While this is a new accounting environment for many lawmakers, states already felt this pressure during the federal shutdown last fall and its effect on Supplemental Nutrition Assistance Program (SNAP) benefits. The shutdown chaos exposed the messy balance between Washington and the states in paying for and administering food assistance — a shared responsibility that devolved into confusion after the U.S. Department of Agriculture (USDA) said it would not fund the program during the shutdown.
Twenty-five states sued the Trump administration, asking a federal judge to force USDA to tap emergency contingency funds to provide benefits. As the issue worked its way through the courts, some states directly covered the full cost of food benefits, others administered partial payments and some did not pay beneficiaries anything.
While Washington ultimately passed a shutdown-ending bill that funds SNAP until this fall, state leaders should look beyond this year’s budget cycle to understand how their overreliance on and deference to Washington led to this fiscal mess and take some important steps to prepare for future fiscal realities.
Since Congress made the food stamp program permanent in 1964, the federal government has shouldered most of its cost, covering all benefits while evenly splitting administrative costs with the states. With Washington footing the bill, states have had little incentive to scrutinize their SNAP enrollment and program eligibility measures. The Biden administration only made matters worse, discouraging states from policing their rolls. As a result, errors in SNAP benefit payments have now soared, costing more than $10.2 billion annually — and states are about to pay the price.
Under the One Big Beautiful Bill Act, the SNAP cost-sharing agreement is changing. Starting in 2027, states will have to cover 75 percent of administrative costs. More significant, however, is the requirement that, beginning in 2028, states with a payment error rate at or above 6 percent will also be on the hook for a portion of direct benefits. These changes will finally hold states accountable for making sure SNAP benefits reach only those who qualify.
Most states are not prepared for this transition. The latest data is sobering, showing that 42 states have a SNAP payment error rate at or above the 6 percent threshold. Unless they can get their error rates down, those states will be liable for hundreds of millions of dollars.
And while 2028 seems distant, the error rates states posted in 2025 or will post this year will determine how much they’ll be penalized. If they don’t drive down their error rates now, for example, Pennsylvania will owe $640 million, Florida $963 million and California $1.8 billion. Because most states are required to balance their budgets, their leaders will soon face a choice: fix SNAP integrity issues or divert funds from other priorities.
The Foundation for Government Accountability has outlined several commonsense measures states should implement to strengthen SNAP integrity, including prohibiting state agencies from waiving work requirements, closing broad-based categorical loopholes and removing the deceased from SNAP rolls.
Beyond improving program integrity, state leaders must also consider how a little-understood mechanism of federal influence has helped drive error rates so high — and how to prevent its influence in the future. That mechanism is guidance — federal agencies’ nonbinding policy instructions or recommendations that states often choose to follow. New research from the Alliance for Opportunity and the Center for Practical Federalism finds that federal guidance — and how states implemented it — was a major driver of high SNAP error rates.
Consider how guidance issued by the Food and Nutrition Service (FNS) encouraged states to streamline their enrollment procedures. Most states implemented this guidance to make sign-ups easier but failed to create systems to efficiently vet and audit their SNAP rolls. Many states also followed FNS guidance to remove SNAP asset limits by redefining benefits more broadly.
State lawmakers can push back on this trend and require more oversight of federal guidance. Utah, for example, requires its state agencies to disclose all guidance it receives to the Legislature, which examines its potential impact on the state. Other states should follow suit.
State lawmakers will face tough budget decisions as they determine how to meet the new SNAP requirements. They should seize the opportunity this legislative session to insulate themselves from future Washington dysfunction by exercising responsible stewardship, ensuring that programs like SNAP serve those in need without wasting taxpayer dollars.
Madison Ray is the senior director of the State Policy Network’s Center for Practical Federalism.
Governing's opinion columns reflect the views of their authors and not necessarily those of Governing's editors or management.
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