Paid Lunch Equity: Guidance for SY 2023-24

Purpose

The purpose of this memorandum is to provide guidance to state agencies and school food authorities (SFAs) on the paid lunch equity (PLE) requirements for school year (SY) 2023-24. This memorandum explains the PLE exemption provided in the Consolidated Appropriations Act 2023 (PL 117-328) (the Appropriations Act). This memorandum also provides guidance for SFAs that do not qualify for the exemption, including those who may be returning to PLE requirements for the first time in a few years.

Guidance for Paid Lunch Pricing for SY 2023-24

SP 06-2023, CACFP 05-2023, SFSP 02-2023, Consolidated Appropriations Act, 2023: Effect on Child Nutrition Programs, published on March 3, 2023, announced that in Section 752 of Division A of the Appropriations Act, enacted on Dec. 29, 2022, Congress provides an exception to the PLE requirements for SY 2023-24. It stated that only SFAs that had a negative balance in the nonprofit school food service account as of June 30, 2022, shall be required to establish prices for paid lunches according to the PLE provisions in Section 12(p) of the Richard B. Russell National School Lunch Act, 42 USC 1760(p) and implemented in National School Lunch Program regulations at 7 CFR 210.14(e). Therefore, the guidance that follows is separated into two categories: SFAs that qualify for the exemption and SFAs that do not qualify for the exemption.

SFAs Qualifying for the SY 2023-24 PLE Exemption

For SY 2023-24, SFAs with a positive or zero balance in the nonprofit school food service account as of June 30, 2022, are exempt from PLE pricing requirements found at 7 CFR 210.14(e).

Because the Appropriations Act affects one school year only, FNS recommends that state agencies maintain documentation that includes which SFAs are using the PLE exemption for SY 2023-24 in order to demonstrate state agency oversight of this provision. This documentation should include a record that each SFA implementing the exemption had a positive or zero balance in the nonprofit school food service account as of June 30, 2022. This record could include documents such as a financial ledger or an attestation provided by the SFA. This documentation may be reviewed by FNS upon request.

While not required, exempt SFAs may still use the PLE tool to complete the steps necessary to determine their target SY 2023-24 paid lunch price, consistent with program regulations at 7 CFR 210.14(e), and adjust their paid lunch prices accordingly. Please note, the SY 2023-24 PLE tool and instructions will be provided in a separate communication.

SFAs Not Qualifying for the SY 2023-24 PLE Exemption

SFAs that had a negative balance in the nonprofit school food service account as of June 30, 2022, must follow PLE requirements according to 7 CFR 210.14(e) when establishing their paid lunch prices for SY 2023-24. SFAs may use the forthcoming SY 2023-24 PLE tool, or an equivalent procedure, to determine their required paid lunch prices.

In the PLE tool, or via the equivalent procedure, SFAs may use the prices they last charged students as the basis for their SY 2023-24 paid lunch price calculation, even if those prices were charged during a year the SFA was not required to comply with PLE requirements. For example, SFAs that received flexibility under the PLE waiver during SY 2022-23 ¹ or that were exempt based on the FY 2022 Appropriations Act ² may uses prices charged during SY 2022-23 to determine their PLE requirement for SY 2023-24.

If an SFA did not charge for meals during SY 2022-23, such as an SFA that operated the Community Eligibility Provision, Provisions 2 or 3, or a state funded non-pricing option and is returning to standard counting and claiming in SY 2023-24, it may use the most recent paid lunch price data as the basis for its SY 2023-24 paid lunch calculation. If an SFA is unable to find documentation of the last paid meal price charged to students, then it must follow FNS guidance for new schools found in Guidance on Paid Lunch Equity and Revenue from Nonprogram Foods | Food and Nutrition Service (usda.gov).

Consistent with 7 CFR 210.14(e)(4)(i), SFAs are not required to raise their paid lunch price by more than 10 cents for SY 2023-24 from the last year they charged for paid lunches. SFAs can still choose to raise the price by more than 10 cents.

Reporting

As a reminder, while SFAs that meet the Appropriations Act’s criteria are exempt from the PLE pricing requirements, all state agencies and SFAs must continue to report paid lunch prices as required in regulations at 7 CFR 210.14(e)(7) for SY 2023-24.

State agencies are reminded to distribute this memorandum to program operators. Program operators should direct any questions concerning this guidance to their state agency. State agencies with questions should contact the appropriate FNS regional office.

Tina Namian
Director
School Meals Policy Division

¹ To ease the transition from operating under COVID-19 nationwide waivers, state agencies were able to request a waiver of PLE requirements during SY 2022-23 to provide schools with the flexibility to not raise their paid lunch prices.
² On April 4, 2022, FNS issued SP 08-2022, CACFP 07-2022, SFSP03-2022 - Consolidated Appropriations Act, 2022: Effect on Child Nutrition Programs, notifying states that as required by the 2022 Appropriations Act, any SFA with a positive or zero balance in its nonprofit school food service account as of Dec. 31, 2021, was exempt from PLE pricing requirements found at 7 CFR 210.14(e) for SY 2022-23. Consolidated Appropriations Act, 2022: Effect on Child Nutrition Programs | Food and Nutrition Service (usda.gov)