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Appendix C- Section 4 of the Child Nutrition Act of 1966

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CHILD NUTRITION ACT OF 1966

Sec. 4

(7) For the fiscal year ending June 30, 1975, and for subsequent school years, the minimum rate of reimbursement for a halfpint of milk served in schools and other eligible institutions shall
not be less than 5 cents per half-pint served to eligible children,
and such minimum rate of reimbursement shall be adjusted on an
annual basis each school year to reflect changes in the Producer
Price Index for Fresh Processed Milk published by the Bureau of
Labor Statistics of the Department of Labor.
(8) Such adjustment shall be computed to the nearest onefourth cent.
(9) Notwithstanding any other provision of this section, in no
event shall the minimum rate of reimbursement exceed the cost to
the school or institution of milk served to children.
(10) The State educational agency shall disburse funds paid to
the State during any fiscal year for purposes of carrying out the
program under this section in accordance with such agreements approved by the Secretary as may be entered into by such State agency and the schools in the State. The agreements described in the
preceding sentence shall be permanent agreements that may be
amended as necessary. Nothing in the preceding sentence shall be
construed to limit the ability of the State educational agency to
suspend or terminate any such agreement in accordance with regulations prescribed by the Secretary.
(b) Commodity only schools shall not be eligible to participate
in the special milk program under this section. For the purposes
of the preceding sentence, the term ‘‘commodity only schools’’
means schools that do not participate in the school lunch program
under the Richard B. Russell National School Lunch Act ø(42
U.S.C. 1751 et seq.)¿, but which receive commodities made available by the Secretary for use by such schools in nonprofit lunch
programs.
SCHOOL BREAKFAST PROGRAM AUTHORIZATION

SEC. 4. ø42 U.S.C. 1773¿ (a) There is hereby authorized to be
appropriated such sums as are necessary to enable the Secretary
to carry out a program to assist the States and the Department of
Defense through grants-in-aid and other means to initiate, maintain, or expand nonprofit breakfast programs in all schools which
make application for assistance and agree to carry out a nonprofit
breakfast program in accordance with this Act. Appropriations and
expenditures for this Act shall be considered Health and Human
Services functions for budget purposes rather than functions of Agriculture.
APPORTIONMENT TO STATES

(b)(1)(A)(i) The Secretary shall make breakfast assistance payments to each State educational agency each fiscal year, at such
times as the Secretary may determine, from the sums appropriated
for such purpose, in an amount equal to the product obtained by
multiplying—
(I) the number of breakfasts served during such fiscal year
to children in schools in such States which participate in the
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Sec. 4

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school breakfast program under agreements with such State
educational agency; by
(II) the national average breakfast payment for free breakfasts, for reduced price breakfasts, or for breakfasts served to
children not eligible for free or reduced price meals, as appropriate, as prescribed in clause (B) of this paragraph.
(ii) The agreements described in clause (i)(I) shall be permanent agreements that may be amended as necessary. Nothing in
the preceding sentence shall be construed to limit the ability of the
State educational agency to suspend or terminate any such agreement in accordance with regulations prescribed by the Secretary.
(B) The national average payment for each free breakfast shall
be 57 cents (as adjusted pursuant to section 11(a) of the Richard
B. Russell National School Lunch Act ø(42 U.S.C. 1759a(a))¿. The
national average payment for each reduced price breakfast shall be
one-half of the national average payment for each free breakfast,
except that in no case shall the difference between the amount of
the national average payment for a free breakfast and the national
average payment for a reduced price breakfast exceed 30 cents. The
national average payment for each breakfast served to a child not
eligible for free or reduced price meals shall be 8.25 cents (as adjusted pursuant to section 11(a) of the Richard B. Russell National
School Lunch Act).
(C) No school which receives breakfast assistance payments
under this section may charge a price of more than 30 cents for a
reduced price breakfast.
(D) No breakfast assistance payment may be made under this
subsection for any breakfast served by a school unless such breakfast consists of a combination of foods which meet the minimum
nutritional requirements prescribed by the Secretary under subsection (e) of this section.
(E) FREE AND REDUCED PRICE POLICY STATEMENT.—
After the initial submission, a local educational agency
shall not be required to submit a free and reduced price
policy statement to a State educational agency under this
Act unless there is a substantive change in the free and
reduced price policy of the local educational agency. A routine change in the policy of a local educational agency,
such as an annual adjustment of the income eligibility
guidelines for free and reduced price meals, shall not be
sufficient cause for requiring the local educational agency
to submit a policy statement.
(2)(A) The Secretary shall make additional payments for breakfasts served to children qualifying for a free or reduced price meal
at schools that are in severe need.
(B) The maximum payment for each such free breakfast shall
be the higher of—
(i) the national average payment established by the Secretary for free breakfasts plus 10 cents, or
(ii) 45 cents (as adjusted pursuant to section 11(a)(3)(B) of
the Richard B. Russell National School Lunch Act (42 U.S.C
1759a(a)(3)(B))).
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(C) The maximum payment for each such reduced price breakfast shall be thirty cents less than the maximum payment for each
free breakfast as determined under clause (B) of this paragraph.
(3) The Secretary shall increase by 6 cents the annually adjusted payment for each breakfast served under this Act and section 17 of the Richard B. Russell National School Lunch Act. These
funds shall be used to assist States, to the extent feasible, in improving the nutritional quality of the breakfasts.
(4) Notwithstanding any other provision of law, whenever
stocks of agricultural commodities are acquired by the Secretary or
the Commodity Credit Corporation and are not likely to be sold by
the Secretary or the Commodity Credit Corporation or otherwise
used in programs of commodity sale or distribution, the Secretary
shall make such commodities available to school food authorities
and eligible institutions serving breakfasts under this Act in a
quantity equal in value to not less than 3 cents for each breakfast
served under this Act and section 17 of the Richard B. Russell National School Lunch Act.
(5) Expenditures of funds from State and local sources for the
maintenance of the breakfast program shall not be diminished as
a result of funds or commodities received under paragraph (3) or
(4).
STATE DISBURSEMENT TO SCHOOLS

