The School Lunch Price Hike: Not Such a Big Deal


DC Central Kitchen/flickr

Various organizations, led by the School Nutrition Association, were unhappy with my recent post, which praised a provision in the new child nutrition law that requires schools to raise the price they charge students for school lunch. A price increase, the SNA's spokeswoman Diane Pratt-Heavner said, could result in a drop in meal participation: "No one knows how severe the decline in participation will be, and that's a risky gamble to play with a program that is vital to the nutrition and well being of millions of school children."

Change can be scary. But upon further reflection, I think the objections to the law are shortsighted. The provision will, over time, bring $2.6 billion to schools to spend on school meals. More importantly, it's the right thing to do.

First, the bill doesn't require schools to immediately raise their prices all at once. Rather, it provides them with a methodology that gradually increases prices with the specific intent of avoiding price shock that would turn families away. Under the method provided in the bill, many schools may take as many as 25 years to align the prices they charge kids, who technically can afford to buy school lunch, with the amount of money the federal government pays for each meal for a low-income child.

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Second, as the SNA notes, a Congressional Budget Office report did predict that increasing meal prices to match the federal reimbursement rate would result in a drop in participation in school meals (PDF). But read the fine print and you'll see that it projects declines of less than $500,000 annually. That's $500,000 per year for a program that spends more than $10 billion annually and serves 31 million kids. Given that the provision will raise $2.6 billion over 10 years to improve schools meals, the risk of a very small number of kids leaving the programs seems about as good of a policy tradeoff as one is going to get.

And one more thing: Opponents of the provision assume that kids right at the margin have absolutely no discretionary income and that a price increase of as little as 5 cents, which is what the bill would do, would have major participation impacts. But other research shows that this is not the case. According to a recent article in Grist, researchers found that low-income kids buy so-called competitive foods—the cookies, French fries, and other junky food sold outside the lunch line—at about the same rate as higher-income kids. (You can see the full report here.) If they lacked any disposable income, they would not purchase snacks that are not included in the school meal.

During a recession, it is true that a price increase could hurt some kids. But isn't it more worrisome that our system had low-income kids subsidizing the meals of well-off kids?

Consider this: There are some major school systems that charge as little as a $1.50 for paid meals for higher-income kids, even though they are getting well over $2 in reimbursement for free-meals. That means that in areas like much of Northwest D.C., which is extremely affluent, parents making hundreds of thousands of dollars a year are getting meal prices that are artificially low, even as the school system fails to invest that money in balanced meals for low-income kids in the really poor parts of the city.

Where's the logic, or justice, in that?