The bill before the subcommittee would take differences in the rate of program growth into account by introducing the factor of participation into the apportionment formula. The cash assistance funds would be apportioned among the States on the basis of the number of type A lunches served in each State in the preceding year, with below-average income States receiving relatively more assistance per meal than average or above-average income States.

In the proposed formula, the lower income States would be provided with a larger per meal allowance by applying a value of 5 to each lunch served in average or above-average income States and a higher value (up to a maximum of 9) in below-average income States. In table II there is shown the resulting per meal payments that would have been provided for 1962 under a total cash assistance fund of $98.6 million, $118.6 million, and $139.9 million. (Table III shows the same data in dollar amounts.)

As table II illustrates, the minimum rate assigned to any State under the proposed formula is the rate assigned to the average income State. Also, the minimum rate in any year would depend upon the amount of funds made available by the Congress for apportionment to the States in that year. In 1961-62referring again to table II-the minimum rate would be 3.5 cents at $98.6 million, 4.2 cents at $118.6 million, and 5 cents at $139.9 million.

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The same factor of participation-as measured by the number of type A méals served in the preceding year-would be used to divide funds between public and private schools within a State whenever such a division is necessary. This would result in the same average per meal rates of assistance for public and private schools, in those States in which the program in private schools, because of State law, is directly administered by the U.S. Department of Agriculture.

We have, as previously indicated, provided for a 1-year transition from the old to the new apportionment formula. For the first year, half of the cash assistance funds would be apportioned under the old formula and half under the new method. For the second year, the new formula would be fully effective. Table IV shows the possible apportionments to States under the current and proposed formula during the transition period.

One additional technical change is provided in the bill. Currently, the income factor is measured by the per capita income figures for the latest year that can be certified by the Department of Commerce. This bill provides that a 3-year moving average of per capita shall be used in the apportionment formula, using the latest 3 years available from Commerce. This change will help eliminate abrupt year-to-year changes that now may occur in a State's share of the available funds and, thus, help in the more orderly development of the program.

We feel that these changes are desirable in order to correct inequities that have developed, since 1947, in the application of the present apportionment formula. Currently, those States which have been most successful in extending the program to more schools and to more children have found themselves in the position of having to spread available cash funds thinner and thinner as the number of type A lunches steadily increased. This necessarily has served to impede further development of the program. We believe the proposed formula will provide an equitable basis for the division of the amount of cash assistance funds that the Congress annually will make available under the regular appropriation process. The new section of the bill would authorize a specific annual appropriation under the act to provide special assistance to especially needy schools. This, of course, was one of the provisions originally requested by the subcommittee. We believe, also, that it would be a valuable addition to the enabling legislation.

We have become increasingly aware of the need to make some special provisions for those communities and those children that are least able to take advantage of the school lunch program. Under this bill, considerable administrative flexibility would be provided to the Department in developing the new program. We feel this is necessary. Also, we will gain considerable experience this year in administering the $2 million commodity fund that has been provided by the Congress for this purpose in the Department's 1961-62 appropriation bill.

Finally, the Department recommends a further addition to the bill in order to extend the school lunch program to American Samoa. Such an extension was recommended by the study mission to Eastern (American) Samoa, which was established pursuant to Senate Resolution 330, 86th Congress.

Almost 7,000 children are enrolled in elementary and secondary public and private schools in American Samoa. Development of the lunch program there may be slow and any rapid progress will probably depend upon the provision of

more adequate school facilities. Nonetheless, a beginning could be planned once Federal assistance was available.

Because of the absence of a participation record, special provision would need to be made for an allotment of funds to American Samoa under the proposed bill. It is recommended that for each of the 5 fiscal years following the revision in the formula, an initial reserve of up to $25,000 be established for American Samoa. Thereafter, American Samoa would receive funds based upon actual participation. We are prepared to submit to the subcommittee language for an appropriate change in the language of the bill to accomplish this recommendation.

We appreciate the opportunity to make this statement and will be glad to answer any questions you may have.

TABLE I. Selected program statistics, fiscal years 1947 and 1961

TABLE II.-Average per meal rate of assistance under present formula for apportionment and under proposed formula

1 States ranked in order from highest to lowest per capita income average for latest 3 years: 1958, 1959, 1960. 2 Based on estimated meals in fiscal year 1962.

TABLE III.-Payments to States under present formula for apportionment and under proposed formula

1 States ranked in order from highest to lowest per capita income average for latest 3 years: 1958, 1959, 1960.

TABLE IV.-Payments to States under present formula for apportionment and under proposed formula during transition period1

1 Represents an apportionment of funds, 11⁄2 under the present formula and 1⁄2 under the proposed formula. 2 States ranked in order from highest to lowest per capita income average for latest 3 years: 1958, 1959, 1960.

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