MADISON, N.C. — The Henderson County Board of Public Education on Jan. 12 received a midyear update on the district's child‑nutrition program that showed participation and some temporary revenue gains but flagged persistent structural pressures that could produce an operating deficit by year end.

"Increased labor cost, also the inflated food prices, and the fact that federal reimbursement rates have not gone up" are the primary pressure points, the district presenter said during the board's child‑nutrition review. The presenter reported current student prices of $1.25 for breakfast and $3.50–$3.75 for lunch and said December USDA reimbursements reduced the running deficit to roughly $60,000 through December.

Staff described several steps already taken: discontinuing a universal breakfast policy (financially beneficial after CEP changes), use of supplemental sales, and a previous board decision to waive an indirect cost charge (about $200,000 per year). The finance director reported year‑to‑date child‑nutrition revenue through November of $3,000,792 against expenditures of $3,000,587; after posting December reimbursements the program shows a modest surplus for the first half of the year but staff warned that a deficit remains possible by fiscal year end.

To address structural shortfalls, staff proposed a two‑pronged approach: reduce payroll costs through attrition (targeting roughly 25 positions of about 106 current child‑nutrition employees, with an estimated annual benefits savings of about $460,000) and — if necessary — recommend a modest price increase to families. The superintendent asked the board whether April would be an appropriate timeline to bring a recommendation on any price change so families could be notified in advance.

The board also discussed a district donation option, to be administered by the Henderson County Education Foundation, that would allow community members to contribute toward student lunch charges. Staff recommended a single district fund with an option to designate gifts to particular schools; board members emphasized transparency, clear disbursement rules, and continued allowance for existing school‑level donations.

Board members and staff repeatedly highlighted the limits they face: federal reimbursement rates have not kept pace with rising costs, procurement is bound by public bid rules, and labor costs are rising. One board member warned that, without structural changes, the district's fund balance could be deeply strained next year.

Next steps: staff will continue monthly monitoring of child‑nutrition finances, meet with vendor Eat Real in February, and return to the board in April with a data‑driven recommendation if a price increase or other action is needed.