to afford balanced meals on a regular bases, it is not as important to subsidize their feeding. The large amount of Federal funds currently expended subsidizing their meals could more efficiently be used for other purposes ranging from nutrition education to job training. Furthermore, non-needy children would benefit indirectly from a block grant program, since the technical, assistance and nutritional standards used for a school food service program would help all the children receiving meals-needy and non-needy alike. Question. What is your opinion on the economic costs attributed to these nutrition related health problems? Answer. It is difficult to translate the effects of nutrition related health problems into dollars and cents terms. However it is understandable that poor nutrition during childhood translates itself into an overall reduction in skills and productivity on the part of workers in later life. The loss of such skills and productivity as well as happiness that might have been is unmeasurable. Question. Based on NSLP statistics for the 1970's, will you describe any trends in participation? How do you assess the impact of these trends on overall program goals? Answer. The NSLP, according to our peak month information, has grown from 24.6 million children participating in FY 1971 to 25.3 million during FY 1975. We anticipate that if the NSLP retains its current structure that the peak month will be between 25.0-25.5 for FY 1976. There are however, more significant trends in the program. The number of participants receiving a free or reduced price lunch (peak month) have grown from 7.3 million in FY 1971 to 10.3 million in FY 1975. This growth has been partly offset by a decline in the participation of paying children. These trends have directed us take a closer look at several aspects of our program. We have an on-going High School Participation Project to examine why high school participation is at a lower rate than in elementary schools. We also are concerned about overall non-needy participation. Question. What are your views on the participation by non-needy children? Do you consider their participation to have a significant economic impact on program costs? Answer. As I have mentioned, the participation of non-needy children has declined somewhat. Based on the best data available to us, 49.9% of the non-needy children in NSLP schools participated during March 1971 and 45.8% in March of 1974. Our preliminary analysis shows that this trend is continuing during FY 1975. We believe the participation of the non-needy children is important. All children can benefit from the meals served in the school lunch program. However, unneeded Federal subsidies are not the proper approach to encourage participation of non-needy children. There are better ways to accomplish this, for example, more attractive meal patterns, more state/local support. Question. Do you regard the Type A lunch as an important component of our school children's health and education? Will you elaborate? Answer. The type A pattern was designed to meet one third of the R.D.A. for children. The type A pattern not only serves as the basis for a well balanced meal, but also serves as a spring board for nutrition education by exposing children to good nutrition on a routine basis. Question. In recent years only 82-85 percent of NSLP children eligible for free and reduced price meals have participated in the program. Do you have an opinion on actions which may increase participation by these students? Answer. All schools participating in the program must notify students and their families of the availability of free or reduced price meals at the beginning of the school year. The standards are clear enough that a qualified family would know that their children can receive free or reduced price meals. However, there are certain social and cultural pressures that may deter a family from applying even when aware that they are qualified. Simple pride would be one factor. In order to attain 100% participation, these determents to participation must be overcome. The best course is to emphasize the value of the meals in helping to maintain an adequate diet. High unemployment and poor economic conditions have made free and reduced price meals more important to qualified families as evidenced by the estimated 92.3% participation of eligible children reported in April, 1975. [The prepared statement of Mr. Feltner follows:] STATEMENT OF RICHARD L. FELTNER, ASSISTANT SECRETARY FOR MARKETING AND CONSUMER SERVICES, U.S. DEPARTMENT OF AGRICULTURE Mr. Chairman and Members of the Committee: We welcome the opportunity to participate in today's hearing on legislative proposals relating to Federal-State Child Nutrition Programs. First, I'd like to discuss the child nutrition proposal that was contained in President Ford's Budget for fiscal year 1976. The "bloc grant" approach, recommended in the Budget, would increase Federal assistance to provide adequate nutrition for needy children, including needy infants, and would, at the same time, serve as a means to reduce Federal costs. The proposed legislation-the "Child Food Assistance Act of 1975"-would substitute one annual consolidated appropriation for all the child nutrition funding now in effect, including direct grants to the School Lunch Program; Special Milk Program; Nonfood Assistance Program; the Special Supplemental Food Program for Women, Infants, and Children (WIC); and all other related school and