This is the accessible text file for GAO report number GAO-05-563 
entitled 'School Meal Programs: Competitive Foods Are Widely Available 
and Generate Substantial Revenues for Schools' which was released on 
September 7, 2005.

This text file was formatted by the U.S. Government Accountability 
Office (GAO) to be accessible to users with visual impairments, as part 
of a longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the printed 
version. The portable document format (PDF) file is an exact electronic 
replica of the printed version. We welcome your feedback. Please E-mail 
your comments regarding the contents or accessibility features of this 
document to Webmaster@gao.gov.

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately.

Report to Congressional Requesters:

United States Government Accountability Office:

GAO:

August 2005:

School Meal Programs:

Competitive Foods Are Widely Available and Generate Substantial 
Revenues for Schools:

GAO-05-563:

GAO Highlights:

Highlights of GAO-05-563, a report to Congressional Requesters: 

Why GAO Did This Study:

Recent increases in child obesity have sparked concerns about 
competitive foods—foods sold to students at school that are not part of 
federally reimbursable school meals. The nutritional value of these 
foods is largely unregulated, and students can often purchase these 
foods in addition to or instead of school meals. In our April 2004 
report on competitive foods (GAO-04-673), we reported that several 
states had enacted competitive food policies that were more restrictive 
than federal regulations. However, these policies differed widely in 
the type and extent of restrictions. In addition, it was unclear how 
and to what extent states were monitoring compliance with these 
policies. GAO was also asked to provide a national picture of 
competitive foods in schools, as well as strategies that districts and 
schools themselves are taking to limit the availability of less 
nutritious competitive foods. This report provides information from 
two nationally representative surveys about the prevalence of 
competitive foods in schools, competitive foods restrictions and groups 
involved in their sale, and the amounts and uses of revenue generated 
from the sale of competitive foods. It also provides information about 
strategies schools have used to limit the availability of less 
nutritious competitive foods, based on visits to a total of six school 
districts in California, Connecticut, Mississippi, Missouri, and South 
Carolina.

What GAO Found:

Nearly 9 out of 10 schools sold competitive foods to students in school 
year 2003-2004, and the availability of competitive foods sold in 
middle schools and through a la carte lines has increased over the last 
5 years. Schools often sold these foods in or near the cafeteria and 
during lunch, and the competitive foods available ranged from 
nutritious items such as fruit and milk to less nutritious items such 
as soda and candy. High and middle schools were more likely to sell 
competitive foods than elementary schools.

Many different people made decisions about competitive food sales, but 
no one person commonly had responsibility for all sales in a school. In 
a majority of schools, district officials made competitive food 
policies, while school food authority directors and principals made 
decisions about specific sales. Other groups, such as student clubs and 
booster groups, also made competitive food decisions through their 
direct involvement in sales.

Many schools, particularly high schools and middle schools, generated 
substantial revenues through competitive food sales in 2003-2004. 
Specifically, the nearly 30 percent of high schools generating the most 
revenue from these sales raised more than $125,000 per school. Food 
services, responsible for providing federal school meals, generally 
spent the revenue they generated through a la carte sales on food 
service operations. Other school groups often used revenues for student 
activities.

The six school districts visited all recently took steps to substitute 
healthy items for less nutritious competitive foods. In each district, 
committed individuals took actions to initiate and lead change while 
also involving those affected. However, districts faced several 
barriers to change, including opposition due to concerns about revenue 
losses. In the districts visited, the effects of changes on revenues 
were often unclear because of limited data.

A Majority of Schools Sell Competitive Foods to Students through 
Vending Machines: 

[See PDF for image]

[End of figure] 

What GAO Recommends:

www.gao.gov/cgi-bin/getrpt?GAO-05-563.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact David Bellis at (415) 904-
2272 or bellisd@gao.gov.

[End of figure] 

Contents:

Letter:

Results in Brief:

Background:

Almost All Schools Sold Competitive Foods in 2003-2004, and Middle 
School Availability Has Increased over the Last 5 Years:

Many People Made Decisions about Competitive Food Sales, but No One 
Person Commonly Had Responsibility over All Sales in a School:

Many Schools Raised a Substantial Amount of Revenue through Competitive 
Food Sales and Used It to Support Food Service Operations and Student 
Activities:

School Districts We Visited Substituted Healthy Competitive Foods for 
Less Nutritious Items while Overcoming Obstacles to Change, and the 
Effects on Revenue Were Unclear:

Concluding Observations:

Agency Comments:

Appendix I: Scope and Methodology:

Appendix II: GAO Contacts and Staff Acknowledgments:

Related GAO Products:

Tables:

Table 1: Select USDA Initiatives That Promote Child Nutrition and 
Address the Competitive Food Environment:

Table 2: Estimated Percentage of Schools of Different Levels with Each 
Competitive Food Venue in 2003-2004:

Table 3: Types of Competitive Foods Often or Always Available through 
Each Venue in Schools, by Nutrition Category:

Table 4: Types of Competitive Foods Often or Always Available through 
Any Venue in Schools, by School Level and Nutrition Category:

Table 5: District, School, and Community Groups Involved in the Process 
of Changing Competitive Foods, by District Visited:

Table 6: Sampling Error Calculations for Questions in Which the Error 
Exceeded 15 Percent:

Table 7: SFA Director Survey: Population and Sample by School Level:

Table 8: Principal Survey: Population and Sample by School Level:

Figures:

Figure 1: Categories and Sources of Competitive Foods in Schools:

Figure 2: States That Have Made Efforts to Restrict Competitive Foods 
in Schools beyond USDA Regulations, as of April 2005:

Figure 3: Estimated Percentage of Schools Selling Competitive Foods 
through Each Type of Venue in 2003-2004:

Figure 4: Estimated Percentage of Schools with a Written Competitive 
Food Policy in 2003-2004 Enacted by Districts and Schools:

Figure 5: Number of Groups Directly Involved in Competitive Food Sales 
in 2003-2004, Reported as an Estimated Percentage of Schools with Sales:

Figure 6: Groups Most Frequently Involved in Various Competitive Food 
Venues Commonly Available in High Schools:

Figure 7: Estimated Percentage of Schools Generating Different Minimum 
Amounts of Total Competitive Food Revenue in 2003-2004, by School Level:

Figure 8: Estimated Percentage of High Schools in Which Food Services 
Generated Different Amounts of Revenue through a la Carte Sales in 2003-
2004:

Figure 9: Estimated Percentage of High Schools in Which Other School 
Groups Generated Different Amounts of Revenue through Exclusive 
Beverage Contracts in 2003-2004:

Figure 10: Estimated Percentage of Schools Using Competitive Food 
Revenue, Excluding Food Service Revenue, for Various Purposes in 2003- 
2004:

Abbreviations:

CCD: Common Core of Data:

CDC: Centers for Disease Control and Prevention:

FMNV: foods of minimal nutritional value:

FNS: Food and Nutrition Service:

HHS: Department of Health and Human Services:

NSLP: National School Lunch Program:

SFA: school food authority:

USDA: U.S. Department of Agriculture:

WIC: Special Supplemental Nutrition Program for Women, Infants, and 
Children:

United States Government Accountability Office:

Washington, DC 20548:

August 8, 2005:

The Honorable Tom Harkin: 
Ranking Member: 
Committee on Agriculture, Nutrition, and Forestry: 
United States Senate:

The Honorable Patrick J. Leahy: 
Ranking Member: 
Subcommittee on Research, Nutrition, and General Legislation: 
Committee on Agriculture, Nutrition, and Forestry: 
United States Senate:

The Honorable George Miller: 
Ranking Member: 
Committee on Education and the Workforce: 
House of Representatives:

The Honorable Lynn Woolsey: 
Ranking Member: 
Subcommittee on Education Reform: 
Committee on Education and the Workforce: 
House of Representatives:

Increasing child obesity rates have recently focused attention on 
children's health and nutrition and have raised concerns about foods 
available in schools that compete nutritionally and financially with 
federally regulated school meal programs. The number of children who 
are overweight has more than doubled, and the number of adolescents who 
are overweight has more than tripled since 1980, according to the U.S. 
Centers for Disease Control and Prevention (CDC). These changes are 
related, in part, to poor nutrition. According to U.S. Department of 
Agriculture (USDA) data, more than 60 percent of young people eat too 
much fat and less than 20 percent of the recommended daily servings of 
fruits and vegetables. In addition to having negative health outcomes, 
children with poor nutrition may have a harder time concentrating and 
succeeding in school than other children. The Surgeon General's 2001 
call to action identified schools as one of the key settings for public 
health strategies to address child nutrition. Since children spend a 
large portion of their day in school, providing them with healthful 
food options throughout the school day can be an important step toward 
good child nutrition.

The key school meal programs, the National School Lunch Program and the 
School Breakfast Program, provide millions of children with nutritious 
meals each school day. USDA's Food and Nutrition Service administers 
these programs through local school food authorities (SFA) and 
subsidizes the meals served in local schools as long as meals meet 
certain nutritional guidelines. However, other foods not provided 
through these programs, typically referred to as competitive foods, are 
often available to children at school. Competitive food sales can take 
place at a variety of venues in schools, including vending machines, 
school stores, and a la carte lines in the cafeteria, through which the 
SFA sells individually priced food and beverage items. Federal 
restrictions concerned with the nutritional value of competitive foods 
are limited. Specifically, federal regulations require that one segment 
of competitive foods, defined as foods of minimal nutritional value, 
not be sold to students during the breakfast and lunch periods in food 
service areas.

In recent years, federal, state, and local governments have 
increasingly focused on the role that competitive foods play in 
children's diets. In our April 2004 report on competitive 
foods,[Footnote 1] we reported that increasing numbers of state 
legislatures have enacted and proposed legislation to restrict the 
availability of competitive foods in schools. In addition, school 
districts and schools themselves are taking steps to limit the 
availability of competitive foods.

Because of your interest in further understanding issues related to 
competitive foods in schools, you asked us to answer the following 
questions: (1) How prevalent is the sale of competitive foods in 
schools across the country, and has this prevalence changed over time? 
(2) Who makes decisions about competitive food sales in schools? (3) 
What amount of revenue is generated from the sale of competitive foods, 
and for what purposes is the revenue used? (4) What strategies have 
schools used to limit the availability of less nutritious competitive 
foods, what obstacles did they face, and how have these strategies 
affected sales revenue?

To answer your first three questions, we obtained information through 
two Web surveys, one of school principals and the other of district- 
level SFA directors. To conduct our surveys, we selected a stratified 
random sample from the 80,000 public schools nationwide that 
participate in the National School Lunch Program, which allowed us to 
provide national estimates based on school level. The surveys were 
administered between October 19, 2004, and February 11, 2005, with 65 
percent of principals and 70 percent of SFA directors 
responding.[Footnote 2] The surveys asked respondents about conditions 
in their schools during specific school years, primarily 2003-2004, and 
therefore, all years cited refer to school years. In addition, all 
estimates presented from the surveys have margins of error of plus or 
minus 15 percent or less, unless otherwise noted. To answer the fourth 
question, we conducted site visits to 6 school districts in California 
(Oakland), Connecticut (New Haven), Mississippi (McComb), Missouri 
(Independence and Fort Osage), and South Carolina (Richland One), 
including visits to a total of 10 schools. Our site visit localities 
were selected from a group of approximately 100 districts and schools 
recognized as making efforts to limit access to less nutritious 
competitive foods. The 6 districts visited were also selected because 
it appeared that they used different strategies to restrict competitive 
foods, and when viewed as a group, they provided variation across 
characteristics such as geographic location, district size, and 
socioeconomic status. See appendix I for detailed information on our 
surveys, sampling strategy, and site visits.

We conducted our work from May 2004 through July 2005 in accordance 
with generally accepted government auditing standards.

Results in Brief:

Almost all schools sold competitive foods to students in school year 
2003-2004, and over the last 5 years, the availability of competitive 
foods has increased both in middle schools and in a la carte lines in 
many schools. We estimate that nearly 9 out of 10 schools offered 
competitive foods through one or more of the following venues in 2003- 
2004: a la carte cafeteria lines, vending machines, and school stores. 
While competitive foods were commonly sold in schools of all levels, 
high schools and middle schools were more likely to sell these foods 
than elementary schools. For example, vending machines were available 
to students in almost all high schools and middle schools but in less 
than half of elementary schools. Schools often sold competitive foods 
in or near the cafeteria and during lunchtime, allowing students to 
purchase these foods as their lunch or to supplement their lunch. The 
competitive foods available ranged from nutritious items such as fruit 
and milk to less nutritious items such as soda and candy, with 
nutritious foods more frequently available through a la carte lines 
than through vending machines or school stores. Between 1998-1999 and 
2003-2004, the availability of competitive foods increased in middle 
schools, and the volume and variety of a la carte foods sold increased 
in many schools.

