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8
Meal Cost Implications

Meal costs encompass food costs plus non-food costs such as labor, supplies, utilities, and the costs of capital and equipment. This chapter focuses primarily on changes in Child and Adult Care Food Program (CACFP) food costs that are projected to result from implementation of the recommended Meal Requirements. The chapter also addresses ways in which specific elements of the recommendations affect those changes and briefly covers non-food meal costs.

PROJECTED CHANGES IN FOOD COSTS

Ideally, the changes in food cost would be estimated by comparing the cost of all food provided through the program before and after the implementation of the recommended Meal Requirements. One approach to obtaining such information is to compare the cost of foods in representative menus planned using the current Meal Requirements with the cost of foods from menus planned using the recommended Meal Requirements; and weighting would be done to reflect the proportions of meals served (by type of meal) to different age groups. Because of a lack of two types of data: (1) current baseline data on a nationally representative sample of meals served by providers, and (2) the distribution of participants by age and meal patterns—the committee used an alternate approach that provides useful, albeit crude, estimates of changes in food costs. This approach is described briefly below and in more detail in Appendix I.



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8 Meal Cost Implications Meal costs encompass food costs plus non-food costs such as labor, supplies, utilities, and the costs of capital and equipment. This chapter focuses primarily on changes in Child and Adult Care Food Program (CACFP) food costs that are projected to result from implementation of the recommended Meal Requirements. The chapter also addresses ways in which specific elements of the recommendations affect those changes and briefly covers non-food meal costs. PROJECTED CHANGES IN FOOD COSTS Ideally, the changes in food cost would be estimated by comparing the cost of all food provided through the program before and after the implementation of the recommended Meal Requirements. One approach to obtaining such information is to compare the cost of foods in representa- tive menus planned using the current Meal Requirements with the cost of foods from menus planned using the recommended Meal Requirements; and weighting would be done to reflect the proportions of meals served (by type of meal) to different age groups. Because of a lack of two types of data: (1) current baseline data on a nationally representative sample of meals served by providers, and (2) the distribution of participants by age and meal patterns—the committee used an alternate approach that provides useful, albeit crude, estimates of changes in food costs. This approach is described briefly below and in more detail in Appendix I. 137

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138 CHILD AND ADULT CARE FOOD PROGRAM Overview of Methods of Estimation Baseline Foods A data set, herein called CACFP component serving data,1 provided data representative of foods used by CACFP family day care providers. Us- ing the CACFP component serving data, the cost estimation process began by grouping the foods currently used by providers into composite food items called food clusters and then into composite food groups (composite meal components). The objective of the development of food clusters and composite food groups was to provide a profile of the food currently served by CACFP providers. The first steps included the identification of the food items most commonly offered by providers and weighting of the food items by their current frequency of use for three different meal types (breakfast, lunch/supper, and snack). The weighted composite food groups were then used as a proxy for menus of foods offered and, hence, as the baseline for the evaluation of changes to the food cost2 of the meals and snacks served. The identified foods and their weights within the clusters were used in the estimation of the cost of the food clusters. In turn, the relative weights of the clusters that belong in each of the current four meal components, esti- mated separately by eating occasion, allowed the estimation of the baseline cost of each of the meal components by eating occasion. As an example, the “vegetables and fruit” component (a composite food group) offered for breakfast under the current Meal Requirements includes the following weights of seven food clusters: bananas, 23 percent; strawberries/berries/ kiwi, 11 percent; peaches/apricots, 8 percent; oranges, 7 percent; apple- sauce, 7 percent; pears, 6 percent; various juices, total of 14 percent; and other vegetables and fruits. Price data were applied to the food items within each cluster to obtain the cost of the food clusters. Foods Representing the Recommended Meal Requirements Estimates of costs representing the recommended Meal Requirements need to reflect the revised meal patterns and food specifications presented in Chapter 7. To accomplish this, it was necessary to make adjustments in the baseline food clusters and composite food groups, as described in Ap- pendix I. In general, the revised food clusters contain fewer food items that are high in solid fats, added sugars, and/or sodium. Compared to baseline, 1 See Appendix I for information about this data set. 2 The composite food groups were also used for nutrient analyses; see Chapter 10.