non-school feeding programs. This proposal to substitute a single program for the current set of child nutrition programs is being made to assure that States can provide the equivalent of a free meal to every needy child. Estimates indicate that almost 700.000 needy children receive no program benefits because present programs are not available to them. The cost to insure the needy an adequate diet is lower than projected estimates for the current programs if they were to continue. The difference does not represent a decrease in benefits to the poor but is the result of disconto them. The cost to insure the needy an adequate diet is lower than projected would more than double current benefits for needy children by providing substantial increases in reimbursements for meals served for one year rather than just during the school term. Furthermore, the grant would provide States the flexibility of designing a feeding program tailored to local situations. USDA's budget for the current child nutrition programs would be $2.4 billion in fiscal 1976. The cost of the bloc grant program for fiscal year 1976 is estimated at $1.7 billion, which would represent a savings of about $700 million for the year, compared to costs of extending current programs with no liberalization or increase in participation. Over the next five years the bloc grant approach is estimated to produce savings of $4 billion, as compared to the estimated costs of current programs. Under the new approach, the Secretary would establish annually a national daily reimbursement rate which would cover the projected cost of providing a meal or food which meets one-third of the daily Recommended Dietary Allowance for a child on a year-round basis. In establishing the national daily reimbursement rate, the Secretary would take into consideration, in addition to cost estimates received from the States, adjustments in the food-away-from-home component of the Consumer Price Index and other appropriate factors. For fiscal year 1976, the proposal would provide for a national rate of reimbursement of 90 cents. This rate is consistent with the Department's estimates of the cost of providing one-third of the Recommended Dietary Allowance during that year and is in accordance with the President's proposal to limit increases in programs tied by law to the Consumer Price Index to five percent through June 30, 1976. The States would be responsible for designing a feeding program tailored to provide specifically for the needs of poor children in the State, with considerable latitude in exercising that responsibility to adapt programs to local situations. States would develop plans to provide free meals to poor children in schools and institutions, utilizing the most appropriate type of meal. or combination of meals, snacks, and/or milk; or would provide food directly to needy children not in schools or institutions. Annually, each State would receive an amount of funds equal to the national daily reimbursement rate times the number of needy children certified by the Governor as having been served meals or provided food which met at least one-third the Recommended Dietary Allowance per child per day. Another significant change in the new approach would discontinue the Federal cash support now given for lunches to non-needy children under the National School Lunch Program. The States could continue to support non-needy children, if they feel such support should be continued. In that case, however, the support for non-needy children would have to come from State and local resources. Eliminating Federal subsidies to the non-needy would provide sufficient Federal funds for the States to increase benefits to all needy children. States would be free to operate programs year-round, during school periods only, or in some combination best suited to local circumstances. Grants could be used for the present "Type A" lunches, for breakfasts, snacks, supplementary milk, a WIC-type program for infants and children, or any other suitable nutritional combination responsive to local needs and preferences. States and local school systems and governments would, in short, be free to adapt programs to local conditions. Each State would annually develop a plan to feed poor children, publish it for review and comment and send it to the Department. USDA would advise the State if some feature of the plan represented a non-legal use of bloc-grant funds, but USDA approval of the plan would not be required. Then, at the end of each fiscal year, States would submit a report in the form of a statement of accomplishment, certified by the Governor as to the legality of use of the funds. Additionally, the block-grant program would establish a National Advisory Committee to advise the Secretary of Agriculture on program administration, and would require periodic evaluation of the effectiveness of the grants in achieving the elimination of poverty-caused hunger among children. Turning to the matter of commodities, the block-grant proposal would not repeal Section 32 or Section 416 authorities. The Secretary could, at his discretion, continue to purchase non-price supported surplus commodities or to take other actions to achieve farm price objectives, as necessary, and to donate such commodities to States. Commodities are currently budgeted for fiscal year 1976. The block grant proposal provides that the value of commodities donated to schools would offset a portion of the funds payable to states under