Giving out lunch based on this criterion has led to what some observers have branded as "lunch shaming." As a result, many kids chose to skip lunch to avoid bullying.
New York City Council member Ben Kallos knows that effect all too well. He grew up in the Upper East Side section of Manhattan, which is known to be very wealthy, and attended the Bronx High School of Science. However, he stood out among his classmates.
"Not only did I come from a single parent household, but a multi-generational household, which meant I was eligible for free or reduced lunch," Ben Kallos, NYC Council member told CNBC's "On the Money."
He added that every day his friends would go out and buy lunch instead of staying in the cafeteria. So he had to make a choice between friends and food.
"I would tell them I wasn't hungry, when the truth is, I was starving," Kallos said.
"Every single child will be treated the same. No one will have to worry if their family can afford it…and we'll actually be giving kids an even start to life," said Kallos.