tion attending from the New England area. They are Miss Gertrude Griney, director of the School Nutrition Programs of the Maine State Department of Education in Augusta, Maine; Mr. Edward L. Ryan, Chief, Education Field Services, State of Vermont, Department of Education, Montpelier, Vt.; and Mr. George A. Bussell, director of Child Feeding Services, New Hampshire State Department of Education, Concord, N.H.

Senator MCGOVERN. Mr. Hansford, did you have a statement?

STATEMENT OF BYRON HANSFORD, EXECUTIVE SECRETARY, COUNCIL OF CHIEF STATE SCHOOL OFFICERS

Mr. HANSFORD. Yes, I do.

Mr. Chairman, members of the committee, my name is Byron Hansford. I am the executive secretary of the Council of Chief State School Officers, an organization whose membership is made up of the chief State school officers of all of the States and territories.

I appreciate the opportunity to appear at this hearing and discuss some of the problems which will be faced by the States and local school districts as a result of the proposed regulations for the FederalState Child Nutritional programs.

I could talk about the incredibly complex-and some people could say confused or confusing-regulations. But, there are others here today who are much more competent than I to do that, so I will talk about other issues. I could talk about the lack of meaningful dialog between the USDA and the people who implement the programs-and determine whether or not they will succeed-but, that problem is better left for another day, when we are not facing a crisis such as the one we have before us.

I could talk about the rationale, logic, and need for programs to feed hungry children; but, we are all in agreement on that. So I will spend a very few minutes on how I perceive the present situation, and what I think the almost certain consequences will be.

ALLOCATED FUNDS GROSSLY INADEQUATE

I believe the funds which have been allocated for this program for this year are grossly inadequate to meet the needs and to carry out the stated purpose of the program. I believe the proposed regulations put forth by the USDA are an attempt on their part to have their cake and eat it too, by passing on to the States and local districts the responsibility for making up the deficiences in the Federal funding. Under the circumstances, one might reasonably assume that one of two things might happen: either the deficiencies will be made up; or the children will continue to go hungry. I can assure you that it will be primarily the latter. Even where States and local districts have the desire and financial ability to make up for the Federal Government's inadequacies, the timing, as Senator Cook has said, makes it well nigh impossible. Budgets and tax rates were set months ago. In practically every instance, legislative appropriations have been made, and in most States the legislatures have adjourned.

I do not think it is likely that the Governors of the respective States are going to call their legislatures back into session to bail out the Federal Government.

LEAST ABLE HARDEST HIT

I would also like for the record to show that the States and local districts which are hardest hit by this inadequate funding are those which are least able to raise money on their own. They are the ones with large numbers of poor residents and/or many poor immigrants. If they are forced to spend additional money to feed hungry children, it will be at the expense of the educational program. The prospect of intellectual malnutrition is as appalling to me as is the prospect of physical malnutrition.

In conclusion, Mr. Chairman, members of the committee, let me say that I believe it is time for us to be completely honest in this matter. It is time for us to put all of our cards on the table. If the Government of the United States of America cannot afford to feed the hungry school children in this country, let's say so. Let us say that this year we are going to feed 7 million rather than 9 million, and then prepare honest and straightforward rules and regulations to implement such a program, rather than expecting others to bail us out.

I, of course, believe that the additional funds necessary to fund an adequate program are very small in comparison to other more questionable programs, and can well be afforded.

Finally, I would hope and propose-as the council has in the pastthat a mechanism be devised to provide for meaningful dialog between the Federal officials and those who must implement the programs. This dialog must be ongoing and must provide all parties time to do appropriate planning so that hungry children may be fed. Senator MCGOVERN. Thank you very much, Mr. Hansford, for your statement.

I especially want to commend the point you made that we must close this gap between what we say we are going to do and what we actually do. I take it, the thrust of your point is that we are going to leave several million children outside this program if we continue with these regulations as presently proposed?

Mr. HANSFORD. Yes, sir.

Senator McGOVERN. Thank you for your testimony.

Thank you, Mr. Bartlett.

