A new policy from the U.S. Department of Agriculture (USDA) will prohibit schools from charging online “junk fees” to low-income families for meals provided through the School Breakfast Program and the National School Lunch Program starting in the 2027-28 school year.
The USDA’s announcement on Friday marks a critical step toward making school meals more affordable for eligible students, particularly those who qualify for free or reduced-price meals.
Although this policy initially applies only to these students, the USDA aims to expand the ban to cover all families in the future.
“Today’s action is a first step,” the USDA stated, adding that it will assess the impact of fees on all families with the goal of eventually eliminating online junk fees for every student, regardless of income.
These junk fees typically come in the form of online processing charges added when parents deposit money into school meal accounts, as schools increasingly move toward cashless payment systems.
According to a July report from the Consumer Financial Protection Bureau (CFPB), nearly 87% of 25,000 sampled school districts have contracts with payment processors, allowing families to make electronic payments for various school expenses.
These transactions often carry an additional fee—averaging $2.37 or 4.4% of the transaction—adding unexpected costs to families already paying for their children’s meals.
The USDA highlighted that by law, students eligible for reduced-price meals should not pay more than 30 cents for breakfast or 40 cents for lunch.
However, online processing fees can push costs beyond these limits, impacting families that rely on these programs to afford nutritious meals for their children.
The new policy is designed to ensure that the 1 million children who receive reduced-price meals won’t face extra costs for accessing their meals.
“This action lays the foundation to eliminate these junk fees for all 30 million children receiving healthy meals at school every day,” stated Lael Brainard, the national economic advisor, underscoring the USDA’s goal of further expanding this benefit.
Agriculture Secretary Tom Vilsack praised the USDA’s move to eliminate junk fees, calling it an essential step forward in ensuring equitable access to school meals.
However, he stressed that the most fair and effective approach would be to provide healthy school meals to every child at no cost, a goal he pledged to pursue with Congress in the months to come.