The letter, which was reviewed by CNN, told parents that "several letters were sent home with your child" and that no payments were made.
"Your child was sent to school every day without money and without breakfast and / or lunch," the letter said. Failure to provide children with food could also result in parents being sent to the court of dependency.
"Bringing your child away from home and placing you in a foster home can result in being brought before a court," the letter said.
CNN has contacted the Wyoming Valley West School District, but has not heard of it.
According to the school department, more than $ 22,000 was owed to the district's parents.
Muth informed the subsidiary that the school district is considering serving students with criminal accounts such as peanut butter and jam buns.
"Arming my agency was simply outrageous"
Joanne Van Saun, who heads the local agency, told CNN on Saturday that she feels her agency has arms to threaten families.
"We exist to protect and protect families, the only time a child is taken out is that it can not be safely cared for in their home," she said. "Our agency has helped many children and families pay rent and buy clothes, and we know children are better off when they're with their families."