Commodity Allowance Act

Commodity Allowance Act - Amends the National School Lunch Act and the Child Nutrition Act of 1966 to direct the Secretary of Agriculture to issue commodity allowances to States, schools, and service institutions participating in food service programs, for the purchase of domestic agricultural commodities in lieu of providing such commodities to such entities.

Requires the Secretary to issue such allowances not later than the school year beginning September 1982 to States participating in the school lunch program, specifying the types of commodities to be purchased. Sets forth the minimum national average value of food assistance for each lunch which shall be adjusted annually to reflect changes in the Price Index for Food Used in Schools and Institutions.

Provides for the apportionment by the Secretary of commodity allowances between the States and for States to apportion such allowances among their schools. Directs the Secretary to make advance program payments to each State not later than July 1 and January 1 of each fiscal year for the purchase of domestic agricultural commodities by the schools.

Sets forth administrative procedures for the provision of commodity allowances and surplus agricultural commodities to participating States and schools.

Prohibits the Secretary, after June 30, 1981, from offering commodity assistance based upon the number of breakfasts served to children under the Child Nutrition Act of 1966.

Amends the National School Lunch Act, the Child Nutrition Act of 1966, and other applicable laws to remove various provisions relating to donated foods by the Secretary and provide for the issuance of commodity allowances, with the exception of Indian tribes which request federally donated foods.

Authorizes States and certain food program recipients to elect to receive cash payments in lieu of commodity allowances under this Act.

Permits the Secretary to issue commodity allowances to any State qualifying for disaster relief.

Sets forth penalties for violations of this Act and makes such Act effective October 1, 1981.