(D) 11-6(i) In the case of any school that 11-7 is receiving special assistance payments under this paragraph for a 3-school-year period described in subparagraph (C), the State may grant, at the end of the 3-school-year period, an extension of the period for an additional 2 school years, if the State determines, through available socioeconomic data approved by the Secretary, that the income level of the population of the school has remained stable.

(ii) A school described in clause (i) may reapply to the State at the end of the 2-school-year period described in clause (i) for the purpose of continuing to receive special assistance payments, as determined in accordance with this paragraph, for a subsequent 5school-year period. The school may reapply to the State at the end of the 5-school-year period, and at the end of each 5-school-year period thereafter for which the school receives special assistance payments under this paragraph, for the purpose of continuing to receive the payments for a subsequent 5-school-year period.

(iii) If the Secretary determines after considering the best available socioeconomic data that the income level of families of children enrolled in a school has not remained stable, the Secretary may require the submission of applications for free and reduced price lunches, or for free and reduced price lunches and breakfasts, in the first school year of any 5-school-year period for which the school receives special assistance payments under this paragraph, for the purpose of calculating the special assistance payments.

(iv) For the purpose of updating information and reimbursement levels, a school described in clause (i) that carries out a school lunch or school breakfast program may at any time require submission of applications for free and reduced price lunches or for free and reduced price lunches and breakfasts.

(E) 11-8(i) In the case of any school that

(I) elects to serve all children in the school free lunches under the school lunch program during any period of 4 successive school years, or in the case of a school that serves both lunches and breakfasts, elects to serve all children in the school free lunches and free breakfasts under the school lunch program and the school breakfast program during any period of 4 successive school years; and

(II) pays, from sources other than Federal funds, for the costs of serving the lunches or breakfasts that are in excess of the value of assistance received under this Act and the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.) with respect to the number of lunches or breakfasts served during the period; total Federal cash reimbursements and total commodity assistance shall be provided to the State educational agency with respect to the school at a level that is equal to the total Federal cash reimbursements and total commodity assistance received by the school in the last school year for which the school accepted applications under the school lunch or school breakfast program, adjusted annually for inflation in accordance with paragraph (3)(B) and for

11-6 See note 11-5.

11-7 Section 704(a) of P.L. 104-193, 110 Stat. 2289, Aug. 22, 1996, amended this clause by striking", on the date of enactment of this subparagraph,”. 11-8 See note 11-5.

changes in enrollment, to carry out the school lunch or school breakfast program.

(ii) A school described in clause (i) may reapply to the State at the end of the 4-school-year period described in clause (i), and at the end of each 4-school-year period thereafter for which the school receives reimbursements and assistance under this subparagraph, for the purpose of continuing to receive the reimbursements and assistance for a subsequent 4-school-year period. The State may approve an application under this clause if the State determines, through available socioeconomic data approved by the Secretary, that the income level of the population of the school has remained consistent with the income level of the population of the school in the last school year for which the school accepted the applications described in clause (i).

(iii) Not later than 1 year after the date of enactment of this subparagraph, the Secretary shall evaluate the effects of this subparagraph and notify the Committee on Education and Labor of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate of the results of the evaluation.

(2) 11-9 The special assistance factor prescribed by the Secretary for free lunches shall be 98.75 cents and the special assistance factor for reduced price lunches shall be 40 cents less than the special assistance factor for free lunches.

(3)(A) The Secretary shall prescribe on July 1, 1982, and on each subsequent July 1, an annual adjustment in the following:

(i) The national average payment rates for lunches (as established under section 4 of this Act).

(ii) the special assistance factor for lunches (as established under paragraph (2) of this subsection).

(iii) The national average payment rates for breakfasts (as established under section 4(b) of the Child Nutrition Act of 1966 [(42 U.S.C. 1773(b))]). 11-10

(iv) The national average payment rates for supplements (as established under section 17(c) of this Act).

