The National School Lunch Program (NSLP) and the School Breakfast Program (SBP) provide federal cash and commodity support to participating public and private schools and to nonprofit residential institutions that serve meals to children. Both programs have a three-level reimbursement system. Children from households with incomes at or below 130 percent of the poverty line receive free meals. Children from households with incomes between 130 percent and 185 percent of the poverty level receive meals at a reduced price (no more than 40 cents). Table 8.8 shows the income eligibility guidelines, based on the poverty line, effective from July 1, 2003, to June 30, 2004. The levels are higher for Alaska and Hawaii than in the forty-eight contiguous states, Washington, D.C., Guam, and other U.S. territories. Children in TANF families are automatically eligible to receive free breakfasts and lunches. Almost 90 percent of federal funding for the NSLP is used to subsidize free and reduced-price lunches for low-income children.

Meals for children from households that do not qualify for free or reduced-price meals are also subsidized. There was a reimbursement of about 21 cents for each full-price school lunch during the 1999–2000 school year. Local school food authorities set their own prices for full-price meals. In 2003–2004 the reimbursement for each free school lunch was $2.19.

The National School Lunch Program (NSLP), created in 1946 under the National School Lunch Act (60 Stat 230), supplies subsidized lunches to children in almost all schools and in 6,000 residential and child-care institutions. About 16.4 million children (58.5 percent) received free or reduced-price lunches in 2003. (See Table 8.9.) According to the U.S. Department of Agriculture, by 2004, about 99,800 public and non-profit private elementary and secondary schools and residential child-care institutions participated in the program.

In the school year 1996–97, the U.S. Department of Agriculture changed certain policies so that school meals would meet the recommendations of the Dietary Guidelines for America, the federal standards for what constitutes a healthy diet.

The School Breakfast Program (SBP), created under the Child Nutrition Act of 1966 (PL 89-642), serves far fewer students than does the NSLP. The SBP also differs from the NSLP in that most schools offering the program are in low-income areas, and the children who participate in the program are mainly from low- and moderate-income families. In 2003 about 8.4 million students participated, with 82.8 percent receiving free or reduced-price (up to 30 cents) breakfasts. (See Table 8.10.) In 2003 the total federal cost of school food programs was estimated at $8.8 billion.