 4088), meeting the first sodium target 
was not estimated as a separate cost due to the fact that the first 
target was meant to be met using food currently available when

[[Page 56712]]

the target went into effect in SY 2014-2015 (or by making minimal 
changes to the foods offered). While the regulatory impact analyses did 
not estimate a separate cost to implement Sodium Target 1, it did 
factor in higher labor costs for producing meals that meet all the meal 
standards at full implementation to factor in the costs of schools 
replacing packaged goods to food prepared from scratch. Over 5 years, 
the final rule estimated that total SFAs costs would increase by $1.6 
billion to meet all standards. The cost estimate extended only through 
FY 2016, two years before the final rule's second sodium target would 
have taken effect. The second sodium target was designed to be able to 
be met with the help of industry changing food processing technology.
    This interim final rule retains Sodium Target 1 as the regulatory 
limit through June 30, 2019 (SY 2018-2019) and seeks public comments on 
the long-term sodium requirement. We do not anticipate any additional 
costs associated with this change as it is simply allowing for 
additional time for Program operators and industry to reduce sodium 
levels.
Executive Order 13771
    This interim final rule is an E.O. 13771 deregulatory action. It 
provides regulatory flexibilities in the meal pattern and nutrition 
requirements that are consistent with those currently available as a 
result only of appropriation legislation in effect for SY 2017-2018 and 
administrative actions.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies 
to analyze the impact of rulemaking on small entities and consider 
alternatives that would minimize any significant impacts on a 
substantial number of small entities. Because Program operators would 
have discretion to exercise the provisions of this rule and the 
flexibilities in this rule are only a small part of the overall changes 
in 7 CFR parts 210, 215, 220, and 226, it has been determined that the 
rule would not have a significant impact on a substantial number of 
small entities.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and Tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a cost 
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures by State, local or Tribal 
governments, in the aggregate, or the private sector, of $100 million 
or more in any one year. When such a statement is needed for a rule, 
Section 205 of the UMRA generally requires the Department to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the most cost effective or least burdensome alternative that achieves 
the objectives of the rule.
    This interim final rule does not contain Federal mandates (under 
the regulatory provisions of Title II of the UMRA) for State, local and 
Tribal governments or the private sector of $100 million or more in any 
one year. Thus, the rule is not subject to the requirements of sections 
202 and 205 of the UMRA.
Executive Order 12372
    The NSLP, SMP, SBP, and the CACFP are listed in the Catalog of 
Federal Domestic Assistance under NSLP No. 10.555, SMP No. 10.556, SBP 
No. 10.553, and CACFP No. 10.558, respectively, and are subject to 
Executive Order 12372, which requires intergovernmental consultation 
with State and local officials. Since the Child Nutrition Programs are 
State-administered, USDA's Food and Nutrition Service (FNS) Regional 
Offices have formal and informal discussions with State and local 
officials, including representatives of Indian Tribal Organizations, on 
an ongoing basis regarding program requirements and operation. This 
provides FNS with the opportunity to receive regular input from program 
administrators which contributes to the development of feasible program 
requirements.

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under Section (6)(b)(2)(B) of Executive Order 13132.
    The Department has considered the impact of this rule on State and 
local governments and has determined that this rule does not have 
federalism implications. Therefore, under section 6(b) of the Executive 
Order, a federalism summary is not required.
Executive Order 12988, Civil Justice Reform
    This interim final rule has been reviewed under Executive Order 
12988, Civil Justice Reform. This rule is intended to have preemptive 
effect with respect to any State or local laws, regulations or policies 
which conflict with its provisions or which would otherwise impede its 
full and timely implementation. This rule is not intended to have 
retroactive effect. Prior to any judicial challenge to the provisions 
of the interim final rule, all applicable administrative procedures 
must be exhausted.

