The
School Lunch Plunder
Reported by Brad
Penner, STATEWIDE Correspondent
Every school day in Nebraska, more than 50,000 children eat free lunches at
school. The program is supposed to ensure that children from low-income families
get a good meal so they're better prepared to learn. Few would argue with that
goal. But one Nebraska school district found that the benefits aimed at the
poor are being claimed by those who are not, at least not by the standards set
by the government.
Administrators in South Sioux City started getting concerned
a couple of years ago. They were finding more cases of people misstating their
incomes when they applied for free or reduced price lunches. They also found
that more than half of the people they asked were unwilling or unable to prove
that they met income standards for the program. A check of the numbers showed
a similar situation in a couple of other school districts. In South Sioux City
they decided to do something about it. They may become the first school district
in the country to prosecute people for lying on an application form. They want
to make sure that families who can afford it don't get a free lunch. It's lunchtime at South Sioux City High School. Some of the
kids pay cash. Others have a lunch card punched. But it's impossible to tell
which kids are paying full price for their meal and which of them pay less or
eat free. School officials think many of those free lunches go to kids whose
families don't legally qualify.
[Rick Feauto, South Sioux City Schools:] "We thought
we had a high percentage of people that were misrepresenting their income so
we wanted to take it a step further. We didn't want to just be over and done
with it. We wanted to try and do something about the high number of misrepresented
incomes."
The federal government sets income guidelines for free and
reduced price lunches. Families under 130% of the poverty level get free lunches.
The reduced price cutoff is set at 185% of the poverty line. For example, a
family of four could make close to $20,000 per year and qualify for free lunches.
If they made $28,000, they'd pay the reduced price.
[Feauto:] "This is a summary of all 85 people that we did verify."
Rick Feauto is the business manager for the South Sioux City
schools. It's his job to check school lunch applications. He found a number
of cases where the income on a family's application didn't match what they actually
made. [Feauto:] "Number 39 went from free status all the way to denied status.
Said they made 2,600. Really made 3,300."
Now the school is out to stop abuse of the lunch program.
[Feauto:] "What we are after here is trying to take the
people off of the free and reduced roles that don't belong there."
When a family applies for free or reduced price lunches, they
write down their monthly income. If they meet the guidelines, they're enrolled
in the program. No proof of income is needed, but the federal government requires
schools to audit 3% of those applications. Schools ask parents to provide proof
of income. If they don't reply, they get another letter. In 1994 56% of the
people checked didn't answer the letters.
[Feauto:] "They've refused to cooperate and at that point
we send them a letter say, if you do not send us any information, then in ten
days your children will be removed from the free and reduced lunch status. And
29 people allowed us to take their children off."
[Brad Penner:] "Have you received any appeals after that's
happened?"
[Feauto:] "Nobody's contacted us and said, why'd you
take my kids off? They've just allowed it to happen."
Feauto says they do what they can to make sure people understand
the process. The letters are printed in Spanish if necessary and interpreters
are provided for those who may speak other languages. But he believes that most
of those who don't comply know perfectly well what they're doing.
[Feauto:] "We ask 'em, well, what is your real income,
and maybe they sit back and they go, 'Gee, I filled this out incorrectly and
I didn't even realize it.' Or they think, 'Oh, they caught me,' and they don't
respond to us. I can't think of too many reasons why somebody would allow us
to remove their children from a free lunch program if they, in fact, deserved
to be on a free lunch program."
More than half of the people checked in 1994 either admitted
to putting down the wrong income on their application form or they didn't reply.
If those percentages apply to all the applications, you get close to 600 cases
of potential fraud.
Feauto took his concerns to Van Phillips, the South Sioux
City Superintendent. Phillips decided it was time to take action and to try
to enforce the law. [Van Phillips, Superintendent:] "If nobody's ever going
to check -- if we have the speed limit of 55 but there's no highway patrolmen
out there, I guess we're probably gonna' drive more than that, and so in fairness
to those people, perhaps we should say, if nobody's checking, what difference
does it make, you know, I think maybe that's a thing we've encouraged somewhat
by not bothering to check very many."
But lying on a school lunch form is a crime and in South Sioux
City, folks who get caught might be spending some time at the courthouse. Penalties
could include jail time or a fine if the case were severe enough. If local prosecutors
do take some cases to court, they'll be breaking new ground. No one in the country
has been prosecuted for school lunch fraud.
[Connie Stefkovich, Nebraska Dept. of Education:] "Last
spring when South Sioux City first called to visit about their plans, I called
the USDA Regional Office in Denver, which is who we deal with here in Nebraska,
and they checked with all the regional offices across the country and there's
no record of anyone ever being prosecuted for what they've put down on a free
and reduced price meal application."
If no one else is doing it, why would South Sioux City want
to take such an aggressive approach toward enforcing school lunch guidelines?
They say they want to send a message.
[Phillips:] "One of the values that this country, frankly,
has always been based on is an element of honesty and so we felt that it's probably
sending bad messages to students if we totally ignore this."
[Feauto:] "What kind of a message are we sending our
kids if we allow the parents to do these types of things and face no prosecution
whatsoever? It's like it's okay to cheat, it's okay to misrepresent things,
everybody else does it." Close to 1,100 kids get free or reduced price lunches in South Sioux City
and Phillips and Feauto make it clear they aren't out to hurt the program.
[Phillips:] "We want to also say it was never our intent
to prevent anybody from getting a free or reduced price lunch. Those people
who need it certainly are entitled to it and in no way do we want to infringe
upon that benefit that was there and was intended for kids."
