Dozens of States Face Potential New Costs Over SNAP Payment Errors

Dozens of states may soon face new financial burdens related to the Supplemental Nutrition Assistance Program (SNAP), as a federal law enacted last year introduces cost-sharing requirements based on payment error rates. Beginning in October 2027, states with error rates of 6% or higher could be responsible for paying a portion of SNAP benefits.

The error rate is defined as the percentage of SNAP benefits paid out incorrectly, either above or below the amount recipients should have received. Data released by the U.S. Department of Agriculture provides the first look at how states might fare under these new provisions. The law, signed by President Donald Trump, aims to increase accountability for both participants and states.

States that maintain low error rates will be exempt from these new costs. Nine states, including South Dakota (2.5% error rate) and Nebraska (5.9%), have error rates low enough to avoid the cost-sharing requirement. Other states below the 6% threshold include Idaho, Iowa, Kentucky, Vermont, Utah, Wisconsin, and Wyoming.

Federal law establishes a sliding scale for states with higher error rates. Those with error rates between 6% and 8% will be required to pay 5% of the benefit costs. Error rates between 8% and 10% will result in states paying 10% of benefit costs, and rates exceeding 10% will require states to cover 15% of benefit costs.

For example, Missouri, which had an 8.7% error rate in the 2025 fiscal year, could be liable for 10% of its SNAP benefit costs starting in October 2027. Based on 2024 figures, Missouri distributed approximately $1.5 billion in SNAP benefits. If that amount remains constant, the state could owe around $150 million annually.

However, states with the most significant error rates have a reprieve. Those with error rates of at least 13.34% in the 2025 fiscal year will have their cost-sharing requirements delayed until at least the 2029 fiscal year. Alaska, with an error rate exceeding 23%, is among the states eligible for this delay. Other jurisdictions receiving a one-year delay include Delaware, Georgia, Illinois, New Mexico, Oregon, and the District of Columbia. States that exceed 13.34% in 2026 could see their cost-sharing delayed until the 2030 fiscal year.

The impending cost-sharing could force states to make difficult budgetary decisions. Options include reducing spending in other public services such as education or law enforcement, tightening eligibility rules to remove people from SNAP, or potentially withdrawing from the program altogether. A survey of state SNAP agencies indicated that over a quarter of responding states might consider narrowing eligibility policies, and four states are contemplating withdrawal from the federal program.

SNAP, informally known as food stamps, provides monthly payments to low-income individuals and families to purchase food. In March, over 37 million people nationwide received SNAP benefits, a decrease of over 11% from the previous year. The law that introduced these cost-sharing requirements also expanded work requirements for certain adult SNAP recipients, intended to offset federal savings from tax cuts.

Advocates for low-income residents have called on Congress to delay or repeal these cost-sharing mandates, citing the ongoing struggles many families face with high grocery prices and recent reductions in food assistance.