If Our School Uses a Third-Party Contractor To Provide Food Services, Can Those Costs Be Included In a Student's Cost of Attendance?

Award Year: 2023-24 KA-36468 Helpfulness Rating 122 page views

This guidance is specific to the 2023-24 award year and later.

Yes. Section 472 of the Higher Education Act of 1965 (HEA), as amended, [20 USC 1087LL], requires schools include an allowance "for a student electing institutionally owned or operated food services, such as board or meal plans, a standard allowance for such services that provides the equivalent of three meals each day."  Many schools contract with third-party food contractors for these services. The U.S. Department of Education (ED) provided clarification in Dear Colleague Letter GEN-22-15, COA-Q6:

"Does 'institutionally owned or operated food services' include institutionally contracted food services via a third party?

Yes. Contracted food and housing are considered institutional charges and typically make up a significant portion of institutional costs. Many institutions use food contractors and know the exact costs associated with these services. Appropriately including these costs in a student’s COA helps the student to obtain the maximum amount of financial aid permissible."

Note: Effective with the 2023-24 award year, the COA component for “room and board” has been renamed “food and housing.” See Section 472 of the HEA, as amended [20 USC 1087LL].

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