Civil Rights Impact Analysis

    FNS has reviewed this interim rule in accordance with USDA 
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify any 
major civil rights impacts the rule might have on program participants 
on the basis of age, race, color, national origin, sex or disability. 
After a careful review of the rule's intent and provisions, FNS has 
determined that this rule is not expected to limit or reduce the 
ability of protected classes of individuals to participate in the NSLP, 
SMP, SBP, and CACFP.
Executive Order 13175
    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' Executive Order 13175 requires Federal agencies 
to consult and coordinate with tribes on a government-to-government 
basis on policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on one or 
more Indian tribes, on the relationship between the Federal Government 
and Indian tribes or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes.
    The Food and Nutrition Service (FNS) has assessed the impact of 
this rule on Indian tribes and determined that this rule does not, to 
our knowledge, have tribal implications that require tribal 
consultation under E.O. 13175. If a Tribe requests consultation, FNS 
will work with the Office of Tribal Relations to ensure meaningful 
consultation is provided where changes, additions and modifications 
identified herein are not expressly mandated by Congress.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR part 
1320) requires the Office of Management and Budget (OMB) to approve all 
collections

[[Page 56713]]

of information by a Federal agency before they can be implemented. 
Respondents are not required to respond to any collection of 
information unless it displays a current valid OMB control number. The 
provisions of this rule do not impose new information collection 
requirements subject to approval by the OMB under the Paperwork 
Reduction Act of 1994.

E-Government Act Compliance

    The Department is committed to complying with the E-Government Act, 
to promote the use of the Internet and other information technologies 
to provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

List of Subjects

7 CFR Part 210

    Grant programs--education, Grant programs--health, Infants and 
children, Nutrition, Penalties, Reporting and recordkeeping 
requirements, School breakfast and lunch programs, Surplus agricultural 
commodities.

7 CFR Part 215

    Food assistance programs, Grant programs--education, Grant 
program--health, Infants and children, Milk, Reporting and 
recordkeeping requirements.

7 CFR Part 220

    Grant programs--education, Grant programs--health, Infants and 
children, Nutrition, Reporting and recordkeeping requirements, School 
breakfast and lunch programs.

7 CFR Part 226

    Accounting, Aged, Day care, Food assistance programs, Grant 
programs, Grant programs--health, American Indians, Individuals with 
disabilities, Infants and children, Intergovernmental relations, Loan 
programs, Reporting and recordkeeping requirements, Surplus 
agricultural commodities.

    Accordingly, 7 CFR parts 210, 215, 220 and 226 are amended as 
follows:

PART 210--NATIONAL SCHOOL LUNCH PROGRAM


0
1. The authority citation for 7 CFR part 210 continues to read as 
follows:

    Authority:  42 U.S.C. 1751-1760, 1779.


0
2. In Sec.  210.10:
0
a. In paragraph (c) introductory text, revise the table;
0
b. In paragraph (c)(2)(iv)(A), add a sentence at the end of the 
paragraph; and
0
c. Revise paragraphs (c)(2)(iv)(B), (d)(1)(i), and (f)(3).
    The revisions and addition read as follows:


Sec.  210.10  Meal requirements for lunches and requirements for 
afterschool snacks.

