DOE wants
lunch money back

$10.6 million is being sought from
the state to fund school meals

The state Department of Education wants the Legislature to fully restore state funds that were cut from the public school lunch program, cuts that have raised the specter of an increase in lunch prices and forced the DOE to divert funding from other programs.

The Lingle administration reduced state funding for school meals two years ago, citing an operating surplus in the food program. The state Legislature approved those cuts.

But that surplus is nearly gone, and the Board of Education is asking for $10.6 million per year in state funds over the next two years. Even that would be much less that the state provided in the past, but the Lingle administration has recommended the Legislature approve just $5 million a year.

DOE officials say that will not be enough.

"Now that the surplus has been depleted, we're very concerned," said DOE Budget Director Ed Koyama. "If the money is not fully restored, we'll have to talk with the Board (of Education) about other steps."

That could include a future hike in lunch prices. Lunches now sell for $1, one-third of what it costs to produce them. The board recently completed draft legislation that would allow it to raise prices to one-half the production cost if necessary, though there is no plan to do so yet.

The state school system served 23 million lunches last year. Traditionally, the program has been subsidized by state funds, federal money and the prices paid by students in a roughly equal three-way split.

A price hike would be only a last resort because it might turn away students, said Assistant Superintendent Rae Loui.

"Even if we were to do that, it would not be helpful for the overall revenue picture and would be hard on the families and kids we serve," she said.

Lingle's budget director, Georgina Kawamura, said the cuts two years ago were aimed at "encouraging self-sufficiency" in the program. She said the administration now realizes state funding is needed but "does want to see that climbing."

"I don't have that extra $5.6 million to give," she said.

As recently as the 2002-03 fiscal year, the state chipped in $19 million, but that has plummeted to $5.9 million in the current year. The DOE estimates total funding for the program to reach $70 million in 2005-06.

The drop in state funding has come at a time when milk prices and other costs have shot skyward, pushing the cost of providing a lunch to $3.12 per meal last year, from $2.99 the previous year.

Normally the food program's surplus -- which totaled $26 million in 2003 -- was used as a cushion against those price shocks, said Gene Kaneshiro, the DOE's food services manager.

Since last July, the DOE has made up for the shortage of state money by diverting $9.5 million in federal impact aid from around 30 various DOE initiatives.

These include a $6 million program to help public schools develop reform strategies, which was left with just $1 million in funding, and nearly $2 million for professional development for academic coaches. Funding for that program was halved.

Federal impact aid is intended to help offset the impact on school systems stemming from movements of military families.

"It's definitely unusual for us to have used those funds," said BOE member Karen Knudsen. "By funding the school food services program, other programs could not be funded."

Koyama said there are no significant federal funds left to tap. Loui adds that if state money for the program is not fully restored, the department may have to seek ways to cut operational costs and possibly increase revenue from the sale of a la carte items sold separately from the standard meal, Loui said.

DOE officials said none of this will affect the free or reduced-price lunches provided to qualifying students from lower-income families.