Now the committee would be pleased to hear from the Assistant Secretary of Agriculture, Mr. Lyng.

Mr. Secretary, you can proceed.

STATEMENT OF HON. RICHARD LYNG, ASSISTANT SECRETARY OF THE U.S. DEPARTMENT OF AGRICULTURE, ACCOMPANIED BY MISS ISABELLE M. KELLEY, ASSISTANT DEPUTY ADMINISTRATOR; EDWARD HEKMAN, ADMINISTRATOR; AND HERBERT ROREX, DIRECTOR, CHILD NUTRITION DIVISION, FOOD AND NUTRITION SERVICE, WASHINGTON, D.C.

Mr. LYNG. Mr. Chairman, and members of the committee, I have with me, on my left, Miss Isabelle Kelley, assistant deputy administrator of the Food and Nutrition Service. On my right, Ed Hekman, the administrator of the Food and Nutrition Service; and Herbert Rorex, the director of the Child Nutrition Division of the Food and Nutrition Service.

I am pleased to appear before the committee today concerning the proposed amendments to the School Lunch regulations which we issued for public comment on August 13th. It is apparent that there has been considerable confusion about those proposed regulations and their impact on the 1971-72 School Lunch Program. Therefore, we welcome this opportunity to clarify the issues.

Last year the initial year of operation under the Public Law 91-248 amendments-resulted in substantial progress in the National School Lunch Program. In September of 1970, the month when most schools opened for the 1970-71 school year:

A total of 22.1 million children were being reached with a school lunch.

A total of 4 million children were being reached with a free and reduced-price lunch; and

A total of 77,454 schools were approved for participation in the

program.

By April of 1971:

A total of 24.1 million children were being reached with a school lunch-up 9 percent over September.

A total of 7.3 million children were being reached with a free and reduced-price lunch-up 3.3 million over September, or 82 percent.

A total of 79,754 schools were approved for participation. Attendance in these schools represented 84 percent of all elementary and secondary school attendance.

That record of progress represented the combined work of local, State, and Federal government units, and thousands of dedicated school officials and concerned local citizens-backed by the traditional combination of local, State, and Federal financial support for the program.

There was, in fact, a sharp increase in Federal funding of school feeding programs for 1971-largely as a result of the administration's request for a supplemental appropriation of $217 million following approval of Public Law 91-248.

The amount of the direct appropriations under Sections 4 and 11 of the National School Lunch Act more than doubled-from $212.6 million in fiscal year 1970 to $429.8 million in fiscal 1971. In addition, these direct appropriations were augmented by over $150 million in special Section 32 funds-most of which was intended for free and reduced-price lunches. This augmentation was specifically authorized in our 1971 appropriation act and was a very substantial increase over the $99 million in special Section 32 funds made available in the previous year's appropriation act. This level of 1971 Federal funding was designed to support a national average Section 4 rate of reimbursement of 5 cents per lunch and a national average rate of 30 cents under Section 11 for additional assistance for free and reduced-price lunches.

I am here today, Mr. Chairman, because the committee and a number of States have raised a question as to whether past progress in the program can be maintained in 1972-much less additional progress obtained-under the 1972 Federal funding structure outlined in the proposed regulations the Department issued on August 13th.

We believe that significant additional progress is possible. In fact, Mr. Chairman, we believe that our proposal presents a dramatic breakthrough in program funding.

First, we can avoid the mid-year funding uncertainties of last year. At that time, fund shortages in some States were threatening the continuation of their programs while other States had millions of dollars in excess funds.

Second, there is an increase in the amount of Federal funds available to provide special assistance for free and reducedprice lunches in 1972-about $78.8 million more than was spent in 1971.

Third, for the first time in the history of the program, a Stateneeding to expand its program to substantially more schools and substantially more children-can do so without fear that such expansion will be at the expense of an unwarranted reduction in levels of assistance to already participating schools and children. That your committee and some States could have some very different initial reaction to our proposed regulations certainly raises the question as to whether our proposals were, in fact, clearly stated or clearly understood.