* * * * *
    (c) * * *

----------------------------------------------------------------------------------------------------------------
                                                                            Lunch meal pattern
                    Food components                     --------------------------------------------------------
                                                             Grades K-5         Grades 6-8        Grades 9-12
----------------------------------------------------------------------------------------------------------------
                                                               Amount of food a per week (minimum per day)
----------------------------------------------------------------------------------------------------------------
Fruits (cups) b........................................     2\1/2\ (\1/2\)     2\1/2\ (\1/2\)              5 (1)
Vegetables (cups) b....................................     3\3/4\ (\3/4\)     3\3/4\ (\3/4\)              5 (1)
    Dark green c.......................................              \1/2\              \1/2\              \1/2\
    Red/Orange c.......................................              \3/4\              \3/4\             1\1/4\
    Beans and peas (legumes) c.........................              \1/2\              \1/2\              \1/2\
    Starchy c..........................................              \1/2\              \1/2\              \1/2\
Other c d..............................................              \1/2\              \1/2\              \3/4\
Additional Vegetables to Reach Total e.................                e 1                e 1           e 1\1/2\
Grains (oz eq) f.......................................            8-9 (1)           8-10 (1)          10-12 (2)
Meats/Meat Alternates (oz eq)..........................           8-10 (1)           9-10 (1)          10-12 (2)
Fluid milk (cups) g....................................              5 (1)              5 (1)              5 (1)
----------------------------------------------------------------------------------------------------------------
                    Other Specifications: Daily Amount Based on the Average for a 5-Day Week
----------------------------------------------------------------------------------------------------------------
Min-max calories (kcal) h..............................            550-650            600-700            750-850
Saturated fat (% of total calories) h..................                <10                <10                <10
Sodium Target 1 (mg) e.................................            <=1,230            <=1,360            <=1,420
                                                        --------------------------------------------------------
Trans fat h i j........................................    Nutrition label or manufacturer specifications must
                                                              indicate zero grams of trans fat per serving.
----------------------------------------------------------------------------------------------------------------
a Food items included in each group and subgroup and amount equivalents. Minimum creditable serving is \1/8\
  cup.
b One quarter-cup of dried fruit counts as \1/2\ cup of fruit; 1 cup of leafy greens counts as \1/2\ cup of
  vegetables. No more than half of the fruit or vegetable offerings may be in the form of juice. All juice must
  be 100% full-strength.
c Larger amounts of these vegetables may be served.
d This category consists of ``Other vegetables'' as defined in paragraph (c)(2)(iii)(E) of this section. For the
  purposes of the NSLP, the ``Other vegetables'' requirement may be met with any additional amounts from the
  dark green, red/orange, and beans/peas (legumes) vegetable subgroups as defined in paragraph (c)(2)(iii) of
  this section.
e Any vegetable subgroup may be offered to meet the total weekly vegetable requirement.
f All grains must be whole grain-rich. Exemptions are allowed as specified in paragraph (c)(2)(iv)(B) of this
  section.
g All fluid milk must be fat-free (skim) or low-fat (1 percent fat or less). Milk may be unflavored or flavored
  as specified in paragraph (d)(1)(i) of this section.
h Discretionary sources of calories (solid fats and added sugars) may be added to the meal pattern if within the
  specifications for calories, saturated fat, trans fat, and sodium. Foods of minimal nutritional value and
  fluid milk with fat content greater than 1 percent are not allowed.
i Sodium Target 1 (shown) is effective from July 1, 2014 (SY 2014-2015) through June 30, 2019 (SY 2018-2019).
  For sodium targets due to take effect beyond SY 2018-2019, see paragraph (f)(3) of this section.
j Food products and ingredients must contain zero grams of trans fat (less than 0.5 grams) per serving.

* * * * *
    (2) * * *
    (iv) * * *
    (A) * * * The whole grain-rich criteria included in FNS guidance 
may be updated to reflect additional information provided by industry 
on the

[[Page 56714]]

food label or a whole grains definition by the Food and Drug 
Administration.
    (B) Daily and weekly servings. The grains component is based on 
minimum daily servings plus total servings over a 5-day school week. 
Schools serving lunch 6 or 7 days per week must increase the weekly 
grains quantity by approximately 20 percent (\1/5\) for each additional 
day. When schools operate less than 5 days per week, they may decrease 
the weekly quantity by approximately 20 percent (\1/5\) for each day 
less than 5. The servings for biscuits, rolls, muffins, and other 
grain/bread varieties are specified in FNS guidance. All grains offered 
must meet the whole grain-rich criteria specified in FNS guidance. 
Exemptions are allowed at the discretion of the State agency from July 
1, 2018 through June 30, 2019 (school year 2018-2019). If allowed by 
the State agency, a school food authority may submit an exemption 
request for one or more products. The exemption request must 
demonstrate hardship in meeting the requirement, address the criteria 
established in FNS guidance, and be submitted through the process 
established by the State agency. School food authorities granted an 
exemption from the whole grain-rich requirement, at a minimum, must 
offer half of the weekly grains as whole grain-rich.
* * * * *
    (d) * * *
    (1) * * *
    (i) Schools must offer students a variety (at least two different 
options) of fluid milk. All milk must be fat-free (skim) or low-fat (1 
percent fat or less). Milk with higher fat content is not allowed. Low-
fat or fat-free lactose-free and reduced-lactose fluid milk may also be 
offered. All milk may be unflavored or flavored from July 1, 2018 
through June 30, 2019 (school year 2018-2019).
* * * * *
    (f) * * *
    (3) Sodium. School lunches offered to each age/grade group must 
meet, on average over the school week, the levels of sodium specified 
in the following table within the established deadlines:

