The number of children enrolled in the program nationwide exceeds the number in low-income families who would be eligible for it, based on a comparison of the school lunch enrollment figures with an annual survey by the Census Bureau, said Jean Daniel, an Agriculture Department spokeswoman.
Officials have calculated that as many as 27 percent of children now getting free or reduced-price meals are ineligible, she said.
Should the estimate be correct, the government may have spent about $1.8 billion last year buying lunches for children whose family income would have disqualified them. The Agriculture Department spent $6.8 billion on school lunches last year.
Eric Bost, the department's undersecretary for food and nutrition, said he thinks the 27 percent estimate of ineligibility is too high, but that the problem is significant.
Advocates for the poor accuse the department of inflating the number of ineligibles to come up with new criteria that will result in removing children from the program.
Jim Weill, president of a Washington advocacy group, the Food Research and Action Center, said a tougher verification process would scare away families of children whose low incomes would qualify. He said he suspects the problem is that some children who qualify for discount-priced lunches are instead getting free ones.
"But you should not willy-nilly make it harder for schools to operate just because a minor number of kids are given free lunches instead of reduced-price lunches," he said.
Under current program guidelines, children in a family of four with an income of less than $23,530 a year qualify for free lunches. Children in a four-member family with a total annual income less than $33,485 qualify for reduced-price meals, costing up to 40 cents per lunch.
Many schools now approve children for free and reduced-price lunches based solely on applications in which parents self-report monthly income and household size. Some also use as criteria whether families are on food stamps or are on temporary assistance for needy families, a welfare program.
Bost acknowledged that his department is looking at establishing new criteria, leaning toward a method called "direct certification" that allows schools to approve automatically free and low-cost lunches for children whose families are getting food stamps or temporary assistance. Schools can verify the information by checking with local officials in charge of those assistance programs.
"We want to look at improving the integrity of the program," he said. "We're not intent on doing anything that's going to prevent or prohibit children from participating."
The Agriculture Department is spending $2 million on a study of 22 school districts in 16 states that are testing ways to screen their school lunch programs for children who don't qualify. The study began in the 2000-2001 school year and is to be completed in June.
Preliminary results in August showed schools in the study already are screening out ineligible children.
For example, the number of children eating free meals at schools in East Stroudsburg, Pa., dropped from an average of 811 to 633 in the first year of the study. The number of children eating reduced-price lunches also fell from 305 to 257. The schools were verifying eligibility by requiring families to prove their incomes or show they were on food stamps or temporary assistance when they applied, according to the report.
Bost said more preliminary results are expected to be released at the end of the month.