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139 MEAL COST IMPLICATIONS the composite food groups (meal components) for the recommended Meal Requirements differ substantially in several ways: • Fruits and vegetables are separate meal components; • The vegetable food group composite contains higher percentages of green vegetables, orange vegetables, and legumes and lower percentages of starchy and other vegetables; • The fruit food group contains a smaller share of fruit juice at breakfast and snack;3 • The grain group contains a higher percentage of whole grain-rich foods; • The grains and meat/meat alternate group contain lower percent- ages of food clusters that are high in solid fats and/or added sugars; and • The milk group contains predominantly plain low-fat and nonfat milk but also a small proportion of yogurt and, for snacks only, flavored milk. Changes in Amounts of Foods by Meal and Age Group To estimate changes in food costs, it was necessary to determine the changes in the required amounts of the meal components. This involved a somewhat complex process because of recommended changes in the age groups, the separation of the current fruit/vegetable meal component into fruits and vegetables as two separate meal components, some lack of specificity in the current amounts of food to be served to children older than 12 years, and provider choice of which two meal components to serve in the snack under the current regulations. Table 8-1 shows how the amounts of the meal components change at specific ages for children ages 1–12 years for lunch/supper. Changes for youth ages 13–18 years are not included specifically because the current program specifies that they should receive the same pattern for children ages 6–12 years but with larger por- tions. Appendix Table I-3 shows the changes in amounts that apply to adults. The changes in amounts of foods served as snacks relied on the use of data provided to the committee concerning the distribution of the four current meal components among snacks served by family day care provid- ers (see Appendix Table I-2). All comparisons in this chapter are between the current snack and the recommended regular snack. See Chapter 7 for a description of the proposed enhanced snack that would provide more food 3 Essentially no fruit juice was included in either composite at lunch.

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140 CHILD AND ADULT CARE FOOD PROGRAM TABLE 8-1 Weekly Changes in Amounts of Meal Components in Lunch/ Supper in Recommended Meal Patterns for Children Ages 1 Through 13a Years of Age, Compared with Current CACFP Meal Pattern Amounts 1 Year 2 Years 3–4 Years 5 Years 6–13 Years Meal Component Difference: Recommended Minus Current Amounts Fruit and vegetables (c) 1¼ 3¾ 2½ 5 3¾ Grains (oz eq) 0 2½ 2½ 7½ 5 -2½b -2½b Meat/meat alternate (oz eq) 0 2½ 0 -1¼b Milk (c) 0 0 1¼ 0 NOTE: c 5 cup; CACFP 5 Child and Adult Care Food Program; oz eq 5 ounce equivalent. aA clear comparison is not possible for patterns that apply to youth ages 13–18 years because current requirements specify the use of the pattern for children ages 6–12 years but with larger portions. bNegative values indicate a decrease in amounts compared to current practice. SOURCE: Data on current CACFP meal patterns from USDA/FNS, 2010. to participants in the at-risk afterschool program. The process used to cal- culate the cost changes by meal and age group is described in Appendix I. Sample Menus As discussed in Chapter 7, sample menus were written following the recommended Meal Requirements. The costs of the sample menus were estimated using the same source for food prices that had been used for the food items in the revised composites (see Appendix I). Results Estimated Food Costs of Meals and Snacks The food costs of meals and snacks under the current and recom- mended Meal Requirements, as estimated from the current and revised meal component composites, are shown in Table 8-2 by eating occasion and age group. (Appendix Table I-4 provides information illustrating how these cost estimates were made for children ages 2–4 years—the age group with the largest number of participants receiving meals.) The percentage change in food cost is also shown. Except for infants (breakfast for ages 0–5 months and lunch/supper for all infants), the food cost of the meals is substantially higher under the recommended Meal Requirements. The food cost of the regular snack is higher than the baseline cost for children ages 1–4 years and for youths 14–18 years. For the other groups, the food cost of the regu- lar snack is lower or the same as the baseline cost. Notably, the estimated