the block grant. We see the block grant proposal as a sound alternative to continued escalation of the present array of child nutrition programs. Each one, taken by itself serves a worthwhile objective. But taken together, they represent a group of programs, which has grown up in a largely piecemeal, uncoordinated fashion, and which, in many instances, overlap other similar assistance programs. Thus, we advocate that the time is right for you in Congress and us in the Executive Branch to take a close look at the package as a whole, in terms of certain basic questions: First, given the current growth rate of these programs, what are future cost prospects, unless we're able to set reasonable limits on uncontrolled growth? Secondly, to what extent are these rapidly escalating Federal costs disproportionately subsidizing those who do not need subsidies while many needy children remain unassisted? Thirdly, to what extent do these programs overlap and duplicate the benefits available through other assistance programs? Finally, what are the available options for a system to remedy the failings and direct the assistance to where it is most needed? President Ford addressed these fundamental issues in his February 3 Budget Message to the Congress. He said, the "tremendous growth of our domestic assistance programs in recent years has, on the whole, been commendable." But then, he pointed out that unless we are able to “rationalize and streamline these programs," the costs would become "insupportably heavy" for American taxpayers to bear. Similar concerns are reflected in Congressional passage of the Budget Reform Act, under which Congress is establishing machinery to exercise greater control and coordination over Federal spending. The Joint Economic Committee of Congress addressed similar questions in its thorough-going series of STUDIES IN PUBLIC WELFARE. Turning first to the question of costs, where are we heading in child nutrition programs? Should the programs continue as they are, given simple extensions of existing legislative authorities-Department budget projections show that in fiscal year 1976, beginning July 1, they would carry Federal costs over $2.4 billion; and that by fiscal year 1980 the costs would escalate to over $3 billion, nearly 50 percent above this year's level. Then, the question becomes, where does it end? President Ford pointed out in his budget message that if domestic assistance programs continue growing at the rate they have been over the next two decades, government spending would advance to over half of our national output." But now let's look at the second and equally important question. Altogether, as indicated earlier, we estimate that about 700,000 needy children receive no program benefits because the present programs are not available to them. Further, with the exception of the 1.7 million needy children who benefit from the summer feeding program, most needy children are not reached in the summer months. Meanwhile, the Federal government contributes 22 cents per lunch to 15 million non-needy children at a cost of about $600 million annually, plus additional amounts to those non-needy who participate in the breakfast and milk programs. Taking up the third question on program overlap as part of their studies into public welfare, the Joint Economic Committee requested a survey of food stamp participants, the first such national survey. Conducted by the Chilton Research Associates, the study looked into all kinds of income, including Child Nutrition benefits available to food stamp users. Significantly 36 percent of all the families surveyed had children participating in the school lunch program: 6.6 percent had youngsters getting school breakfasts; 2.4 percent, speciai food service benefits; and 2.4 percent were getting supplemental food program benefits. Of all the households surveyed, one-third were receiving benefits from 4 or more Federal assistance programs. These results suggest the desirability of some · integration of these activities into a coordinated package of public assistance. that will encourage more equitable sharing of benefits among people who genuinely need them. The results also suggest that we may well be dividing our Federal and State administrative capabilities among too many narrow categorical programs of limited scope, while some major programs are still falling short of reaching their target audiences. The aforementioned examples are the kinds of problem areas that might better be resolved, if administrative energies at all levels of government were more sharply focused. And finally, returning to the fourth question--on the available options to remedy these situations-we see the block-grant proposal as the most viable longrange alternative. In the interim, however, we are prepared to accept the measure that is currently pending in Congress to extend the Summer Feeding Program through this summer. The program is already authorized and funded for a third of the summer, and it would obviously be disruptive to make major changes in mid season. As I said earlier, The proposed Child Food Assistance Act would provide food to fulfill % of the daily Recommended Dietary Allowances for each needy child in the United States on a year-round basis. We want to ensure that the program concentrates food assistance on needy children-those whose more urgent needs merit highest priority. The program also will help to decentralize government operations and share more decision-making