Many people, including district and school officials as well as members 
of groups involved in sales at schools, made decisions about 
competitive foods, but no one person commonly had responsibility for 
all competitive food sales at the school level. The decisions ranged 
from broad policies about the school nutrition environment to decisions 
about which foods to sell at a specific venue or event. According to 
school principals, an estimated 60 percent of schools had written 
policies in place in school year 2003-2004 that restricted competitive 
food sales to students, and in a majority of those schools the policies 
were set at the district level, often by superintendents and school 
boards. Regarding competitive food sales in schools, district SFA 
directors were commonly involved in policy decisions related to a la 
carte sales, while school principals often had final approval over 
other competitive food sales, such as items sold through vending 
machines. In addition to SFA directors and school principals, many 
other groups such as teachers, student clubs, parent-teacher 
associations, and booster groups were involved in selling competitive 
foods in schools. These groups therefore often made decisions 
concerning the types of food to sell to students and when to make such 
food available. The number and variety of groups involved in these 
sales typically increased as the school level increased.

Many schools raised a substantial amount of revenue through competitive 
food sales in school year 2003-2004 and used this revenue to support 
food service operations and student activities. High schools and middle 
schools generally raised more revenue from competitive food sales than 
elementary schools, reflecting the greater availability of competitive 
foods in high and middle schools. According to our survey, the nearly 
30 percent of high schools generating the most revenue from competitive 
food sales raised more than $125,000 per school in 2003-2004. Across 
all competitive food sales, food services generated more revenue than 
other school groups, largely through a la carte sales, and they 
generally used this revenue to support overall food service operations. 
Other school groups commonly used their revenues to support student 
activities, and the most frequent uses were student field trips, school 
assemblies and programs, and athletic equipment and facilities.

The six school districts we visited all recently took steps to 
substitute healthy competitive foods for less nutritious fare while 
overcoming obstacles to these changes, and the effects of these changes 
on sales revenues were often unclear because of limited data. 
Specifically, many of the schools we visited increased the availability 
of healthy items, including low-fat and low-sugar foods and beverages, 
while they decreased the availability of less nutritious foods, such as 
deep-fried French fries, candy, and soda. Further, although different 
districts used different approaches and achieved different outcomes, 
district and school officials identified several factors that 
consistently facilitated change and several that hindered it. For 
example, in all of the districts we visited, motivated individuals took 
action to initiate and lead the process of change while obtaining 
support from those affected in the district, schools, and community. 
However, districts noted that they also faced many barriers to 
implementing changes, such as opposition due to concerns about 
potential revenue losses. Regarding the effect of changes on sales 
revenues, none of the districts we visited had clear and reliable data 
concerning the impact of competitive food changes on sales revenues. 
From the limited data that were available, it appeared that changes had 
varied effects on revenues across districts. Related to this, while a 
few districts anticipated and planned for the effects of changes on 
sales revenues, most had not. Consequently, many officials expressed 
strong concerns about potential revenue losses because competitive food 
revenues have provided them with a valued source of funding.

Background:

Competitive foods in schools are those foods sold to students during 
the school day that are not part of the federal meal programs. These 
federal programs, the National School Lunch Program (NSLP) and the 
School Breakfast Program, subsidize public school meals and regulate 
their nutritional content. Competitive foods, however, are only 
minimally regulated at the federal level. They are typically sold a la 
carte in the cafeteria, and through vending machines and school stores.

NSLP and School Breakfast Program:

The two largest federal school meal programs, the NSLP and the School 
Breakfast Program, aim to address problems of hunger, food insecurity, 
and poor nutrition by providing nutritious meals to children in 
schools. The NSLP, established in 1946, provides nutritionally balanced 
low-cost or free lunches in participating schools to more than 28 
million children each school day, as well as reimbursement for snacks 
served to those through age 18 in after-school educational and 
enrichment programs. Similarly, the School Breakfast Program, 
permanently established in 1975, provides free or reduced price 
breakfasts to more than 8 million schoolchildren daily.[Footnote 3] At 
the federal level, these programs are administered by USDA's Food and 
Nutrition Service (FNS). As part of its strategic goal to improve the 
nation's nutrition and health, the department has laid out plans to 
increase access to, and utilization of, these school meal programs.

In fiscal year 2004, the federal government spent over $8 billion on 
the NSLP and the School Breakfast Program. FNS provides reimbursement 
in the form of cash subsidies and donated commodities based on the 
number of lunches and breakfasts served that meet certain federal 
requirements. The meals must adhere to the Dietary Guidelines for 
Americans, which include limits on total fat and saturated fat and call 
for diets moderate in sodium.[Footnote 4] The meals must also meet 
standards for the recommended daily allowances of calories, as well as 
nutrients such as protein, calcium, iron, and vitamins A and C. 
Compliance with the standards is determined by averaging the 
nutritional content of the meals offered over a school week. USDA 
reimburses states, usually through the state departments of education, 
which in turn reimburse local SFAs that operate the programs in one or 
more schools.

SFAs function as the governing entities responsible for the local 
administration of the federal meals programs. They are often, but not 
always, responsible for school meals in an entire school district. SFAs 
have some flexibility in operating their school meal programs. For 
example, they may operate the programs themselves or contract with food 
service management companies to perform functions such as planning and 
preparing menus and selecting and buying food. All or some food 
preparation may occur at on-site school kitchens or at central 
kitchens, which then distribute food to satellite schools. In addition, 
SFAs may select among different menu-planning approaches to comply with 
the federal nutritional requirements.

SFAs receive a significant portion of their funding from federal 
reimbursements that are based on the number of meals served to students 
in their schools. In addition, SFAs also receive some funding from 
states for program operations, and they may generate revenues by 
selling competitive foods or by offering fee-based catering services. 
Further, SFAs are permitted to combine costs and revenues for 
reimbursable meals and nonreimbursable offerings, such as competitive 
foods, as long as they maintain their nonprofit status. Therefore, if 
revenues from reimbursable meals are less than the costs of producing 
these meals, SFAs may use competitive food revenues to support the cost 
of reimbursable meals. Likewise, if revenues from reimbursable meals 
are more than the costs of producing these meals, SFAs may use these 
funds to support competitive food sales.

Minimal Federal Restriction of Competitive Foods:

Competitive foods are those foods sold in schools, during the school 
day, that are not part of the federal school meal programs--that is, 
they compete with the nutritionally regulated school meal programs. 
These foods can range from candy and soda to pizza and popcorn to 
apples and milk and are typically available in cafeteria a la carte 
lines, vending machines, and school stores.

Unlike federally subsidized school meals, the sale and nutritional 
content of competitive foods are largely unregulated by the federal 
government. Federal regulations prohibit the sale of certain 
competitive foods, known as foods of minimal nutritional value 
(FMNV),[Footnote 5] during meal periods in school cafeterias and other 
food service areas. FMNV, as defined by USDA, include soda, chewing 
gum, and hard candy, for example (see fig. 1). Other than this 
restriction, federal regulations do not prohibit or limit the sale of 
any other competitive foods anywhere on school grounds at any 
time.[Footnote 6] In contrast, from 1980 to 1983, federal regulations 
prohibited the sale of FMNV anywhere in the school from the beginning 
of the school day until the last meal period. In National Soft Drink 
Ass'n v. Block, 721 F. 2d 1348 (D.C. Cir. 1983), the Court of Appeals 
for the District of Columbia overturned this regulation and construed a 
1977 amendment to the Child Nutrition Act as allowing USDA to regulate 
the sale of competitive foods only in food service areas during meal 
periods. Following this decision, USDA amended its regulation to limit 
the prohibition of these foods to food service areas during meal 
periods.

Figure 1: Categories and Sources of Competitive Foods in Schools:

[See PDF for image]

[End of figure]

According to federal regulations, states and SFAs may impose further 
restrictions on all foods sold at any time throughout their schools. As 
of April 2005, 28 states have made efforts to restrict the sale of 
competitive foods beyond USDA regulations (see fig. 2). Five state 
policies do not restrict particular food items, but instead typically 
address the competitive food environment more broadly. For example, 
some of these states have created committees to develop policies 
concerning competitive foods in schools or have encouraged schools to 
find ways to improve their competitive food environments. The remaining 
23 of these state policies place some form of specific restrictions on 
competitive foods, though they differ in the type and extent of 
restrictions.[Footnote 7] The majority of these policies restrict some, 
but not all, competitive foods and restrict foods only at times 
associated with school meal periods, rather than during the entire 
school day.[Footnote 8]

Figure 2: States That Have Made Efforts to Restrict Competitive Foods 
in Schools beyond USDA Regulations, as of April 2005:

[See PDF for image]

[End of figure]

Recent Federal Initiatives to Promote Better Nutrition in Schools:

The federal government has an interest in improving child nutrition in 
order to promote the health and wellness of the nation's children. 
Moreover, the current child obesity trend poses public health risks 
because of the relationship of obesity to serious illnesses, such as 
type 2 diabetes and hypertension. These illnesses can result in 
substantial long-term costs to society. In response, USDA has recently 
developed initiatives to support school efforts to provide a healthy 
nutrition environment, including competitive food sales. Beginning in 
1995, USDA introduced the School Meals Initiative for Healthy Children 
in an effort to improve the nutritional quality of meals served through 
the NSLP and the School Breakfast Program. That same year, in order to 
assist with implementation of the School Meals Initiative, USDA 
launched Team Nutrition to focus on schools and promote the nutritional 
health of the nation's children. Team Nutrition provides schools with 
nutrition education materials for children and families, technical 
assistance materials for school food services, and materials to build 
school and community support for healthy eating and physical 
activity.[Footnote 9] Since 1995, USDA has also created additional 
resources to help schools improve student nutrition, address 
competitive foods, and foster long-term health, sometimes in 
collaboration with other federal agencies (see table 1).[Footnote 10]

Table 1: Select USDA Initiatives That Promote Child Nutrition and 
Address the Competitive Food Environment:

Initiative: Changing the Scene-Improving the School Nutrition 
Environment (2000); 
Description: Toolkit that focuses on improving the school nutrition 
environment and serves as a guide to local action, developed with input 
from 16 education, nutrition, and health organizations.

Initiative: Fruits and Vegetables Galore (2004); 
Description: Toolkit for school food service professionals that 
contains tips on promoting fruits and vegetables to children.

Initiative: HealthierUS School Challenge (2004); 
Description: Effort to recognize schools that have met higher standards 
for nutrition and physical activity than those required by the federal 
government, and to encourage other schools to achieve such results.

Initiative: Making it Happen! School Nutrition Success Stories (2005); 
Description: Report that shares stories from 32 schools and school 
districts that have made innovative changes to improve the nutritional 
quality of all foods and beverages sold on school campuses, including 
competitive foods, developed in collaboration with CDC and supported by 
the Department of Education.

Source: GAO.

[End of table]

The Department of Health and Human Services (HHS) has also focused on 
the school nutrition environment through various initiatives by CDC. 
These include:

* an eight-component coordinated health model for schools that includes 
school nutrition services as one component, and:

* a School Health Index designed to help schools assess their 
environments and improve the effectiveness of their health and safety 
policies and programs.[Footnote 11]

In addition to these efforts to support a healthy school nutrition 
environment, the National Academy of Sciences' Institute of Medicine 
recently released a broad-based report on preventing childhood obesity. 
Among other things, the institute recommended that the current federal 
funding structure of school meals and the policies and practices of 
selling competitive foods in schools be examined for improvements that 
would encourage students to consume nutritious foods and beverages, and 
that nutritional standards be developed and implemented for all 
competitive foods sold or served in schools.