(B) The annual adjustment under this paragraph shall reflect changes in the cost of operating meal programs under this Act and the Child Nutrition Act of 1966 [(42 U.S.C. 1771 et seq.)], as indicated by the change in the series for food away from home of the Consumer Price Index for all Urban Consumers, published by the Bureau of Labor Statistics of the Department of Labor. Each annual adjustment shall reflect the changes in the series for food away from home for the most recent 12-month period for which such data are available. The adjustments made under this paragraph shall be computed to the nearest one-fourth cent, except that adjustments to payment rates for meals and supplements served to individuals not determined to be eligible for free or reduced price meals and supplements shall be computed to the nearest lower cent

11-9 Paragraphs (2) and (3) added by section 801 of P.L. 97-35, 95 Stat. 522, Aug. 13, 1981. 11-10 Section 4(b)(1)(B) of the Child Nutrition Act of 1966 (42 U.S.C. 1773(b)(1)(B)) requires that the national average payment rates for breakfasts served under such Act be adjusted pursuant to section 11(a) of the National School Lunch Act (42 U.S.C. 1759a(a)).

increment and based on the unrounded amount for the preceding 12-month period. 11-11

(b) Except as provided in section 10 of the Child Nutrition Act of 1966 [(42 U.S.C. 1779)], the special assistance payments made to each State agency during each fiscal year under the provisions of this section shall be used by such State agency to assist schools of that State in 11-12 providing free and reduced price lunches served to children pursuant to subsection 9(b) of this Act. The amount of such special assistance funds that a school shall from time to time receive, within a maximum per lunch amount established by the Secretary for all States, shall be based on the need of the school for such special assistance. Such maximum per lunch amount established by the Secretary shall not be less than 60 cents.

(c) Special assistance payments to any State under this section shall be made as provided in the last sentence of section 7 of this Act.

(d) 11-13(1) 11-14 The Secretary, when appropriate, may request each school participating in the school lunch program under this Act to report monthly to the State educational agency 11-15 the average number of children in the school who received free lunches and the average number of children who received reduced price lunches during the immediately preceding month.

(2) On request of the Secretary, the 11-16 State educational agency of each State shall report to the Secretary 11-17 the average number of children in the State who received free lunches and the average number of children in the State who received reduced price lunches during the immediately preceding month.

(e) 11-18 Commodity only schools shall also be eligible for special assistance payments under this section. Such schools shall serve meals free to children who meet the eligibility requirements for free meals under section 9(b) of this Act, and shall serve meals at a reduced price, not exceeding the price specified in section 9(b)(3)

-Effective July 1, 1997, section 704(b)(1) of P.L. 104-193, 110 Stat. 2289, Aug. 22, 1996, amended this sentence by adding before the period at the end the following: ", except that adjustments to payment rates for meals and supplements served to individuals not determined to be eligible for free or reduced price meals and supplements shall be computed to the nearest lower cent increment and based on the unrounded amount for the preceding 12-month period". 11-12 Section 819 of P.L. 97-35, 95 Stat. 533, Aug. 13, 1981, removed the words "financing the cost of".

11-13 Section 704(c) of P.L. 104-193, 110 Stat. 2290, Aug. 22, 1996, struck former subsection (d) and redesignated formers subsections (e) and (f) as subsections (d) and (e), respectively. Previously, language added by section 7 of P.L. 91-248, 84 Stat. 212, May 14, 1970, and designated as subsection (h). Section 3(a) of P.L. 93-150, 87 Stat. 561, Nov. 7, 1973, deleted old subsections (d) and (e) and designated then subsections (g) and (h) as subsections (d) and (e), respectively. Section 8 of P.L. 94-105, 89 Stat. 514, Oct. 7, 1975, amended this subsection to change planning from a fiscal to a school year basis, and placed the date of the plans' submission at the discretion of the Secretary. This section was further amended by section 812 of P.L. 97-35, 95 Stat. 530, Aug. 13, 1981, to delete former paragraph (1) which required States to file State plans. 11-14 Section 812 of P.L. 97-35, 95 Stat. 530, Aug. 13, 1981, redesignated paragraphs (2) and (3) as (1) and (2), respectively, and eliminated the requirement that schools and States provide an estimate of the number of children eligible for free or reduced meals.

11-15 Section 203 of P.L. 101-147, 103 Stat. 909, Nov. 10, 1989, amended paragraph (1) by striking "Each school participating in the school lunch program under this Act shall report each month to its State educational agency" and inserting "The Secretary" and all that follows through "State educational agency".

11-16 Section 704(c)(2)(A) of P.L. 104-193, 110 Stat. 2290, Aug. 22, 1996, amended this paragraph by striking "The" and inserting "On request of the Secretary, the".

