The spat has taken place behind the scenes in recent weeks as lawmakers try to cobble together a deal to stave off a federal shutdown, which is set to occur after midnight Friday unless Congress acts. The fraught process has touched off a series of tough debates over programs enacted earlier in the pandemic — and how much, if at all, they should be funded further.
The Biden administration had urged lawmakers to extend an initiative first enacted in 2020, which gave the Department of Agriculture the authority to issue nationwide child nutrition waivers. These waivers have allowed school nutrition programs, local government agencies and nonprofit organizations to keep feeding children despite numerous challenges, including school closures that forced students to learn at a distance.
But the Biden administration’s request — backed by congressional Democrats — encountered resistance on Capitol Hill, according to four sources familiar with the matter, who requested anonymity to describe the private discussions. Among the Republican opponents was Senate Minority Leader Mitch McConnell, the sources said.
One of the sources, an aid to Senate Republican leadership, explained the program had meant as a temporary fix — and extending it would have cost more than $11 billion at a time when the party is worried about rising deficits. The aid stressed schools are reopening anyway and faulted the Biden administration for failing to extend the school lunch programs as part of the roughly $1.9 trillion stimulus that Democrats backed last year. The administration also did not include money for the initiative when it asked Congress to approve more than $20 billion in new emergency coronavirus funds last week.
Multiple sources cautioned that the talks around a bipartisan funding deal remain unresolved, meaning the discussion could still change. Lawmakers have aimed to finalize work on the bill as soon as Tuesday so that the House and Senate can vote on the broader spending package imminently.
However, without an extension of the waivers, schools are expected to see a dramatic reduction in reimbursements for school meals in the next school year. The USDA is estimating more than 40 percent decreased funding for school lunches for an average school district. The average reimbursement a school gets for a meal served will fall from $4.56 to an estimated $2.91. And that will happen while schools continue to face higher costs for food, labor and supplies.
Schools also could lose flexibility in how they operate, which has allowed them to adapt traditional program rules to accommodate the pandemic and labor shortages, according to critical advocates for these programmes. This includes flexibilities to offer meals in the classroom or grab-and-go meals for children required to miss school during quarantines.
Schools could lose the ability to substitute foods to meet requirements when they can’t get what they ordered because of unexpected supply chain disruptions, advocates say. Finally, without waivers, schools could face financial penalties if they fail to meet federal requirements as a result of supply chain issues, and by no fault of their own. For example, if they cannot serve a variety of vegetables or obtain whole grain rich products that meet federal standards, states will be required to penalize the districts.
“Ninety percent of schools are using the waivers and only 75 percent of them are breaking even,” said Stacy Dean, USDA deputy undersecretary. “If your revenue is too low for your costs, you either need to go somewhere else for your revenue or you have to cut costs, which could mean lower-quality food, layoffs or trimming back programs like after-school snacks and breakfast, which has a particular impact on low-income students.”
School nutrition advocates are up in arms. Although covid cases have come down and unemployment in this country continues to drop, the loss of these waivers will be cataclysmic for schools and needy students in a situation that continues to be far from normal, said Kelly Orton, director of Salt Lake City School District . He points to shortfalls he’s seeing right now.
“We’ve had a problems getting milk. The manufacturers of the cartons couldn’t make them for us, and sporadically we haven’t had drivers to drive the milk,” he said. “We haven’t had milk since last Tuesday. It wasn’t delivered all week, and it’s a vital component we’re supposed to provide. This is the new normal.”
Also, school districts around the country are having trouble finding enough workers, Orton said, but augmented funding during the pandemic has enabled districts to pay higher wages to compete in a tight labor market.
At retail chains in Utah, the new starting wage is $15. We had been paying $13.50 in our plan, and we just had $15 approved in February so we could be competitive. The current funding has allowed us to do that. The fear is when these waivers go away and the money goes away, there’s no way to fund these higher wages,” he said.
Many of the pandemic-era safety net programs have a gradual return to normal, said Dean with the USDA. By cutting off these waivers on June 30, schools will have insufficient funds for summer programs and for next school year. Dean said that other safety net programs that got pandemic boosts during the crisis, like Medicaid health insurance and SNAP (the supplemental nutrition program formerly called food stamps), have been given more time to ease back down to tighter funding.
“We’re concerned that a hard pivot on June 30 is going to general a seamless return to normal. What we want is an off-ramp to give schools time to get back to regular rules,” Dean said.
The loss of these waivers also means significant logistical challenges for school administrators as they have to once again charge students and track eligibility, said Katie Wilson, executive director of the Urban School Food Alliance, a nonprofit created by school-food-service professionals.
“Families have not filled out free and reduced-priced meal forms for the last two years. It will literally be impossible to get this information before the end of June,” Wilson said. “There will need to be a lot of communication and education to get families to understand why this is changing when they are still underwater from the pandemic. School nutrition programs are taking the heat from all of this, and it will only get worse when they have to figure out a way to charge parents again.”