As meal debt explodes, WCSD weighs plan that could send unpaid accounts to collections

As of February 8, seven months into the 2017-18 school year, Washoe County students have racked up $88,986 in unpaid school meal debt — blowing by last year’s high of $66,000.

This year’s exploding meal debt, and the district meal policy it’s rooted in, have become an ever-increasing burden for the district.

Attempts to stem the yearly upward trend — through policy changes that, among other things, would have given students who owed money alternative lunches — have been met with harsh community criticism. But the district, which is forced to shoulder the accrued debt at the end of the year, has quietly been considering other options to stanch the red ink.

A new report from the district’s internal audit department details some of those options. One recommendation would, after exhausting other options, send unpaid accounts to debt collectors at the end of a school year.

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Collections, the report said, could be a solution to a system that currently has no way to hold parents accountable in paying back their debt.

A plan with “teeth”

Meal debt has doubled every year since 2015. Chief Operations Officer Pete Etchart said if the meal debt hadn’t grown at such an extraordinary rate, it’s unlikely that the district would need to change its meal policy.

This year’s debt, Etchart said, could easily top $100,000.

The current policy, established by the school board last May, allows elementary school students to run up unlimited debt and has zero consequences for parents who don’t pay.

What the district needs, Etchart said, is a plan that has “teeth” -- something with consequences.

“The only thing that anyone could come up with … is collections,” he said.

The audit department laid out a possible framework for how a collections process might work.

A school would attempt to contact a parent in six escalating steps. If the parent pays the debt, fills out a free and reduced lunch form or “communicates hardship” during any of the six steps, the process is halted.

If the parent remains unresponsive through all six steps, any negative balance left in the account at the end of the year would be forwarded to a collections agency.

"A difficult conversation"

If the district chooses to send overdue meal accounts to collections, it wouldn’t be the first to go down that path.

The report references three other “peer” school districts — two in Utah and one in Virginia — that refer unpaid debts to collections.

It will ultimately be up to the school board to implement any changes.

Etchart, who oversees Nutrition Services and is presenting the report to the board on Tuesday, is refraining from making any recommendations on how the board should vote — something district staff normally does when presenting to trustees.

This time, Etchart is placing the decision entirely on the board.

“It’s going to be a difficult conversation … there’s no easy answer here,” he said.

The district, he said, simply can’t afford tens of thousands of dollars of unexpected debt year after year. Especially considering the financial straits the district is in.

This year marks the 11th consecutive year the district has a budget deficit, estimated between $22 million and $28 million.

The board will discuss possible remedies to this year’s deficit on Tuesday.

“This is a tough time to be talking about delinquent debt in nutrition services,” Etchart said.

Etchart speculated that it would likely take multiple meetings for the board to settle on a new meal policy.

The only time constraint they’re up against is approving a new policy prior to the next school year.

“We’re not talking about low-income kids”

According to the school district, the majority of the ballooning debt is being caused by families that, at least on paper, should be able to afford a school meal.

Most of the families who need help paying for lunch are already getting it, Etchart said. Roughly 44 percent of the district’s 64,000 students are enrolled in the district’s free and reduced lunch program, which provides free meals for students whose families make less than $45,510.

“We’re not talking about the low-income kids who can’t afford a meal, I think it’s really important to recognize that,” Etchart said.

As the school district’s carte-blanche meal charge policy has been more publicized, district staff say they’ve seen evidence that parents are simply refusing to pay debt because they know there’s nothing the district can do about it.

Anonymous comments from school administrators, collected in the audit department’s report, also alluded that some parents might be trying to game the system:

Most of my parents can pay their balances, however, when they read in the paper that the district covers whatever is owed at the end of the year, and we can’t keep the report cards until the balance is paid, etc., the parents have no reason to follow through and pay. My AP and I have both called for the past 6 years when the balance is over $50, emails over $10 weekly. I have had parents say oh yes I’ll sign up online and never do, etc. A couple of families always have the best clothes, etc and don’t pay their bill… we are at a loss. A few of our worst offenders are actually parents that are employees of our district, they know that they can get away without paying.

But Etchart said the growing debt can’t solely be attributed to parents taking advantage of the lax policy. Some of the debt is from families who qualify and have been enrolled in the district’s free and reduced lunch program, but their applications have lapsed.

Some parents, the district said, have simply forgotten to resubmit the application. But Etchart speculated that some families may be fearful to fill out the forms and hand over personal information to the school district.

A portion of the debt might be attributed to families hovering just above the free and reduced lunch cutoff that are still struggling to make ends meet.

It’s a constant fear, Etchart said, that those people will be caught in the crossfire of whatever plan the district pursues to hold parents accountable for debt.

“Absolutely it’s a concern of mine,” he said. “When you create one policy that’s going after parents who have every ability to pay, and you’re using collections there, you can also — with that same broadsword — hurt parents who are truly struggling.”