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TABLE 8-2 Comparison of the Daily Costs of Baseline Meal Patterns with Revised Recommended CACFP Meal Patterns Estimated Using Baseline and Revised Meal Component Composites and 2003–2004 Price Cost of Breakfast ($) Cost of Lunch/Supper ($) Cost of Standard Snack ($) % % % Age Group Baseline Recommendeda Difference Baseline Recommendeda Difference Baselineb Recommendeda Difference Infants 0–5 mo 0.95 0.85 −11 1.05 0.85 −19 0.85 0.85 0 Infants 6–11 mo 1.27 1.30 2 1.43 1.39 −3 0.80 0.57 −29 Children 1 y 0.28 0.45 61 0.46 0.58 26 0.23 0.24 4 Children 2–4 y 0.40 0.66 65 0.65 0.89 37 0.23 0.29 26 Children 5–13 y 0.59c 0.73 24 1.07c 1.51 41 0.38c 0.33 −13 Children 14–18 y 0.70d 1.03 47 1.28d 1.65 29 0.39d 0.51 31 Adults 0.70e 0.83 19 1.28e 1.56 22 0.39e 0.40 3 NOTES: CACFP 5 Child and Adult Care Food Program; mo 5 month; y 5 year(s). aFor the method of estimating the costs of the recommended meal patterns by using costs for meal component composites, see Appendix I. bThe cost of the baseline standard snack considered the distribution of meal components shown in Table I-2 in Appendix I. cThese costs are the average of the costs for the meal component composites for children ages 5–10 and 11–13 years. dBaseline cost relies on assumptions about serving amounts because current regulations specify only that children ages 12 and older may be served larger portions than required for the child meals and snacks based on their greater food needs, but no less. eThere were no baseline composite data for adults so the cost of the 14–18-year-olds’ menus were used for comparison. SOURCE: Cost data based on representative food composites from Minute Menu Systems (based on data obtained from family day care homes during August 2009 and February 2010) (Minute Menu Systems, LLC, 2008), and USDA/CNPP Price Database, 2003–2004 prices (USDA/CNPP, 2009) (see Appendix I). 141

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142 CHILD AND ADULT CARE FOOD PROGRAM costs of the sample menus were slightly higher for breakfast and snacks and lower for lunch/supper than the cost estimates that were derived using the revised composites (see Appendix Table I-5). Even so, the committee recognizes that the adoption of all the recommended changes in the Meal Requirements would result in a substantial increase in food cost overall. Amounts of Food as Related to Changes in Food Costs The changes in the amounts of food required account for a majority of the changes in food costs, as summarized below: • The lower or near-constant cost for the feedings of infants is the net effect of changes in the amount of iron-fortified infant formula and solid foods for the younger infants. • The lower cost for the snacks of infants ages 6–11 months results primarily from the reduction in the amount of infant formula.4 • The higher cost of meals for children ages 1 year or older and for adults results from changes in the amounts and types of foods to be offered. The major differences are increases in the total amount of fruits and vegetables, especially at lunch; in the amount of grains for some age groups at both breakfast and lunch; and the inclusion of a meat/meat alternate at some breakfasts. The increases are only partially offset by lower amounts of meat/meat alternates for the 1-year-old and 3–4-year-old children at lunch.5 • The lower cost of the revised regular snack for infants, children ages 5–13 years, and adults results mainly from the smaller size of the snack (and less formula for infants). Compared with the cur- rent snack for all the age groups except children ages 14–18 years, the revised snack provides smaller amounts of food, but the snack pattern specifies more variety. Table I-2 in Appendix I shows that currently the snacks include a grain food, the least expensive food group, as one of the two items nearly half of the time. It is not possible to make a one-to-one comparison of the amounts of food provided by the current snack pattern with either the proposed regular or enhanced snack pattern because providers currently choose which two of the four items to offer. For both the regular and enhanced recommended snack patterns, there is specificity regarding the meal components and food subgroups that are to be used over the week. 4 This is the amount of formula that is allowed for reimbursement. Providers could offer more if needed. 5 The lower amounts relate to the change in the age groupings.

