[Federal Register Volume 88, Number 129 (Friday, July 7, 2023)]
[Notices]
[Pages 43266-43270]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-14313]


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DEPARTMENT OF AGRICULTURE

Food and Nutrition Service


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

AGENCY: Food and Nutrition Service, USDA.

ACTION: Notice.

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SUMMARY: This Notice announces the annual adjustments to the national 
average payments, the amount of money the Federal Government provides 
States for lunches, afterschool snacks, and breakfasts served to 
children participating in the National School Lunch and School 
Breakfast Programs; to the maximum reimbursement rates, the maximum per 
lunch rate from Federal funds that a State can provide a school food 
authority for lunches served to children participating in the National 
School Lunch Program; and to the rate of reimbursement for a half-pint 
of milk served to non-needy children in a school or institution that 
participates in the Special Milk Program for Children. The annual 
payments and rates adjustments for the National School Lunch and School 
Breakfast Programs reflect changes in the Food Away From Home series of 
the Consumer Price Index for All Urban Consumers. The annual rate 
adjustment for the Special Milk Program reflects changes in the 
Producer Price Index for Fluid Milk Products. Further adjustments are 
made to these rates to reflect higher costs of providing meals in 
Alaska, Guam, Hawaii, Puerto Rico, and Virgin Islands. The payments and

[[Page 43267]]

rates are prescribed on an annual basis each July.

DATES: These rates are effective from July 1, 2023 through June 30, 
2024.

FOR FURTHER INFORMATION CONTACT: Penny Burke, Branch Chief, Program 
Monitoring and Operational Support Division, Child Nutrition Programs, 
FNS USDA, 1320 Braddock Place, Suite 401, Alexandria, VA 22314, 303-
844-0357.

SUPPLEMENTARY INFORMATION:

Special Note

    This Notice reflects the June 30, 2023 expiration of the temporary 
reimbursement rates provided under the Keep Kids Fed Act of 2022 (Pub. 
L. 117-158), which included an additional 40 cents per school lunch and 
15 cents per school breakfast meal reimbursement. The reimbursement 
rates in this Notice reflect an adjustment to the base rate from School 
Year (SY) 2022-2023.\1\
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    \1\ https://www.govinfo.gov/content/pkg/FR-2022-07-26/pdf/2022-15892.pdf--Reference Page--44335.
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    While the USDA Food and Nutrition Service (FNS) does not have the 
authority to adjust reimbursement rates above inflation in the 
contiguous United States (CONUS), pursuant to section 12 of the Richard 
B. Russell National School Lunch Act (42 U.S.C. 1760) USDA may make 
adjustments to reimbursement rates in the outlying areas to reflect 
differences between the cost of providing meals and supplements in 
those areas and the costs of providing meals and supplements in all 
other States. Therefore, FNS is temporarily increasing the 
reimbursement rates for the child nutrition programs in Guam, Hawaii, 
Puerto Rico, and the Virgin Islands to 30 percent above CONUS rates 
beginning July 1, 2023. This adjusted rate will be applied beginning on 
July 1, 2023, until further notice.