On the Horizon: School Wellness Policies and Research on Nutritional 
Standards:

The Child Nutrition and WIC Reauthorization Act of 2004 requires school 
districts that participate in the federal meal programs to establish 
local wellness policies by the first day of the 2006-2007 school 
year.[Footnote 12] Congress added this requirement, in part, in order 
to promote nutrition and address child obesity by encouraging 
localities to provide healthy school environments. These policies must 
include nutrition guidelines for all foods available on each school 
campus during the school day and goals for nutrition education and 
physical activity, as well as establish a plan for measuring 
implementation of the local wellness policy. Further, the local 
wellness policies must be developed in collaboration with the 
community--including a combination of school officials, parents, 
students, and the public. The act also requires that USDA, HHS--through 
CDC--and the Department of Education provide technical assistance to 
districts regarding wellness policies. In addition, in order to assist 
schools in setting appropriate nutrition standards for foods available 
in schools, Congress--through the Conference Report of the Consolidated 
Appropriations Act of 2005--provided $1 million to the Institute of 
Medicine. With these funds, the institute will conduct a study and 
provide recommendations regarding appropriate nutritional standards for 
the availability, sale, content, and consumption of all foods at 
school, with a particular emphasis on competitive foods.

Almost All Schools Sold Competitive Foods in 2003-2004, and Middle 
School Availability Has Increased over the Last 5 Years:

Nearly 9 out of 10 schools sold competitive foods to students in 2003- 
2004, and over the last 5 years, the availability of competitive foods 
has increased both in middle schools and in a la carte lines in many 
schools. While competitive foods were commonly available in all school 
levels, students in high schools and middle schools had greater access 
to these foods than students in elementary schools. The competitive 
foods available ranged from nutritious items such as fruit and milk to 
less nutritious items such as soda and candy. Between 1998-1999 and 
2003-2004, the availability of competitive foods increased in middle 
schools, and the volume and variety of a la carte foods sold increased 
in many schools.

Competitive Foods Were Available in Almost All Schools and Were More 
Common in High Schools and Middle Schools:

We estimate that almost 90 percent of schools sold competitive foods to 
students in 2003-2004 through one or more of the following venues: a la 
carte lines, vending machines, and school stores.[Footnote 13] 
Considering each type of venue individually, a majority of schools sold 
foods through a la carte lines and vending machines, as shown in figure 
3.

Figure 3: Estimated Percentage of Schools Selling Competitive Foods 
through Each Type of Venue in 2003-2004:

[See PDF for image]

[End of figure]

High schools and middle schools were more likely to sell competitive 
foods than elementary schools. Table 2 shows the percentage of 
elementary, middle, and high schools selling competitive foods through 
each type of venue and through one or more venues.

Table 2: Estimated Percentage of Schools of Different Levels with Each 
Competitive Food Venue in 2003-2004:

A la carte; 
Elementary schools: 67; 
Middle schools: 88; 
High schools: 91.

Vending machines; 
Elementary schools: 46; 
Middle schools: 87; 
High schools: 91.

School stores; 
Elementary schools: 15; 
Middle schools: 25; 
High schools: 54.

One or more of the above venues; 
Elementary schools: 83; 
Middle schools: 97; 
High schools: 99.

Source: GAO.

[End of table]

In addition to the competitive food venues regularly available in 
schools, students in some schools also were able to purchase 
competitive foods through on-campus fund-raisers. For example, more 
than 4 out of 10 schools allowed fund-raising--such as seasonal candy 
sales or short-term sales of baked goods raising revenues for school 
organizations--through the sale of foods to students during the school 
day in 2003-2004. Such fund-raisers were permitted in two-thirds of 
high schools and less than 40 percent of middle and elementary schools.

While federal regulations restrict access to FMNV--a subset of 
competitive foods--in food service areas during meal periods, many 
types of competitive foods are allowed to be sold in these locations at 
meal times. According to our survey, competitive foods sold in 2003- 
2004 through a la carte lines, vending machines, and school stores were 
frequently available for purchase in or near school cafeterias and 
during lunch.[Footnote 14]

* A la carte items were available to students in the cafeterias of 
schools that offered them and were available to students during lunch 
in 94 percent of those schools.

* One-half of schools with vending machines had machines in or near the 
cafeteria, and one-third of schools with vending machines had machines 
that were available to students during lunch.

* Nearly half of schools with stores had such stores in or near the 
cafeteria, and about one-third of schools with stores sold competitive 
foods through these stores during lunch.

Although schools that sold competitive foods through a la carte lines 
or school stores often sold these foods in just one physical location, 
schools with vending machines typically had multiple machines available 
throughout the school, ranging from 1 to 25 machines. For example, the 
quarter of high schools with the most vending machines had 10 or more 
machines, the top quarter of middle schools had 7 or more machines, and 
the top quarter of elementary schools had 3 or more machines.[Footnote 
15] Schools generally had more beverage vending machines than snack 
vending machines.

Further, in many schools, particularly high schools, beverages sold in 
vending machines or elsewhere in the school were provided through an 
exclusive beverage contract--a contract granting a company exclusive 
rights to sell beverages to students in that school. In addition to 
covering vending machine sales, these contracts may require schools to 
provide beverages through the contracted company in other venues, such 
as school stores or athletic event concessions. Nearly half of all 
schools in 2003-2004 had an exclusive beverage contract. In over a 
third of schools with exclusive beverage contracts, the contracts 
covered 5 years or more, with some covering at least 10 years[Footnote 
16]. Nearly 75 percent of high schools, 65 percent of middle schools, 
and 30 percent of elementary schools had exclusive beverage contracts.

Types of Competitive Foods Ranged from Nutritious to Less Nutritious, 
with High and Middle Schools Selling a Wider Variety of Items:

Competitive foods available through a la carte lines, vending machines, 
and school stores ranged from nutritious items, such as vegetables and 
salad, to less nutritious items, such as soda and candy. Nutritious 
foods were more frequently available through a la carte lines than 
through vending machines and school stores. For example, as shown in 
table 3, we estimate that many of the types of foods commonly available 
through a la carte sales were nutritious foods and beverages, such as 
fruit and milk. However, types of less nutritious items, such as sweet 
baked goods and salty snacks not low in fat, were also available 
through a la carte lines in at least one-third of schools. Furthermore, 
many of the types of foods commonly available through vending machines 
and school stores were less nutritious ones, such as soda and salty 
snacks.[Footnote 17]

Table 3: Types of Competitive Foods Often or Always Available through 
Each Venue in Schools, by Nutrition Category:

[See PDF for image] 

Note: The nutrition categories, as signified by the shading, are 
general descriptions of the foods in each category. GAO created these 
nutrition categories to generally reflect the Dietary Guidelines for 
Americans, recognizing that they apply to many but not all foods of 
each type--nutritional content can vary depending on the ingredients 
and the methods used to prepare foods. Four of the estimates in this 
figure have margins of error that exceed plus or minus 15 percent. See 
table 6 in appendix I for more information.

[End of figure] 

In addition, our data suggest that students may have had increased 
access to more types of competitive foods as they progressed from 
elementary school to middle school and high school. While nutritious 
foods were commonly available in schools of each level, students in 
high schools and middle schools had access to a greater variety of 
types of less nutritious foods than students in elementary schools. For 
example, salty snacks, sweet baked goods, soda, and candy were 
available in at least one-third of high schools and middle schools with 
competitive foods but in less than one-third of such elementary 
schools, as shown in table 4.[Footnote 18]

Table 4: Types of Competitive Foods Often or Always Available through 
Any Venue in Schools, by School Level and Nutrition Category:

[See PDF for image] 

Note: The nutrition categories, as signified by the shading, are 
general descriptions of the foods in each category. GAO created these 
nutrition categories to generally reflect the Dietary Guidelines for 
Americans, recognizing that they apply to many but not all foods of 
each type--nutritional content can vary depending on the ingredients 
and the methods used to prepare foods.

[End of figure] 

Over the Last 5 Years, the Availability of Competitive Foods Sold in 
Middle Schools and through a la Carte Lines Increased:

According to our survey, the availability of competitive food venues in 
middle schools increased during the period between 1998-1999 and 2003- 
2004.

* The percentage of middle schools offering competitive foods through a 
la carte lines, vending machines, or school stores increased from 83 to 
97 percent during this time period.[Footnote 19]

* The percentage of middle schools with exclusive beverage contracts 
increased between 1998-1999 and 2003-2004.[Footnote 20]

* The number of vending machines per school increased between 1998-1999 
and 2003-2004 in more than one-third of middle schools that had vending 
machines.[Footnote 21] In addition, the number of vending machines per 
school increased in more than half of high schools that had vending 
machines.

In addition, the availability of a la carte items, particularly the 
volume sold and the variety available for purchase, increased between 
1998-1999 and 2003-2004 in many schools.

* The volume of a la carte items sold--that is, the overall amount of 
all a la carte items sold--increased in more than two-thirds of high 
schools, more than half of middle schools, and nearly one-third of 
elementary schools that had a la carte sales.[Footnote 22]

* The variety--that is, the number of different types--of a la carte 
items available to students increased in about one-half of all schools 
that had a la carte sales.

According to SFA directors, reasons for the increases in a la carte 
volume and variety between 1998-1999 and 2003-2004 included responding 
to student demand, providing more nutritious foods, making foods more 
appealing to students, and generating additional revenue for the food 
service.

Aside from increases in the availability of competitive foods sold in 
middle school and through a la carte lines, we did not find that the 
availability of competitive foods in schools changed considerably 
during the period between 1998-1999 and 2003-2004. For example, 
according to our survey, there have not been considerable changes in 
the percentage of high schools or elementary schools offering 
competitive foods through a la carte lines, vending machines, or school 
stores during this time period. Further, in a majority of all schools 
with school stores or vending machines, the number of different types 
of food offered for sale through these venues stayed the same.

Many People Made Decisions about Competitive Food Sales, but No One 
Person Commonly Had Responsibility over All Sales in a School:

Many people, including district and school officials as well as members 
of groups selling foods in schools, made decisions about competitive 
food sales, but no one person consistently had responsibility for all 
competitive food sales at the school level. The decisions ranged from 
broad policies about the school nutrition environment to decisions 
about which foods to sell at a specific venue or event. In 2003-2004, a 
majority of schools had policies in place that restricted competitive 
food sales to students, and these policies were often set at the 
district level by superintendents and school boards. Regarding the 
actual selection and sale of competitive foods in schools, SFA 
directors were commonly involved in decisions related to a la carte 
sales, while principals often had final approval over other competitive 
food sales. In addition, many different groups were directly involved 
in selling competitive foods in schools in 2003-2004, and these groups 
could make decisions about which foods to sell and when to make them 
available. The number and variety of groups involved in these sales 
typically increased as the school level increased.

District and School Officials Made Decisions about Competitive Food 
Policies:

According to principals, an estimated 60 percent of schools had written 
policies in place that restricted competitive foods accessible to 
students in 2003-2004, and most often, districts enacted those policies 
(see fig. 4).[Footnote 23] In contrast, 40 percent of schools had no 
such policies.

Figure 4: Estimated Percentage of Schools with a Written Competitive 
Food Policy in 2003-2004 Enacted by Districts and Schools:

[See PDF for image]

[End of figure]

In addition to superintendents and school boards that were involved in 
making these competitive food policy decisions for a district, both SFA 
directors and school principals commonly made policy decisions about 
actual food sales at the school level, resulting in no one person 
having responsibility over all sales. Specifically, district SFA 
directors often made ongoing decisions about policies affecting the 
school nutrition environment. For example, SFA directors provided many 
of the foods available to students through their administration of the 
federal meal programs and typically decided which foods to serve 
through school a la carte sales. In addition, SFA directors were also 
often concerned with other competitive food sales in the schools, such 
as those through vending machines, school stores, and fund-raising 
sales. According to our survey, 84 percent of SFA directors in 2003- 
2004 considered addressing the competitive food environment in schools 
to be part of their responsibilities. More than three-quarters of those 
directors considered it a priority.

Moreover, principals also made decisions about competitive food 
policies in their schools. For example, as shown in figure 4, aside 
from the more than three-quarters of schools with competitive food 
policies developed by their districts, school principals enacted 
policies in conjunction with their districts in an additional 10 
percent of schools and enacted their own policies in another 2 percent 
of schools with policies. Regarding operational decisions, principals 
in more than half of schools with competitive food sales reported in 
our survey that they provided final approval over the foods and 
beverages sold through vending machines, school stores, and fund- 
raisers in their schools. Also, similar to SFA directors, principals in 
a majority of schools reported that they considered addressing the 
competitive food environment one of their responsibilities.

Many Different Groups Were Directly Involved in Deciding What to Sell 
and Selling Competitive Foods:

In addition to the district and school officials involved in decisions 
related to competitive food policy, myriad individuals and groups were 
directly involved in the sale of competitive foods. These groups could 
make decisions about which specific foods to sell to students and when 
to conduct sales. During 2003-2004, groups such as students, parent- 
teacher associations, and booster groups--in addition to SFA directors 
and school principals--were most commonly involved in sales, according 
to our survey.

