According to the San Francisco Chronicle, since April, the district has paid up to $1.5 million a month to cover the cost of the program for low-income students.
State inspectors cited the district after making surprise visits to a dozen schools. None of the violations had to do with the quality of food being served.
Inspectors say they found critical problems with the way the district dealt with the bureaucratic rules.
The district says they have been working on the problem since the inspection and hope to get federal funding back.