Title of Regulation: 8VAC20-740. Regulations Governing Nutritional Guidelines for Competitive Foods Sold in the Public Schools (adding 8VAC20-740-10 through 8VAC20-740-40).

Statutory Authority: § 22.1-207.4 of the Code of Virginia.

Public Hearing Information:

October 24, 2013 - Immediately following adjournment of the 11 a.m. Board of Education business meeting - James Monroe Building, 101 North 14th Street, 22nd Floor Conference Room, Richmond, VA

Public Comment Deadline: October 31, 2013.

Agency Contact: Catherine Digilio-Grimes, Director of School Nutrition Programs, Department of Education, P.O. Box 2120, Richmond, VA 23218, telephone (804) 225-2074, or email catherine.digilio-grimes@doe.virginia.gov.

Basis: Section 22.1-207.4 of the Code of Virginia requires the Board of Education, in cooperation with the Department of Health, to promulgate and periodically update regulations setting nutritional guidelines for all competitive foods sold to students during regular school hours that are not part of the federal school lunch or school breakfast program.

Purpose: Chapter 718 of the 2010 Acts of Assembly requires in the development and implementation of the regulations regarding nutritional guidelines. The rising rate of childhood obesity has become a major health concern because of both its impact on childhood health and as a contributing factor to the development of chronic disease in adulthood. In response to this growing concern, attention has focused on the need to establish nutrition standards for foods in schools by offering healthier food options on school grounds. From a nutritional perspective, the goal is to increase the consumption of whole grains, fruits, vegetables, and nonfat or low-fat dairy, and reduce fat, sugars, and sodium. Federal regulations governing the national school lunch program, school breakfast program, and afterschool snack program establish nutrition standards for school meals and snacks, and strengthened federal nutrition standards are pending. Nutritional standards for competitive foods can complement the federal school meal nutrition standards for an overall healthier eating environment in schools. In addition, it is anticipated the U.S. Department of Agriculture will establish nutritional standards for competitive foods in schools.

Substance: The proposed regulation sets nutritional standards for competitive foods sold to students on school grounds during regular school hours in the areas of calorie, fat, sugar, and sodium content, and foods of minimal nutritional value. Competitive food means any food, excluding beverages, sold to students on school grounds during regular school hours, that is not part of the school breakfast or school lunch programs. In the school setting, these are typically food items sold to students as a la carte items in the cafeteria, in vending machines, in school stores or snack bars, and through other school activities. Beverages are not included in the definition of competitive food. In addition, food items served or provided, but not sold, to students, or those sold outside regular school hours or off school grounds, are outside the purview of the regulations.

The guidelines are based on the Institute of Medicine's (IOM) nutrition standards for competitive foods in schools.

In addition, a local school board must adopt the state guidelines set forth in the regulation as part of its existing local wellness policy and annually report on the status of the development and implementation of the policy to the Department of Education.

Issues: Nutritional standards for competitive foods can complement the federal school meal nutrition standards for an overall healthier eating environment in schools.

Additionally, the rising rate of childhood obesity has become a major health concern because of both its impact on childhood health and as a contributing factor to the development of chronic disease in adulthood. In response to this growing concern, attention has focused on the need to establish nutrition standards for foods in schools by offering healthier food options on school grounds. Federal regulations governing the national school lunch program, school breakfast program, and afterschool snack program establish nutrition standards for school meals and snacks, and strengthened federal nutrition standards are pending. In addition, it is anticipated the U.S. Department of Agriculture will establish nutritional standards for competitive foods in schools.

Statewide nutritional guidelines for competitive foods sold to students during the school day would strengthen the local wellness policies and help address some of the factors that impact childhood obesity, as well as increase the nutritional quality of foods offered in the school setting.

The adopted regulations could affect a school's ability to continue to sell certain competitive food items to students. School divisions will be required to adopt the nutritional guidelines contained in the regulation as part of their local wellness policies.