Background

    Special Milk Program for Children--Pursuant to section 3 of the 
Child Nutrition Act of 1966, as amended (42 U.S.C. 1772), the 
Department announces the rate of reimbursement for a half pint of milk 
served to non-needy children in a school or institution that 
participates in the Special Milk Program for Children. This rate is 
adjusted annually to reflect changes in the Producer Price Index for 
Fluid Milk Products, published by the Bureau of Labor Statistics of the 
Department of Labor.
    National School Lunch and School Breakfast Programs--Pursuant to 
sections 11 and 17A of the Richard B. Russell National School Lunch 
Act, (42 U.S.C. 1759a and 1766a), and section 4 of the Child Nutrition 
Act of 1966 (42 U.S.C. 1773), the Department annually announces the 
adjustments to the National Average Payment Factors and to the maximum 
Federal reimbursement rates for lunches and afterschool snacks served 
to children participating in the National School Lunch Program and 
breakfasts served to children participating in the School Breakfast 
Program. Adjustments are prescribed each July 1, based on changes in 
the Food Away From Home series of the Consumer Price Index for All 
Urban Consumers, published by the Bureau of Labor Statistics of the 
Department of Labor.
    Lunch Payment Levels--Section 4 of the Richard B. Russell National 
School Lunch Act (42 U.S.C. 1753) provides general cash for food 
assistance payments to States to assist schools in purchasing food. The 
Richard B. Russell National School Lunch Act provides two different 
section 4 payment levels for lunches served under the National School 
Lunch Program. The lower payment level applies to lunches served by 
school food authorities in which less than 60 percent of the lunches 
served in the school lunch program during the second preceding school 
year were served free or at a reduced price. The higher payment level 
applies to lunches served by school food authorities in which 60 
percent or more of the lunches served during the second preceding 
school year were served free or at a reduced price.
    To supplement these section 4 payments, section 11 of the Richard 
B. Russell National School Lunch Act (42 U.S.C. 1759 (a)) provides 
special cash assistance payments to aid schools in providing free and 
reduced-price lunches. The section 11 National Average Payment Factor 
for each reduced-price lunch served is set at 40 cents less than the 
factor for each free lunch.
    As authorized under sections 8 and 11 of the Richard B. Russell 
National School Lunch Act (42 U.S.C. 1757 and 1759a), maximum 
reimbursement rates for each type of lunch are prescribed by the 
Department in this Notice. These maximum rates are to ensure equitable 
disbursement of Federal funds to school food authorities.
    Performance-Based Reimbursement--In addition to the funding 
mentioned above, school food authorities certified as meeting the meal 
pattern and nutrition standard requirements set forth in 7 CFR parts 
210 and 220 are eligible to receive performance-based cash assistance 
for each reimbursable lunch served (an additional eight cents per lunch 
available beginning July 1, 2023, and adjusted annually thereafter).
    Afterschool Snack Payments in Afterschool Care Programs--Section 
17A of the Richard B. Russell National School Lunch Act (42 U.S.C. 
1766a) establishes National Average Payments for free, reduced price 
and paid afterschool snacks as part of the National School Lunch 
Program.
    Breakfast Payment Factors--Section 4 of the Child Nutrition Act of 
1966 (42 U.S.C. 1773) establishes National Average Payment Factors for 
free, reduced price, and paid breakfasts served under the School 
Breakfast Program and additional payments for free and reduced-price 
breakfasts served in schools determined to be in ``severe need'' 
because they serve a high percentage of needy children.

Adjusted Payments

    The following specific section 4, section 11, and section 17A 
National Average Payment Factors and maximum reimbursement rates for 
lunch, the afterschool snack rates, and the breakfast rates are in 
effect from July 1, 2023 through June 30, 2024. Due to a higher cost of 
living, the average payments and maximum reimbursements for Alaska, 
Guam, Hawaii, Puerto Rico, and Virgin Islands are higher than those for 
all other States. The District of Columbia uses figures specified for 
the contiguous States. These rates do not include the value of USDA 
Foods or cash-in-lieu of USDA Foods which schools receive as additional 
assistance for each meal served to participants under the Program. A 
notice announcing the value of USDA Foods and cash-in-lieu of USDA 
Foods is published separately in the Federal Register.
    Adjustments to the national average payment rates for all lunches 
served under the National School Lunch Program, breakfasts served under 
the School Breakfast Program, and afterschool snacks served under the 
National School Lunch Program are rounded down to the nearest whole 
cent.

Special Milk Program Payments

    For the period July 1, 2023 through June 30, 2024, the rate of 
reimbursement for a half pint of milk served to a non-needy child in a 
school or institution that participates in the Special Milk Program is 
26.25 cents. This change is based on the 3.46 percent decrease in the 
Producer Price Index for Fluid Milk Products from May 2022 to May 2023.
    As a reminder, schools or institutions with pricing programs that 
elect to serve milk free to eligible children continue to receive the 
average cost of a half pint of milk (the total cost of all milk 
purchased

[[Page 43268]]

during the claim period divided by the total number of purchased half 
pints) for each half pint served to an eligible child.

