State education official says federal rules and direct certification cut projected cost of universal school meals; committee votes to keep program in budget

Rosie Krueger, state director of child nutrition programs at the Vermont Agency of Education, told the House Committee on Agriculture, Food Resiliency, & Forestry that higher direct-certification rates and a recent USDA rule change have reduced the state’s projected cost for its universal school meals policy this school year.

Krueger said the agency’s Medicaid direct-certification demonstration project and a USDA change to the Community Eligibility Provision helped raise the share of meals the federal government fully reimburses, lowering the state appropriation needed to fund universal meals. “Once we participate, we get to keep participating,” Krueger said of the Medicaid direct-cert pilot, which uses Department of Vermont Health Access data to identify additional students eligible for free meals.

The committee’s interest centered on how those federal changes interact with the state education fund and how the child nutrition programs could expand summer and after‑school meal sites.

AOE program funding and enrollment details

Krueger said that before statewide universal meals, Vermont participating schools collectively enrolled about 84,000 students in 2018–19 (that figure was later corrected to about 80,000 for the most recent year) and served roughly 7.5 million school meals annually. At that time the agency reported average daily participation of about 51 percent for lunch and about 28 percent for breakfast. Federal reimbursements to schools were about $21.8 million and the federal USDA Foods allotment about $2.4 million in the referenced baseline period. Krueger said local transfers from school general funds to cover nonprofit school food service deficits totaled about $6.48 million in the earlier baseline year.

State appropriation and the change in this year’s projection

Krueger outlined recent state appropriations for the statewide universal meal supplement and how the projection for the current year fell below earlier estimates. The agency recorded a state appropriation for universal meals of roughly $22.1 million in the first year of the statewide policy, and Krueger said earlier budget projections had assumed higher consumer‑price‑index growth than actually occurred. For the current school year the agency projects an appropriation need of about $17.3–$17.5 million, down from previous projections prepared last spring.

Why the cost dropped, and remaining pressures

Krueger said two primary factors reduced the state share this year: (1) the Medicaid direct‑certification pilot, which identifies additional students eligible for free meals using Department of Vermont Health Access records, and (2) a USDA change to the Community Eligibility Provision (CEP) that lets more schools qualify for the federal universal option. She explained that CEP uses the number of directly certified students multiplied by 1.6 to approximate total eligible students; that multiplier, together with the direct‑cert matches, pushed more schools above federal thresholds.

She cautioned that other pressures remain. Federal reimbursement rates change annually with the consumer price index for food away from home; Krueger said the agency had assumed a 4.5 percent CPI change for projections but actual CPI changes have varied. She also noted pandemic-era temporary reimbursement increases have since ended, and food and staff costs have risen. Krueger warned that future federal policy proposals could change eligibility and funding — for example, a proposal already discussed in policy circles to raise the CEP threshold from 25 percent to 60 percent could, by one estimate referenced by the agency, make about 188 Vermont schools ineligible for CEP; another proposal would raise verification requirements for free‑and‑reduced applications above the current 3 percent used for fraud checks, which could reduce application‑based eligibles.

Summer and after‑school meal expansion

Krueger told the committee the agency has an interactive map showing which locations are now "area eligible" for the federal Summer Food Service Program and the after‑school snack/meal program. She said a combination of increased direct certification and CEP changes made 101 additional schools area eligible and that those schools’ attendance areas together added 27 towns newly area eligible this summer. Area eligibility allows a site to serve free summer or after‑school meals to all children who attend without collecting household applications, and sites that operate under area eligibility can remain eligible for five years.

The agency also described expanded federal flexibilities first adopted during the pandemic that remain available for summer programs — including non‑congregate options and weekly meal kits for families — which Krueger said help reach children in remote areas such as the Northeast Kingdom and in parts of the Rutland‑Bennington corridor.

Requests to the committee and next steps

Krueger asked committee members to help identify local sites and partner organizations where summer and after‑school meal programs could be established or expanded; she said the agency is especially seeking existing programs or gatherings of children that could add a meal component. She also said AOE staff plan to study the practices of a small group of school food authorities that have operated at breakeven without requiring general‑fund transfers, and then disseminate those practices to other districts.

Committee action

After questioning, the committee conducted a recorded straw poll on whether it supports maintaining universal school meals in the state budget going forward. The acting clerk announced a tally of eight yes votes, zero no votes and zero abstentions; the committee chair said two of the yes votes were provisional. The chair said she would draft a letter to other committees, including appropriations, and share it with committee members.

Why it matters

The exchange connected federal program design, state budget pressures and local school budget choices. Krueger emphasized that federal eligibility rules and data matching determine how much of the program is funded by federal reimbursements and how much by the state education fund; proposed federal changes or future CPI increases could alter the state’s cost. The committee’s recorded support signals legislative interest in keeping universal school meals in the budget while the agency seeks to expand summer and after‑school access.

Ending

The agency offered to provide corrected enrollment numbers and additional written materials; committee members indicated some would be available to testify to appropriations if requested. Krueger also asked members to share candidate sites for summer meal operations so the agency can pursue federal funding and site setup.