                                                 National School Lunch Program Sodium Timeline & Limits
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Target 1: July 1, 2014  SY     Target 2: July 1, 2019  SY     Final target: July 1, 2022
                      Age/grade group                               2014-2015  (mg)                2019-2020  (mg)               SY 2022-2023  (mg)
--------------------------------------------------------------------------------------------------------------------------------------------------------
K-5........................................................                       <=1,230                          <=935                          <=640
6-8........................................................                       <=1,360                        <=1,035                          <=710
9-12.......................................................                       <=1,420                        <=1,080                          <=740
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *


Sec.  210.11  [Amended]

0
3. In Sec.  210.11(m)(1)(ii), (m)(2)(ii), and (m)(3)(ii):
0
a. Add the words ``or flavored'' after the word ``unflavored''; and
0
b. Add the words ``from July 1, 2018 through June 30, 2019, school year 
2018-2019'' before the semicolon.

PART 215--SPECIAL MILK PROGRAM FOR CHILDREN


0
4. The authority for 7 CFR part 215 continues to read as follows:

    Authority:  42 U.S.C. 1772 and 1779.


0
5. In Sec.  215.7a, revise paragraph (a)(3) to read as follows:


Sec.  215.7a   Fluid milk and non-dairy milk substitute requirements.

* * * * *
    (a) * * *
    (3) Children 6 years old and older. Children six years old and 
older must be served low-fat (1 percent fat or less) or fat-free (skim) 
milk. Milk may be unflavored or flavored from July 1, 2018 through June 
30, 2019 (school year 2018-2019).
* * * * *

PART 220--SCHOOL BREAKFAST PROGRAM

0
6. The authority citation for 7 CFR part 220 continues to read as 
follows:

    Authority: 42 U.S.C. 1773, 1779, unless otherwise noted.


0
7. In Sec.  220.8:
0
a. In paragraph (a) introductory text, remove the second and third 
sentences;
0
b. In paragraph (b) introductory text, remove the words ``, once fully 
implemented as specified in paragraphs (c), (d), (e), (f), (h), (i), 
and (j) of this section,'';
0
c. In paragraph (c) introductory text, revise the table;
0
d. In paragraphs (c)(1) and (c)(2)(i), remove the words ``Effective 
July 1, 2013 (SY 2013-2014), schools'' and add the word ``Schools'' in 
their place;
0
e. In paragraph (c)(2)(ii), remove the words ``Effective July 1, 2014 
(SY 2014-2015), schools'' and add the word ``Schools'' in their place;
0
f. In paragraph (c)(2)(iii), remove the words ``, effective July 1, 
2014 (SY 2014-2015),'';
0
g. In paragraph (c)(2)(iv)(A), add a sentence after the second sentence 
and remove the words ``Effective July 1, 2013 (SY 2013-2014), schools'' 
and add the word ``Schools'' in their place;
0
h. Revise paragraphs (c)(2)(iv)(B) and (d);
0
i. In paragraph (e), remove the words ``beginning July 1, 2014 (SY 
2014-2015)'';
0
j. In paragraph (f)(1), remove the words ``Effective July 1, 2013 (SY 
2013-2014), school'' and add the word ``School'' in their place and 
remove the words ``--Effective SY 2013-2014'' from the table heading;
0
k. In paragraph (f)(2), remove the words ``Effective July 1, 2012 (SY 
2012-2013), school'' and add the word ``School'' in their place;
0
l. Revise paragraph (f)(3);
0
m. In paragraph (f)(4), remove the words ``Effective July 1, 2013 (SY 
2013-2014), food'' and add the word ``Food'' in their place; and
0
n. In paragraph (h)(2), remove the words ``Effective SY 2013-2014,''.
    The revisions and addition read as follows:


Sec.  220.8  Meal requirements for breakfasts.

