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Financial woes are not slowing school kitchens

POSTED: August 23, 2008 5:00 a.m.
SCOTT ROGERS/The Times

Robin Hulsey places chicken-fried steaks into the oven at the Lyman Hall Elementary cafeteria kitchen Monday morning as the kitchen staff prepares for lunch.

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Here’s some reassuring news for parents: Despite the financial troubles facing Georgia’s public schools, at least the kids won’t starve.

That’s because school nutrition budgets are entirely separate from the rest of the school system.

"We generate the money we spend," said Cookie Palmer, nutrition director for Hall County schools. "I don’t give anything to (school administrators), and I don’t get anything."

The National School Lunch Program pays school nutrition departments $2.57 for each meal served to a child who qualifies for the free lunch program. Reimbursement for students in the reduced-price lunch category is $2.17 per meal. And the feds even reimburse 24 cents for each child who pays the full price of their lunch.

Palmer said reimbursement rates for the 2008-09 year have been adjusted to reflect the rising cost of food.

"This year, our increase for free meals was 10 cents per meal," she said. "That doesn’t sound like a lot, but it adds up."

In addition to federal reimbursement, school cafeterias collect money from meals bought by full-price students and by adults. In the Hall County system, lunch prices have remained the same this year: $1.40 for elementary schools, $1.50 for middle and high schools, $2.75 for adults.

"We looked at increasing lunch prices, but decided not to," Palmer said. "With the unstable economy, I did not want a parent to have to decide whether their child can have lunch."

In the Gainesville system, the school board voted in June to raise prices by 25 cents. Elementary students who are not in the federal subsidy program now pay $1.25, middle-school students pay $1.50, and high-school students pay $1.75. Lunches for adults cost $2.75.

Tiffany Lommel, nutrition director for Gainesville City Schools, said the price increase will have minimal impact.

"Only 18 percent of our students pay for lunch," she said. "And only 80 to 100 adults buy lunch. So a 25-cent price increase potentially would only bring in an extra $25 for the entire school system."

Planning a school system’s nutrition budget is something of a gamble, because officials have to make an educated guess about the coming year’s enrollment and how much food prices likely are to rise.

Palmer said she starts working on the next year’s budget in March, and for the past two years she has factored in a 20 percent increase in food costs.

"We could already see there was some instability in the world market in 2007, when gas prices went up for the first time," she said.

Some school systems did not predict the rapid rise in food prices, and struggled to make ends meet during the 2007-08 school year. When the cost of food went up, they only had a fixed amount of money available and had to cut back in other areas, such as cafeteria personnel and kitchen equipment.

Palmer said all of those expenses are part of the nutrition budget. So when a school system’s general budget is tight, the system cannot cut costs by laying off lunchroom workers or putting off the purchase of a new stove because the two budgets are separate.

But Palmer said she and other nutrition directors are acutely aware that times are tough.

"I am committed to spending every penny as efficiently as we can," she said. "With our vendors, we made sure we had competition for every bid, and that keeps prices down."

Lommel said vendors probably are having to absorb the cost of higher food prices, because so far they aren’t passing along the increase to the schools.

"Contracts with vendors were signed before the school year started, and those prices are locked in," she said.

Why would vendors agree to prices that barely cover their own costs? The same reason companies offer their products to Wal-Mart at dirt-cheap rates: That’s the price you pay in order to be part of the biggest game in town.

"Schools are such a huge industry," Palmer said.

Because of these favorable contracts, Palmer said school lunch programs have not had to sacrifice the quality of their ingredients.

They’re also able to take advantage of the USDA commodities program, which gives each school system an allotment of foods from which to choose.

Lommel said she stretches those free dollars as much as she can. "We’re trying to get our most expensive foods, such as meat, from commodities, and get the cheaper items from vendors," she said.

Palmer has a similar strategy. "We tend to focus on protein when we can, and if that’s not available (from the commodities program), we use (our allotment) for fruits and vegetables," she said.

But it seems even the U.S. Department of Agriculture is feeling the pinch from the global food crisis.

"Our allocation (of commodities) has decreased," Palmer said. "For the 2008 school year, our USDA entitlement was $793,647. For 2009, it’s $737,151."

Lommel said the trick is providing enough of a cushion so that food costs don’t overwhelm the entire nutrition budget. She tries to have money available if, for example, a refrigeration unit breaks down and needs to be replaced immediately.

"We do factor that into the budget," she said, "because you can’t shut down the kitchen."



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