11-17 Section 704(c)(2)(B) of P.L. 104-193, 110 Stat. 2290, Aug. 22, 1996, amended this paragraph by striking "each month".

1-18 This subsection added by section 813 of P.L. 97-35, 95 Stat. 530, Aug. 13, 1981.

of this Act, to children meeting the eligibility requirements for reduced price meals under such section. No physical segregation of, or other discrimination against, any child eligible for a free or reduced priced lunch shall be made by the school, nor shall there by any overt identification of any such child by any means.

MISCELLANEOUS PROVISIONS AND DEFINITIONS

SEC. 12. 12-1 [1760] (a) States, State educational agencies, and schools participating in the school lunch program under this Act shall keep such accounts and records as may be necessary to enable the Secretary to determine whether the provisions of this Act are being complied with. Such accounts and records shall be available at any reasonable time 12-2 for inspection and audit by representatives of the Secretary and shall be preserved for such period of time, not in excess of five years, as the Secretary determines is necessary.

(b) The Secretary shall incorporate, in the Secretary's 12-3 agreements with the State educational agencies, the express requirements under this Act with respect to the operation of the school lunch program under this Act insofar as they may be applicable and such other provisions as in the Secretary's 124 opinion are reasonably necessary or appropriate to effectuate the purpose of this Act.

(c) 12-5 In carrying out the provisions of this Act, the Secretary shall not 12-6 impose any requirement with respect to teaching personnel, curriculum, instruction, methods of instruction, and materials of instruction in any school.

(d) 12-7 For the purposes of this Act

(1) 12-8 CHILD.

(A) IN GENERAL.-The term "child" includes an individual, regardless of age, who

(i) is determined by a State educational agency, in accordance with regulations prescribed by the Sec

12-1 Section 12 was section 11 until renumbered by section 5 of P.L. 87-823, 76 Stat. 945, Oct. 15, 1962.

12-2 Section 705(a) of P.L. 104-193, 110 Stat. 2290, Aug. 22, 1996, amended this sentence by striking "at all times be available" and inserting "be available at any reasonable time".

12-3 Section 306(b)(1) of P.L. 101-147, 103 Stat. 915, Nov. 10, 1989, amended subsection (b) by striking "his" each place it appears and inserting "the Secretary's".

12-4 See note 12-3.

12-5 Section 5 of P.L. 87-823, 76 Stat. 945, Oct. 15, 1962, deleted a requirement of equitable distribution of funds in States maintaining separate schools for minority and majority races.

12-6 Section 705(b) of P.L. 104-193, 110 Stat. 2290, Aug. 22, 1996, amended this subsection by striking "neither the Secretary nor the State shall" and inserting "the Secretary shall not". 12-7 Section 705(c)(2) and (3) of P.L. 104–193, 110 Stat. 2290, Aug. 22, 1996, amended this subsection by striking former paragraphs (3) and (4) and by redesignating former paragraphs (1), (2), and (5) through (9) as paragraphs (6), (7), (3), (4), (2), (5), and (1), respectively, and rearranging the paragraphs so as to appear in numerical order.

Previously, section 9(c) of P.L. 94-105, 89 Stat. 514, Oct. 7, 1975, deleted a definition of “nonprofit private school" found in paragraph (3) and renumbered former paragraphs (4) through (7) as former paragraphs (3) through (6), respectively.

Former paragraph (3) (defining "participation rate") was added by section 5 of P.L. 87-823, 76 Stat. 945, Oct. 15, 1962. Section 1(b) of P.L. 91-248, 84 Stat. 207, May 14, 1970, provided for the use of data from a different fiscal year. Section 819 of P.L. 97-35, 95 Stat. 533, Aug. 13, 1981, eliminated former paragraph (3) which defined "food service equipment" and renumbered paragraph (4) as paragraph (3).

Former paragraph (4) (defining "assistance need rate”) was added by section 5 of P.L. 87-823, 76 Stat. 945, Oct. 15, 1962. Renumbered from (5) to (4) by section 819 of P.L. 97-35, 95 Stat. 533, Aug. 13, 1981.

12- This definition added by section 701(b) of P.L. 104-193, 110 Stat. 2288, Aug. 22, 1996. For redesignation, see note 12-7.

retary, to have one or more mental or physical disabilities; and

(ii) is attending any institution, as defined in section 17(a), or any nonresidential public or nonprofit private school of high school grade or under, for the purpose of participating in a school program established for individuals with mental or physical disabilities.

