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In the area of school nutrition financial management, it’s not uncommon to hear I don’t know if I am meeting my financial targets from directors and site managers.
If you haven’t prioritized effective school nutrition financial management, you need to start now!
The stress and uncertainty of finances can lead you to make snap decisions, get into conflicts, or procrastinate and constantly worry about what to do. At SproutCNP, our team encourages school nutrition professionals to take positive action on school meal budgeting for program sustainability and growth.
5 Recommended School Nutrition Financial Management Goals
This post will walk you through five goals to set and work towards for program sustainability and growth.
- Achieve Fiscal Sustainability Through Effective School Meal Budgeting
- Implement a Good Accounting System as Part of Your School Nutrition Financial Management System
- Maximize School Nutrition Program Efficiency
- Plan For Financial Management Emergencies
- Involve Your Team in School Nutrition Financial Management and Training
1. Achieve Fiscal Sustainability Through Effective School Meal Budgeting
School meal programs should be self-supporting, meaning that the school’s general fund does not subsidize program expenses.
- Revenues should be determined and expenses identified.
- Don’t spend more than you make.
- Establish a detailed budget.
- Regularly review and compare monthly financial statements to the budget to ensure targets are met and expenditures are in line with expectations.
Failure to routinely review projected budget categories against actual revenues and expenses could result in expenditure overages and the inability to make timely corrective actions.
2. Implement a Good Accounting System as Part of Your School Nutrition Financial Management System
School nutrition operators depend on monthly financial statements to make timely decisions.
If you learn at the end of the year that a school had extremely high food costs, there’s nothing you can do about it months later.
Here are three steps you can take:
- Produce a cost analysis or financial statement within 20 days after the end of the month.
- Review individual school financial statements to determine the financial position of each school.
- Determine which schools are contributing to the financial goals of your program, and which schools are draining your resources.
The business office or finance department may provide school nutrition accounting services, but that does not relieve the school nutrition director from financial responsibility and the ethical management of taxpayer dollars.
3. Maximize School Nutrition Program Efficiency
For over 30 years, Chef Cyndie has stressed the importance of implementing a cycle menu. Pre-costed cycle menus are to school meal programs as your phone’s GPS system is to navigation. Both systems keep you going in the right direction!
Money-saving benefits of cycle menus include:
- Ability to pre-cost each menu item and identify daily and weekly totals to keep food costs within budget
- Reduction of food waste by improved forecasting (saves big money)
- Streamlined inventory
- Increased staff efficiency through repetitive actions (boosts staff confidence, too!)
- Ensured consistency and program quality
4. Plan For Financial Management Emergencies
School nutrition programs should have a fund balance that allows operators to cover unexpected expenses or revenue losses. It is recommended to keep two to three months of operating balance.
A note to new directors, USDA allows up to three months’ operating expense in your fund balance (7 CFR 210.14).
If you have more than three months of operating expenses, here are a few examples to improve or expand your program:
- Investing in staff training
- Purchasing higher quality foods such as whole muscle chicken or more fresh produce
- Adding new equipment
- Providing professional team uniforms
Investing in your program’s financial future helps to ensure a cushion for the unexpected.
5. Involve Your Team in School Nutrition Financial Management and Training
The school nutrition director is responsible for the overall financial status of the program. However, no school nutrition director is solely responsible for program finances. Mid-level administrators, managers, and frontline staff play a pivotal role in securing your program’s financial future. Daily kitchen level decisions have a direct impact on finances.
80% to 85% of your expenses are food and labor. These costs are controlled at the site level!
Ask yourself these questions to evaluate potential losses:
- How much waste occurs during food production?
- Is there too much inventory on the shelves?
- Are student meal reimbursements lost because a cashier failed to record a transaction?
- Are staff clocking in and out on time, or are you overpaying for labor?
If you are not sure of the answers to these questions, you need to investigate.
This is why routine monitoring, checks and balances, and staff training is critical to responsible school nutrition financial management.
When staff members understand their roles and your expectations, they are much more likely to follow through and assume responsibility.
School Meal Budgeting: Don’t Step Over a Dollar to Pick Up a Dime
At SproutCNP, we encourage leaders to think critically. Analyze data, review facts, investigate and discuss the evidence with your team before solutions are generated.
Cuts to school nutrition funding may always occur. There will be those who suggest revenues from a la carte or nutritionally inferior foods should be a consideration when cuts happen. Revenues may be generated at the expense of student nutrition, and not the answer to improving finances.
A la carte item sales can hurt your program.
Parents and guardians are secondary customers who directly impact whether their children participate in the school meals program. If they start to doubt your decision making as a nutrition provider, you may see a decrease in student participation. The nutrition integrity of school nutrition programs could be jeopardized. If items such as soda are sold, including zero sugar soda, you are sending a mixed message.
Cola consumption has been associated with reduced calcium intake and low bone density, especially in aging females. Additionally, students will opt for sodas instead of nutritionally superior milk and dairy beverages.
According to the Bone Health & Osteoporosis Foundation, about 85-90 percent of adult bone mass is acquired by age 18 in girls and 20 in boys. One in two women and up to one in four men will break a bone in their lifetime due to osteoporosis. For women, the incidence is greater than that of heart attack, stroke, and breast cancer combined.
Nutrition Integrity of School Meal Programs
Protecting the nutrition integrity of school meal programs must be a priority with school nutrition operators.
Regardless of the amount of funding, we need to reinforce the nutritional benefits of school meals. It’s more important than ever to hold firm to ensure that nutrition integrity takes a front seat in decision-making for the future of the program and the health of our nation’s children, who are grappling with an unprecedented obesity crisis.
Stick to your core values by balancing financial management and nutrition integrity.
How One Director Approached Financial Management and Nutrition Integrity
When I became the director of a school nutrition program years before the Healthy Hunger–Free Kids Act, the department was $500,000 in the red. I was hired primarily to correct the financial situation of the program, and I was told that if I could not do so, I would be replaced.
Many changes had to be made, which included improving efficiencies, but we did not need to decrease staffing. Some changes were unpopular (such as taking away milkshakes, jumbo cookies, and fries on a daily basis), but they enabled the program to survive and thrive.
Maintaining the desired emphasis on finances and nutrition resulted in a $1,000,000 fund balance three years after taking the position. Instead of looking for a new job, I retired from the school district.
I maintain the same passion about making the best decisions based on balancing good nutrition with effective financial management practices.
Remember your core beliefs and values – make good decisions.
Beverly Girard, Ph.D., MBA, MS, RD, SNS
Former Director of one of the largest districts in Florida