Breakfast and lunch prices at Georgia Elementary and Middle School will rise for the first time in four years when a 10-cent price hike takes effect October 1. Lunch will cost $1.85, and breakfast will be $1.10.
The GEMS School Board OK’d the increase at its September 4 meeting after a presentation from The Abbey Group, the school food provider. Vice President David Underwood said the request was spurred by several factors, including the price of commodities and the desire to give their employees a raise.
The program “just can’t go any further with the demographics we have … to make [it] work for the fiscal bottom line,” he said.
Despite Georgia’s relatively high meal program participation rate of 69 percent, it didn’t generate enough to cover Abbey’s overhead last fiscal year, Underwood said. Abbey ended the school year more than $9,200 in the red. The company’s $10,000 management fee absorbed the debt, Underwood said.
The Abbey Group strives to keep prices low for families, Underwood said. Before the price hike, lunch at GEMS cost $1.75.
To compare, the company presented figures from area schools with their own food service. Underwood reported Milton High School’s full-priced lunches cost $2.50; the school upped to $3 this year. Burlington High School also charges $3, and those schools have 54 and 59 percent participation rates, respectively, according to the Abbey’s data.
Low prices encourage students to buy hot lunch and also help level the field for students who are eligible for free and reduced meals, Underwood added.
In Georgia, though, that percentage is low: 24.4 percent of students were on FRL doles in June, said Chris Sumner, Franklin West Supervisory Union business manager, citing the most recent data available.
The U.S. Department of Agriculture subsidizes free lunches at $2.77, so more FRL students would mean less local funds are needed to sustain the school lunch program.
According to Abbey’s income statement, it received about $3,765 from the state to cover FRL meals in June. It only took in $9,421 to operate the $9,723 program that month.
Abbey gave the board a chart predicting its finances if it authorized a 10- or 25-cent increase. Both statements show the company ending in the red.
The 10-cent hike predicts a $9,764 loss. This is after factoring in 30 fewer students at GEMS and $5,000 in raises for lunchroom staff. Underwood and his wife, Sherry, the company’s president, said it’s important to give employees their first raise in two years.
The cost of food is also rising: Droughts in the Midwest this summer and impending federal requirements for whole grains and produce will make groceries pricier.
That’s the Health Hunger-Free Kids Act, which also sets new restrictions on caloric and sodium content. The changes went into effect nationwide in June 2011 and will be gradually incorporated into The Abbey Group’s menus. Some require the company to rework its recipes, Underwood said.
A provision of the law also addresses the USDA’s concern for equal food program investment by federal and local authorities.
The Paid Lunch Equity Rule, as its called, requires schools whose full-priced meals cost less than $2.51 last year – a figure derived from federal subsidy rates and commodity charges, Underwood said – to either gradually raise prices or use the school’s general fund to subsidize the meal program.
A memo from Laurie Colgan, director of the Vermont Department Education’s Child Nutrition Programs, explained that as the reimbursements change, so will target prices for schools.
“I am encouraging programs to support their sustainability by gradually increasing their meal prices to help cover the actual costs to produce the meals,” she wrote.
But at its June meeting, the GEMS School Board unanimously voted to take the other option. The district diverted $15,000 planned for cafeteria equipment from the capital improvement and general funds into the hot lunch fund.
The board members voiced concerns in June that higher prices might discourage students from buying lunch and also that the economy was still negatively impacting Georgia families.
Board Chairman Doug Bergstrom said his major concern was asking parents to pay more for the services their kids were already receiving.
“To make us pay more just because it matches what the government pays, to me, just doesn’t make sense,” he said.
When Abbey approached the board earlier this month, its members discussed those and other issues for 45 minutes before ultimately authorizing the price hike to help cut the Abbey Group’s losses. Chief among reasons the board hesitated was complaints its members heard from students about the food changes in the federal act’s wake.
“Unfortunately, a lot of the kids are complaining because of the whole grains. Because there’s so much of it, they won’t eat it,” board member Cheryl Letourneau said.
Underwood said his company doesn’t agree with the entire act, but it’s required to carry out the requirements.
Letourneau continued that students have complained the portions are smaller.
“They’re hungry for additional lunch, but then you get the parents complaining because 1) [students are] buying the lunch and throwing it away because they don’t like it, or 2) a second grilled cheese sandwich costs as much as a lunch,” she said.
Underwood said Abbey charges more for second helpings to discourage students from buying less than the whole meal.
The Abbey Group, which contracts with nearly 80 school districts and private accounts in Vermont, New Hampshire and New York, ramped up the whole grain offerings in 2008, so it’s gaining acceptance, especially in younger grades, Underwood said. In 2010, the Whole Grains Council recognized the company for serving and educating families about whole grains.
Some school food service providers “have experienced much lower participation with these changes,” said Shannon Harrison, another Abbey Group representative at the meeting. “But we have been lucky; we introduced our kids to it, and so far, so good. We’ll see. It’s new for everybody.”
Underwood said Abbey will work to entice customers they lost due to the changes.
The company’s food service directors facilitate taste-testings and other ways to interest people in new products, which contributes to GEMS’ high participation rate, Underwood said.
“We know we’re going to take a hit right out front, and it’s going to take a few months to get some of those kids back, but we’ll get ’em back,” he said.
If parents have questions or concerns about the GEMS meal program, contact GEMS principals or School Board member Jen Petrie, who sits on GEMS’ Nutrition Committee. The group of GEMS administrators, Abbey staff, parents and students meets intermittently during the school year, 5-8 Principal Frank Calano said.
Concerned parents can also contact the USDA Food Nutrition Service, the agency behind the Healthy Hunger-Free Kids Act. Its website is http://www.fns.usda.gov.