This report found that school districts fail to take advantage of healthier foods offered by the federal child nutrition commodity program, despite improvements in the nutritional quality of foods offered to schools by USDA. The study found that, in California, meat and cheese products accounted for more than 82% of the dollars spent on commodity foods, while only 13% were used to purchase fruits, vegetables, and legumes. Nationally, the study found that more than 50% of commodity foods are sent to processors before they arrive at schools. Processing is completely unregulated as to nutritional quality. As a result, the items most frequently purchased-ground beef, cheese and chicken-are served to children as hamburgers, pizza and chicken nuggets, which are high in calories and saturated fat. School districts need assistance in using the commodity program wisely and fully to assure the highest nutritional meal quality for their students.