* * * * *
    (c) * * *

----------------------------------------------------------------------------------------------------------------
                                                                          Breakfast meal pattern
                    Food components                     --------------------------------------------------------
                                                             Grades K-5         Grades 6-8        Grades 9-12
----------------------------------------------------------------------------------------------------------------
                                                               Amount of food a per week (minimum per day)
----------------------------------------------------------------------------------------------------------------
Fruits (cups) b c......................................              5 (1)              5 (1)              5 (1)

[[Page 56715]]

 
Vegetables (cups) c....................................                  0                  0                  0
    Dark green.........................................                  0                  0                  0
    Red/Orange.........................................                  0                  0                  0
    Beans and peas (legumes)...........................                  0                  0                  0
    Starchy............................................                  0                  0                  0
    Other..............................................                  0                  0                  0
Grains (oz eq) d.......................................           7-10 (1)           8-10 (1)           9-10 (1)
Meats/Meat Alternates (oz eq) e........................                  0                  0                  0
Fluid milk f (cups)....................................              5 (1)              5 (1)              5 (1)
----------------------------------------------------------------------------------------------------------------
                    Other Specifications: Daily Amount Based on the Average for a 5-Day Week
----------------------------------------------------------------------------------------------------------------
Min-max calories (kcal) g h............................            350-500            400-550            450-600
Saturated fat (% of total calories) h..................                <10                <10                <10
Sodium Target 1 (mg) h i...............................              <=540              <=600              <=640
                                                        --------------------------------------------------------
Trans fat h j..........................................    Nutrition label or manufacturer specifications must
                                                              indicate zero grams of trans fat per serving.
----------------------------------------------------------------------------------------------------------------
a Food items included in each group and subgroup and amount equivalents. Minimum creditable serving is \1/8\
  cup.
b One quarter cup of dried fruit counts as \1/2\ cup of fruit; 1 cup of leafy greens counts as \1/2\ cup of
  vegetables. No more than half of the fruit or vegetable offerings may be in the form of juice. All juice must
  be 100% full-strength.
c Schools must offer 1 cup of fruit daily and 5 cups of fruit weekly. Vegetables may be substituted for fruits,
  but the first two cups per week of any such substitution must be from the dark green, red/orange, beans and
  peas (legumes) or ``Other vegetables'' subgroups, as defined in Sec.   210.10(c)(2)(iii) of this chapter.
d All grains must be whole-grain-rich. Exemptions are allowed as specified in paragraph (c)(2)(iv)(B) of this
  section. Schools may substitute 1 oz. eq. of meat/meat alternate for 1 oz. eq. of grains after the minimum
  daily grains requirement is met.
e There is no meat/meat alternate requirement.
f All fluid milk must be fat-free (skim) or low-fat (1 percent fat or less). Milk may be unflavored or flavored
  as specified in paragraph (d) of this section.
g The average daily calories for a 5-day school week must be within the range (at least the minimum and no more
  than the maximum values).
h Discretionary sources of calories (solid fats and added sugars) may be added to the meal pattern if within the
  specifications for calories, saturated fat, trans fat, and sodium. Foods of minimal nutritional value and
  fluid milk with fat content greater than 1 percent milk fat are not allowed.
i Sodium Target 1 (shown) is effective from July 1, 2014 (SY 2014-2015) through June 30, 2019 (SY 2018-2019).
  For sodium targets due to take effect beyond SY 2018-2019, see paragraph (f)(3) of this section.
j Food products and ingredients must contain zero grams of trans fat (less than 0.5 grams) per serving.