National School Lunch Program Payments

    Overall, payments for the National School Lunch Program and the 
Afterschool Snack Program saw an 8.27 percent increase in the national 
average payment rates for schools and residential child care 
institutions for the period July 1, 2023 through June 30, 2024 in the 
Consumer Price Index for All Urban Consumers for the Food Away From 
Home series during the 12-month period May 2022 to May 2023 (from a 
level of 325.952 in May 2022, as previously published in the Federal 
Register to 352.892 in May 2023).
    These changes are reflected below.
    Section 4 National Average Payment Factors--In school food 
authorities that served less than 60 percent free and reduced-price 
lunches in School Year (SY) 2021-2022,\2\ the payments for meals served 
are: Contiguous States--paid rate--40 cents (3 cents increase from the 
2022-2023 base rate \3\), free and reduced price rate--40 cents (3 
cents increase), maximum rate--48 cents (3 cents increase); Alaska--
paid rate--66 cents (5 cents increase), free and reduced price rate--66 
cents (5 cents increase), maximum rate--76 cents (5 cents increase); 
Guam, Hawaii, Puerto Rico, and Virgin Islands--paid rate--53 cents (9 
cents increase), free and reduced price rate--53 cents (9 cents 
increase), maximum rate--61 cents (9 cents increase).
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    \2\ Clarification on determining 60 percent free and reduced can 
be found in policy memo SP 02-2023 Determining Eligibility for 
Severe Need Reimbursement for the School Breakfast Program (SBP) and 
the Two Cent Differential Reimbursement for the National School 
Lunch Program (NSLP) in School Year (SY) 2023-24. https://www.fns.usda.gov/cn/sp-02-2023.
    \3\ Rates reflect adjustment to the SY 2022-2023 base rate and 
does not include the decrease from the expiration of the temporary 
rates included in Keep Kids Fed Act of 2022 (Pub. L. 117-158).
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    In school food authorities that served 60 percent or more free and 
reduced price lunches in School Year 2021-2022, payments are: 
Contiguous States--paid rate--42 cents (3 cents increase), free and 
reduced price rate--42 cents (3 cents increase), maximum rate--48 cents 
(3 cents increase); Alaska--paid rate--68 cents (5 cents increase), 
free and reduced price rate--68 cents (5 cents increase), maximum 
rate--76 cents (5 cents increase); Guam, Hawaii, Puerto Rico and Virgin 
Islands--paid rate--55 cents (9 cents increase), free and reduced price 
rate--55 cents (9 cents increase), maximum rate--61 cents (9 cents 
increase).
    School food authorities certified to receive the performance-based 
cash assistance will receive an additional 8 cents (adjusted annually) 
added to the above amounts as part of their section 4 payments.
    Section 11 National Average Payment Factors--Contiguous States--
free lunch--3 dollars and 85 cents (29 cents increase from the SY 2022-
2023 base rate), reduced price lunch--3 dollars and 45 cents (29 cents 
increase); Alaska--free lunch--6 dollars and 24 cents (48 cents 
increase), reduced price lunch--5 dollars and 84 cents (48 cents 
increase); Guam, Hawaii, Puerto Rico and Virgin Islands--free lunch--5 
dollars and 1 cent (85 cents increase), reduced price lunch--4 dollars 
and 61 cents (85 cents increase).
    Afterschool Snacks in Afterschool Care Programs--The payments are: 
Contiguous States--free snack--1 dollar and 17 cents (9 cents increase 
from the SY 2022-2023 base rate), reduced price snack--58 cents (4 
cents increase), paid snack--10 cents (1 cent increase); Alaska--free 
snack-1 dollar and 89 cents (14 cent increase), reduced price snack--94 
cents (7 cents increase), paid snack--17 cents (1 cent increase); Guam, 
Hawaii, Puerto Rico and Virgin Islands--free snack--1 dollar and 52 
cents (26 cents increase), reduced price snack--76 cents (13 cents 
increase), paid snack--13 cents (2 cents increase)