The number of groups involved in sales typically increased as the 
school level increased. For example, three or more different groups 
were much more likely to be involved in competitive food sales in high 
schools than in middle and elementary schools in 2003-2004 (see fig. 5).

Figure 5: Number of Groups Directly Involved in Competitive Food Sales 
in 2003-2004, Reported as an Estimated Percentage of Schools with Sales:

[See PDF for image]

Note: The estimates for elementary schools and one estimate for middle 
schools in this figure have margins of error that exceed plus or minus 
15 percent. See table 6 in appendix I for more information.

[End of figure]

The groups directly involved in sales varied by school level. In 
elementary schools, the SFA/school food service and student 
associations/clubs were commonly involved in sales.[Footnote 24] In 
middle schools, in addition to these groups, school officials/
administrators were most commonly involved.[Footnote 25] In high 
schools, where the greatest number of competitive food venues was 
typically available, these three groups and a variety of others were 
directly involved in sales. Consequently, within a high school that has 
a number of competitive food sales occurring simultaneously, a student 
at lunchtime could be faced with many different food options sold by a 
variety of different groups through several venues (see fig. 6).

Figure 6: Groups Most Frequently Involved in Various Competitive Food 
Venues Commonly Available in High Schools:

[See PDF for image]

Note: The competitive food venues shown were estimated to be available 
in a majority of high schools, according to our survey. The groups 
listed with these venues were estimated to be directly involved in 
competitive food sales through the specified venue in at least 25 
percent of high schools.

[End of figure]

Many Schools Raised a Substantial Amount of Revenue through Competitive 
Food Sales and Used It to Support Food Service Operations and Student 
Activities:

Many schools generated substantial revenue through competitive food 
sales in 2003-2004, often using this revenue to support food service 
operations and student activities. High schools and middle schools 
generally raised more revenue from competitive food sales than 
elementary schools, reflecting the greater availability of competitive 
foods in high and middle schools. Across all competitive food sales, 
food services generated more revenue than other school groups, largely 
through a la carte sales. Some food service directors said they relied 
on this revenue to support overall food service operations, while other 
school groups primarily used their competitive food revenues to fund 
student activities.

Total Competitive Food Revenue Varied by School Level From More than 
$125,000 in Some High Schools to More than $5,000 in Some Elementary 
Schools:

Many schools generated a substantial amount of revenue through 
competitive food sales in 2003-2004.[Footnote 26] Total revenue 
generated through competitive food venues varied by school level, 
reflecting, among other things, the greater availability of competitive 
foods in high schools and middle schools than in elementary 
schools.[Footnote 27] In particular, we estimate that about 30 percent 
of all high schools generated more than $125,000 per school through 
competitive food sales in 2003-2004, while about 30 percent of all 
elementary schools generated more than $5,000 per school through these 
sales (see fig. 7). These estimates of total competitive food revenue 
are conservative, as they are based on the sum of the minimums of 
specified revenue ranges.[Footnote 28] Therefore, many schools likely 
generated more total revenue from competitive food sales than our 
analysis reflects.

Figure 7: Estimated Percentage of Schools Generating Different Minimum 
Amounts of Total Competitive Food Revenue in 2003-2004, by School Level:

[See PDF for image]

Note: See appendix I for more information on this analysis, which used 
data obtained from the matched responses. One of the estimates in the 
high school figure has a margin of error that exceeds plus or minus 15 
percent. See table 6 in appendix I for more information.

[End of figure]

Food Services Generated More Revenue through These Sales than Other 
School Groups, with Food Services Using Revenue for Their Operations 
and Other School Groups Using Revenue for Student Activities:

Across all competitive food sales, food services generated more revenue 
than other school groups, such as school administrators, student 
associations, and booster groups.[Footnote 29] Specifically, food 
services generated a greater amount of revenue through a la carte sales 
than through any other type of competitive food sale. Other school 
groups raised a greater amount of revenue through exclusive beverage 
contracts than through any other type of competitive food 
sale.[Footnote 30] In addition to raising varying amounts of 
competitive food revenues through different types of sales, food 
services and other school groups generally used their revenues for 
different purposes.

Food Services:

The revenue food services generated through a la carte sales was 
substantial in many schools. For example, we estimate that 40 percent 
of high school food services and nearly a quarter of middle school food 
services selling competitive foods through a la carte lines generated 
more than $50,000 per school through these sales in 2003-2004. 
Furthermore, food services in 20 percent of high schools selling a la 
carte items generated more than $125,000 per school through a la carte 
sales, as shown in figure 8.

Figure 8: Estimated Percentage of High Schools in Which Food Services 
Generated Different Amounts of Revenue through a la Carte Sales in 2003-
2004:

[See PDF for image]

Note: Estimated percentages do not add to 100 because some SFA 
directors were unsure how much revenue they generated through a la 
carte sales.

[End of figure]

Food services typically used their substantial a la carte revenue to 
support overall food service operations, supplementing revenue earned 
through the sale of school meals. According to our survey of SFA 
directors, in 2003-2004, food services in 40 percent of schools earned 
less revenue than they spent, generating a loss, and food services in 
an additional 20 percent of schools broke even. Food services in the 
remaining 40 percent of schools generated more revenue than they spent 
in 2003-2004, yielding a gain.[Footnote 31] From the data we collected, 
it is not clear what proportion of this food service revenue came from 
federal reimbursement for meals served and what proportion came from 
revenue generated through competitive food sales.[Footnote 32] In our 
previous work, we found that food services in some states had a small 
but increasing shortfall in total revenue compared with expenses 
between school years 1996-1997 and 2000-2001 and that a la carte sales 
had become an increasingly important source for augmenting total food 
service revenue.[Footnote 33] Moreover, some SFA directors told us in 
survey comments for this study that they sold competitive foods in 
order to maintain balanced budgets. For example, one food service 
director commented that the food service would not be able to maintain 
a balanced budget without the substantial revenue generated through a 
la carte sales. Another commented that the district food service 
generated nearly half of its revenue through competitive food sales.

Other School Groups:

Other school groups raised more revenue through exclusive beverage 
contracts than through any other type of competitive food sales. In 
particular, we estimate that school groups in nearly one-quarter of 
high schools with exclusive beverage contracts generated more than 
$15,000 per school through these contracts in 2003-2004, as shown in 
figure 9. However, it is important to note that 15 percent of high 
school principals did not know how much revenue exclusive beverage 
contracts generated for their schools in 2003-2004.

Figure 9: Estimated Percentage of High Schools in Which Other School 
Groups Generated Different Amounts of Revenue through Exclusive 
Beverage Contracts in 2003-2004:

[See PDF for image]

Note: Estimated percentages do not add to 100 because some school 
principals were unsure how much revenue other school groups generated 
through exclusive beverage contracts.

[End of figure]

Exclusive beverage contracts also provided some schools with noncash 
benefits--goods and services such as athletic scoreboards and in-kind 
support of school events. In particular, nearly 30 percent of schools 
of all levels selling competitive foods through exclusive beverage 
contracts received noncash benefits. Nearly one-third of those schools 
received athletic equipment, facilities, or uniforms, and a small 
number of schools also received support for assemblies and programs, 
scholarships, and personal items for students and school staff, such as 
cups and coolers. The value of those items was sometimes considerable: 
in one-quarter of those schools receiving noncash benefits through 
exclusive beverage contracts in 2003-2004, the benefits were worth more 
than $5,000 per school.[Footnote 34]

School groups other than food services most commonly used their 
competitive food revenues to support student activities such as field 
trips and assemblies, as shown in figure 10. Similarly, groups in many 
schools spent competitive food revenues on athletic equipment, 
facilities, or uniforms. However, some used revenues to meet school 
needs such as expenses associated with general school overhead or with 
textbooks and school supplies.

Figure 10: Estimated Percentage of Schools Using Competitive Food 
Revenue, Excluding Food Service Revenue, for Various Purposes in 2003- 
2004:

[See PDF for image]

Note: General school overhead includes facilities and grounds 
maintenance. Respondents in 22 percent of schools said they spent 
competitive food revenues on other uses, such as student rewards and 
incentives.

[End of figure]

School Districts We Visited Substituted Healthy Competitive Foods for 
Less Nutritious Items while Overcoming Obstacles to Change, and the 
Effects on Revenue Were Unclear:

The six school districts we visited all recently took steps to 
substitute healthy competitive foods for less nutritious items while 
overcoming several obstacles to change, and in the end, the effects of 
these changes on revenue were unclear. Although the districts we 
visited increased the availability of healthy competitive foods and 
decreased less nutritious items through differing approaches, 
perseverant and committed individuals took actions in each district to 
initiate and lead the process of change while also taking steps to 
involve and obtain support from those affected. At the same time, 
officials noted that they faced several barriers to making changes, 
including concerns about potential revenue losses, among others. 
Concerning the effects of changes on sales revenues, none of the 
districts we visited had sufficient data to examine these effects, and 
few had planned for these effects before implementing changes. 
Regardless of the limited data on revenue, many officials expressed 
strong concerns about potential revenue losses largely because 
competitive food sales have provided a source of flexible funding used 
for a wide variety of purposes.

School Districts We Visited Substituted Healthy Competitive Foods for 
Less Nutritious Items:

Though the six school districts we visited varied in terms of 
socioeconomic status, student population size, and geographic location, 
they were all able to take steps to restrict the availability of less 
nutritious competitive foods in their schools. Further, rather than 
just remove less nutritious competitive foods from their schools, these 
districts continued to offer competitive foods to students by 
substituting healthy fare for the items removed. In addition, these 
districts all took steps beyond current federal and state competitive 
food regulations, and while there were differences in the details of 
changes, most districts' changes had similar characteristics. 
Specifically, most, if not all, of the districts we visited:

* made changes to competitive foods in all of the schools in their 
districts, rather than changes only to certain schools, such as 
elementary;[Footnote 35]

* made changes to the availability of competitive foods throughout the 
entire school day, rather than limiting availability only during 
certain hours of the day;

* made changes to the availability of competitive foods in each of the 
venues through which they were sold, including fund-raising;[Footnote 
36]and,

* made simultaneous changes to foods served through school meal 
programs.

Regarding districts' efforts to increase the availability of healthy 
competitive foods, as they defined them, all of the districts we 
visited recently took steps to make water and juice more available to 
students in their schools. For example, districts and schools often 
replaced soda in their vending machines with bottled water and juices 
with higher concentrations of real fruit juice. Further, several 
districts also replaced fried potato chips with baked potato chips, and 
packaged desserts with granola bars or similar items. Several districts 
also increased the variety of flavored milk available in schools to 
encourage milk consumption.

All of the districts we visited also took steps to restrict less 
nutritious items. The specific types of competitive foods restricted 
varied by district, with two of the districts limiting the availability 
of primarily soda and candy, and four districts limiting the 
availability of competitive foods high in sugar and fat.[Footnote 37] 
In these districts, different criteria were used by each district to 
define foods high in sugar and fat. For example, in Fort Osage, all 
competitive foods must be low-fat (no specified percentage) and cannot 
have sugar listed as the first ingredient, while in Richland One, all 
competitive foods must contain less than 40 percent sugar (or other 
sweeteners) and less than 8 grams of fat per 1 ounce serving. In the 
other two districts, New Haven and Independence, formulating specific 
nutrition criteria has been an ongoing process.

In addition to making changes to the types of competitive foods sold in 
schools, all of the districts we visited also made similar changes to 
increase healthy foods available through school meals. For example, 
SFAs in both Independence and Oakland recently removed deep fryers from 
school cafeterias, and they now bake all foods. In Richland One, the 
SFA decided to implement stricter standards for school meals than those 
required by the federal government. Specifically, Richland One requires 
school meal menus to meet the federal requirements for nutrients, fat, 
and sugar intake on a daily basis, rather than averaging the 
nutritional value of meal components over the course of a week. In 
addition, several SFA directors stated that they would like to 
introduce a greater variety of fresh fruits and vegetables into school 
meal menus. However, they also expressed their opinion that the federal 
school meal reimbursement is insufficient to provide these items more 
frequently.[Footnote 38]

Individuals Who Initiated and Led Change Also Obtained the Support of 
Multiple Groups:

While the characteristics of the six districts we visited differed, as 
well as the process of change in each, districts typically noted 
several key components to their success. These key components included 
an enthusiastic initiator of change, leadership by dynamic and 
committed individuals, and support from groups directly affected by 
changes, such as teachers, parents, and students. Overall, those 
involved in the process of change agreed on the importance of improving 
student nutrition and health and directing resources and energy toward 
achieving this goal. As shown in table 5, the types of individuals and 
groups involved in the process of change varied across the districts 
visited and often included individuals from the district, school, and 
community.

