Summary — SB 769: Community Eligibility Provision Expansion Program — Establishment
Status
- Introduced: January 27, 2025 (Senate)
- Assigned to: Budget & Taxation; Education, Energy, and the Environment
- Hearing scheduled: February 26, 2025 (Budget & Taxation) (per bill materials)
- Effective date in bill text: July 1, 2025
Purpose
- Establishes a Maryland State Department of Education (MSDE) administered Community Eligibility Provision (CEP) Expansion Program to provide State funding to schools that participate in the federal Community Eligibility Provision of school nutrition programs.
- Intended to supplement — not replace — federal CEP reimbursements so high-poverty schools receive more support for breakfast and lunch programs.
Key provisions
- Program creation: Adds new Article – Education §7‑606 establishing the “Community Eligibility Provision Expansion Program” administered by MSDE.
- State payment formula: The State will pay the difference between (a) the applicable federal paid reimbursement rate and (b) the federal free reimbursement rate as set annually by USDA (42 U.S.C. § 1759A). This effectively increases per‑meal funding for CEP schools up to the federal free rate.
- Eligibility & distribution:
- Funding is available to schools participating in the federal CEP.
- MSDE must develop a process for county boards to participate, based on funding availability.
- MSDE must ensure funding distribution is based on the concentration of poverty within a county board’s public schools and consider geographic diversity when prioritizing funds.
- Funds are distributed to eligible county boards (local school systems).
- Appropriation: For FY 2027 and each fiscal year thereafter the Governor must include $10.0 million in the annual budget bill for the program.
- Reporting: MSDE must report to the General Assembly on program status and outcomes on or before July 1, 2026, and annually thereafter.
- Legislative intent: The General Assembly expresses intent that the State, county boards, and participating nonpublic schools maximize use of all available federal and State funds in implementing the program.
Fiscal impact (as analyzed)
- State general fund expenditures increase by an estimated $75,000 in FY 2026 (planning / limited contractor/admin costs).
- Beginning FY 2027, a mandated appropriation of $10.0 million annually (net increase in GF spending of $10.0 million per year).
- MSDE administrative/contract support needs were described in the fiscal note (contractor costs estimated up to $150,000, assumed split across fiscal years).
Who is affected
- Primary: Public schools participating in CER (CEP) and their students — especially high‑poverty schools; county boards of education (local school systems) that receive and administer funds.
- State: MSDE (program administration and reporting).
- Federal interaction: Could increase federal reimbursements indirectly if CEP participation rises.
- Small business: no direct fiscal effect per fiscal note.
Potential impacts and considerations
- Direct increased state funding targeted to high‑poverty schools to reduce local costs of offering free meals to all students under CEP.
- May provide an incentive for more schools/districts to adopt CEP, potentially increasing total federal meal reimbursements.
- Local school systems will receive most of the $10 million annually but may have related administrative responsibilities; local expenditures could change in proportion to new revenues and program choices.
- Administrative design choices (prioritization, participation process) are left to MSDE within the bill’s distribution criteria.
Related/companion legislation
- HB 271, HB 143, HB 1254 (companions)
- SB 579 (prior-session)
For further detail
- Full bill language and the Department of Legislative Services fiscal note provide the statutory text of §7‑606, the reimbursement mechanism tied to USDA rates, and the fiscal assumptions underlying the $10M appropriation and administrative costs.
