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MCPS food services projects smaller deficit with proposed 30¢ meal price increase; meal‑debt accrual down after new notifications
Summary
MCPS food services ran about a $5M loss in FY25 on ~$78M revenue and $83M expenses. A proposed 30¢ increase in FY27 would add roughly $2M and help reduce annual losses; staff said improved notifications cut projected new meal debt from about $1M to $450K.
MCPS presented an overview of enterprise funds on May 19 and a deeper briefing on Food and Nutrition Services (DFNS) finances and meal‑debt trends.
CFO Yvonne Alfonso Windsor said enterprise funds are intended to be self‑supporting; DFNS is the largest enterprise fund at roughly $75.8 million. DFNS Director Leach said FY25 revenues were about $78 million and expenses about $83 million, with roughly 50% of expenses for labor and 40% for food.
Leach showed two projected scenarios over the next three fiscal years: without meal‑price changes, the fund would continue to show annual losses in the $5M–$6M range as labor and food costs rise. With a 30¢ meal price increase in FY27 — the first increase in more than a decade — staff estimate the district would collect about $2 million more in FY27 and reduce the projected annual loss to about $3 million, improving the path toward fiscal stability by FY29.
On meal debt, Leach said DFNS moved to real‑time parent notifications through ParentSquare and stopped clearing year‑end balances. Those steps reduced projected new meal debt from about $1 million to approximately $450,000 this year.
Leach also explained federal rules for school nutrition (citing 7 CFR 210.14) and noted the district participates in Community Eligibility Provision (CEP) analysis annually; about 60 schools are currently in CEP. Staff said they will provide further information to the full board ahead of the pricing decision, including comparisons to federal paid lunch equity guidance.
Members asked about the operational implications of using operating funds to backstop the enterprise fund; staff said doing so is possible for a limited time but would remove food services from 'enterprise' status and shift funding to tax‑supported appropriations.
