A university setting often has a cafeteria or other method of feeding the students, and one of the employment benefits is getting to eat there "for free" - but then for tax reasons they list it out separately on the income statement.
Not sure how common it is in the US, but at Berkeley the cafeterias are not free. They are a bit cheaper, around $9 for lunch if you prepay, but $13 if you don't!
To be honest, I don't even think faculty are told how to take advantage of this... they're off campus too and in the last couple of years, the hours have not been great. Food is totally fine for what it is, though!