USDA distributes $1.5 billion to to help school meal programs impacted by supply chain disruptions

WASHINGTON, D.C.– Agriculture Secretary Tom Vilsack has announced that the Biden-Harris Administration is providing up to $1.5 billion to states and school districts to help school meal program operators deal with the challenges of supply chain disruptions brought on by the pandemic.

With funding made available through USDA’s Commodity Credit Corporation, USDA will provide $1 billion for schools to purchase food for their meal programs and another $300 million for states to purchase foods to be distributed to schools. An additional $200 million will be used for cooperative agreements to purchase local foods for schools with a focus on buying from historically underserved producers. A state-by-state breakdown of funds can be found in this table.

“USDA’s school meal programs have a wide-reaching impact on the health and well-being of our nation’s children,” said Vilsack. “Now, more than ever, America’s children need access to healthy and nutritious foods and our school nutrition professionals play a huge role in making that happen.

Throughout the COVID-19 pandemic, school districts have met extraordinary challenges to ensure that every child has the food needed to learn, grow and thrive. The food and funds USDA is distributing will help ensure schools have the resources they need to continue to serve our nation’s schoolchildren quality food they can depend on, all while building a stronger, fairer, and more competitive food system.”

Supply Chain Assistance Funds

USDA’s Food and Nutrition Service (FNS) is providing $1 billion to states for cash payments – known as Supply Chain Assistance funds – that school districts can use to purchase foods for their school meal programs. These funds deliver direct relief from ongoing supply chain issues and improve the quality and consistency of school meals for children in communities experiencing disruptions, making it easier for schools to operate successful meal programs.

In total, the Supply Chain Assistance Funds are expected to provide a boost in resources for up to 100,000 schools across all 50 states, D.C., Puerto Rico, Guam, and the U.S. Virgin Islands, including public, tribal, charter schools, and nonprofit private schools as well as residential child care institutions.

Supply Chain Assistance funding can be used by school districts to purchase unprocessed and minimally processed domestic food such as fresh fruit, milk, cheese, frozen vegetables and ground meat. Each state will allocate the funds to schools based on student enrollment, with a minimum amount per district to ensure that small schools aren’t left behind.

To strengthen local food supply chains, states have the option of using up to 10% of the Supply Chain Assistance funds to make bulk purchases of local food and then distributing these foods to schools for use in their meal programs. States also have the option of targeting the funds to areas of highest need by limiting distribution to school districts where a quarter or more of students are from low-income households.

Local Food for Schools

Through the Agricultural Marketing Service (AMS)’s new Local Food for Schools Cooperative Agreement Program, USDA will award up to $200 million to states for food assistance purchases of domestic local foods for distribution to schools. This program will strengthen the food system for schools by helping to build a fair, competitive, and resilient local food chain and expanding local and regional markets with an emphasis on purchasing from historically underserved producers and processors.

USDA Foods Purchases

USDA will also purchase about $300 million in 100% domestically grown and produced food products, known as USDA Foods, for states to distribute to schools to offset the impact of disruptions to their normal supply chains. Conducting market research and working with USDA’s qualified small to large vendors, USDA has identified a large list of available products. States will be able to order these additional foods within the coming weeks, with deliveries to occur as soon as possible.

This latest assistance is on top of a broad range of flexibilities, resources, and hands-on support USDA is providing schools to ensure supply chain disruptions like contract cancellations and increased food costs do not negatively impact the school meal programs.

USDA is also taking a wide variety of actions to strengthen the school meal programs more broadly. Earlier this week, FNS selected eight states to participate in the Direct Certification with Medicaid Demonstration Project, bringing the total number of participating states to 27.

Direct Certification with Medicaid uses data matching to create an easier pathway for low-income children whose families have already gone through Medicaid’s rigorous eligibility determination process to receive free and reduced price school meals. This increases access to nutritious school meals for those in need while also reducing administrative burden for schools and families and increasing program integrity.

To learn more, visit www.usda.gov.