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143 MEAL COST IMPLICATIONS Changes in Cost by Age Groups The committee was unable to estimate the average increase in the cost of meals and snacks across all the age groups served because data were lacking on the distribution of the meals and snacks served across the eating occasions by age group. As shown in Chapter 2, Table 2-3, the distribution of participants in different settings is very uneven, with the largest number in child care and the smallest number in adult day care. Very limited evi- dence suggests that, for young children, the majority of CACFP providers seek reimbursement for two meals and one snack (Personal communication, J. Hirschman, August 2–4, 2010). Data on the distribution of meals and snacks from the 1997 U.S. Department of Agriculture (USDA) Food and Consumer Service (FCS) Early Childhood and Child Care Study (USDA/ FCS, 1997) are of limited value, especially because the study preceded the Child Nutrition Reauthorization Act of 1998, which authorized reimburse- ment for snacks for children up to age 18 in afterschool care programs. Consequently, the estimates of changes in costs of meal combinations presented here are restricted to those applicable to the two largest groups being served—(1) young children and (2) youth in at-risk afterschool pro- grams—and to specified meal combinations (see Table 8-3). As expected, the costs of the meal combinations reflect the underlying changes in the individual meal costs. The lower or relatively small increases in the cost of the regular snack are outweighed by increases in the cost of supper. Serving the enhanced snack rather than one regular snack with sup- per would greatly increase the cost to providers for the at-risk afterschool care program. The estimated cost of the enhanced snack is twice that of the regular snack, namely $0.66 for 5–13-year-olds, $1.02 for 14–18-year- olds, and $0.80 for adults. This means, for example, there would be an TABLE 8-3 Estimated Cost Changes for CACFP Meals and Snacks Served to Children Ages 1–4 Years and to Youth Ages 5–18 Years Given Specified Meal Combinations Percentage Change in Change in Age Group Meal Combinations Cost ($) Cost (%) 1y Breakfast, lunch, and snack 0.30 31 2–4 y Breakfast, lunch, and snack 0.56 44 5–13 y Regular snack and supper 0.39 27 14–18 y Regular snack and supper 0.49 29 NOTE: CACFP 5 Child and Adult Care Food Program; y 5 year(s). SOURCE: Cost data based on representative food composites from Minute Menu Systems, LLC (based on data obtained from family day care homes during August 2009 and February 2010) (Minute Menu Systems, LLC, 2008) and USDA/CNPP Price Database, 2003–2004 prices (USDA/CNPP, 2009) (see Appendix I).

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144 CHILD AND ADULT CARE FOOD PROGRAM additional $0.51 cost to serve an enhanced snack instead of a regular snack to the 14–18-year-olds. Factors Contributing to the Increased Food Cost In view of the substantial increase in food cost that would be expected to result from recommendations that improve the alignment of CACFP meals with the Dietary Guidelines, the committee performed three ad- ditional analyses. The intent was to provide information that could be useful to USDA in determining cost-cutting measures, if necessary. The first analysis provides estimates for the change in costs of the baseline and revised meal component composites, by eating occasion (Table 8-4), using data for the largest age group (2–4 years). The second analysis provides estimates of the range of unit costs of the revised meal components by eat- ing occasion, across all the age groups except infants (Table 8-5). The third analysis provides estimates of the cost per standard unit for selected meal component subgroups and of selected grain foods that would be increased or decreased in the recommended meal patterns (Table 8-6). Change in Unit Cost of the Composites The unit costs of the baseline breakfast, lunch, and snack composite dif- fer because different foods were included in the composites at the different TABLE 8-4 Comparison of Average Unit Cost ($) of Baseline Meal Component Composites and Composites Revised to Align with Recommended Meal Requirementsa for Children Ages 2–4 Years, Based on 2003–2004 Prices Breakfast Lunch/Supper Snack Composites Composites Composites Meal Component Unit Baseline Revised Baseline Revised Baseline Revised cb Fruits and vegetables 1 0.44 00.47 0.55 0.77 0.23 0.39 Grain 1 oz eq 0.12 0.17 0.08 0.09 0.14 0.14 NAc Meat/meat alternate 1 oz eq 0.22 0.17 0.18 0.20 0.19 Milk 8 fl oz 0.23 0.24 0.22 0.19 0.22 0.23 NOTE: c 5 cup; fl oz 5 fluid ounce; oz eq 5 ounce equivalent. aFor the method of estimating the cost of the menu component composites, see Appendix I. bThis value represents the amount of fruits and vegetables combined. cThe current breakfast pattern does not include meat/meat alternate. SOURCE: Cost data based on representative food composites from Minute Menu Systems, LLC (based on data obtained from family day care homes during August 2009 and February 2010) (Minute Menu Systems, LLC, 2008) and USDA/CNPP Price Database, 2003–2004 prices (USDA/CNPP, 2009) (see Appendix I).

