Section 220.9(e) of the School Breakfast Program (SBP) regulations outlines criteria for schools to qualify for severe need reimbursement. Included in these criteria is the requirement that 40 percent or more of the lunches served to students at that school in the second preceding school year were served free or at a reduced price. This criterion is intended to ensure that the severe need reimbursement rate is provided to schools which have already demonstrated that a high percentage of meals, defined as 40 percent or more of lunches, are being served to needy students.
Section 201 of the Child Nutrition and WIC Reauthorization Act of 2004 (Public Law 108-265) eliminated the previous requirement that school breakfast costs exceed the National Average Payment rate of reimbursement as one criterion for receiving the higher severe need funding in the SBP. Furthermore, P.L. 108-265 allows school food authorities to claim eligibility for severe need reimbursements when approved by the State agency, based on guidance established by the Secretary that the 40 percent criteria would otherwise have been met, in schools that did not serve lunches in the second preceding year.