Figure 11: District, School, and Community Groups Involved in the 
Process of Changing Competitive Foods, by District Visited:

[See PDF for image]

Note: In Independence, New Haven, Oakland, and McComb, some of the 
groups indicated were involved in the process of changing competitive 
foods through districtwide committees to address school nutrition and 
health issues.

[End of figure]

As shown in table 5, in the districts we visited, initiators of change 
sometimes came from within the ranks of district staff and sometimes 
from the community, while leaders of change often were district or 
school staff. In some districts, one person or group acted as both the 
initiator and leader of change, while in other cases, the initiator 
pushed the idea of changing competitive foods forward and then the 
leader took over implementation of the changes. For example, in several 
districts, the superintendent or SFA director initiated and led changes 
to competitive foods because of concerns about both student nutrition 
and competition with the school food service. In another district, 
changes were initiated and led largely by a middle school principal and 
a physical education teacher. In contrast, in New Haven, a local 
pediatrician who was also the district's medical adviser initiated 
change to competitive foods, and then a committee of district staff, 
school staff, and community members took over leadership of changes. In 
all of the districts we visited, a strong leader helped formulate new 
policies, reached out to parties affected by changes, and ensured that 
policies were implemented.

While competitive food changes were often initiated and led by a few 
individuals, all six districts realized that changes would be 
successful only with the involvement of a variety of people in the 
process in order to ensure their support for the changes and help 
sustain changes. To address this need, some districts, such as Oakland 
and New Haven, convened formal committees to provide recommendations on 
school nutrition and health issues. In other districts, leaders took 
steps to reach out individually to those parties affected by changes, 
such as school principals, teachers, and students, to obtain support 
before their enactment. This support was also instrumental to 
sustaining changes. For example, the McComb superintendent noted that 
successful implementation of the district's coordinated school health 
program required both leadership as well as substantial community 
involvement, including input from school officials and teachers, 
parents, and health providers in the community. The involvement of 
these groups in formulating changes helped ensure continued commitment 
and support of the changes.

In addition to obtaining the support of a variety of groups before 
implementing changes, many districts noted that obtaining student 
acceptance of the changes was particularly important to the success of 
change. To that end, some districts held nutrition and health fairs to 
distribute related information to students and the broader community, 
and others involved students in taste testing and voting on the foods 
they preferred. For example, middle school students and parents in Fort 
Osage taste-tested healthy competitive foods during parents' night and 
the school's open house. In other districts, student feedback on policy 
changes was sought by officials before their implementation, sometimes 
by consulting the district's student advisory council.

Districts Faced Several Barriers to Changing Competitive Foods, 
Including Schools' Concerns about Revenue Losses:

While the districts we visited all noted several key components to 
successful change, they also cited several barriers to implementing 
changes to competitive foods that they had commonly faced. In 
particular, officials in almost all of the districts visited cited 
opposition because of concerns about future revenue losses as a barrier 
to changing the availability of competitive foods. In these cases, 
school principals most frequently expressed these concerns because 
competitive food revenues often provided discretionary money that was 
otherwise unavailable to fund a variety of projects and needs at the 
school level.

In addition, a lack of information on other districts' efforts to make 
changes to competitive foods and a lack of nutritional guidelines for 
these foods were also barriers to change in the districts we visited. 
While a majority of the districts visited implemented their own changes 
to competitive foods without knowledge of the steps taken by other 
districts to make such changes, officials in Richland One and Oakland 
conducted their own research on other state and district competitive 
food policies in order to learn from the experiences of others. Related 
to this, officials in Independence, Fort Osage, and New Haven noted 
that the lack of agreed-upon nutrition guidelines for competitive foods 
was an obstacle to change because they had to independently develop 
their own nutrition standards. From our observations during these 
visits, the absence of a clear set of standards defining healthy and 
less nutritious foods can create a problem for districts making changes 
to competitive foods as continual debates and disagreements on such 
standards may slow the process of policy formation, particularly when 
many groups are involved in the process.

Several districts mentioned additional barriers to making changes, such 
as determining the full extent of competitive food sales in schools and 
the groups involved in sales. For example, the SFA director in 
Independence noted that the district's delay in developing nutrition 
standards for competitive foods was largely due to the difficulty of 
compiling a full picture of all competitive food sales occurring in 
schools. Related to this, given the number of groups that can be 
involved in these sales in each school, and the lack of clear roles and 
responsibilities in this environment, she noted that it has been 
difficult to determine the full extent of groups involved in sales 
across the district. She emphasized that it is important for the groups 
that have a stake in the revenues generated by these sales to be 
involved in discussions concerning competitive food policy in order to 
obtain support for the policy and successful implementation of changes.

Some districts also noted that the need to continually monitor 
implementation of competitive food changes at the school level can be 
an obstacle to change. Officials in both Oakland and Richland One 
stated that monitoring adherence to their competitive food policies at 
the school level has been difficult but is necessary to effective 
implementation. Even when school-level groups were involved in the 
process of developing changes, monitoring policy implementation was 
difficult because of the involvement of many groups in competitive food 
sales. In Richland One, the SFA director noted that she often relies on 
observances by food service staff working in the schools to ensure that 
the policy is being followed by all groups selling competitive foods. 
Our own observations of the school food environment during our visits 
to schools support the conclusion that districts have difficulty 
monitoring the implementation of policies, as we noticed a few 
deviations from district competitive food policies in some schools. 
Even though school officials often seemed devoted to the goal of 
improving the nutritional quality of foods available in their schools, 
they typically faced many competing priorities during the school day. 
Further, in many schools, it was unclear who was responsible for 
ensuring that policies were effectively implemented.

Food service staff in Fort Osage and New Haven stated that the 
difficulty of finding healthy foods that both meet district nutrition 
goals and appeal to students was also a barrier to making changes to 
competitive foods. They noted that some healthy foods students found 
appealing were unavailable from vendors, while in other instances, the 
healthy foods available were too expensive to sell to students. This 
sentiment was echoed by students in several districts, as they 
expressed their opinions that some of the newly introduced healthy 
foods, such as bottles of flavored milk or juice, were too costly to 
purchase as part of their lunch. In contrast to districts that 
mentioned problems obtaining new healthy products from vendors, several 
districts noted that they were able to work within their exclusive 
beverage contracts to obtain healthier beverages to serve to students. 
However, at least one mentioned that the major soft drink company with 
whom the district had a contract offered few nonsoda options.

In addition, districts also faced the challenge of educating students 
about healthy eating and encouraging students to change their behavior 
by choosing healthy foods. In several of the districts, schools 
reported providing students with nutrition information and education, 
sometimes through classroom lessons, posters, and programs and 
activities to promote healthy eating. During our visits, students we 
spoke with frequently demonstrated their understanding of the 
importance of healthy eating, and some noted that they would like to 
see the addition of certain healthy foods to school offerings, such as 
a greater variety of fresh fruits and vegetables. In addition, several 
middle school students in Fort Osage and New Haven explained that after 
changes were made to competitive foods and they began to learn more 
about good nutrition in their schools, they went home and talked to 
their parents about these issues.[Footnote 39] However, experts agree 
that it is more difficult to change behavior than to educate 
individuals.[Footnote 40] Related to this, high school students in most 
of the districts we visited mentioned that some students continue to 
purchase less nutritious foods before school and after school from 
neighborhood stores and restaurants. In addition, during our visits to 
schools, we observed students eating a wide range of both healthy and 
unhealthy items during lunch, with younger students being more likely 
to eat healthy foods than high school students.[Footnote 41]

As part of their role in helping districts develop wellness policies 
that address, among other things, school nutrition, USDA has recently 
taken several steps that may help districts overcome some of these 
barriers.[Footnote 42] In March 2005, USDA, in partnership with HHS/CDC 
and the Department of Education, sent a letter to state 
superintendents, district superintendents, and SFA directors describing 
the wellness policy requirements. Through this letter, the agencies 
offered to provide technical assistance to districts, and they also 
provided information on online resources available at the federal level 
to help districts develop their policies. Specifically, these agencies, 
in collaboration with several food and nutrition organizations, have 
begun to compile resources that will provide districts with information 
on state and local efforts to make changes to the school health and 
nutrition environment, including examples of nutrition standards used 
by states and localities that have already developed competitive food 
policies.[Footnote 43] In addition to online resources, these three 
agencies recently released Making it Happen! School Nutrition Success 
Stories, a publication that describes local efforts to address the 
school nutrition environment, in order to assist districts as they move 
forward with their own changes.[Footnote 44]

The Effects of Changes to Competitive Foods on Revenues Were Often 
Unclear because of Limited Data; Nonetheless, Many Officials Expressed 
Concerns about Revenue Losses:

In the districts we visited, reliable data on how changes to 
competitive food sales affected revenues were typically unavailable. 
Schools and districts often did not maintain detailed revenue records 
to enable the type of analyses needed to parcel out the direct effects 
of competitive food changes on revenues. Nonetheless, most schools and 
districts were able to provide partial data on revenue changes for 
specific venues, and these limited data suggest that districts 
experienced mixed revenue effects. Several schools we visited appear to 
have lost revenue from competitive food sales after they made changes, 
while at least one may have increased revenue. For example, after 
increasing the availability of healthy a la carte foods and restricting 
less nutritious items, SFA directors in both Independence and Richland 
One recorded decreases in a la carte sales. In contrast, a middle 
school in McComb reported that after removing soda from beverage 
vending machines and changing the policy regarding the times sales were 
allowed, vending revenues increased. However, these data did not 
account for other factors that may also have affected revenues.

While the limited data available suggest that school districts 
experienced mixed revenue effects after implementing competitive food 
changes, they also illustrate the difficulty of tracking these effects. 
Because the competitive food environment is complex, sometimes 
involving many sales and many groups, the effects of changes on 
revenues are often complicated and may differ for each group involved 
in sales. Some groups may benefit from changes, others may lose. For 
example, in Fort Osage, when the middle school decided to remove all 
less nutritious competitive foods available in the school and replace 
them with healthy items, it also simultaneously decided to stop using 
outside vendors to supply its vending machines. Subsequently, the 
district SFA took over operation of the middle school's vending 
machines, and as a result, vending revenue began to accrue to the SFA 
instead of school administrators. While the SFA director was unable to 
compare the revenue before changes with that generated after changes, 
she reported that the machines were self-supporting. In this instance, 
because of the changes made to competitive foods and their sale, school 
administrators lost a source of revenue while the SFA gained one.

In addition to the challenge of understanding the revenue effects of 
competitive food changes on different groups in schools, the 
relationship between changes in a la carte sales and school meal 
participation adds complexity. Although food service programs rely on 
reimbursement for school meal participation as a primary source of 
funding, officials often cite the importance of using additional 
revenue from a la carte sales to balance their budgets. Therefore, 
officials take risks when they make changes to the competitive foods 
available in schools, because changes may affect revenues from these 
sales and they may also affect school meals participation. In the 
districts we visited, competitive food changes were often accompanied 
by increased school meals participation. In four districts, federal 
reimbursements for meals subsequently increased, benefiting the SFA, 
and in at least one instance, this increase more than made up for food 
service losses in competitive food sales. While Richland One reported 
losing approximately $300,000 in annual a la carte revenue after 
implementing changes, school lunch participation and subsequent federal 
reimbursements increased by approximately $400,000 in the same year.

Despite the lack of conclusive data on revenue effects, district and 
school officials often expressed strong concerns about potential 
revenue losses. Because food services often operate on tight budgets 
and use competitive food revenues to support their operations, they 
take the risk of losing important revenues when they make changes to 
these foods.[Footnote 45] In addition, principals frequently stated 
that competitive food revenues are used at the school level as 
discretionary funding, and they do not typically have other sources of 
flexible funding available to use for the wide variety of purposes 
toward which competitive food revenues are directed. Therefore, when 
making changes to competitive foods, principals also risk losing what 
is an oftentimes important source of funding. For example, in the 
schools we visited, many principals reported using competitive food 
revenues for student activities and classroom supplies, and some 
reported using these revenues to support school dances and assist needy 
students.