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145 MEAL COST IMPLICATIONS TABLE 8-5 Rangea of Mean Cost ($) for One Serving of Each of the Five Revised Meal Components, by Eating Occasion Meal Component Range of Serving Sizes Breakfast Lunch/Supper Snack Fruit ¼–½ c 0.12–0.23 0.13–0.26 0.20–0.40 1⁄ –½ NAb Vegetables c 0.07–0.26 0.04–0.16 8 Grain ½–2½ oz eq 0.06–0.24 0.05–0.23 0.07–0.27 Meat ½–2½ oz eq 0.11–0.45 0.09–0.46 0.10–0.19 Milk ½–1 c 0.12–0.24 0.09–0.19 0.11–0.18 NOTE: c 5 cup; NA 5 not applicable; oz eq 5 ounce equivalent. aThe range covers the range of serving sizes for the age groups, excluding infants, and may vary by eating occasion. bThe revised meal pattern allows for either fruit or non-starchy vegetables at breakfast, but the revised breakfast composite includes only fruit. SOURCE: Cost data based on representative food composites from Minute Menu Systems, LLC (based on data obtained from family day care homes during August 2009 and February 2010) (Minute Menu Systems, LLC, 2008) and USDA/CNPP Price Database, 2003–2004 prices (USDA/CNPP, 2009) (see Appendix I). TABLE 8-6 Unit Costsa for Selected Types of Foods That Are Recommended in Increased or Decreased Amounts Food Food Increased Unit Food Decreased Unit Cost ($)a in Amount Component in Amount Unit Unit Cost ($) Fruit Fruit (fresh, canned, 1c 0.49 Fruit juice 1c 0.22 dried) Vegetables Dark green vegetables 1 c 0.78 Starchy vegetables 1c 0.72 Orange vegetables 1 c 0.33 Other vegetables 1c 0.40 Legumes 1 c 0.25 Grains Whole grain bread 1 oz 0.10 Refined bread and 1 oz 0.09 eq crackers eq Whole grain cereal 1 oz 0.16 Refined grain cereal 1 oz 0.09 eq eq Meat/meat Chicken cluster with 1 oz 0.18 Chicken cluster 1 oz 0.16 baked chickenb alternate eq with frozen eq chicken nuggetsb NOTE: c 5 cup; oz eq 5 ounce equivalent. aUnit costs for food subgroup composites, except fruit juices, whole grain cereal and refined grain cereal, are based on the revised composites for the lunch/supper meal and 2003–2004 prices. Unit costs for fruit juice, whole grain cereal, and refined grain cereal are based on the revised composites for the breakfast meal and 2003–2004 prices. bAs an example of the changes in the meat/meat alternate group, the chicken food composite was modified from the original to reduce the share of frozen chicken nuggets in the chicken composite. This change increased the unit cost from $0.16 to $0.18. SOURCE: Cost data based on representative food composites from Minute Menu Systems, LLC (based on data obtained from family day care homes during August 2009 and February 2010) (Minute Menu Systems, LLC, 2008) and USDA/CNPP Price Database, 2003–2004 prices (USDA/CNPP, 2009) (see Appendix I).

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146 CHILD AND ADULT CARE FOOD PROGRAM eating occasions. The same is true for the costs of the revised composites. As shown in Table 8-4, when the costs of the revised composites were compared with those of the representative baseline composites, either no changes or relatively small changes were found. The biggest increases in unit costs of the revised meal components occurred as a result of recommended changes in the foods included in the fruit/vegetables (at breakfast, lunch/supper, and snack) and the grain groups (excluding snacks). In the revised breakfast and snack composites, a substantial (. 50 percent) reduction in the proportion of fruit that is juice6 influenced the degree of the difference. The substantial increase in the unit cost of the revised fruit and vegetable composites is largely due to the increased variety of vegetables. The increase in unit costs of the fruit and vegetable and grain components means that the recommended forms of the foods in these components (e.g., the variety of vegetables and the increase in whole grain-rich foods) contribute to the increased cost: the amounts of these meal components account for most, but not all, of the increase in food cost by eating occasion and age group. The increased variety of vegetables at lunch/ supper contributes to the cost of the revised composite, with an increase of more than 20 percent. Because only the most commonly consumed fruits and vegetables and currently used whole grains were included in the baseline and revised components (in different proportions), it is possible that expanding the variety of fruits and vegetables served or including new and different whole grains would change the estimated cost of the revised composite. Range of Costs of the Meal Components Table 8-5 shows the range of serving sizes and costs of specific meal components for each of the three eating occasions. The average cost of one- fourth cup of fruit at breakfast, for example, was $0.12, but the average cost of the same amount (but a different selection) of fruit at snack was $0.20. By looking at this table, one can see that increasing the amount of vegetables by one-half cup at lunch/supper contributes approximately $0.26 extra to the cost of the meal. Unit Costs for Selected Types of Food Table 8-6 shows how average unit costs differ for selected types of foods. For example, on average, a 4-ounce portion of fruit is more expen- sive than 4 ounces of juice; dark green vegetables are more expensive than the other types of vegetables; and whole grain products are slightly more expensive than refined grain products. The table makes it clear that specify- ing limits on the proportion of fruit that may be in the form of fruit juice, 6 Juice is the less expensive form of fruit; see Table 8-5.

