The kids just started a reading program at our local library. They got started a little late (like a week) but have already made up the week that they missed and are now working on this weeks reading.
Basically this is all we are doing.
Lots and lots and lots of reading. They get to color in a little picture for every 15 minutes that they read/are read to and then at the end of the week they get some kind of treat if they have done enough. There is also some kind of craft/project during the week that they get to participate it.
I can't say enough about library programs during the summer. The programs are a huge help in keeping the kids entertained and motivated during the summer.