US consumer watchdog finds that school lunch fees are taking a toll on parents

abcnews.go.com:

The U.S. consumer watchdog has found that low-income families typically pay as much as 60 cents per dollar in fees when paying for school lunches electronically

NEW YORK — Single mother Rebecca Wood, 45, was already dealing with high medical bills in 2020 when she noticed she was being charged a $2.49 “program fee” each time she loaded money onto her daughter’s school lunch account.

As more schools turn to cashless payment systems, more districts have contracted with processing companies that charge as much as $3.25 or 4% to 5% per transaction, according to a new report from the Consumer Financial Protection Bureau. The report found that though legally schools must offer a fee-free option to pay by cash or check, there’s rarely transparency around it.

“It wouldn’t have been a big deal if I had hundreds of dollars to dump into her account at the beginning of the year,” Wood said. “I didn’t. I was paying as I went, which meant I was paying a fee every time. The $2.50 transaction fee was the price of a lunch. So I’d pay for six lunches, but only get five.”

The U.S. Department of Agriculture, which oversees the federal policy on fee-free school lunch, has mandated that districts inform families of their options since 2017, but even when parents are aware, having to pay by cash or check to avoid fees can be burdensome.

“It’s just massively inconvenient,” said Joanna Roa, 43, who works at Clemson University in South Carolina as a library specialist and has two school-aged children.

Roa said that when her son was in first grade and she saw the $3.25-per-transaction fee for lunch account transactions, she and her husband decided to send him to school with packed lunches instead.

“A dollar here and there, I expected,” she said.