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147 MEAL COST IMPLICATIONS increasing the proportion of specific types of vegetables, and specifying that at least half the grain must be whole grain-rich all contribute to increased food costs. In addition, changes in some of the composites to limit saturated fat also contribute to increased food costs. For example, Table 8-6 shows the effects of substituting a baked chicken cluster for chicken nuggets. “What-If?” Scenarios Using the information above, one can obtain a rough estimate of what effect various changes would have on the cost of a recommended meal for a specified age group. For example: • If the amount of fruit per week at lunch were reduced by half for the 2–4-year age group (from 2.5 to 1.25 cups per week, which is equivalent to a decrease from 0.5 to 0.25 cups per day), then the cost would be reduced by about $0.65 per week. This estimate uses the lunch/supper price for fruit ($0.26 for 0.5 cup, from Table 8-5). $0.26 3 5 days 5 $1.30 per week, half of which would be $0.65. • If 0.5 cup of juice were served in place of fruit at a meal or snack, then the cost would be reduced by about $0.68 per week ([$0.49– $0.22 = $0.27 per cup from Table 8-6] × 5 days = $1.35 per cup, or $0.68 per half cup, half of which would be $0.68, from Table 8-6). • If a whole grain-rich food were substituted for the meat at break- fast for the 2–4-year age group, then the cost would be reduced by half for those ages 5 years and older, about $0.24 per week. (The pattern calls for 1 ounce of meat at breakfast three times per week for this age group. Taking the composite cost of meat from Table 8-5 [$0.22] and the average of whole grain bread and cereal from Table 8-6 [$0.14 with rounding], one subtracts the cost of the grain from the cost of the meat and multiplies the result times 3 days: [$0.22–$0.14] 3 3 days.) • If the vegetables at lunch were reduced by half for those ages 5 years and older (to 0.5 cups per day total) and the same variety were maintained, then the cost would be reduced by $0.26 per day or $1.30 per week. In all these examples, the decrease in cost is accompanied by movement away from alignment with Dietary Guidelines and lower intake of nutrients and/or fiber. Summary of Effects of Recommended Meal Requirements on Food Cost Overall, the major changes that lead to the substantial increase in food cost are

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148 CHILD AND ADULT CARE FOOD PROGRAM 1. Increased amount and variety of vegetables at lunch; 2. Increased use of whole fruit and decreased use of juice, especially for the snacks; 3. Larger percentage of whole grain-rich grain products at all eating occasions; and 4. Addition of lean meat or meat alternate to the breakfast meal. By contrast, changes that slightly offset the cost increases are 1. Smaller amounts of infant formula for infants, at all meals (and snacks for the older infants), and elimination of solid foods for the younger infants; 2. Some reduction of the meat or meat alternate for younger children at lunch; and 3. Reduction in the amount of food offered in standard snacks for children above the age of 5 years. When developing the meal patterns, the committee considered the effect on costs of increasing the amounts and types of foods to be recommended but gave priority to improving alignment with Dietary Guidelines. Limitations of the Analyses The committee recognizes a number of limitations to the cost analyses that result from the lack of appropriate baseline data both for determining baseline meals served and for distributing aggregate costs across the differ- ent age groups: • No recent nationally representative data exist on foods served in CACFP meals. The current meal requirements offer providers relatively large scope and flexibility in the selection of foods within the required components. In addition, providers select their own methods of food preparation and use of condiments, and they may serve other (unreimbursed) foods. • The food composite database for food costs covers only foods served by family day care homes, which provide care for children. These homes constitute 73 percent of CACFP facilities. The com- mittee assumed that the foods selected by the homes are foods that are “economical” for the providers and selected to meet the existing program criteria. The prices used in determining the cost of foods were prices associated with foods consumed in households and prepared at home. However, to the extent that child care cen- ters, afterschool programs, and adult day care currently serve foods

