USDA Announces Ban on School Meal Junk Fees

Last week, USDA announced that students eligible for free and reduced-price school meals must not be charged junk fees along with the cost of a meal served through the School Breakfast Program and National School Lunch Program, effective for School Year (SY) 2027-28. This means that families uploading money to a school’s online payment system for school meals cannot be charged additional fees. This is a clarification of existing policy that families eligible for reduced-priced lunch cannot be charged more than $0.40 per lunch and $0.30 per breakfast.

The announcement follows a recent report from the Consumer Financial Protection Bureau (CFPB) which found that some families are paying upwards of $100 million each year on processing fees. Moreover, in some cases, families eligible for reduced priced lunch were paying $0.60 to payment processors for each $1 spent.

In the memo, USDA also emphasized best practices to expand fee-free payment options for families and increase awareness of this options.

AASA has raised concerns that vendors may shift this cost onto schools or other paying families and will continue to work with USDA to address these potential issues.