Although data on revenue effects were limited and complicated by the 
complex competitive food environment in the districts we visited, some 
districts tried to lessen adverse revenue effects by the process 
through which changes to competitive foods were implemented. 
Specifically, a few districts and schools reported taking incremental 
steps to change competitive foods in order to mitigate the severity of 
the effects on revenue. For example, in one Independence high school, 
incremental changes were being made to beverage vending machines to 
phase in juice and water and phase out soda over a span of several 
years. The high school principal reported that the school was 
conducting this change slowly in order to avoid surprising students 
with sudden changes and to maintain revenue. In addition, a few schools 
noted that their efforts to include students in decisions about 
changing food offerings may have helped ensure that the new foods would 
be accepted by students and mitigate the effects on revenues. However, 
many of the districts we visited did not fully plan for the effects on 
sales revenues when they were considering changes to competitive food 
policy, and several recognized that efforts to do so would have likely 
eased the implementation of policies. Moreover, some principals 
reported that their schools were able to find ways to support projects 
previously funded with competitive food sales after changes were 
implemented. For example, in several districts, principals reported 
that after restrictions on fund-raiser food sales were implemented, 
groups sold nonfood items like wrapping paper and candles, and also 
raised funds by providing services, such as car washes.

In the publication Making it Happen! School Nutrition Success Stories, 
key contacts in selected schools reported similar mixed revenue results 
from their efforts to improve the school nutrition environment. 
[Footnote 46] Of the group of schools that reported on revenue changes, 
some experienced increases in revenue while others reported decreases 
or no change. These schools used approaches similar to those in the 
schools we visited, such as replacing less nutritious food with more 
nutritious choices, obtaining input from the students, and using 
marketing to encourage students to make healthy choices. In addition, 
several of the schools reported increases in school meal participation.

Concluding Observations:

Our nation's schools are uniquely positioned to positively influence 
the eating habits of children, yet almost all schools sell readily 
available foods that are largely unregulated by the federal government 
in terms of nutritional content. While not all of these competitive 
foods are unhealthy, many are. Although schools cannot be expected to 
solve the current problems with child nutrition and growing obesity 
alone, many states and districts have begun efforts to improve the 
nutritional environments in their schools.

As districts across the country develop their required wellness 
policies by school year 2006-2007, they will likely face decisions and 
challenges similar to those of the districts we studied and may benefit 
from their lessons learned. Although each district took a different 
approach, all of them recognized the value of including those parties 
affected by the changes, such as parents, teachers, and other community 
members, when developing new policies. In addition, they recognized 
that students are the ultimate consumers of competitive foods and took 
steps to consider their opinions.

Because districts reported they typically lacked a source of 
recommended nutrition standards for competitive foods in schools, 
officials were faced with difficult decisions about the criteria they 
would use to determine which foods were considered adequately 
nutritious to offer. The technical assistance available from FNS, 
including multiple examples of nutrition standards developed by other 
districts, as well as the Institute of Medicine's forthcoming 
recommendations on nutritional standards for foods in schools, should 
help district efforts to address this issue.

In addition, given the multiple groups that rely on sales of 
competitive foods for revenue, districts may choose to consider the 
possible revenue effects of changes in food offerings as they develop 
and implement new policies. Since competitive food revenues are often 
critical to food service operations and provide principals with 
flexible funds relied on for a multitude of discretionary purposes, 
making changes to competitive foods entails risks for both groups. 
Districts we visited took varied steps that may mitigate potential 
revenue changes, such as substituting healthy foods for less healthy 
ones instead of removing all competitive foods, asking students to 
taste and approve the more nutritious foods, offering alternate means 
for fund-raising, or implementing change gradually. Lack of support 
from the groups that use revenue from competitive food sales can 
scuttle policy changes. Furthermore, the lack of a single person 
responsible for the presence and sale of competitive foods in schools 
complicates efforts to ensure that new policies will be implemented as 
intended and maintained over time. Despite the complex food environment 
in schools, new wellness policy requirements and USDA's efforts to 
provide technical assistance to districts will provide an opportunity 
for districts to plan and implement changes that recognize the needs of 
the various groups and assign individuals with responsibility for 
consistent and sustained implementation.

Agency Comments:

We provided a draft of this report to the U.S. Department of 
Agriculture for review and comment. On June 17, 2005, FNS officials 
provided us with their oral comments. The officials stated that they 
were in general agreement with the findings as presented in the report 
and offered technical comments that we have incorporated as 
appropriate. In addition, the officials reiterated that the 1983 court 
decision in National Soft Drink Ass'n v. Block is significant because 
they believe it severely limits USDA's ability to restrict the sale of 
competitive foods. FNS officials pointed out that prior to this ruling, 
USDA regulations prohibited the sale of FMNV anywhere in the school 
from the beginning of the school day until the last meal period. 
Following the decision, USDA restricted the sale of FMNV only in food 
service areas during meal periods. We agree that this ruling limited 
USDA's ability to regulate competitive food sales as to time and place. 
However, we believe the department has the authority to expand the 
definition of FMNV to include additional foods with limited nutritional 
value. Doing so could further limit the types of these foods available 
in the cafeteria during meal times.

Second, officials discussed what is known about the use of revenue from 
competitive food sales and reimbursable meals compared to their costs. 
We did not determine if revenues generated by competitive food sales 
were sufficient to cover the actual cost of the competitive foods sold. 
The officials stressed that the 1994 School Lunch and Breakfast Cost 
Study, the last definitive study of cost and revenue in the NSLP and 
the School Breakfast Program, found that regardless of size, most 
school food authorities failed to generate enough revenue to cover the 
reported costs of nonreimbursable food sales.[Footnote 47] The mean 
reported revenue-to-cost ratio was 71 percent for the study period. The 
officials noted that this would equate to a loss of 41 cents for every 
dollar received from the sale of nonreimbursable foods. Further, this 
revenue-to-cost ratio did not include all costs for school food service 
operations, such as uncharged labor costs, indirect costs, and 
utilities. If these were included, the revenue to cost ratio would 
generate even higher losses. FNS informed us that they are in the 
process of contracting for a new school meal cost study.

We agree with FNS that our report focused on revenues generated by 
competitive food sales and that we did not determine if revenues 
generated by competitive food sales were sufficient to cover the actual 
cost of the foods sold. However, our report and others have shown that 
the availability of competitive foods, and particularly a la carte 
items, has increased over time. In addition, the Cost Study's 
definition of nonreimbursable meals included food sales such as adult 
meals and special functions, as well as competitive foods, and 
therefore, it is unclear how each of these types of sales contributed 
to the mean reported revenue-to-cost ratio. Absent more current 
information on the actual costs and revenues of providing competitive 
foods and reimbursable school meals, we believe it is difficult to know 
whether the results of the 1994 study are applicable today.

As agreed with your offices, unless you release the report's contents 
earlier, we plan no further distribution of it until 30 days from its 
issue date. We will send copies of this report to the Secretary of 
Agriculture, appropriate congressional committees, and other interested 
parties. In addition, the report will be available at no charge on 
GAO's Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please 
contact me at (415) 904-2272 or bellisd@gao.gov. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this report. Key contributors to this report are 
listed in appendix II.

Signed by: 

David D. Bellis: 
Director, Education, Workforce, and Income Security Issues:

[End of section]

Appendix I: Scope and Methodology:

To obtain nationally representative information on competitive food 
availability, policies, decision makers, groups involved in their sale, 
and revenues generated by their sale, we conducted two Web-based 
surveys. In addition, to gather information on strategies used by 
school districts to restrict less nutritious competitive foods in their 
schools, we visited six school districts. Further, to inform the design 
of our study, we spoke with staff at the U.S. Department of Agriculture 
(USDA) as well as the Centers for Disease Control and Prevention (CDC). 
We also interviewed numerous researchers and organizations that have 
been involved with child nutrition and school health environment issues 
in recent years.[Footnote 48]

Surveys:

To better understand competitive foods in the school environment, we 
designed and administered two Web-based surveys. For a random sample of 
schools, we administered one survey to each school's school food 
authority (SFA) director and a second survey to each school's 
principal. We chose to survey these officials because we believed they 
would be the most knowledgeable sources on competitive food issues in 
schools. The surveys were conducted between October 19, 2004, and 
February 11, 2005. We defined competitive foods as all foods or 
beverages sold to students on school grounds during the school day that 
are not part of federally reimbursable school meals.

While neither survey asked questions about the full range of 
competitive food issues, together the two surveys were designed to 
provide a broad picture of the competitive food environment. Both Web 
surveys contained school background, a la carte, (beverage and snack) 
vending machine, and school store and snack bar sections. However, each 
survey had unique sections as well. The SFA directors' survey included 
sections that asked questions about the SFA, the school food service, 
and school meals participation. The principals' survey included unique 
sections on school and district policies for competitive foods, 
including fund-raising and exclusive beverage contracts.

A majority of the survey questions asked both SFA directors and 
principals to consider school year 2003-2004. To gain a sense of change 
for certain competitive food issues, a few questions asked SFA 
directors and principals to consider school year 1998-1999 alone, make 
comparisons between these reporting periods (1998-1999 versus 2003- 
2004), or consider change in specific competitive food issues over the 
entire time of these reporting periods (from 1998-1999 to 2003-2004).

Population:

The target population consisted of all public schools in the 50 states 
and the District of Columbia that participated in the National School 
Lunch Program (NSLP) for the 2003-2004 school year. We used the 
Department of Education's Common Core of Data (CCD) Public Elementary/
Secondary School preliminary file for the 2002-2003 school year as a 
basis for defining our population. On the basis of our review of these 
data, we determined this source to be adequate for the purposes of our 
work.

To define our sampling frame, we removed schools from the CCD that were 
permanently or temporarily closed; not yet operational; special 
education, vocational education, or alternative/other; run by the 
Department of Defense or Bureau of Indian Affairs; or located in 
American Samoa, Guam, Northern Marianas, Puerto Rico, or the Virgin 
Islands. From this analysis, we obtained a sampling frame consisting of 
85,569 regular public schools in the 50 states and the District of 
Columbia. However, consistent information specifically identifying a 
school's participation in the NSLP was not available in the CCD.

Sample Design and Errors:

The sample design for the Web surveys was a stratified random 
probability sample of 656 schools that allows for estimates to be 
calculated for each school level (elementary, middle, and high). We 
stratified by school level, census region, and rural status, and we 
produced estimates by school level. With this probability sample, each 
school in the population had a known, nonzero probability of being 
selected. Each selected school was subsequently weighted in the 
analysis to account statistically for all the schools in the 
population, including those that were not selected. Because each school 
was randomly chosen, some SFA directors had more than one school under 
their responsibility selected for our study, and they were therefore 
asked to complete a separate survey for each school.

Because we surveyed a sample of schools, our results are estimates of a 
population of schools and thus are subject to sample errors that are 
associated with samples of this size and type. Our confidence in the 
precision of the results from this sample is expressed in 95 percent 
confidence intervals, which are expected to include the actual results 
in 95 percent of the samples of this type. We calculated confidence 
intervals for this sample based on methods that are appropriate for a 
stratified probability sample.

Through a telephone survey of the schools selected in our sample, we 
determined the number of schools selected in our sample that 
participated in the NSLP. We estimate that 80,245 (94 percent) schools 
in our population participated in the NSLP. All estimates produced from 
the sample and presented in this report are for the estimated target 
population of 80,245 schools that participated in the NSLP. All 
percentage and numerical estimates included in this report have margins 
of error of plus or minus 15 percentage points or less, except for 
those shown in table 6.

Table 5: Sampling Error Calculations for Questions in Which the Error 
Exceeded 15 Percent:

Page: 15; 
Question: Percentage of elementary schools with vending machines that 
had three or more vending machines in school year 2003- 2004; 
Estimate: 29; 
Lower bound: 15; 
Upper bound: 47.

Page: 17; 
Question: Percentage of schools with school stores in which salty 
snacks (not low-fat) were often or always available for students to 
purchase from these stores in school year 2003-2004; 
Estimate: 45; 
Lower bound: 29; 
Upper bound: 61.

Page: 17; 
Question: Percentage of schools with school stores in which sports 
drinks were often or always available for students to purchase from 
these stores in school year 2003-2004; 
Estimate: 44; 
Lower bound: 28; 
Upper bound: 60.

Page: 17; 
Question: Percentage of schools with school stores in which sweet baked 
goods (not low-fat) were often or always available for students to 
purchase from these stores in school year 2003-2004; 
Estimate: 40; 
Lower bound: 25; 
Upper bound: 56.

Page: 17; 
Question: Percentage of schools with school stores in which water was 
often or always available for students to purchase from these stores in 
school year 2003-2004; 
Estimate: 47; 
Lower bound: 32; 
Upper bound: 62.