power with State governments. We appreciate this opportunity to present the Department's views. Now, Mr. Chairman, we would be happy to answer any questions. Senator McGOVERN. I would like to ask that Senator Case's statement be made a part of the record. He was delayed at a meeting at the White House this morning. Also a letter from Congressman Jeffords to Chairman Talmadge. [The statement of Senator Case and a letter from Congressman Jeffords follow:] STATEMENT OF HON. CLIFFORD P. CASE, A U.S. SENATOR FROM THE STATE OF NEW JERSEY I welcome the opportunity to testify before the Senate Agriculture Subcommittee on Agricultural Research and General Legislation in behalf of my bill to prohibit the unrestricted sale of competitive foods in the school cafeteria. My bill, S. 1309, is co-sponsored by Senators McGovern, Hugh Scott, Kennedy, Metcalf. Philip Hart, Clark, Humphrey, Stafford. Schweiker and Moss. If enacted, S. 1309 will accomplish two closely related goals. First, it will return to the Department of Agriculture the authority to regulate competitive foods in the school lunchroom, and it will do so with the admonition of Congress that so-called "empty calorie" or "junk" foods should not be sold in schools already under the National School Lunch program. Second, S. 1309 will create a new section in the National School Lunch Act aimed at providing assistance to schools for nutrition education programs. My bill is not an anti-vending machine measure. It is directed at the soda pop. cakes and candies sold in some vending machines and which undermine the purpose of the school lunch program. The objective of the lunch program is to help provide a nutritionally adequate diet for school children and, thereby, help to safeguard their health and wellbeing. It has been proven time and again that well nourished children are more alert in school, better behaved, and benefit more from their classroom experience. Many experts and citizens concerned about the existence of empty-calorie foods in the school cafeteria have been in touch with me. And I share their belief that any assault on the integrity of our school feeding programs must be regarded most seriously. My bill has the support of the American School Food Service Association and the American Dental Association, both strong advocates of the best in nutrition for the school lunchroom. The practice in my own state of New Jersey is to serve only nutritious food during the hours that the school breakfast and lunch programs are in operation. In other words, the vending machines selling non-nutritious foods are turned off for those periods. I do not know what the practice is in other states. For my own part, I am deeply concerned about the attitude of the Department of Agriculture on this matter. Through its inaction and failure to speak out, it has permitted its authority over the school feeding programs to be undermined. Several years ago I offered an amendment to the School Lunch Act to prevent the sale of competitive foods in the school cafeteria. While my amendment was adopted by the Senate, it did not have the support of the Department of Agriculture. Without this support, the amendment was dropped in conference. I hope the Committee will look into the question of how well the Department is carrying out its responsibilities for safeguarding children's feeding programs particularly with regard to competitive foods. I agree with Senator Allen, chairman of this subcommittee, that "proper nutrition is the primary purpose" of the school lunch programs. In line with this objective, S. 1309 also provides cash grants to departments of education or comparable agencies in the states to educate children on the nutritional value of foods and the importance of nutrition to good health. In addition, it authorizes the Department of Agriculture to carry out research and develop materials and techniques for effective presentation of this information. Enactment of S. 1309 will go a long way to assure that the Federal dollars spent in the school feeding programs are providing the best possible nutrition for the children of our country. I would also like to take this opportunity, Mr. Chairman, to say a few words in support of the amendment to S. 850, which I am co-sponsoring, to make mandatory the reduced price lunch. As the original sponsor of legislation to make permanent the optional reduced-price lunch-termed a milestone by the American School Food Service Association-I view this proposal as yet another milestone. The school feeding programs take on added importance at this time when the economy is depressed and the rate of unemployment is high. Family incomes cannot stretch to meet increased prices, and those in the low to middle income range have the bardest time of it. Prices of school lunches have increased, and children are being forced to drop out of the program because they simply do not have enough money to be able to purchase the nutritionally adequate lunch available through the school lunch program. To safeguard the health of these children, I urge the committee to act favorably on the amendment to make mandatory the reduced price lunch pro gram. CONGRESS OF THE UNITED STATES, HOUSE OF REPRESENTATIVES, The Honorable HERMAN TALMADGE DEAR MR. CHAIRMAN: As you begin hearings on the extension of the National School Lunch and Child Nutrition Acts, the House probably will not have comFleted action on H.R. 4222. Regardless, I would like to draw your attention to an |