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USDA announces $1.5 billion to aid schools rocked by inflation, supply chain disruptions

Costs and worker constraints have complicated school nutrition during the pandemic. The Biden administration takes another step to bolster the program.

Donna Martin, Burke County school nutrition director, talks about serving smoothies to students at Burke County Middle School in Waynesboro, Ga., on Nov. 3, 2021. (Sean Rayford for The Washington Post)

Agriculture Secretary Tom Vilsack announced Friday that the Biden administration would provide $1.5 billion to states and school districts to help school meal programs deal with the challenges of rising inflation and supply chain disruptions brought on by the pandemic.

The new funding comes from the Commodity Credit Corporation, a government program started during the Great Depression. In September, Vilsack said in a statement that additional money would be made available, but at the time, the U.S. Department of Agriculture did not have details about how or when schools could begin to use the funds.

According to USDA officials, guidance will be sent to states Friday afternoon about how the money can be used, and states and districts can begin drawing on it as early as January.

Vilsack told The Washington Post on Thursday that he had been spurred to action by conversations with school nutrition administrators.

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“I had a chance to visit with school nutrition officials by phone, and what I heard about consistently is their difficulty in securing certain items, and not being able to secure products from their national distributors, or that distributors had announced they were no longer going to sell to schools,” he said, adding that the money will be provided in three apportionments.

“One tranche is distributed through states — a minimum of $5,000 per school, that’s about $1 billion — with another $500 million available to be used to encourage purchases from local and regional sources,” Vilsack said.

The $1 billion that school districts can use to buy food for their meal programs is expected to help as many as 100,000 schools across all 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands, and will include public, tribal and charter schools, and nonprofit private schools as well as residential child-care institutions.

The funding can be used by school districts to buy unprocessed and minimally processed domestic food such as fresh fruit, milk, cheese, frozen vegetables and ground meat. The USDA also will purchase about $300 million of food products for states to distribute to schools in the coming weeks.

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“Resources to states will get out immediately,” Vilsack said, “but some states may be quicker than others” in getting that assistance to individual districts. He explained that the urgent action is a response to many districts’ having to make purchasing decisions in the next month or two for the remainder of the school year — decisions that have been complicated by rising prices, shipping problems and contracts with vendors being canceled with little notice.

Vilsack said that this local-food portion gives schools the flexibility to avoid having to show that they have accepted the most competitive bid. Its aim is to help build a resilient local food chain that can provide insurance against the kinds of supply disruptions the pandemic has produced.

Crystal FitzSimons of the hunger nonprofit Food Research & Action Center said this will provide about a 10 percent increase in federal funding for school nutrition over the 2020 funding level.

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“This combined with the increase in reimbursement rates that schools are receiving this school year will help make school nutrition programs financially viable,” said FitzSimons, who leads work on the child nutrition programs for the nonprofit. “Which, of course, is critical to ensuring that kids have the healthy school meals they need to learn and thrive.”

President Donald Trump had tapped the Commodity Credit Corporation to give $28 billion to American farmers who had been hurt by the U.S.-China trade war. Vilsack said the present use of the obscure 1933 act, which was intended to “stabilize, support, and protect farm income and prices” is appropriate.

“This is a straightforward use of CCC resources,” he said. “It’s all tied to the purchase of food products. It was designed to create circumstances, when there are market disruptions, that can be helped through investments made by CCC.”