President Releases FY 2004 Budget, Agriculture Appropriations

President Bush sent his fiscal year 2004 budget to Congress this week, asking for $2.23 trillion dollars in all. Funds for the Department of Agriculture remained close to FY2002 levels, when adjusted for inflation. Half of the Department’s budget supports federal nutrition programs including food stamps and the National School Lunch Program.

The President’s budget narrative includes analysis of the National School Lunch Program, with specific attention to the alleged over-certification of children in the Program. The narrative states,

Studies conducted by USDA and data from national surveys suggest that a significant number of children approved for free lunches are from ineligible households. Because the information collected for school lunch eligibility is also used to allocate a wide array of federal, state, and local education dollars, errors in certifying children for school lunches can lead to a diversion of funds away from the lowest-income schools. The Performance Assessment Rating Tool (PART) for the lunch program noted the high rate of improper payments and the lack of annual performance goals to measure the long-term goal of serving meals that meet the dietary guidelines. USDA proposes to improve the accuracy of eligibility decisions through actions under current law and as part of the reauthorization of the Child Nutrition Act. The new system will improve access for low-income children already participating in means-tested programs by mandating the use of program records from Food Stamps or Temporary Assistance for Needy Families to directly certify children’s eligibility for lunch. For other households, states will use a combination of third-party wage data, expanded requirements for up-front documentation, or other means to verify information reported by households.

The Budget narrative goes on to state: “The proposal [relating to over-certification] will not reduce funding for the lunch program. Any savings that result from improving payment accuracy will be reinvested in the program in support of the Administration’s principles for strengthening the program’s operation.” The Administration’s principals include the following

• Ensuring all eligible children have access to meals
• Providing financial incentives to schools that serve meals that meet the dietary guidelines
• Creating an equitable mechanism for allocating federal and state education dollars targeted at low-income children
• Ensuring that meal reimbursement rates provide adequate support for program meals
• Streamlining program administration and minimizing administrative burden
• Providing adequate resources for program oversight and evaluating the impact of program changes on children and participating schools

ASFSA is concerned with the Administration’s proposed budget for the federal child nutrition programs, noting that no new additional funds have been set aside for important improvements to the programs to ensure the healthiest possible meals for America’s children. The integrity of the National School Lunch Program remains a top priority for the Association, as is making sure that as many eligible children as possible are served.

There is a concern that some proposals, described in the budget documents and intended to control against ineligible children being approved, will result in large numbers of eligible children, perhaps as many as one million, being driven from the programs. Related Links includes reaction to the budget from the Food Research and Action Center and Senator Tom Harkin (D IA).

The Budget proposes the following in funding for the USDA Food and Nutrition Service, amounts in million of dollars:

Section 32 funding for commodities would be $400 million, while commodity funds in Section 6 would be $422 million, for a total of $822 million in commodities, representing a decrease of $33 million from 2002 commodity funding levels.

From the Budget

Child Nutrition Programs (including transfer of funds): For necessary expenses to carry out the National School Lunch Act (42 USC 1751 et seq.) except section 21, and the Child Nutrition Act of 1966 (42 USC 1771 et seq.) except sections 17 and 21; $11,418,441,000 to remain available through September 20, 2005; of which $6,819,340,000 is hereby appropriated and $4,559,101,000 shall be derived by transfer from funds available under section 32 of the Act of August 25, 1935 (7 USC 612c): Provided, that up to $5,198,000 shall be available for independent verification of school food service claims.

A breakdown of funding for selected Child Nutrition Programs, in millions of dollars:

See Related Links to view the Department of Agriculture Proposed FY 2004 Budget and to read responses from the Food Research and Action Center and Senator Harkin (D-IA).