* * * * *
    (2) * * *
    (iv) * * *
    (A) * * * The whole grain-rich criteria included in FNS guidance 
may be updated to reflect additional information provided by industry 
on the food label or a whole grains definition by the Food and Drug 
Administration. * * *
    (B) Daily and weekly servings. The grains component is based on 
minimum daily servings plus total servings over a 5-day school week. 
Schools serving breakfast 6 or 7 days per week must increase the weekly 
grains quantity by approximately 20 percent (\1/5\) for each additional 
day. When schools operate less than 5 days per week, they may decrease 
the weekly quantity by approximately 20 percent (\1/5\) for each day 
less than 5. The servings for biscuits, rolls, muffins, and other 
grain/bread varieties are specified in FNS guidance. All grains offered 
must meet the whole grain-rich criteria specified in FNS guidance. 
Exemptions are allowed at the discretion of the State agency from July 
1, 2018 through June 30, 2019 (school year 2018-2019). If allowed by 
the State agency, a school food authority may submit an exemption 
request for one or more products. The exemption requests must 
demonstrate hardship in meeting the requirement, address the criteria 
established in FNS guidance, and be submitted through the process 
established by the State agency. School food authorities that are 
granted an exemption from the current whole grain-rich requirement, at 
a minimum, must offer half of the weekly grains as whole grain-rich.
* * * * *
    (d) Fluid milk requirement. A serving of fluid milk as a beverage 
or on cereal or used in part for each purpose must be offered for 
breakfasts. Schools must offer students a variety (at least two 
different options) of fluid milk. All fluid milk must be fat-free 
(skim) or low-fat (1 percent fat or less). Milk with higher fat content 
is not allowed. Low-fat or fat-free lactose-free and reduced-lactose 
fluid milk may also be offered. Milk may be unflavored or flavored from 
July 1, 2018 through June 30, 2019 (school year 2018-2019). Schools 
must also comply with other applicable fluid milk requirements in Sec.  
210.10(d)(1) through (4) of this chapter.
* * * * *
    (f) * * *
    (3) Sodium. School breakfasts offered to each age/grade group must 
meet, on average over the school week, the levels of sodium specified 
in the following table within the established deadlines:

                                                    School Breakfast Program Sodium Timeline & Limits
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Target 1: July 1, 2014  SY     Target 2: July 1, 2019  SY     Final target: July 1, 2022
                      Age/grade group                               2014-2015  (mg)                2019-2020  (mg)               SY 2022-2023  (mg)
--------------------------------------------------------------------------------------------------------------------------------------------------------
K-5........................................................                         <=540                          <=485                          <=430

[[Page 56716]]

 
6-8........................................................                         <=600                          <=535                          <=470
9-12.......................................................                         <=640                          <=570                          <=500
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *

PART 226--CHILD AND ADULT CARE FOOD PROGRAM

0
8. The authority citation for 7 CFR part 226 continues to read as 
follows:

    Authority:  Secs. 9, 11, 14, 16, and 17, Richard B. Russell 
National School Lunch Act, as amended (42 U.S.C. 1758, 1759a, 1762a, 
1765 and 1766).

0
9. In Sec.  226.20:
0
a. Revise paragraphs (a)(1)(iii) and (iv); and
0
b. Revise the tables in paragraphs (c)(1), (2), and (3).
    The revisions read as follows:


Sec.  226.20  Requirements for meals.

    (a) * * *
    (1) * * *
    (iii) Children 6 years old and older. Children six years old and 
older must be served milk that is low-fat (1 percent fat or less) or 
fat-free (skim). Milk may be unflavored or flavored from July 1, 2018, 
through June 30, 2019 (school year 2018-2019).
    (iv) Adults. Adults must be served milk that is low-fat (1 percent 
fat or less) or fat-free (skim). Milk may be unflavored or flavored 
from July 1, 2018, through June 30, 2019 (school year 2018-2019). Six 
ounces (weight) or \3/4\ cup (volume) of yogurt may be used to fulfill 
the equivalent of 8 ounces of fluid milk once per day. Yogurt may be 
counted as either a fluid milk substitute or as a meat alternate, but 
not as both in the same meal.
* * * * *
    (c) * * *
    (1) * * *

 BILLING CODE 3410-30-P

[[Page 56717]]

[GRAPHIC] [TIFF OMITTED] TR30NO17.000


[[Page 56718]]


[GRAPHIC] [TIFF OMITTED] TR30NO17.001

    (2) * * *

[[Page 56719]]

[GRAPHIC] [TIFF OMITTED] TR30NO17.002


[[Page 56720]]


[GRAPHIC] [TIFF OMITTED] TR30NO17.003

    (3) * * *

[[Page 56721]]

[GRAPHIC] [TIFF OMITTED] TR30NO17.004


[[Page 56722]]


[GRAPHIC] [TIFF OMITTED] TR30NO17.005


[[Page 56723]]


* * * * *

     Dated: November 22, 2017.
Brandon Lipps,
Acting Deputy Under Secretary, Food, Nutrition, and Consumer Services.
[FR Doc. 2017-25799 Filed 11-29-17; 8:45 am]
BILLING CODE 3410-30-C