Potential disadvantages associated with this regulation to the public and regulated community include the following: (i) school divisions will be impacted administratively, as they will be required to adopt the new state nutritional guidelines as part of their required local wellness policies; (ii) with newly released (June 27, 2013) Interim Federal regulations for Nutrition Standards for All Foods Sold in School, schools and vendors to the schools may have two sets of regulatory requirements to follow, which may conflict, and (iii) as schools change the food offerings on the school site during the school day to meet the adopted nutritional guidelines, they may experience financial impact. Disadvantages to the Commonwealth and agency include the following: (i) the Department of Education will be required to ensure compliance with both state and newly published federal regulations with different provisions, and (ii) the department may need to provide additional ongoing staff support and technical assistance to school divisions in the implementation of these regulations.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. Senate Bill 414 (2010 Acts of Assembly) amended the Code of Virginia by adding Section 22.1-207.4 on nutritional guidelines for competitive foods. The legislation requires the Board of Education (Board), in cooperation with the Department of Health, to promulgate and periodically update regulations setting nutritional guidelines for all competitive foods sold to students during regular school hours that are not part of the federal school lunch or school breakfast program. The term competitive foods refers to food items served in the school setting outside of planned meals under the federal school lunch and school breakfast programs, and which may compete with foods served under the federal programs. Further, the legislation specifies "That in promulgating its regulations pursuant to this act, the Board of Education shall adopt either the Alliance for a Healthier Generation's Competitive Foods Guidelines or the Institute of Medicine's Recommended Standards for Competitive Foods in Schools as the initial statewide standard for competitive foods." Pursuant to the legislation, the Board proposes the maximum calorie, fat, sugar, and sodium content for competitive foods contained within the Institute of Medicine's Recommended Standards for Competitive Foods in Schools.

In addition, federal regulations require every school division to have wellness policies that address nutrition and physical activity. The content and implementation of these policies have been at the discretion of the local school divisions. The proposed regulations would require each local school board to adopt the state nutrition guidelines as part of their existing local wellness policies.

Result of Analysis. There is insufficient data to accurately compare the magnitude of the benefits versus the costs. Detailed analysis of the benefits and costs can be found in the next section.

Estimated Economic Impact. At present, there is no federal regulation for competitive foods sold in schools. The U.S. Department of Agriculture is in the process of developing nutrition standards for competitive foods, as authorized under the 2010 federal legislation that reauthorizes the federal school meal programs (Healthy, Hunger-Free Kids Act of 2010). It is expected that the Institutes of Medicines standards will be the basis for the federal regulations,¹ and that the federal regulations will be in place for the 2013-2014 academic year.

In order to be consistent with the expected federal regulations, the Board proposes to adopt the Institute of Medicine's Recommended Standards. These proposed regulations will likely be in effect prior to the federal regulations, and will thus likely have significant impact. Additionally, if the standards in the federal regulations turn out to differ in any attributes from Virginia's standards, whichever standard is more stringent applies. School divisions that do not comply with the standards would presumably be at risk of losing federal funds associated with the federal school lunch and school breakfast programs.

In practice it is common for schools to sell a la carte food items in addition to planned meals under the federal school lunch and school breakfast programs. An a la carte item means an individually priced food item served by the local school nutrition department that may or may not be part of the reimbursable meal under the federal child nutrition programs. A la carte items as well as food sold in vending machines and other food sold to students during regular school hours, including fundraisers, are subject to the maximum calorie, fat, sugar, and sodium content values in these proposed regulations. Beverages are exempt from the standards.

Most if not all school divisions sell competitive foods. The proposed standards will likely prohibit the sale of much of the competitive foods currently sold in most divisions. Thus, students throughout the Commonwealth will likely consumer fewer foods during the school day that are high in calories, fat, sugar, and sodium. This may result in improved health for Virginia's schoolchildren. On the other hand it may have some negative consequences on revenues for schools. For example, one Virginia school division that on its own decided to stop selling french fries has noticed an associated decrease in food sale revenue. This anecdotal example is countered though by a study² published in the Journal of School Health which found that "Thus far, few data exist to substantiate the concern that changes in nutrition standards in schools lead to a loss in total revenue." An interesting phenomenon of increased participation in the National School Lunch Program was noted in a number of reports and might play a role in buffering financial losses.