[Feauto:] "I just think schools ought to make an effort
to make sure that the people that should not be getting free lunch, that should
not be benefitting from this program aren't benefitting, so that the money that
is left, should there be some cuts, can go to people that need it and not to
people that are not supposed to be receiving the money."
In South Sioux
City the people who are not supposed to be receiving the money could be costing
federal taxpayers $900 a day, not a lot in the vast federal budget, but South
Sioux City may not be the only school district with a problem. We checked the
verification reports of several Nebraska school districts. In the smaller districts
nearly all of the applicants followed the law but in Lincoln this year, 53%
of the people checked couldn't or wouldn't prove that they qualified. In Omaha the figure was 59%. Around 20,000
kids get a free or reduced price lunch at Omaha Public Schools. 8,000 of those
are pre-certified because their families receive food stamps. Administrators
verified 370 of the remaining applications to comply with federal law. Mary
Andersen is in charge of the program in Omaha. [Mary Andersen, Omaha Public Schools:] "As I added the numbers for this
year, there was 217 people who did not respond for one reason or another and
out of 20,000 people or 11,000, whichever way you want to look at it, that's
not a very high percentage."
[Penner:] "Except it's 217 out of 370 so that is a high
percentage."
[Andersen:] "The percentage is high but you have to understand
that I don't believe that these people are necessarily putting down numbers
and are afraid to prove what they did."
Andersen believes there are good explanations when people
fail to comply. She's seen cases of honest mistakes or misunderstandings. Some
may have moved, or their family situation might have changed. Others might be
afraid to deal with a government agency. Still, it's difficult to prove, because
few if any of these cases are checked and few protest when their children are
taken off of the program.
[Andersen:] "I would not be willing to wager my salary
on how much of this we could rationalize away and how much of it is actual fraud.
We watch those figures every year, and if it becomes a significant number, we
think, you know, we have several people who watch 'em. We'll, see what we can
do, too, but at the moment we just haven't considered it necessary."
If most of the 59% who won't prove their income in Omaha are
trying to beat the system, then it could be costing the federal government between
one and two million dollars. It doesn't take a lot of imagination to think about
what it might be costing the federal government nationwide.
[Phillips:] "I
believe the people of the Middle West, whether it's South Sioux, Lincoln, or
Omaha, are as honest as anybody across the country. I really believe that. So
if you do press it that far, it becomes almost mind-boggling as to what we've
created."
If South Sioux City succeeds in cutting down on abuse in their
school lunch program, they'll save the federal government some money, but they'll
lose money for their own district, federal dollars that help pay for remedial
reading and other programs.
[Phillips:] "Those dollars that were generated to the
district have been tied directly to free and reduced lunch price numbers."
[Feauto:] "We could be cutting our own funding by pursuing
this matter, but it's what we think is right."
There's another downside. It takes a lot of time to pursue
abuse in the lunch program. Feauto is doing his own investigation to find out
the incomes of people who don't cooperate. They aren't out to put a lot of people
in jail. Penalties aren't the point. They just want to send a message.
[Feauto:] "If we do have some people that it's very obvious
that they misrepresented their income and the district attorney feels that he
can prosecute and we do prosecute, maybe down the road other people won't misrepresent
their income so that they can get a benefit that they should not be getting." Feauto believes their efforts are already working. Figures
for this year show better compliance with school lunch rules. That may be because
they publicized their plans to enforce those rules. Back in Omaha, Mary Andersen
says they already spend a lot of time and money doing paperwork for the school
lunch program. She'd rather see the federal government take over enforcement
of the rules if it's a problem.
It's a valid point. Maybe there's a better way to handle the
program, but for now it's up to schools to see that free lunches go to the kids
who deserve them. And in South Sioux City, they'll keep trying to do that, even
if they don't have much company.
[Phillips:] "We may be kind of a lone ranger in that
respect right now."
[Penner:] "Is that okay with you?"
[Phillips:] "Yeah, that's okay."
Reporting for Statewide, I'm Brad Penner.
Captioning by Nebraska
Captioning Center, Lincoln, Nebraska .
Every school day in Nebraska, more than 50,000 children eat free lunches at
school. The program is supposed to ensure that children from low-income families
get a good meal so they're better prepared to learn. Few would argue with that
goal. But one Nebraska school district found that the benefits aimed at the
poor are being claimed by those who are not, at least not by the standards set
by the government.
It's lunchtime at South Sioux City High School. Some of the
kids pay cash. Others have a lunch card punched. But it's impossible to tell
which kids are paying full price for their meal and which of them pay less or
eat free. School officials think many of those free lunches go to kids whose
families don't legally qualify. 
[Feauto:] "Number 39 went from free status all the way to denied status.
Said they made 2,600. Really made 3,300."
[Van Phillips, Superintendent:] "If nobody's ever going
to check -- if we have the speed limit of 55 but there's no highway patrolmen
out there, I guess we're probably gonna' drive more than that, and so in fairness
to those people, perhaps we should say, if nobody's checking, what difference
does it make, you know, I think maybe that's a thing we've encouraged somewhat
by not bothering to check very many."
Close to 1,100 kids get free or reduced price lunches in South Sioux City
and Phillips and Feauto make it clear they aren't out to hurt the program. 
[Mary Andersen, Omaha Public Schools:] "As I added the numbers for this
year, there was 217 people who did not respond for one reason or another and
out of 20,000 people or 11,000, whichever way you want to look at it, that's
not a very high percentage."
Feauto believes their efforts are already working. Figures
for this year show better compliance with school lunch rules. That may be because
they publicized their plans to enforce those rules. Back in Omaha, Mary Andersen
says they already spend a lot of time and money doing paperwork for the school
lunch program. She'd rather see the federal government take over enforcement
of the rules if it's a problem.