Conservative Spin on Reagan's "Ketchup is a Vegetable"

All the Reagan retrospectives reminded me of this.  I used to work with a bunch of ditto-heads, and one of them had a rationale for proclaiming "ketchup is a vegetable".  The argument was that it had nothing to do with nutrition, but that by categorizing ketchup as a vegetable, the government could supply the schools with cheaper surplus ketchup.

This smells beyond fishy, but I like to check things out before dismissing them offhand.  Can anyone point me to some primary sources that would debunk this?