Have you ever considered having them make their own gear? (It's been too long - are there perhaps some other merit badges they could get simultaneously, for sewing, working with tools, etc.?)

Some possible projects include pop-can or cat-food-can alcohol stoves (using empty water bottles like Dasani, etc., for fuel storage, and aluminum flashing for windscreens), ponchos (assuming silnylon or coated nylon isn't hideously expensive), and even (at a higher skill level) frameless packs and tents. (Tarptent and Gossamer Gear used to give away patterns for a basic pack and tent on their websites.) Sleeping bags or quilts are a possiblity, but may well exceed the skill levels available.

Other low-cost options would include using chlorine dioxide tablets instead of filters, and lightweight stainless steel mixing bowl sets (from WalMart or similar; I had one years ago that cost $10, included nesting quart, pint, and cup bowls with plastic lids, and made a great mess kit.) Silnylon tarps are less expensive than tents; the green poly tarps from Walmart are cheaper yet (but a bit harder to use and subject to wear and tear.) Empty bottled water bottles are fine for, well, water bottles. A ziploc bag, some bandaids and moleskin, and a trip to the sample-size counters at the drug store give everyone a start at a first aid kit.

I'm sure others can offer other low-cost gear suggestions for the typical Scout use.