School Breakfast Program Payments

    Overall, payments for the National School Breakfast Program saw an 
8.27 percent increase in the national average payment rates for schools 
and residential child care institutions for the period July 1, 2023 
through June 30, 2024 in the Consumer Price Index for All Urban 
Consumers in the Food Away from Home series during the 12-month period 
May 2022 to May 2023 (from a level of 325.952 in May 2022, as 
previously published in the Federal Register to 352.892 in May 2023).
    These changes are reflected below.
    For schools ``not in severe need'' the payments are: Contiguous 
States--free breakfast--2 dollars and 28 cents (17 cents increase from 
the SY 2022-2023 base rate), reduced price breakfast--1 dollar and 98 
cents (17 cents increase), paid breakfast--38 cents (3 cents increase); 
Alaska free breakfast--3 dollars and 66 cents (28 cents increase), 
reduced price breakfast--3 dollars and 36 cents (28 cents increase), 
paid breakfast--58 cents (4 cents increase); Guam, Hawaii, Puerto Rico 
and Virgin Islands--free breakfast--2 dollars and 95 cents (49 cents 
increase), reduced price breakfast--2 dollars and 65 cents (49 cents 
increase), paid breakfast--47 cents (7 cents increase).
    For schools in ``severe need'' the payments are: Contiguous States 
free breakfast--2 dollars and 73 cents (21 cents increase from the SY 
2022-2023 base rate), reduced price breakfast--2 dollars and 43 cents 
(21 cents increase), paid breakfast--38 cents (3 cents increase); 
Alaska--free breakfast--4 dollars and 39 cents (33 cents increase), 
reduced price breakfast--4 dollars and 9 cents (33 cents increase), 
paid breakfast--58 cents (4 cents increase); Guam, Hawaii, Puerto Rico 
and Virgin Islands--free breakfast--3 dollars and 53 cents (59 cents 
increase), reduced price breakfast--3 dollars and 23 cents (59 cents 
increase), paid breakfast--47 cents (7 cents increase).

Payment Chart

    The following chart illustrates the lunch National Average Payment 
Factors with the sections 4 and 11 already combined to indicate the per 
lunch amount; the maximum lunch reimbursement rates; the reimbursement 
rates for afterschool snacks served in afterschool care programs; the 
breakfast National Average Payment Factors including severe need 
schools; and the milk reimbursement rate. All amounts are expressed in 
dollars or fractions thereof. The payment factors and reimbursement 
rates used for the District of Columbia are those specified for the 
contiguous States.
BILLING CODE 3410-30-P

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[GRAPHIC] [TIFF OMITTED] TN07JY23.001

    This action is not a rule as defined by the Regulatory Flexibility 
Act (5 U.S.C. 601-612) and thus is exempt from the provisions of that 
Act. This notice has been determined to be exempt under Executive Order 
12866.

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    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507), no new recordkeeping or reporting requirements have been 
included that are subject to approval from the Office of Management and 
Budget.
    National School Lunch, School Breakfast, and Special Milk Programs 
are listed in the Catalog of Federal Domestic Assistance under No. 
10.555, No. 10.553, and No. 10.556, respectively, and are subject to 
the provisions of Executive Order 12372, which requires 
intergovernmental consultation with State and local officials (See 2 
CFR 415.3-415.6).
    Authority: Sections 4, 8, 11, and 17A of the Richard B. Russell 
National School Lunch Act, as amended, (42 U.S.C. 1753, 1757, 1759a, 
1766a) and sections 3 and 4(b) of the Child Nutrition Act, as amended, 
(42 U.S.C. 1772 and 42 U.S.C. 1773(b)).

Cynthia Long,
Administrator, Food and Nutrition Service.
[FR Doc. 2023-14313 Filed 7-6-23; 8:45 am]
BILLING CODE 3410-30-C