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Statistical Issues in Allocating Funds by Formula
the current regulations for the National School Lunch Program. The authorizing legislation for this program stresses the importance of providing nutritionally adequate lunches. The regulations include a section (210.10) on nutrition standards and three lengthy appendices with detailed provisions on the use of meat protein substitutes, a listing of foods of minimum nutritional value, and a description of food labeling procedures.
Program rules are extremely varied in their content and level of detail. A detailed analysis would go well beyond the scope of this study. To some extent, as noted in Chapter 6 under “Bonuses and Penalties,” the rules can affect the amounts received by the target allocation units.
In the April 2000 workshop that preceded and motivated the formation of this panel, one participant made a distinction between formula allocation procedures, which determine how much money goes to each recipient jurisdiction, and program rules, which determine, with varying degrees of specificity, how the money is to be used by the recipients. This participant argued that marginal adjustments in the distribution formulas were considerably less influential in determining the degree to which program goals are met than are the rules governing what happens after the funds are received. The panel agrees that program rules are a major determinant of success in achieving program goals, but in our view allocation formulas and procedures are important and deserve close attention. The issues of potentially unnecessary formula complexity and the interaction between formula features and inputs require additional study.