At least some firms and farms which produce foods that meet the proposed standards for competitive food will likely encounter greater demand for their products. For example, standard hamburgers currently provided to schools do not meet the proposed standards, but healthier hamburgers which do meet the proposed standards and cost 20 percent more are commercially available.³ Of course at least some other firms and farms which produce foods that do not meet the proposed standards for competitive food will likely encounter lesser demand for their products. Since Virginia school divisions all together comprise a significant market, there will likely be some adjustment in food production to meet the changed demand. Once the federal regulations are in place, the incentive for food manufacturers to adjust their products to meet the standards will be even greater given the market for schools nationwide.

Businesses and Entities Affected. The proposed regulations affect the 132 public school divisions in the Commonwealth as well as food producers and distributors which supply schools with food.

Localities Particularly Affected. The proposed regulations do not disproportionately affect particular localities.

Projected Impact on Employment. At least some firms and farms which produce foods which meet the proposed standards for competitive food will likely encounter greater demand for their products. These firms may hire new workers. Other firms and farms which produce foods that do not meet the proposed standards for competitive food will likely encounter lesser demand for their products. These firms may layoff workers.

Effects on the Use and Value of Private Property. The value of firms which produce foods which meet the proposed standards for competitive food may increase. The value of firms which produce foods that do not meet the proposed standards for competitive food may decrease.

Small Businesses: Costs and Other Effects. Small businesses which produce foods that are sold to schools and do not meet the proposed standards are likely to lose demand for their products. Depending on the product, it may be possible to adjust the product to meet the proposed standards. That would likely add to the costs, though.

Small Businesses: Alternative Method that Minimizes Adverse Impact. Adverse impact on small businesses could potentially be lessened with less stringent proposed standards. That would of course likely reduce to some degree the intended benefit of healthier food consumption.

Real Estate Development Costs. The proposed regulations are unlikely to affect real estate development costs.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 14 (10). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB's best estimate of these economic impacts.

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¹ Source: Virginia Department of Education

² Wharton CM, Long M, Schwartz MB. Changing nutrition standards in schools: the emerging impact on school revenue. J Sch Health. 2008; 78: 245-251.

³ Source: a Virginia-based food distributor which currently serves several school divisions

Agency's Response to Economic Impact Analysis: The agency concurs with the economic impact analysis completed by the Department of Planning and Budget.

Summary:

Consistent with Chapter 718 of the 2010 Acts of Assembly and the core nutrition components in the Institute of Medicine's nutrition standards for competitive foods in schools, the proposed regulations set nutritional standards for competitive foods sold to students in the areas of calorie, fat, sugar, and sodium content, and foods of minimal nutritional value.

CHAPTER 740
REGULATIONS GOVERNING NUTRITIONAL GUIDELINES FOR COMPETITIVE FOODS SOLD IN THE PUBLIC SCHOOLS

8VAC20-740-10. Definitions.

"A la carte item" means an individually priced food item served by the local school nutrition department that may or may not be part of the reimbursable meal under the federal Child Nutrition Programs.

"After school activities" means activities that occur on school grounds after regular school hours.

"Beverage" means a drinkable liquid.

"Calorie" means the amount of heat required to change the temperature of one gram of water from 14.5 degrees Celsius to 15.5 degrees Celsius. Calorie is used synonymously with kilocalorie as a unit of measure for energy obtained from food and beverages.

"Child Nutrition Programs" means school meal programs funded and regulated by the U.S. Department of Agriculture (USDA) and includes the National School Lunch Program (NSLP), School Breakfast Program (SBP), Child and Adult Care Food Program (CACFP), Summer Food Service Program (SFSP), and Special Milk Program (SMP).

