The Funding Issue: From a National Perspective

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The Funding Issue:

From a National Perspective



District Level National Level

Top Tier

Funding 51%

Cost of food/food preparation 49%

Funding 62%

Childhood Obesity 51%

Middle Tier

LSWP Implementation

Childhood Obesity

Employee recruitment /retention

Food Safety/HACCP

State or local nutrition policies

Customer Satisfaction

Cost of food/food preparation

LSWP Implementation

Food Safety/HACCP

Employee recruitment /retention

State or local nutrition policies

Pressing Issues Identified by SN Directors (School Nutrition Operations Report)



The Cost of Producing a School Lunch (School Nutrition 2007 Trends Report)



Factors Impacting The Cost of Producing a School Lunch

Energy Prices

Commodity and Food Prices

Insurance & Benefit Costs

Implementation of Wellness Policies

National Issues

School Nutrition Specific Issue



Benefit & Insurance CostsIncreasing Health Care Premiums

Source: Kaiser Family Foundation



Energy PricesCrude Oil Prices Increasing

Source: Energy Information Admin



Commodity and Food Prices Milk Prices Increasing

Source: NASS, USDA



Commodity and Food Prices Corn Prices Increasing

Source: NASS, USDA



Commodity and Food Prices Wheat Prices Increasing

Source: NASS, USDA



Commodity and Food Prices Fruit and Vegetables Increasing

Source: NASS, USDA



DISCLAIMER

SNA is currently in the process of collecting information from school nutrition programs on the costs of producing a meal. The following information is based on preliminary information and will likely change as a information from a broader sample is collected. The following slides are intended to illustrate only the preliminary information and potential impact of increasing costs to produce a meal. This information should not be used as a representation of what is happening nationally.



What Does it Cost to Prepare a School Meal?

Cost Type Cost

Food Costs $1.15

Non-Food Costs $0.14

Labor Costs $1.26

Indirect Costs $0.11

TOTAL COSTS $2.70

**Preliminary Figures**

Source: SNA Preliminary



Price Category

Free Reduced Paid

Federal Reimbursement

$2.47 $2.07 $0.23

Commodity Allotment

$0.17 $0.17 $0.17

Price Paid by Students

$0.00 $0.40 $1.68 to $1.98*

TOTAL REVENUE

$2.64 $2.64 $2.08 to $2.38*

Cost of a School Meal vs.Funding/Revenue

* Preliminary Figures




Price Category

Free Reduced Paid

TOTAL REVENUE

$2.64 $2.64 $2.08 to $2.38*

State Reimbursement

11 states currently provide reimbursements• 5 states have general reimbursements

• 2 states have reimbursements for free and reduced price lunches

• 4 states have reimbursements if certain legislative criteria are met






Total Revenue $2.64 $2.64 $2.08 to $2.38*

Total Costs $2.70* $2.70* $2.70*

Difference -$0.06 -$0.06 -$0.62 to -$0.32


* Preliminary FiguresSource: SNA Preliminary



Total Revenue $2.64 $2.64 $2.08 to $2.38*

Total Costs $2.70* $2.70* $2.70*

Difference -$0.06 -$0.06 -$0.62 to -$0.32

Additional Revenue comes from:

A la carte Sales Vending Sales

Local/State Assistance Catering Sales


* Preliminary FiguresSource: SNA Preliminary



National Impact



Price Category

Free Reduced Paid

National ADP 14.9 million

3.0 million

12.6 million

Cost vs. Revenue Difference

-$0.06 -$0.06 -$0.62 to -$0.32

Average National Loss

$849,000 $180,000 $4 - $7.8 million

*Loss of between $5 million and $8.8 million per school day



Cost of Obesity

Annual U.S. obesity-attributable medical expenditures are estimated at $75 billion in 2003 dollars, and approximately one-half of these expenditures are financed by Medicare and Medicaid. State-level estimates range from $87 million (Wyoming) to $7.7 billion (California). Obesity-attributable Medicare estimates range from $15 million (Wyoming) to $1.7 billion (California), and Medicaid estimates range from $23 million (Wyoming) to $3.5 billion (New York).

Source: Finkelstein, E.A., Fiebelkorn, I. C, and Wang, G. State-Level Estimates of Annual Medical Expenditures Attributable to Obesity. Obesity Research 12:18-24 (2004)

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The Funding Issue: From a National Perspective