He's 100% right. I teach at a middle school in L.A., and our administration actually PRESSURES the students to apply for free breakfast and lunch, because the school gets more money that way. On the second to last day of school, last week, I was given several books of free lunch and tickets for dates that were already past, July-Oct. They had submitted applications retroactively and the tickets were issued. They are completely useless, they do the student no good, they cannot be exchanged for anything else as far as I know... but on the books, it shows that those children needed free lunch.
But they didn't need it, several children looked downright puzzled when presented with these obsolete tickets, and said, "But we don't need these." So the district is actually requiring children to apply for aid that they don't want or need. What kind of message does that send, eh? I'm hating it.