USDA Cancels $1 Billion in Funding for Schools and Food Banks to Purchase Local Food

USDA Cancels $1 Billion in Funding for Schools and Food Banks to Purchase Local Food

The U.S. Department of Agriculture (USDA) is cutting funding for two federal programs that provided approximately $1 billion to schools and food banks for purchasing food directly from local farmers, ranchers, and producers. The USDA stated that the decision to end these programs was made to "return to long-term, fiscally responsible initiatives."

This move cancels around $660 million in funding for the Local Food for Schools program, which operates in 40 U.S. states, and approximately $420 million for the Local Food Purchase Assistance Cooperative Agreement, a program that supports food banks and other local organizations in providing food to their communities.

The decision follows efforts by the Trump administration and Elon Musk's Department of Government Efficiency (DOGE) to cut federal spending in an attempt to reduce government waste. Both USDA programs were funded through the Commodity Credit Corporation, a fund established during the Great Depression to buy products directly from farmers.

A USDA spokesperson said in an email to CBS MoneyWatch, "Unlike the Biden Administration, which funneled billions in [Commodity Credit Corporation] funds into short-term programs with no plan for longevity, USDA is prioritizing stable, proven solutions that deliver lasting impact."

Schools across the country have recently been notified that they will lose $660 million in federal funding for the current year, according to Diane Pratt-Heavner, director of media relations for the School Nutrition Association. This funding cut comes at a time when schools are already struggling with rising food prices.

"It's a pretty big hit," said Patti Bilbrey, director of nutrition services at the Scottsdale Unified School District in Arizona. Her district had planned to use the funding for local beef and produce for student meals, and the loss of this money will significantly affect their ability to support local farmers.

While the $100,000 loss represents only about 2% of the district's $6 million annual food budget, Bilbrey explained that it allowed them to purchase food from small local farmers and introduce new produce, like microgreens, to students. She noted that the funding cut comes at a time when districts are struggling to keep school meals affordable amid rising food and labor costs.

"The Local Food for Schools program was a godsend to us," Bilbrey said. "It kept our meal costs down, and we were helping our community, which improved the perception of school meals."

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