The number of low-income Hawaii children receiving free lunch during the summer through a federally funded nutrition program has declined sharply, a drop the state attributes to fewer participating organizations opting to serve a midday meal.

But officials point out that more needy kids are being served at least one meal during the summer, thanks to a big growth in the number of sites statewide offering breakfast or snacks.

A new report says 38 percent fewer kids – or about 4,000 fewer students – received free lunches last year compared with 2008. And the situation does not appear to have improved this summer, an official said.

State officials said several agencies stopped offering lunch through the summer food service program last year because the cost of prepared food exceeded the meal’s federal reimbursement rate.

The summer food service program, designed to provide a stopgap for kids on summer break who get free or reduced-price lunch during the school year, served an average of 6,589 Hawaii children per day in July 2009. In July 2008, 10,623 kids per day were served on average, according to a report released last week from the Washington, D.C.-based Food Research and Action Center.

Nationally the number of children on average participating in the summer nutrition program fell by 73,000 (or 2.5 percent) in July 2009, to 2.8 million.

The drop in Hawaii children getting lunch through the program comes as more families are seeking assistance and as other nutrition programs – from food stamps to reduced or free school lunches – are seeing big enrollment increases.

Terri Kam-Ogawa, DOE child nutrition specialist, said organizations sometimes take a financial loss to participate in the summer nutrition program, funded by the U.S. Department of Agriculture.

But in the tough economy, several could not afford the out-of-pocket cost.

"Most of the sponsors that have to vend their meals chose to do breakfast because at least they can break even," Kam-Ogawa said. "That’s what I encouraged them to do. At least the kid would have one meal."

The city’s popular Summer Fun program, worried about escalating costs, opted last year to serve only breakfast at 19 of the 24 sites where children in disadvantaged areas get a meal during the day. (Kids at the breakfast-only sites bring a brown-bag lunch.)

Five sites, all on the Leeward Coast, still serve lunch.

"Our goal was to serve them a warm meal," whether breakfast or lunch, said Les Chang, director of the city Parks Department, which oversees Summer Fun.

Hawaii’s federal reimbursement for lunch in the program is $3.73 for an urban site and $3.80 for a rural site. But vendors here charge $4.20 to $4.65 to prepare a lunch, officials said.

The federal reimbursement for breakfast is $2.16, and vendors ask about that much to make and transport the meal.

A typical breakfast includes milk, juice and cereal or a muffin. A lunch includes milk, a fruit or vegetable, bread and one meat or "meat alternate."

Hawaii and Alaska have a higher reimbursement rate than the rest of the nation.

The state could not provide figures on how many organizations are offering lunch this year because receipts are still being tallied, but Kam-Ogawa said it appears many that opted out of serving lunch in 2009 are doing the same this year.

She pointed out, though, that there are new participants in the program, including Kamaaina Kids, which offers free breakfast and lunch to anyone 18 and under at three Oahu sites.

"When children are in public school, they get a nutritious breakfast and lunch," said Buffy Owens, of Kamaaina Kids. "We entered into this knowing that the intent was not to make money."