The School Breakfast Program was established in 1966 as a two-year pilot project designed to provide categorical grants to assist schools serving breakfasts to "nutritionally needy" children. While the term "nutritionally needy" was not defined, the original legislation stipulated that first consideration for program implementation was to be given to schools located in poor areas or in areas where children had to travel a great distance to school. To encourage schools in needy areas to participate, Congress authorized higher federal payments for schools determined to be in "severe need." During the first year of operation, the SBP served about 80,000 children at a federal cost of $573,000.