Republicans’ One Big Beautiful Bill Act is overhauling the federal food stamps program to require states to pick up the tab when they have error rates above a specific threshold starting a few years from now.
The GOP Congress passed the One Big Beautiful Bill Act last week despite thin majorities in the House and Senate. While much of the bill focused on tax cut extensions and other changes to tax policy, it also reformed spending on federal programs to reduce spending alongside the tax cuts.
The legislation put in place new rules for the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps, that aim to combat fraud and reduce overpayments in the program.
Under the new law, states will be required to pay some of the cost of SNAP benefits for the first time ever if they have a payment error rate above 6% starting in 2028. Recent data shows that nearly all states would face payments a few years from now based on payment error rates in 2024.
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The U.S. Department of Agriculture (USDA) released data for fiscal year 2024 which found that 43 states plus the District of Columbia were above the 6% payment error rate threshold – which includes both overpayments and underpayments.
The only states that were below the 6% payment error threshold last year were South Dakota (3.28%), Idaho (3.59%), Wisconsin (4.47%), Wyoming (5.12%), Vermont (5.13%), Nebraska (5.5%), Utah (5.74%) and Nevada (5.94%) – while the U.S. Virgin Islands (3.54%) was the only territory under the threshold.
States and territories with the highest payment error rates were Alaska (24.66%), the District of Columbia (17.36%), Georgia (15.65%), Florida (15.13%) and New Mexico (14.61%).
The nationwide payment error rate was 10.93%, with 9.26% overpayments and 1.67% underpayments.
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Republican leaders in both chambers of Congress criticized states’ payment error rates in SNAP and touted the need for reforms in advance of the One Big Beautiful Bill’s passage, with Senate Agriculture Committee Chairman John Boozman, R-Ark., and House Agriculture Committee Chairman Glenn “GT” Thompson, R-Pa., saying changes will reduce overpayments.
“Another year, another troubling payment error rate in SNAP, a clear sign that the program lacks the state accountability measures hardworking taxpayers deserve,” the chairmen said in a joint statement. “The status quo, slap-on-the-wrist penalties from USDA have failed at maintaining program integrity in SNAP.”
The chairmen added that the OBBBA’s “historic reforms will give states skin in the game on SNAP benefits and ensure they have a real incentive to improve oversight and stop improper payments before they happen.”
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