The funding structure of the National School Lunch Program is complex. And it has become more complex in the past 3 years because our annual appropriation acts have authorized the use of some Section 32 funds to augment the funds directly appropriated for the National School Lunch and Child Nutrition Acts. We have concluded, therefore, that to clarify the intent and impact of our proposed regulations, it is essential to explain the structure under which the school lunch programs is federally funded; to review 1971 program funding; the situation that would have existed if we had continued the 1971 funding structure in 1972; and, finally, how our proposed 1972 funding structure will actually work.

THE BASIC FUNDING STRUCTURE

The National School Lunch Act authorizes two annual appropriations for the program-one under Section 4 of the act and one under Section 11. The act also specifies exactly how each of these annual appropriations is to be apportioned among the States.

Section 4 funds are apportioned among the States on the basis of the number of type A lunches previously served by each State and the relationship between each State's per-capita income and the per-capita income of the United States. For fiscal 1972, the apportionment formula uses the number of type A lunches served by each State 2 years ago in fiscal 1970. Section 11 funds are apportioned on the basis of the relative number of school-age children in households with annual incomes below $4,000 that reside in each of the States.

The Section 4 funds are used to help schools buy food for the lunches served to all children-to both children who pay the full price of the lunch and the children who receive free and reduced-price lunches. The Section 11 funds are used to provide additional special assistance for lunches served free or at a reduced-price to children who meet a school's eligibility standards for such lunches.

Both the Section 4 and 11 funds are actually disbursed to schools by the State on the basis of an assigned per-lunch reimbursement rate. The Section 4 rate is applied to all the lunches; the Section 11 rate ap

plies only to the free and reduced-price lunches. In the program regulations, the Department of Agriculture establishes maximum reimbursement rates that a State may pay under Section 4 and Section 11. Thus, the actual rates of assistance a State may pay a school under Section 4 or Section 11 depend upon two factors: (1) The amount of funds made available to the State for Section 4 and 11 purposes each fiscal year; and (2) the maximum per-lunch rates of assistance authorized by the Department.

MAXIMUM RATES OF ASSISTANCE

Many people have interpreted our proposed regulations as requiring a reduction in the maximum rates of assistance that were in effect during the last school year. This is not the case.

The maximum rates authorized for Section 4 and Section 11 are, of course, considerably higher than the rates actually paid on an average basis. The higher maximums permit the States, if they so elect, to vary rates around the average-in order to provide above-average rates to the poorest schools and less-than-average rates to the affluent schools.

In the regulations we issued last September for the 1970-71 school year, the following maximum rates were authorized:

12 cents per lunch under Section 4;

30 cents in addition for each free and reduced-price lunch under Section 11, with a proviso that the neediest schools could receive up to 60 cents for each free and reduced-price lunch.

If a State determined that a school needed in excess of 30 cents for a free and reduced-price lunch, our regulations required that such a school receive Section 4 assistance at the maximum rate of 12 cents. The Section 11 rate could then exceed 30 cents-up to a maximum of 48 cents-or a total of 60 cents in combined funds. As you know, Mr. Chairman, and as has been brought out this morning, this latter provision-called the "12-cent rule"-met opposition among the States. They felt it endangered the total program because Section 4 funds had to be diverted from the more affluent schools in order to pay 12 cents in Section 4 funds to the neediest schools. They felt all the extra assistance for free and reduced-price lunches required by the neediest schools should be financed out of funds available for Section 11 purposes.

Effective in February, we did, in effect, suspend the 12-cent rule. We allowed States to finance the required increase in Section 4 rates for the neediest schools out of funds available for Section 11 purposes. The maximum rates of assistance we have authorized in the proposed regulations remain essentially unchanged from the 1970-71 rates. A State is still authorized to pay its neediest schools up to 60 cents for a free or reduced-price lunch. (A maximum rate of 50 cents is authorized if the school is serving a significant number of reduced-price lunches because it would be receiving revenues from the reduced-price payments.)

Our proposed amendments are concerned with the distribution of available funds among the States-with the average reimbursement to be paid on a statewide basis-not the maximum rates.