(B) RELATIONSHIP TO CHILD AND ADULT CARE FOOD PROGRAM.-No institution that is not otherwise eligible to participate in the program under section 17 shall be considered eligible because of this paragraph.

(2) 12-9 "Commodity only schools" means schools that do not participate in the school lunch program under this Act, but which receive commodities made available by the Secretary for use by such schools in nonprofit lunch programs.

(3) 12-10 "School" means (A) any public or nonprofit private school of high school grade or under 12-11, and (B) any public or licensed nonprofit private residential child care institution (including, but not limited to, orphanages and homes for the mentally retarded, but excluding Job Corps Centers funded by the Department of Labor) 12-12 12-13 For purposes of this paragraph, the term "nonprofit", when applied to any such private school or institution, means any such school or institution which is exempt from tax under section 501(c)(3) of the Internal Revenue Code of 1986. 12-14

12-9 This definition added by section 813, P.L. 97-35, 95 Stat. 530, Aug. 13, 1981. For redesignation, see note 12-7.

12-10 This definition transferred from section by section 5 of P.L. 87-823, 76 Stat. 946, Oct. 15, 1962. Renumbered from (6) to (5) by section 819 of P.L. 97-35, 95 Stat. 533, Aug. 13, 1981. For redesignation, see note 12-7.

12-11 Section 3(a)(1) of the Child Nutrition Act of 1966 (42 U.S.C. 1772(a)(1)) authorizes a special milk program for children in schools and institutions which do not participate in a meal service program authorized under such Act or the National School Lunch Act.

Section 3(a)(2) of the Child Nutrition Act of 1966 (42 U.S.C. 1772(a)(2)) provides that the limitation imposed under section 3(a)(1) of such Act for participation of nonprofit schools in the special milk program shall not apply to split-session kindergarten programs conducted in schools in which children do not have access to the meal service program operating in schools the children attend as authorized under such Act (42 U.S.C. 1771 et seq.) and this Act. Section 4209 of Public Law 99-661 added paragraph (2) of section 3(a) of the Child Nutrition Act of 1966 (effective October 1, 1986). In an earlier enactment, section 329 of Public Law 99-591 added the identical paragraph (effective July 1, 1987).

12-12 Section 9(c) of P.L. 94-105, 89 Stat. 514, Oct. 7, 1975, expanded this definition to include nonprofit private residential child care institutions. Section 205 of P.L. 96-499, 94 Stat. 2601, Dec. 5, 1980, added the "Job Corp Centers" exclusion.

12-13 Effective October 1, 1995, section 112(a) of P.L. 103-448, 108 Stat. 4708, Nov. 2, 1994, amended this paragraph by striking clause (C) and making conforming amendments.

12-14 Section 808 of P.L. 97-35, 95 Stat. 527, Aug. 13, 1981, changed the definition of "nonprofit" to exclude private schools whose average yearly tuition exceeds $1,500.00 per child. Section 325(a) of P.L. 99-500, 100 Stat. 1783-361, Oct. 18, 1986, and section 325(a) of P.L. 99591, 100 Stat. 3341-364, Oct. 30, 1986, deleted the phrase "except private schools whose average yearly tuition exceeds $1,500 per child". This provision was effective July 1, 1987, under section 325(c) of both acts. Section 4205(a) of P.L. 99-661, 100 Stat. 4072, Nov. 14, 1986, substituted "2,000" for "1,500" and added after the first sentence the following: "On July 1, 1988, and each July 1 thereafter, the Secretary shall adjust the tuition limitation amount prescribed in clause (A) of the first sentence of this paragraph to reflect changes in the Consumer Price Index for All Urban Consumers during the most recent 12-month period for which the data is available." Title I, chapter X, P.L. 100-71, 101 Stat. 429, July 11, 1987, substantially revised this section, removing the tuition limitation and the sentence added by P.L. 99-661. P.L. 100-71 also substituted Corps" for "Corp" in subsection (B) and "nonprofit" for "non-profit" in subsection (C). Section 306(b)(2) of P.L. 101-147, 103 Stat. 915, Nov. 10, 1989, amended paragraph (5) by striking "Internal Revenue Code of 1954" and inserting “Internal Revenue Code of 1986".

Continued