This handbook is designed to serve as a resource guide to New York school district officials who are involved in the application approval, hearing, and verification processes for the National School Lunch and School Breakfast Programs, and for those exercising the free milk option of the Special Milk Program. Detailed information and clarification are provided about eligibility requirements for free and reduced price meals and/or free milk. Issues include the following: (1) free and reduced price policy; (2) public notification of the availability of benefits; (3) application process; (4) determining household size; (5) determining income; (6) verification process for school meals; (7) verification methods; (8) confirmation of eligibility based on income information; (9) confirmation of categorical eligibility; (10) completion of verification; (11) special milk program; (12) program operations; and (13) collection methods. The appendices include a chart illustrating sources of acceptable income documentation, and sample forms and form letters which schools can use during the verification process, when contacting households, or making collateral contacts. (FMW)