States Race to Cut SNAP Errors to Avoid Penalties

U.S. states are updating technology and eligibility verification processes to reduce payment error rates in the Supplemental Nutrition Assistance Program (SNAP). Under the One Big Beautiful Bill Act, states with error rates of 6 percent or higher starting in October 2027 must cover 5 to 15 percent of benefit costs. In 2025, 41 states and the District of Columbia exceeded this threshold, with California, New York, and Florida potentially facing costs exceeding $1 billion each.

Brooke Rollins, the Secretary of Agriculture, stated that state accountability is severely lacking in the program. The United States Department of Agriculture reported significant waste at the state level, while the United States Government Accountability Office found that improper payments primarily resulted from failures to verify eligibility criteria. Since the act took effect in July 2025, SNAP participation has dropped 12 percent to 37 million recipients.

Financial pressures are increasing as states will bear 75 percent of program administration costs starting this October, up from 50 percent. While Virginia, Louisiana, Mississippi, and Minnesota are implementing system updates, four unnamed states are considering exiting the program entirely. A provision known as the Alaska Carveout delays penalties until 2029 or 2030 for states with error rates of 13.34 percent or higher.