Page: 20; 
Question: Percentage of middle schools with vending machines in which 
the total number of vending machines on school grounds increased 
between school years 1998-1999 and 2003-2004; 
Estimate: 39; 
Lower bound: 25; 
Upper bound: 54.

Page: 20; 
Question: Percentage of elementary schools with a la carte sales in 
which the total volume of a la carte items sold to students increased 
between school years 1998-1999 and 2003-2004; 
Estimate: 31; 
Lower bound: 19; 
Upper bound: 47.

Page: 24; 
Question: Percentage of elementary schools with one group directly 
involved in competitive food sales in school year 2003-2004; 
Estimate: 36; 
Lower bound: 19; 
Upper bound: 56.

Page: 24; 
Question: Percentage of elementary schools with two groups directly 
involved in competitive food sales in school year 2003-2004; 
Estimate: 35; 
Lower bound: 20; 
Upper bound: 53.

Page: 24; 
Question: Percentage of elementary schools with three or more groups 
directly involved in competitive food sales in school year 2003- 2004; 
Estimate: 29; 
Lower bound: 14; 
Upper bound: 48.

Page: 24; 
Question: Percentage of middle schools with two groups directly 
involved in competitive food sales in school year 2003-2004; 
Estimate: 29; 
Lower bound: 17; 
Upper bound: 44.

Page: 24; 
Question: Percentage of elementary schools with SFA/school food service 
directly involved in competitive food sales in school year 2003-2004; 
Estimate: 62; 
Lower bound: 45; 
Upper bound: 77.

Page: 24; 
Question: Percentage of elementary schools with student 
associations/clubs directly involved in competitive food sales in 
school year 2003-2004; 
Estimate: 35; 
Lower bound: 19; 
Upper bound: 52.

Page: 24; 
Question: Percentage of middle schools with school officials or 
administrators directly involved in competitive food sales; 
Estimate: 35; 
Lower bound: 21; 
Upper bound: 51.

Page: 28; 
Question: Percentage of high schools that generated total minimum 
combined revenue of $25,001 to $50,000 through competitive food sales 
in school year 2003-2004; 
Estimate: 21; 
Lower bound: 9; 
Upper bound: 37.

Page: 32; 
Question: Percentage of schools with exclusive beverage contracts that 
received noncash benefits through these contracts that were valued at 
over $5,000 in school year 2003-2004; 
Estimate: 25; 
Lower bound: 13; 
Upper bound: 41.

Source: GAO.

[End of table]

Nonsampling Errors:

We took steps to minimize nonsampling errors that are not accounted for 
through statistical tests, like sampling errors. Nonsampling errors 
could figure into any data collection effort and involve a range of 
issues that could affect data quality, including variations in how 
respondents interpret questions and their willingness to offer accurate 
responses.

In developing the Web surveys, we conducted several pretests of draft 
instruments. We held pretest discussions of the principals' survey with 
staff and members of the National Association of Elementary School 
Principals and the National Association of Secondary School Principals. 
We pretested the SFA survey with members of the American School Food 
Service Association (now known as the School Nutrition Association). In 
addition, both surveys were also pretested during a preliminary visit 
to the SFA and an elementary school in Fairfax County, Virginia. All 
pretests were conducted between July and September 2004.

For the survey pretests, we were generally interested in the clarity of 
the questions and the flow and layout of the surveys. For example, we 
wanted to ensure definitions used in the surveys were clear and known 
to the respondents, categories provided in closed-ended questions were 
complete and exclusive, and the ordering of the survey sections and the 
questions within each section was appropriate. On the basis of our 
pretests, the Web instruments underwent some slight revisions.

After the survey was closed, we also made comparisons between select 
items from our competitive food Web-based survey data and other 
national-level data sets.[Footnote 49] Our comparisons found our survey 
data were reasonably consistent with the external sources. Of the basis 
of our comparisons, we believe our survey data are sufficient for the 
purposes of our work.

Using Web-based surveys also helped remove error in our data collection 
effort. By allowing respondents to enter their responses directly into 
an electronic instrument, this method automatically created a record 
for each respondent in a data file and eliminated the need for and the 
errors (and costs) associated with a manual data entry process. To 
further minimize errors, programs used to analyze the survey data and 
make estimations were independently verified to ensure the accuracy of 
this work.

Response Rates:

For each school in our sample, we attempted to obtain valid e-mail 
addresses for the principal and the SFA director. For the 656 schools 
in our sample, we obtained valid e-mail addresses for 489 principals 
and 455 SFA directors. We administered the surveys to those groups, and 
we received completed surveys from 70 percent of the SFA directors and 
65 percent of the principals who received the surveys. The response 
rates for our sample of 656 schools, including those officials we were 
unable to contact, were 51 percent for both principals and SFA 
directors, excluding the 26 non-NSLP schools. We received responses 
from both the SFA director and the principal for the same school 
(matched responses) for 192 schools (30 percent of schools that 
participated in the NSLP in our sample). Tables 7 and 8 summarize the 
population and sample by school level for the SFA director and 
principal surveys respectively.

Table 6: SFA Director Survey: Population and Sample by School Level:

School level: Elementary; 
Schools in population: 51,997; 
Schools in sample: 188; 
Non-NSLP schools: 6; 
No valid e-mail: 55; 
NSLP schools surveyed: 127; 
NSLP schools responding: 85.

School level: Middle; 
Schools in population: 15,737; 
Schools in sample: 188; 
Non-NSLP schools: 3; 
No valid e-mail: 45; 
NSLP schools surveyed: 140; 
NSLP schools responding: 96.

School level: High; 
Schools in population: 14,979; 
Schools in sample: 188; 
Non-NSLP schools: 6; 
No valid e-mail: 48; 
NSLP schools surveyed: 134; 
NSLP schools responding: 103.

School level: Other; 
Schools in population: 2,856; 
Schools in sample: 92; 
Non-NSLP schools: 11; 
No valid e-mail: 27; 
NSLP schools surveyed: 54; 
NSLP schools responding: 35.

School level: Total; 
Schools in population: 85,569; 
Schools in sample: 656; 
Non-NSLP schools: 26; 
No valid e-mail: 175; 
NSLP schools surveyed: 455; 
NSLP schools responding: 319.

[End of table]

Source: GAO.

Table 7: Principal Survey: Population and Sample by School Level:

School level: Elementary; 
Schools in population: 51,997; 
Schools in sample: 188; 
Non-NSLP schools: 6; 
No valid e-mail: 39; 
NSLP schools surveyed: 143; 
NSLP schools responding: 88.

School level: Middle; 
Schools in population: 15,737; 
Schools in sample: 188; 
Non-NSLP schools: 3; 
No valid e-mail: 39; 
NSLP schools surveyed: 146; 
NSLP schools responding: 91.

School level: High; 
Schools in population: 14,979; 
Schools in sample: 188; 
Non-NSLP schools: 6; 
No valid e-mail: 41; 
NSLP schools surveyed: 141; 
NSLP schools responding: 96.

School level: Other; 
Schools in population: 2,856; 
Schools in sample: 92; 
Non-NSLP schools: 11; 
No valid e-mail: 22; 
NSLP schools surveyed: 59; 
NSLP schools responding: 42.

School level: Total; 
Schools in population: 85,569; 
Schools in sample: 656; 
Non-NSLP schools: 26; 
No valid e-mail: 143; 
NSLP schools surveyed: 489; 
NSLP schools responding: 317.

Source: GAO.

[End of table]

While the majority of our estimates are calculated based on survey 
responses from either the SFA directors' survey or the principals' 
survey, we used the matched responses (192 schools) to calculate the 
total combined minimum revenue estimates. Specifically, the amount of 
revenue earned from each competitive food venue within a school was 
reported by SFA directors and principals in multiple ranges. For 
example, SFA directors reported revenue generated by food services 
through competitive food sales, such as a la carte sales, and 
principals reported revenue generated by all other competitive food 
sales in the school. To estimate the combined competitive food revenue 
for a school, we defined the minimum for each of the school's venues as 
the lower bound of the revenue range reported by SFA directors and 
principals. We then summed the minimum revenue across all venues for 
each school.

Survey Nonresponse Issues:

Another type of nonsampling error is nonresponse or, in the case of our 
work, those SFA directors and principals from schools in our sample who 
did not provide a complete survey. To increase survey responses, after 
the Web surveys were initially deployed, we made several follow-ups 
with nonrespondent SFA directors and principals via e-mail and phone to 
remind them of their respective surveys.

After the surveys were closed, we analyzed each set of survey 
respondents (SFA directors, principals, and the matched responses) to 
determine if there were any differences between the responding schools, 
the nonresponding schools, and the population.[Footnote 50] We 
performed this analysis for four characteristics--total number of 
students enrolled, total number eligible for free lunch, total number 
eligible for reduced price lunch, and total number eligible for either 
free or reduced price lunch. We determined whether sample-based 
estimates of these characteristics compared favorably with the known 
population values, and we also tested the differences of the estimates 
for survey respondents and nonrespondents. We performed this analysis 
for all schools and separately for each school level (high, middle, and 
elementary). For each set of survey respondents, the population value 
for all of the characteristics we examined fell within the 95 percent 
confidence intervals for the estimates. We also determined that there 
were no significant differences between estimates from the respondents 
and nonrespondents.

Additionally, we compared the distribution of several demographic 
variables, including region, school level, and rural status, for survey 
respondents and nonrespondents. On the basis of this analysis, we found 
no significant distributional differences between respondents and 
nonrespondents. Although the characteristics were selected because they 
may be related to other school characteristics asked for on our 
surveys, we do not know the extent to which the respondents reflect the 
population characteristics for our specific survey questions. On the 
basis of both sets of analyses, we chose to include the survey results 
in our report and produce sample-based estimates to the population of 
schools that participated in the NSLP.

Site Visits:

To gather information on local efforts to restrict the availability of 
less nutritious competitive foods, we conducted site visits to six 
districts between September 21 and December 9, 2004. The districts 
visited included Independence School District (Independence, Missouri), 
Fort Osage R-1 School District (Independence, Missouri), New Haven 
Public Schools (New Haven, Connecticut), Richland County School 
District One (Columbia, South Carolina), Oakland Unified School 
District (Oakland, California), and McComb School District (McComb, 
Mississippi). We selected these districts from a list of approximately 
100 districts and schools recognized as making efforts to restrict 
access to less nutritious competitive foods. This list was compiled by 
reviewing recently released reports, studies, and articles that 
described local efforts to make changes to competitive foods. The six 
districts visited were selected because they used different strategies 
to restrict competitive foods, and when viewed as a group, they 
provided variation across characteristics such as geographic location, 
district size, and socioeconomic status.

During the site visits, we interviewed district officials, including 
the superintendent and SFA director, as well as visited one or two 
schools within each district. At the schools, we interviewed 
principals, food service staff, and health and physical education 
teachers, as well as others involved with the school food environment. 
From these interviews, we gathered information on the district and 
school food environment, strategies used to restrict competitive foods, 
individuals and groups involved in implementing changes, facilitators 
and barriers to change, revenues generated by competitive foods, 
ongoing efforts, students' reactions to changes, and opinions on the 
school wellness policies mandated in the 2004 Child Nutrition and WIC 
Reauthorization Act. In addition to our interviews with district and 
school officials, we also met with students to collect their opinions 
regarding nutrition and healthy eating, competitive foods in schools, 
and school meals. Further, we observed at least one lunch period in 
each school visited, in order to better understand the school nutrition 
environment and the choices students make at lunch.

[End of section]

Appendix II: GAO Contacts and Staff Acknowledgments:

GAO Contacts:

David Bellis, Director, (415) 904-2272, bellisd@gao.gov:

Staff Acknowledgments:

Kay E. Brown, Assistant Director, and Rachel Frisk, Analyst in Charge, 
managed this assignment and made significant contributions to all 
aspects of this report. Marissa Jones, Avani Locke, Kevin Jackson, and 
Jim Ashley also made significant contributions to this report. In 
addition, Daniel Schwimer assisted in the legal analysis, Amber Edwards 
assisted in the analysis of local efforts to restrict competitive foods 
across the country, and Susan Bernstein assisted in the message and 
report development.

[End of section]

Related GAO Products:

Commercial Activities in Schools: Use of Student Data is Limited and 
Additional Dissemination of Guidance Could Help Districts Develop 
Policies. GAO-04-810. Washington, D.C.: August 20, 2004.