"Competitive food" means any food, excluding beverages, sold to students on school grounds during regular school hours that is not part of the reimbursable meals served through the National School Lunch Program (NSLP), School Breakfast Program (SBP), or Afterschool Snack Program (ASP).

Competitive food includes all foods sold to students:

1. In school cafeterias as a la carte items not offered as a component of the planned reimbursable menu.

2. In vending machines located on school grounds during regular school hours.

3. As fundraisers held on school grounds during regular school hours.

4. In school snack bars on school grounds during regular school hours.

5. In school stores operated on school grounds during regular school hours by the school, a student association, or other school-sponsored organization.

6. At school activities such as special fundraisers, achievement rewards, classroom parties, school celebrations, classroom snacks, or school meetings held on school grounds during regular school hours.

This term does not apply to food a student brings from home for consumption at school.

"Dietary Guidelines for Americans" means guidelines jointly issued by the U.S. Department of Health and Human Services and U.S. Department of Agriculture and revised every five years and that provide authoritative advice based on current scientific evidence and medical knowledge for people two years of age and older about how good dietary habits can promote health and reduce risk for major chronic diseases.

"Food of minimal nutritional value" or "FMNV" means foods and beverages that are restricted by the U.S. Department of Agriculture (7 CFR 210.11(a)(2) and subsection (a) of Appendix B to 7 CFR Part 210 Definition) unless specifically exempted by USDA. The federal FMNV definition is limited to the following four specific categories of foods and beverages:

1. Soda water (any carbonated or aerated beverages, i.e., beverages that are labeled as "aerated" or that bubble and fizz for several minutes after opening).

2. Water ices (any frozen, sweetened water such as "…sicles" and flavored ice with the exception of products that contain fruit, fruit juice, milk, milk ingredients, or egg ingredients other than egg whites).

3. Chewing gum (regular and sugarless).

4. Certain candies (regular and sugarless), including:

a. Hard candy (e.g., sour balls, candy sticks, lollipops, starlight mints, after-dinner mints, sugar wafers, rock candy, cinnamon candy).

b. Jellies and gums (e.g., gum drops, jelly beans, and jellied and fruit-flavored slices and shapes).

c. Marshmallow candies, fondant, such as candy corn and soft mints, licorice, spun candy, and candy coated popcorn.

"Kcal" means kilocalorie, commonly known as calorie, which is a unit of measure in the United States for energy obtained from food and beverages. A kilocalorie is equal to 1,000 calories.

"Obesity" means obesity in children and adolescents referring to the age-specific and sex-specific body mass index (BMI) that is equal to or greater than the 95th percentile of the BMI charts of the Centers for Disease Control and Prevention (CDC).

"Regular school hours" means the same as the standard school day, as defined in 8VAC20-131-5, a calendar day that averages at least five and one-half instructional hours for students in grades 1 through 12, excluding breaks for meals and recess, and a minimum of three instructional hours for students in kindergarten. Regular school hours does not include school-related activities or events that occur either before or after the standard school day, such as clubs, yearbook, band and choir practice, student government, drama, childcare programs, interscholastic sporting events, school plays, band concerts, or other school-related programs.

"School food authority" or "SFA" means, under the federal child nutrition laws, the entity that is legally responsible for the operations and administration of the local school nutrition programs (i.e., school division).

"School Health Advisory Board" or "SHAB" means an entity formed according to the provisions of § 22.1-275.1 of the Code of Virginia that assists in the development of wellness policies as required by § 204 of Public Law 108-265 (42 USC § 1751 et seq.) and develops an annual report of activities that is required to be submitted to the Department of Education.

"Trans fat" means food items containing vegetable shortening, margarine, or any partially hydrogenated vegetable oil unless the label required on the food, pursuant to applicable federal and state law, lists the trans fat content as less than 0.5 grams per serving.

"Wellness policy" means a policy required for public schools participating in a nutrition program authorized by the Richard B. Russell National School Lunch Act (42 USC § 1751 et seq.) or the Child Nutrition Act of 1966 (42 USC § 1771 et seq.).

