Program errors and the risk of erroneous payments in the National School Lunch Program (NSLP) and School Breakfast Program (SBP) continue to be a concern. Slightly more than one in five students were certified inaccurately or erroneously denied benefits in school year (SY) 2005-06. New data estimates the gross cost of school meals erroneous payments due to certification error at about $935 million while other operational errors represent about $860 million. Most of the payment errors resulted from (1) household misreporting of income, (2) administrative errors by school districts in processing applications, and (3) errors by cashiers in counting reimbursable meals. The U.S Department of Agriculture (USDA) will use this new information to continue the extensive work underway, and step up its commitment to work with Congress and program partners to address these erroneous payments. Actions to reduce these errors must improve accuracy without compromising access for low-income families, must not unduly increase burden on schools, and must be cost-effective.