Key Takeaways
New USDA data released in late June puts the national SNAP payment error rate at 10.62 percent for fiscal 2025.
Under the One Big Beautiful Bill Act, states with error rates at or above 6 percent will cover 5 to 15 percent of benefit costs, and one estimate puts the total near $9 billion.
Only nine states sit below the 6 percent line, and SNAP enrollment has already fallen by 5.5 million people since January 2025.
A new federal rule is about to turn feeding low-income families into a line item on state budgets for the first time. Under the One Big Beautiful Bill Act signed last July, states whose SNAP payment error rates sit at or above 6 percent will have to cover 5, 10, or 15 percent of the benefit costs Washington has always paid in full. Fresh USDA data released in late June shows most states are nowhere close to safe.
The national payment error rate was 10.62 percent in fiscal 2025, and because the figure counts both overpayments and underpayments, it is not a measure of fraud. Only nine states, among them Iowa, Nebraska, and Wisconsin, came in under 6 percent. The Center on Budget and Policy Priorities estimates states could owe roughly $9 billion once the cost share begins, with nearly half of them facing $100 million or more.
The timing leaves a short runway. The benefit cost shift starts in October 2027 for most states, and they can use the lower of their 2025 or 2026 error rate. On top of that, the law raises the share of SNAP administrative costs that states pay from 50 to 75 percent starting this October.
"We really are in uncharted waters"
Paige Chickering, vice chair, Iowa Hunger Coalition
The strain is already showing. National SNAP enrollment has fallen by 5.5 million people since January 2025, according to the Food Research and Action Center, with the steepest drop in the months after the law passed. We covered the fight when the Senate farm bill kept the cost shift in place, and the summer version of the squeeze when 13 states skipped Summer EBT. Food banks are bracing for more of the same. Worth watching.
People Also Ask
What is the SNAP payment error rate?
It measures how often a state overpays or underpays SNAP benefits. The national rate was 10.62 percent in fiscal 2025, and USDA notes the errors are largely unintentional, not fraud.
How much could states owe for SNAP?
The Center on Budget and Policy Priorities estimates states could owe about $9 billion once the cost shift begins, with nearly half of states facing bills of $100 million or more.
When does the SNAP cost shift start?
For most states the benefit cost share begins in October 2027, based on the lower of their 2025 or 2026 error rate. The administrative cost share rises to 75 percent this October.
Why is SNAP enrollment falling?
Enrollment has dropped by 5.5 million since January 2025, which advocates attribute to new work and eligibility rules and added paperwork under the One Big Beautiful Bill Act.