(c) Funds apportioned and paid to any State for the purpose of
this section shall be disbursed by the State educational agency to
schools selected by the State educational agency to assist such
schools in operating a breakfast program and for the purpose of
subsection (d). Disbursement to schools shall be made at such rates
per meal or on such other basis as the Secretary shall prescribe.
In selecting schools for participation, the State educational agency
shall, to the extent practicable, give first consideration to those
schools drawing attendance from areas in which poor economic conditions exist, to those schools in which a substantial proportion of
the children enrolled must travel long distances daily, and to those
schools in which there is a special need for improving the nutrition
and dietary practices of children of working mothers and children
from low-income families. Breakfast assistance disbursements to
schools under this section may be made in advance or by way of
reimbursement in accordance with procedures prescribed by the
Secretary.
(d) SEVERE NEED ASSISTANCE.—
(1) IN GENERAL.—Each State educational agency shall provide additional assistance to schools in severe need, which
shall include only those schools (having a breakfast program or
desiring to initiate a breakfast program) in which—
(A) during the most recent second preceding school
year for which lunches were served, 40 percent or more of
the lunches served to students at the school were served
free or at a reduced price; or
(B) in the case of a school in which lunches were not
served during the most recent second preceding school
year, the Secretary otherwise determines that the requirements of subparagraph (A) would have been met.
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(2) ADDITIONAL ASSISTANCE.—A school, on the submission
of appropriate documentation about the need circumstances in
that school and the eligibility of the school for additional assistance, shall be entitled to receive the meal reimbursement
rate specified in subsection (b)(2).
NUTRITIONAL AND OTHER PROGRAM REQUIREMENTS

(e)(1)(A) Breakfasts served by schools participating in the
school breakfast program under this section shall consist of a combination of foods and shall meet minimum nutritional requirements
prescribed by the Secretary on the basis of tested nutritional research, except that the minimum nutritional requirements shall be
measured by not less than the weekly average of the nutrient content of school breakfasts. Such breakfasts shall be served free or
at a reduced price to children in school under the same terms and
conditions as are set forth with respect to the service of lunches
free or at a reduced price in section 9 of the Richard B. Russell National School Lunch Act ø(42 U.S.C. 1758)¿.
(B) The Secretary shall provide through State educational
agencies technical assistance and training, including technical assistance and training in the preparation of foods high in complex
carbohydrates and lower-fat versions of foods commonly used in the
school breakfast program established under this section, to schools
participating in the school breakfast program to assist the schools
in complying with the nutritional requirements prescribed by the
Secretary pursuant to subparagraph (A) and in providing appropriate meals to children with medically certified special dietary
needs.
(2) At the option of a local school food authority, a student in
a school under the authority that participates in the school breakfast program under this Act may be allowed to refuse not more
than one item of a breakfast that the student does not intend to
consume. A refusal of an offered food item shall not affect the full
charge to the student for a breakfast meeting the requirements of
this section or the amount of payments made under this Act to a
school for the breakfast.
DISBURSEMENT TO SCHOOLS BY THE SECRETARY

SEC. 5. ø42 U.S.C. 1774¿ (a) The Secretary shall withhold
funds payable to a State under this Act and disburse the funds directly to schools or institutions within the State for the purposes
authorized by this Act to the extent that the Secretary has so withheld and disbursed such funds continuously since October 1, 1980,
but only to such extent (except as otherwise required by subsection
(b)). Any funds so withheld and disbursed by the Secretary shall
be used for the same purposes, and shall be subject to the same
conditions, as applicable to a State disbursing funds made available under this Act. If the Secretary is administering (in whole or
in part) any program authorized under this Act, the State in which
the Secretary is administering the program may, upon request to
the Secretary, assume administration of that program.
(b) If a State educational agency is not permitted by law to disburse the funds paid to it under this Act to any of the nonpublic
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