8VAC20-740-20. Applicability.

A. This regulation shall apply to all public school divisions, public schools, and school food authorities (SFAs) in the Commonwealth of Virginia.

B. This regulation shall not apply to beverages.

C. This regulation shall apply to the nutritional content of food items, excluding beverages, sold to students on the school grounds of any public school during regular school hours. It shall include:

1. Foods sold to students in vending machines.

2. Foods sold to students as a la carte items in the school cafeteria.

3. Foods sold to students at snack bars and stores operated by the school, a student association, or other school-sponsored organization.

4. Foods sold to students at school activities such as fundraisers.

D. This regulation shall not apply to the nutritional content of foods and beverages:

1. Provided through the National School Lunch, School Breakfast, and Afterschool Snack programs, as regulated by 7 CFR Part 210 and 7 CFR Part 220.

2. Sold at snack bars, concession stands, or athletic events after regular school hours.

3. Sold either during intermission or immediately before or after athletics events.

4. Sold for school-related fundraising activities that take place off school grounds.

5. Sold during activities that take place after regular school hours, such as clubs, yearbook, band and choir practice, student government, drama, sports practices, interscholastic sporting events, school plays, and band concerts.

8VAC20-740-30. Nutrition standards.

Competitive foods sold to students shall support the Dietary Guidelines for Americans by complying with the following nutritional standards:

1. Standard 1: Calories.

a. Snack items shall be 200 calories or less per portion or as packaged.

b. A la carte entree items shall not exceed calorie limits on comparable National School Lunch Program (NSLP) entrees. A la carte entree items shall not provide more calories or larger portion sizes than the comparable NSLP entree items. In accordance with 8VAC20-290-10, a la carte entree items for sale to students shall be limited to those entree items recognized as being components of the school breakfast program or school lunch program meal patterns.

2. Standard 2: Fat.

a. Snacks and food items shall meet the following criteria for dietary fat per portion or as packaged:

(1) No more than 35% of total calories from fat.

(2) Less than 10% of total calories from saturated fats.

(3) Zero grams of trans fat.

b. Exceptions: Nuts and seeds (allowed as combination products as long as other nutrient standards are met; the fat content will not count against the total fat content of the product).

3. Standard 3: Sugar.

a. Snacks and food items shall provide no more than 35% of calories from total sugars per portion or as packaged.

b. Exceptions:

(1) 100% fruits and fruit juices in all forms without added sugars.

(2) 100% vegetables and vegetable juices without added sugars.

(3) Unflavored nonfat and low-fat (1.0%) milk and yogurt.

(4) Flavored nonfat and low-fat (1.0%) milk with no more than 22 grams of total sugars per 8-ounce serving.

(5) Flavored nonfat and low-fat yogurt with no more than 30 grams of total sugars per 8-ounce serving.

4. Standard 4: Sodium.

a. Snack items shall meet a sodium content limit of 200 milligrams or less per portion or as packaged.

b. A la carte entree items recognized as being components of the school breakfast program or school lunch program meal patterns that are not part of the planned reimbursable menu shall meet a sodium content of 480 milligrams or less per portion. Portion sizes for a la carte entree items shall not be larger than the comparable portion size for NSLP entree items.

5. Standard 5: Foods of minimal nutritional value. In accordance with 8VAC20-290-10 and 7 CFR Part 210, all foods of minimal nutritional value (FMNV) as defined in 8VAC20-740-10 shall be prohibited from being sold to students on school grounds during regular school hours.

8VAC20-740-40. Implementation and compliance.

A. Each local school board shall adopt these nutrition guidelines as part of its existing local wellness policy.

B. Each local school board shall submit annually to the Department of Education the School Health Advisory Board (SHAB) Progress Report as required by § 22.1-275.1 of the Code of Virginia. This report shall include a status report on the development and implementation of the local wellness policy. This report shall be used by the Department of Education to monitor compliance with this chapter.