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149 MEAL COST IMPLICATIONS that differ from those used in a “home” setting or face different prices for food because of their ability to access different markets or purchase in larger quantities, the estimates for the changes in cost will differ. For example, the larger child care centers may have access to some savings through bulk (case) purchase of food items, and this may affect the type of food selected and the cost. More- over, in a limited number of states, some centers (but not family day care homes) may have access to USDA foods (previously called commodity foods), including fruits, vegetables, and whole grain- rich products. The use of these foods would reduce the estimated increase in food costs (IOM, 2010). • Numerous assumptions were required when determining the food clusters for the baseline meal patterns and modifying these clusters for the recommended meal patterns. To the extent possible when making the revisions, only necessary and limited modifications were made to the baseline food clusters under the assumption that these foods served were well accepted by participants. Implemen- tation of the recommended Meal Requirements may lead to ad- ditional changes in the selection of foods offered. • Price changes for different foods have not been uniform over the years since 2003–2004 (IOM, 2010; Monsivais et al., 2010). Dif- ferential price changes may have increased or decreased the effect of the recommended changes in food groups on the net change in cost and, hence, on the cost of foods served by providers. • The overall effect on the change of food cost for the program (considering all age groups) needs to take account of the relative number of participants for each meal type by age group. The lack of data on the distribution of types of meals limited the ability of the committee to estimate the aggregate food costs associated with offering meals. NON-FOOD MEAL COSTS The following discussion of non-food meal costs that are covered by the federal meal reimbursements does not include administrative costs, which averaged about 6 percent of total program cost from fiscal year (FY) 2005 through FY 2009 (Personal communication, E. Harper, July 30, 2010). The cost of food represents only a portion of the providers’ costs for meals and snacks. No studies were found that document the average pro- portions of total costs to attribute to food, labor, and other costs among providers who participate in CACFP. Data from the second School Lunch and Breakfast Cost Study (USDA/FNS, 2008) indicate that reported costs for operating the school meals programs average about 46 percent for food

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150 CHILD AND ADULT CARE FOOD PROGRAM costs, 45 percent for labor costs, and 10 percent for other costs.7 These values appear to have limited applicability to CACFP, however, because of substantial differences in the food service operations. According to the Alabama Department of Education Child Nutrition Program (2010), food costs (which include sales taxes and delivery fees) must account for at least 50 percent of operating costs. The costs for menu planning, food acquisition, food preparation, train- ing, and reporting vary widely by provider type. Sponsoring organizations may handle menu planning, training, and much of the record keeping for sponsored centers and for family and group homes; sponsoring organiza- tions for affiliated centers receive separate reimbursement for these services; independent centers do not. Providers serving small numbers of clients are unlikely to be able to arrange for food delivery and thus incur costs related to the time and trans- portation needed to shop for the food. These costs could be considerable for small day care sites located in food deserts, because fewer processed foods (a variety of fruits and vegetables, for example) could be obtained only from distant stores, and transportation may be limited (Bodor et al., 2010; IOM, 2009; Rose and Richards, 2004; Sharkey, 2009; Smith and Morton, 2009; Zenk et al., 2009). Note that even uncompensated time, as may occur in family day care homes, has a value. Although there is no clear basis on which to produce an estimate of the impact of the recommended Meal Requirements on non-food meal costs, the non-food costs are expected to increase at least initially because change will be required. The magnitude and persistence of the increase will vary widely—across the United States, within states, by provider type, and by the quality and amount of technical assistance provided (see Chapter 9). The committee found no data on which to base an estimate of the extent to which increases in non-food meal costs are likely to persist. A single publication (Gabor et al., 2010) addresses increased non-food meal costs in child care. Gabor and colleagues (2010) note that, in Delaware, more food is prepared from basic ingredients to comply with the state’s new meal guidelines. As documented by Wagner and colleagues (2007) for the school meal setting, the introduction of more on-site food preparation requires greater managerial skill, may require a one-time investment in equipment, and may require more skilled labor and/or training, but food costs decrease. Because the recommended Meal Requirements are considerably more detailed than the current ones and because there is substantial turnover among CACFP providers, an increase in training needs (and therefore costs) 7 For many school meal programs, full costs are higher than reported costs because the school district underwrites some costs (USDA/FNS, 2008).

