We are being bombarded with sensationalist stories in the press about state and local governments having to “slash” programs because of a lack of revenues. These stories typically revolve around the question of whether the federal government will continue supplementing “essential services” provided by state and local government.
School districts couldn't conduct a more thorough check even if they wanted to. In 2004, Congress amended the Richard B. Russell National School Lunch Act, changing the verification process so districts could not audit more than 3 percent of the applications. Before, some districts voluntarily chose to audit every application in the district.
After learning of the fraud rate in the free and reduced lunch program, one North Carolina school board fought the U.S. Department of Agriculture for the right to conduct a more thorough audit. The USDA threatened to cut off the district's $34 million lunch subsidy if it audited more than 3 percent of applications, according to a report earlier this year in Education Next, an opinion research journal sponsored by the Hoover Institute and the Harvard Kennedy School.
In the last six decades the school lunch act has inspired a powerful school lunch lobby, including food giants Tyson and Archer Daniels Midland and various food advocacy and nutrition groups. Attempts to scale back the program have been a political deathblow to legislators on both sides of the aisle.
“If these well-financed and effective lobbying interests keep watch over school lunch from outside government, there is a host of congressional insiders and bureaucrats at the Department of Agriculture who help grease the skids,” wrote researcher Ron Haskins in a 2005 report for Education Next.
Like other subsidy programs, the school meal programs are widely abused. A large share of free and reduced-price meals is inappropriately provided to families with incomes above the statutory income cutoffs. Because schools put little effort into verifying recipient incomes, many higher-income parents receive subsidies. Audits have found that about one-quarter of those receiving free and reduced-cost lunches are not eligible. The USDA testified to Congress that in 2002 “27 percent more students are certified for free or reduced-price meals than the Census data itself would suggest are eligible.”