Nutrition Education: USDA Provides Services through Multiple Programs, 
but Stronger Linkages among Efforts Are Needed. GAO-04-528. Washington, 
D.C.: April 27, 2004.

School Meal Programs: Competitive Foods Are Available in Many Schools; 
Actions Taken to Restrict Them Differ by State and Locality. GAO-04- 
673. Washington, D.C.: April 23, 2004.

School Lunch Program: Efforts Needed to Improve Nutrition and Encourage 
Healthy Eating. GAO-03-506. Washington, D.C.: May 9, 2003.

School Meal Programs: Revenue and Expense Information from Selected 
States. GAO-03-569. Washington, D.C.: May 9, 2003.

FOOTNOTES

[1] See GAO, School Meal Programs: Competitive Foods Are Available in 
Many Schools; Actions Taken to Restrict Them Differ by State and 
Locality, GAO-04-673 (Washington, D.C.: April 23, 2004).

[2] These percentages reflect those principals and SFA directors who 
actually received the Web surveys. We were unable to contact a subset 
of principals and SFA directors selected in our sample of 656 schools. 
See appendix I for detailed information on response rates for each 
survey. 

[3] These data are based on the fiscal year 2004 average daily 
participation in the NSLP and the School Breakfast Program, according 
to the FNS Program Information Report for December 2004 from USDA.

[4] These requirements for the federal meal programs were established 
by Congress in 1994 through the passage of the Healthy Meals for 
Healthy Americans Act, Pub. L. No. 103-448, § 106 (1994).

[5] FMNV are defined in regulations for the NSLP (7 C.F.R. § 210.11) 
and listed in appendix B of those regulations. USDA has the authority 
to change the definition of FMNV and also has established procedures to 
amend the list of these foods. 

[6] According to regulations, all income from the sale of competitive 
foods in the food service area must accrue to the nonprofit food 
service provider, the school, or an organization approved by the school.

[7] See GAO-04-673 for more information on the type and extent of 
restrictions implemented by state competitive food policies in place as 
of March 2004.

[8] For example, some states restrict competitive foods for one half 
hour before and after each school meal period, while others restrict 
competitive foods from the start of the school day until the end of the 
last lunch period.

[9] For more information on federally funded nutrition education 
programs, including Team Nutrition, see GAO, Nutrition Education: USDA 
Provides Services through Multiple Programs, but Stronger Linkages 
among Efforts Are Needed, GAO-04-528 (Washington, D.C.: April 27, 
2004). 

[10] In addition, USDA published its School Nutrition Dietary 
Assessment Study II in 2001, providing information on the nutritional 
quality of meals served in public schools that participate in the NSLP 
and the School Breakfast Program. This study found that students in 
school year 1998-1999 had access to a variety of breakfast and lunch 
options other than the federal meal programs. 

[11] CDC also reported in its 2000 School Health Policies and Programs 
Study that competitive foods were widely available in schools.

[12] WIC is the acronym commonly used to refer to the Special 
Supplemental Nutrition Program for Women, Infants, and Children.

[13] We asked survey respondents questions about "school stores and/or 
snack bars." Throughout this report, we will use the term "school 
stores" to refer to both school stores and snack bars.

[14] A la carte foods, vending machines, and school stores were also 
available in some schools during other periods of the school day. In 
addition, vending machines and school stores were available in other 
locations in some schools, such as outside school buildings. 

[15] The elementary school estimate has a margin of error that exceeds 
plus or minus 15 percent. See table 6 in appendix I for more 
information.

[16] While contracts could be negotiated by the school district, the 
school, the school food service, or a combination of those groups, over 
half of schools with exclusive beverage contracts had a contract that 
was negotiated with the school district.

[17] While the federal government prohibits the sale of soda and 
certain candy in cafeterias and food service areas during mealtimes, 
these foods can be sold in other locations and during other periods of 
the school day. Other less nutritious items, such as sweet baked goods 
and salty snacks, can be sold in any school location during any period 
of the day. 

[18] However, less nutritious foods were available in some elementary 
schools. For example, frozen desserts not low in fat were available in 
nearly a quarter of elementary schools with competitive foods.

[19] For this analysis, we compared the percentage of middle schools 
that had any competitive food venues between school years 1998-1999 and 
2003-2004 with the percentage that had any venues in 2003-2004.

[20] According to our survey, the percentage of middle schools with 
exclusive beverage contracts increased to 65 percent in 2003-2004 from 
26 percent in 1998-1999. An additional 31 percent of middle school 
principals were unsure if their school had an exclusive beverage 
contract in 1998-1999. 

[21] This estimate has a margin of error that exceeds plus or minus 15 
percent. See table 6 in appendix I for more information.

[22] The elementary school estimate has a margin of error that exceeds 
plus or minus 15 percent. See table 6 in appendix I for more 
information.

[23] We did not collect information on the type and extent of 
restrictions placed on competitive foods by these policies or on the 
enforcement of these policies.

[24] The estimates for SFA/school food service and student 
associations/clubs have margins of error that exceed plus or minus 15 
percent. See table 6 in appendix I for more information. 

[25] The estimate for school officials/administrators has a margin of 
error that exceeds plus or minus 15 percent. See table 6 in appendix I 
for more information.

[26] Throughout this report, revenue for each type of competitive food 
venue includes all revenue generated through competitive food sales. We 
did not ask survey respondents for information on profits retained 
after covering expenses. 

[27] While the number of students in each school likely affects the 
amount of revenue generated through competitive foods, our data do not 
allow us to determine the effect of school size on revenue.

[28] Total revenue reflects the combined minimums of revenue ranges 
reported by schools for a la carte lines, vending machines, school 
stores, and exclusive beverage contracts. To conduct this analysis, we 
used matched survey responses, which combined the principal and SFA 
director's responses for each specific school. We defined the minimum 
for each venue as the lower bound of the revenue range selected by the 
respondent, and we then summed the minimum revenues across all venues 
for each school. See appendix I for a description of this analysis. 

[29] For the purposes of this discussion, revenue generated by food 
services refers to revenue that was raised by both the school and 
district food services.

[30] Many schools also held fund-raisers to generate revenue for 
activities and programs, but this revenue is difficult to measure 
because of the involvement of numerous groups, and it is not included 
in our analysis.

[31] In addition, food services in 20 percent of schools received 
supplemental funds from the district or school in 2003-2004, while food 
services in 21 percent of schools transferred funds to the district or 
school in that year.

[32] Further, because we did not collect information on total school 
food service revenue, we were not able to compare food services' 
competitive food revenue with their total revenue in 2003-2004 in order 
to determine the effect of competitive food revenue on food service 
budgets. 

[33] GAO, School Meal Programs: Revenue and Expense Information from 
Selected States, GAO-03-569 (Washington, D.C.: May 9, 2003). This 
report analyzed revenue and expense data from six selected states.

[34] This estimate has a margin of error that exceeds plus or minus 15 
percent. See table 6 in appendix I for more information.

[35] We selected Fort Osage School District as one of our site visits 
because of the changes made to competitive foods at Fire Prairie Middle 
School, and all references to Fort Osage in this report reflect only 
the changes made at Fire Prairie. 

[36] The only exception to this was Independence, where districtwide 
changes had been made to only those competitive foods sold by the SFA 
through a la carte lines and vending machines at the time of our visit.

[37] Independence, one of the four districts restricting competitive 
foods high in sugar and fat, restricted many, but not all, of these 
foods. Further, as noted earlier, Independence made changes to only 
those competitive foods sold by the SFA. 

[38] In recognition of the importance of fruits and vegetables in 
children's diets, Congress included the Fruit and Vegetable Pilot 
Program in the 2002 Farm Bill and expanded and made the program 
permanent in the 2004 Child Nutrition and WIC Reauthorization Act. This 
program provides federal grants to schools in eight states and on three 
Indian reservations to provide free fruits and vegetables to students 
in order to improve student nutrition and introduce healthy snack 
options.

[39] Related to this, students we met with made comments reflecting 
their awareness that, in addition to schools, families and the broader 
community play a key role in teaching children about good nutrition. 

[40] For more information on federally funded nutrition education 
programs and efforts to increase healthy eating in schools, see GAO-04-
528 and GAO, School Lunch Program: Efforts Needed to Improve Nutrition 
and Encourage Healthy Eating, GAO-03-506 (Washington, D.C.: May 9, 
2003). 

[41] Specifically, we noticed that pizza appeared to be the most 
popular item purchased for lunch by students in almost all of the 
schools we visited. Burgers and fresh fruits and vegetables appeared to 
be the next most popular items, as they were purchased and eaten by 
students during lunch in almost half of the schools we visited. In the 
lunch periods we observed, these foods were sometimes sold as 
competitive foods and were sometimes served as components of the school 
lunch. 

[42] McComb used federal resources to assist its own process of 
changing competitive foods. Changes in McComb were modeled on the CDC- 
developed coordinated school health model. 

[43] USDA stated that Action for Healthy Kids, the School Nutrition 
Association, and the Food Research and Action Center are among the 
organizations that have assisted with these efforts. 

[44] Food and Nutrition Service, USDA; CDC, HHS; and the U.S. 
Department of Education. Making it Happen! School Nutrition Success 
Stories. Alexandria, Va., January 2005.

[45] In the districts we visited, most SFA directors did not express 
concerns about potential revenue losses resulting from changes to 
competitive foods, possibly because they were often significantly 
involved and invested in the process of making these changes.

[46] This publication contains self-reported information by key 
contacts from 32 schools and districts nationwide. 

[47] Abt Associates, Inc. School Lunch and Breakfast Cost Study-Final 
Report, a special report prepared at the request of USDA (Cambridge, 
Mass.: October 1994). 

[48] We spoke with staff of Mathematica Policy Research Inc., Abt 
Associates Inc., Nutrition for the Future Inc., University of 
Minnesota--School of Public Health, School Nutrition Association, the 
National Association of Secondary School Principals, the National 
Association of Elementary School Principals, Samuels & Associates, the 
Association of School Business Officials International, the Council of 
Chief State School Officers, the National Association of State Boards 
of Education, and the National School Boards Association.

[49] We compared our Web-based survey data to data on competitive foods 
reported by USDA in the School Nutrition and Dietary Assessment Study 
II (1998-1999) and the School Meals Implementation Initiative--Third 
Year Report (2002), and by CDC in the School Health Policies and 
Programs Study (2000). 

[50] Nonresponding schools include both schools for which we were 
unable to obtain valid e-mail addresses and schools that received the 
survey but did not respond.

GAO's Mission:

The Government Accountability Office, the investigative arm of 
Congress, exists to support Congress in meeting its constitutional 
responsibilities and to help improve the performance and accountability 
of the federal government for the American people. GAO examines the use 
of public funds; evaluates federal programs and policies; and provides 
analyses, recommendations, and other assistance to help Congress make 
informed oversight, policy, and funding decisions. GAO's commitment to 
good government is reflected in its core values of accountability, 
integrity, and reliability.

Obtaining Copies of GAO Reports and Testimony:

The fastest and easiest way to obtain copies of GAO documents at no 
cost is through the Internet. GAO's Web site ( www.gao.gov ) contains 
abstracts and full-text files of current reports and testimony and an 
expanding archive of older products. The Web site features a search 
engine to help you locate documents using key words and phrases. You 
can print these documents in their entirety, including charts and other 
graphics.

Each day, GAO issues a list of newly released reports, testimony, and 
correspondence. GAO posts this list, known as "Today's Reports," on its 
Web site daily. The list contains links to the full-text document 
files. To have GAO e-mail this list to you every afternoon, go to 
www.gao.gov and select "Subscribe to e-mail alerts" under the "Order 
GAO Products" heading.

Order by Mail or Phone:

The first copy of each printed report is free. Additional copies are $2 
each. A check or money order should be made out to the Superintendent 
of Documents. GAO also accepts VISA and Mastercard. Orders for 100 or 
more copies mailed to a single address are discounted 25 percent. 
Orders should be sent to:

U.S. Government Accountability Office

441 G Street NW, Room LM

Washington, D.C. 20548:

To order by Phone:

Voice: (202) 512-6000:

TDD: (202) 512-2537:

Fax: (202) 512-6061:

To Report Fraud, Waste, and Abuse in Federal Programs:

Contact:

Web site: www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470:

Public Affairs:

Jeff Nelligan, managing director,

NelliganJ@gao.gov

(202) 512-4800

U.S. Government Accountability Office,

441 G Street NW, Room 7149

Washington, D.C. 20548: