School Food: Seeking New Ways to Satisfy Appetites Officials Turn to Private Contractors to Balance Budgets and Please Palates

August 29, 1993|By MICHAEL K. BURNS

When Baltimore City decided last month to turn over operation of its high school cafeterias to a private contractor, officials admitted they found it increasing difficulty to feed youngsters nutritious and appealing lunches and still manage to break even financially. It's a problem shared by a growing number of school districts across the nation.

The federal government will pay nearly $5 billion into the National School Lunch Program this year, mostly in cash but also in commodities, to serve more than 4 billion student meals.

But overall costs are rising even faster. Adjusted for inflation, the federal government is providing less for each child than it did when the program began 47 years ago. So lunch prices for 25 million youngsters in the program have to rise to meet school system mandates that they stay out of the red.

Federal surplus foods, based on the Agriculture Department's commodity-price support programs, were once the backbone of the school cafeteria lunch.

The caves of surplus cheese, the mountains of wheat, the warehouses of peanut butter have shrunk dramatically as farm subsidies have been reduced, market demand for these goods has risen, and government export incentives send more food abroad.

School cafeterias can no longer rely on an endless flow of these staples to plan menus.

The lakes of high-fat butter and whole milk remain, but their dietary benefit is under mounting attack from health authorities worried about high amounts of animal fat that make up many of the traditional school lunch menus.

Adding to the woes of the school lunch program has been a nationwide bid-rigging scheme by dairy companies supplying cafeterias with milk, the foundation of the USDA's "meal pattern" school lunch.

The scandal has implicated suppliers in 20 states, including Maryland, where federal investigators charge that companies colluded to assure that one of the suppliers got the contract at a high, non-competitive price.

And while school cafeterias long relied on having a captive clientele that would eat -- or throw away -- whatever was available that day, the school food service now has to compete for these fussier young consumers with distinctive tastes.

For some schools, the answer has been to turn to outside contractors, who can efficiently cut costs as well as whipping up meals that appeal to youngsters.

For others, it means revamping the in-house menus to serve up healthier versions of today's popular fast foods and finger foods, and even to offer a la carte items (not subsidized by the federal program) for those who don't want a full cafeteria meal. Some schools even place orders at fast-food restaurants to supply pizzas and other popular fare for the lunch lines.

Baltimore City schools, which serve more than 60,000 lunches daily, hope to save the $500,000 they lost on cafeteria operations, primarily because of a silent boycott by older students. The private firm operating nine "Tesseract" schools in the city will also take over food service in those cafeterias.

Anne Arundel County also considered using a private food service for its schools, consulting with a leader in the field, Maryland-based Marriott Corp.

Improvements can be made, school board members said, even though the in-house food service last year made a $200,000 surplus.

Queen Anne's County hired Marriott last year to run its lunch program and reduce annual losses of $300,000, the first Maryland county to do so.

The private firm produced a profit of $71,000 (for the schools), nearly doubled the number of meals served, froze meal prices and retained the employees that formerly worked for the school system. "Their management expertise, their customer-oriented operation were the keys," said county superintendent Joseph L. Shilling.

Other school districts are raising meal prices and eliminating subsidies. Baltimore County last year raised prices a nickel (to $1.55 for secondary pupils) and took $1 million from the school lunch program to pay for all-day kindergarten at a few schools.

Financial squeezes have caused personnel cutbacks in some cafeterias. This has affected the food selections and, thus, the number of children deciding to buy lunches there.

The federal government last school year contributed 16 cents for each fully-paid lunch, $1.70 for each free lunch and $1.30 for each reduced-price lunch. (Free and reduced-price food is available for children from qualifying lower-income families.) In addition, schools get 14 cents in commodities for each meal served, plus access to a fluctuating stock of free agricultural surplus foods.

Maryland also reimburses schools 14.25 cents for each free and reduced-price lunch, although funds have been cut 40 percent over the past three years.

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