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151 MEAL COST IMPLICATIONS is likely to persist. The training would be supportive of providers’ ability to serve appetizing, nutritious meals; provide sound nutrition education to participants and families; and help providers manage their food service safely and efficiently. SUMMARY The recommended Meal Requirements increase overall food costs in CACFP mainly because of increased amounts and variety of fruits and vegetables for many age groups at lunch/supper and snacks, the addition of meat/meat alternates at breakfast (balanced only in part by reductions of meat/meat alternates at lunch for the younger children), and increases in the amount of whole grain-rich foods for some age groups. Non-food meal costs are expected to increase initially, to vary with the provider set- ting and with the extent to which the provider has already implemented changes similar to those recommended, and to be influenced substantially by the quality and extent of technical assistance provided. An increased need for training may persist but will be accompanied by improvements in food service and nutrition education, especially in larger centers. REFERENCES Alabama Department of Education Child Nutrition Program. 2010. Financial Records for CACFP. http://cnp.alsde.edu/cacfp/CACFPPresentations/10POFinancialRecords.ppt (accessed August 23, 2010). Bodor, J. N., J. C. Rice, T. A. Farley, C. M. Swalm, and D. Rose. 2010. Disparities in food ac- cess: Does aggregate availability of key foods from other stores offset the relative lack of supermarkets in African-American neighborhoods? Preventive Medicine 51(1):63–67. Gabor, V., K. Mantinan, K. Rudolph, R. Morgan, and M. Longjohn. 2010. Challenges and Opportunities Related to Implementation of Child Care Nutrition and Physical Activ- ity Policies in Delaware: Findings from Focus Groups with Child Care Providers and Parents. Washington, DC: Altarum Institute. http://www.altarum.org/files/pub_resources/ DelawareFocusGroup-FullReport-FIN.pdf (accessed July 13, 2010). IOM (Institute of Medicine). 2009. The Public Health Effects of Food Deserts. Washington, DC: The National Academies Press. IOM. 2010. School Meals: Building Blocks for Healthy Children. Washington, DC: The Na- tional Academies Press. Minute Menu Systems, LLC. 2008. Minute Menu Systems. http://www.minutemenu.com/web/ index.html (accessed August 27, 2010). Monsivais, P., J. McLain, and A. Drewnowski. 2010. The rising disparity in the price of health- ful foods: 2004–2008. Food Policy 35(6):514–520. Rose, D., and R. Richards. 2004. Food store access and household fruit and vegetable use among participants in the US Food Stamp Program. Public Health Nutrition 7(8):1081–1088.

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152 CHILD AND ADULT CARE FOOD PROGRAM Sharkey, J. 2009. Rural food deserts: Perspectives from rural Texas. Presented at the Institute of Medicine-National Research Council Workshop on the Public Health Effects of Food Deserts, Washington, DC, January 26–27. Smith, C., and L. W. Morton. 2009. Rural food deserts: Low-income perspectives on food access in Minnesota and Iowa. Journal of Nutrition Education and Behavior 41(3):176–187. USDA/CNPP (U.S. Department of Agriculture/Center for Nutrition Policy and Promotion). 2009. USDA Food Plans: Cost of Food. http://www.cnpp.usda.gov/usdafoodplanscostof food.htm (accessed August 30, 2010). USDA/FCS (U.S. Department of Agriculture/Food and Consumer Service). 1997. Early Child- hood and Child Care Study: Nutritional Assessment of the CACFP: Final Report, Vol- ume 2. Alexandria, VA: USDA/FCS. http://www.fns.usda.gov/ora/menu/Published/CNP/ cnp-archive.htm (accessed July 9, 2010). USDA/FNS (U.S. Department of Agriculture/Food and Nutrition Service). 2008. School Lunch and Breakfast Cost Study II, Final Report. Alexandria, VA: USDA/FNS. http:// www.fns.usda.gov/OANE/MENU/Published/CNP/FILES/MealCostStudy.pdf (accessed August 4, 2008). USDA/FNS. 2010. Child & Adult Care Food Program Meal Patterns. http://www.fns.usda. gov/cnd/care/ProgramBasics/Meals/Meal_Patterns.htm (accessed March 24, 2010). Wagner, B., B. Senauer, and F. C. Runge. 2007. An empirical analysis of and policy recom- mendations to improve the nutritional quality of school meals. Review of Agricultural Economics 29(4):672–688. Zenk, S. N., L. L. Lachance, A. J. Schulz, G. Mentz, S. Kannan, and W. Ridella. 2009. Health promoting community design/nutrition: Neighborhood retail food environment and fruit and vegetable intake in a multiethnic urban population. American Journal of Health Promotion 23(4):255–264.