USDA Distributes $1.5 Billion to Strengthen School Meal Programs Amidst Supply Chain Disruptions

On December 17, the U.S. Department of Agriculture (USDA) announced that it is providing up to $1.5 billion to states and school districts to help school meal operators deal with the challenges of supply chain disruptions caused by the pandemic.

The funding will be made available through USDA’s Commodity Credit Corporation and funneled through the states for different purposes:

• $1 billion in Supply Chain Assistance Funds for schools to purchase food for their programs
• $300 million in USDA Food Purchases for states to distribute to schools
• $200 million through the new Local Food for Schools Cooperative Agreement Program that will be used for cooperative agreements to purchase local foods for schools.

Find a state by state breakdown of funds here.

Supply Chain Assistance Funds—The $1 billion in Supply Chain Assistance Funds will go to states for cash payments to school districts to use to purchase food for their school meal programs. Supply Chain Assistance funding can be used by school districts to purchase unprocessed and minimally processed domestic food such as fresh fruit, milk, cheese, frozen vegetables and ground meat. Each state will allocate the funds to schools based on student enrollment, with a minimum amount per district to ensure that small schools aren’t left behind.

To strengthen local food supply chains, states have the option of using up to 10% of the Supply Chain Assistance funds to make bulk purchases of local food and then distributing these foods to schools for use in their meal programs. States also have the option of targeting the funds to areas of highest need by limiting distribution to school districts where a quarter or more of students are from low-income households.

USDA Foods Purchases—USDA will purchase about $300 million in 100% domestically grown and produced food products, known as USDA Foods, for states to distribute to schools to offset the impact of disruptions to their normal supply chains. Conducting market research and working with USDA’s qualified small to large vendors, USDA has identified a large list of available products. States will be able to order these additional foods within the coming weeks, with deliveries to occur as soon as possible.

Local Foods for Schools Cooperative Agreement Program—USDA will award up to $200 million to states for food assistance purchases of domestic local foods for distribution to schools. This program will strengthen the food system for schools by helping to build a fair, competitive, and resilient local food chain and expanding local and regional markets with an emphasis on purchasing from historically underserved producers and processors.