What’s the cure for Montclair’s lunch program debt?
USDA Photo by Lance Cheung.
By Erin Roll
The Montclair School District is looking for a fix to a persistent deficit in its school meal program, which in the 2016-17 school year resulted in a nearly a $225,000 loss. Although school officials have not released the 2017-18 numbers, one Board of Education member said the lunch program is an area where the district has tended to lose money in recent years.
Montclair Local reported in the spring that students owed the district $100,000 for unpaid lunches for last year. Food sales are supposed to make up almost half of the budget.
The district does budget a contribution of $30 per student or a total of $200,430 to food services in 2017-18, up $10 from last year’s amount of $20 per student or $133,620 in total.
Montclair switched to food service provider Pomptonian at the start of the 2017-2018 school year, changing over from the previous provider Chartwell’s, to provide meal options to the district’s 6,681 students. In 2016-17, Montclair’s food provider Chartwell’s received $1,102,471, according to an audit. School officials would not release the amount Pomptonian, this year’s provider, was paid.
Due to the district’s loss of funds in providing meal services, at July 16 BOE meeting board member Anne Mernin suggested raising the price of regular breakfast and lunch, while keeping the same price for reduced lunch.
“It’s an area where we continually lose money,” Mernin said.
However, lunch prices are set based on guidelines given by the Department of Agriculture, Business Administrator Emidio D’Andrea advised.
In Montclair, regular prices for breakfast ranges from $2.10 in the elementary schools to $2.40 at Montclair High School, while lunch prices range from $3.40 in the elementary schools to $3.90 at the high school. The cost for students who receive the reduced-price lunch is 40 cents, while reduced breakfast is 30 cents at all schools.
At Columbia High School in South Orange-Maplewood, which also contracts with Pomptonian, the full-price lunch is $3.50. At Bloomfield High School, the full-price lunch by food vendor Maschio’s is $2.95.
BOE President Laura Hertzog said raising prices could also hurt the students who don’t qualify for free lunches, but are still struggling economically.
At the end of the meeting, it was decided that meal prices will remain the same for next year, but the board left open the possibility of increasing prices at a later date.
After the meeting, Mernin said the district’s meals program has been running at a deficit for about five years.
“Certainly there is concern regarding the costs the district is facing regarding the lunch program. Pricing is one area I believe we should look at, but I’m sure there are others,” Mernin said.
2016-2017 revenues and expenses
The federal and state subsidies that Montclair receives go into the district’s Food Service Enterprise Fund. The district uses the fund to make payments to its food service vendor and other suppliers.
Total expenses for 2016-17 were $1,280,854, with the combination of revenue and subsidies calculated at $1,055,000.
That year, the meal program brought in revenues of $487,168 in sales and $37,128 in sales from special programs that sold meals.
Additionally, the district received $530,704 in federal and state aid funding for meals for about 15 percent of the student body that has signed up for reduced and free meals. An unaudited report states that for the 2017-2018, the district received $453,256.67 in aid reimbursements, according to director of accounting Melissa Beattie.
Expenses include $509,141 in meal sales; $507,061 for salaries, benefits and payroll taxes; $73,608 for administrative expenses; $76,386 for supplies and materials and $81,304 in management fees.
The audit report did not identify any issues requiring corrective action to the district’s school meal service, except related to the large amount of unpaid debt remaining on students’ lunch accounts.
“Due to the district’s uncertainty as to the collectability of the receivable an allowance for doubtful accounts for $107,382 was established in the Food Service Fund in the 2017-2018 school year,” the report said. “It is recommended that the district evaluate and collect or cancel the students’ food service accounts receivable at year end.”
Payments to Chartwell’s out of the Food Service Enterprise Fund were $1,102,471. That year, the district also paid another $50,846 to other suppliers.
Revenues and expenses for 2017-2018 will not be available until the district does its annual audit in November.
National School Lunch Program
Montclair participates in the National School Lunch Program, one of the main food service programs offered to schools by the U.S. Department of Agriculture.
According to the School Nutrition Association, the National School Lunch Program reimburses $3.31 for each free meal and $2.91 for each reduced-price lunch during the 2018-2019 school year. For paid meals, school districts will receive 31 cents from the National School Lunch Program.
As of July 24, there were 1,038 children, or 15.5 percent of the Montclair public school population, who were receiving free and reduced lunches, according to Beattie.
About 16 percent of students in Montclair are considered to be economically disadvantaged, according to the district’s annual performance report from the state.
A family of four with a combined household income of $45,000 is eligible for reduced-price lunch, according to federal eligibility guidelines. In Montclair, according to census data, the average household income is $102,349 as of 2016, and the average per capita income from 2012 to 2016 was $65,688.
During the 2016-2017 school year, Montclair received a total of $530,704 in federal subsidies of which $88,275 was from the School Breakfast Program, $362,501 from the National School Lunch Program; and $79,478 from the Federal Food Distribution Program.