Date: 1981-12-16
Speaker: JAMES A. BAKCER (republican)
Chamber: H

331. Chief of Staff and Assistant to the President. the White House. Washington. D.C. DEAR Jim: There is speculation that the Administration Is planning to propose. as part of Its next round of budgot cuts. a total elimination of the subsidy to "paying" vtudents In the National School Lunch Program. When the Administration proposed this method of achieving savings In the area of child nutrition programs last time around. the Input from the local level on the potential Impact caused a great amount of concern among members of Congress. In marking up legislation to achieve savings called for. Jn the First Concurrent Budget Resolution for Fiscal Year 1982. no member of the Senate Committee on Agriculture Nutrition and Forestry even suggested the Administrations proposal to terminate the subsidity to "paying" students. As you know. Congress did agree to reduce substantially the subsidy to the paying child. but specifically rejected the Administrations proposal to eliminate It entirely. A total elimination of the subsidy to "payIng" students participating In the National School Lunch Program could have a devastating effect on the viability of the Federal program. Over 90 percent of all the schools In the country participate In the National School Lunch Program. This year. schools will receive 21.50t In Federal general assistance toward each lunch served (110 in USDAdonated commodity support and 10.50 In cash). This 21.50 represents a 40 percent reduction In Federal assistance. Mhe 21.50 subsidy is not a subsidy directly to nonpoor children. or the "paying" childit is a grantinaid to the schools to help defray the cost based on total student participation. regardless of Income. In thousands of school districts throughout the country. less than onethird of the students are eligible for free or reduced price lunches. According to last years figures. about 55 percent of all school lunch participants are In the "paid" category: they are children whose parents income exceeds 185 percent of poverty (or about $15.600 for a family of four). Those at the local level who adminliter the program and are most familiar with how It works argue that a complete elimination of general assistance for lunches served to "paying" children would cripple the Federal lunch program. There Is substantiai evidence to support their point uf view. The loss of tbe Federal reimbursement would result In sharply rising school lunch costs for these children. with resultant high dropout rates and potential program termination. Thus needy and nonneedy alike would fail to receive Federal support. When the Administration first proposed significant reductions In school lunch fundinig. It also listed this as one of the seven "safety net" programs. If the Administration continues to consider this a "safety net" program. we suggest that It consider other alternatives to the elimination of the "Paid" lunch subsidy In order to achieve the needed level of savings. We would like to make memhers of our staff readily available to discuss options with the Administration. It seems to us that the Federal savings that would be gained by eliminating the "paid" subsidy are more than overshadowed by the severe consequences It could have for the program. and therefore the Administration. We feel certain this proposal would fail dramnatically In Congress. In short. as members of the Senate Committee on Agriculture. Nutrition. and Forestry. we are deeply concerned about the program and the political consequences of such a proposal. Because more viable options are available. we wanted to share our concern With you before the Administration Is Irrevocably committed to an option which Is certain to fall. Sincerely.