A Charlotte-Mecklenburg school board member is raising questions about the school system's $30 million-a-year free and reduced-price lunch program after an audit resulted in benefits being lowered or canceled for more than 60percent of applicants checked.
Schools officials disclosed results of an October 2007 audit of more than 700 applications after questions were raised recently by school board member Ken Gjertsen. Out of the 704 applications sampled, 263 families had their benefits reduced and another 174 were removed from the program because they failed to respond.
Gjertsen said he asked school administrators for more information about the federally funded school meals program after someone e-mailed him expressing concerns. The issue received statewide attention recently when the Carolina Journal, a monthly publication of the John Locke Foundation, alleged widespread fraud and income falsification by N.C. families.
The foundation studied CMS and three other districts and found that authorities reduced or canceled benefits for two out of three households checked in audits during the 2007-08 school year. The Observer checked figures for counties surrounding Mecklenburg and found similarly high percentages.
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Gjertsen called the results of CMS's spot-check disturbing enough to warrant a broader investigation.
“That would seem to raise questions about our program,” he said. “I don't see this as a big deal. I just want to know what we're going to do from a management standpoint.”
His query comes the same week CMS mailed applications to 84,724 households. Regulations from the U.S. Department of Agriculture, which runs the program, require that applications be sent to the households of every registered student.
The program, which dates to 1946, provides free or low-cost breakfasts and lunches to low-income schoolchildren across the country. School officials call it a critical service that keeps hunger from distracting children from their lessons. CMS officials said 58,000 students are eligible in the district.
The USDA requires school systems to check the eligibility of 3 percent of applicants whose incomes fall within $100 of the qualification threshold. For a family of four, the gross income cap is $27,560 for free lunch, and $39,220 for reduced-price lunch.
The federal government also subsidizes paid lunches, reimbursing school systems about 24 cents for every lunch a student's family purchases.
School leaders cautioned that results of their audit shouldn't be interpreted to mean more than 60 percent of all those families receive benefits they don't qualify for.
The USDA requires checks only of the most error-prone group – those nearest the income cap, said Cindy Hobbs, executive director of child-nutrition services for CMS. A more scientific, random sampling of all applications would likely lower the error rate, she said. Many who had benefits reduced made math errors trying to calculate their monthly income, or used their net income instead of their gross income.
“It probably isn't fair to say this high a percentage are committing fraud,” Hobbs said. “People tend to fill out forms without reading the instructions.”
She added that there are students who qualify but don't receive benefits, often because their parents don't understand the forms.
CMS isn't planning to make a broader eligibility check, she said, because USDA rules specifically limit the audits to 3percent of those within $100 of the cutoff.
The N.C. Department of Public Instruction consulted with federal officials recently about the 3 percent rule and was told broader checks are not permitted. “The law does say clearly that we are not allowed to do that,” said Lynn Hoggard, a state child nutrition services official.
Such explanations left Gjertsen unsatisfied.
“If that's the rule, that's just lunacy,” he said. “We had rumors of cheating on athletic eligibility and spent $100,000 investigating it. We have rumors of cheating in the free and reduced-price lunch program. Will we do the same thing?”
Terry Stoops, an education policy analyst with the John Locke Foundation, said a mother once admitted to his wife, a middle school teacher in Wake County, that she lied on her meals application. The parent said she did so “because she pays taxes and feels (the benefit) is owed to her,” Stoops said.
He added that local officials could do broader checks if they really wanted.
“I believe the federal government, if approached, would grant them the flexibility in verifying those applications,” he said. “If my wife can detect (fraud) in a small middle school in Wake County, we can predict that there are plenty of other parents out there with the same attitude.”
The state must investigate any fraud reports it receives from the public about the meals program, Hoggard said. But it received less than 10 in the past year. She said she feels most errors stem from illiteracy, not corruption.
“The application can be quite confusing. And for a household with limited literacy skills or for whom English is a second language, it can truly be a challenge.”