Federal reimbursement rates for child nutrition programs in Hawaiʻi do not currently reflect the high cost of living, a new report found. Nearly 1 in 3 keiki in Hawaiʻi were projected to be food insecure in 2020, and advocates are calling for the US Department of Agriculture (USDA) to readjust the reimbursement rate to relieve high labor and food costs.
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Hawaiʻi Appleseed first approached USDA in 2015 about the reimbursement discrepancy, but the agency requested more data before taking action. The result was a joint report by Hawaiʻi Appleseed, Hawaiʻi Children’s Action Network, the Hawaiʻi Afterschool Alliance, and Ulupono Initiative.
According to the report, children in low-income households have a better chance of eating healthier foods through federally-funded programs such as the National School Lunch Program or Summer Food Service Program. Participating organizations then receive reimbursement from USDA for meals served.
Hawaiʻi’s current reimbursement rate is 17% higher than the national average, but advocates say that is inaccurate, especially since the food and labor analysis used to calculate the adjustment has not been updated since 1979.
“We reran the analysis,” said Daniela Spoto, Director of Anti-Hunger Initiatives at Hawai‘i Appleseed. “[Hawaiʻi is] now 62% higher, so we’ve exponentially widened the gap between how much food and labor costs are in Hawaiʻi versus the mainland. However, that 17% adjustment remains the same.”
Spoto said federal reimbursement typically covers 85%-90% of the meal programs’ operating costs on the mainland. However, Hawaiʻi’s reimbursement only covers 55% of operating costs. Hawaiʻi also ranks the lowest among states for participation in school nutrition programs.
To fill the gap between federal reimbursement and Hawaiʻi’s high labor and food costs, the state has had to redirect its funding. According to the report, the Hawaiʻi Department of Education currently subsidizes $20-$30 million per year for these programs. Since 2000, that amounts to over $200 million in funding that could have been available for other public education needs, such as after school child care, school health programs, and higher teacher pay.
USDA is taking some steps to update the reimbursement rates, such as conducting the School Nutrition Meal Cost Study-II for new labor and food cost data. However, that study is not scheduled to be completed before 2026 or 2027, due to delays from the Covid pandemic. Spoto says Hawaiʻi families are struggling with food insecurity now, and can’t wait a few more years for action.
“Families are being stretched from every angle, from health care to housing,” she said. “Wages are not high enough. Childcare is not as available as it used to be. We really see child nutrition programs as one tool to take a little bit of the pressure off. If parents know that they’re going to be sending their kids to school … and they’re going to get a healthy, balanced meal, they can take that off their shopping list. They don’t have to add all of that to their grocery bill. It does have household budget applications as well.”
On May 20th, Hawaiʻi’s congressional delegation sent a joint letter to the USDA calling for a temporary reimbursement rate increase for all outlying states and territories until the study can be completed.
Spoto also said Hawaiʻi Appleseed and other partners will continue to look for shorter-term solutions.
“There’s a lot of opportunities between now and 2027 that we’re going to keep our eye on. If Child Nutrition Reauthorization gets going or the farm bill, or other opportunities for appropriations … Whatever pathway seems to be the path of least resistance, we’re open to that.”