Overview
- The U.S. Department of Agriculture's June 24 FY2025 payment‑error report found a national error rate of 10.62 percent and $10.1 billion in improper SNAP payments, setting the benchmark for state obligations under the new law.
- Under the One Big Beautiful Bill Act, states with error rates above set thresholds must now pay a share of benefits and take on more administrative costs, exposing 41 states plus D.C. to potential charges based on FY2025 or a lower FY2026 rate.
- Minnesota’s error rate rose from about 9 percent in 2024 to over 12 percent in 2025, forcing the state to project roughly $250 million in added benefit costs over two years and plan multi‑million dollar IT and fraud‑detection investments.
- States are responding by funding system modernizations, boosting staffing, tightening verification rules, and offering staff incentives to cut overpayments, while counties that handle day‑to‑day casework face higher workloads and some recipients have already lost benefits.
- A built‑in Alaska carveout temporarily shields very high error‑rate jurisdictions and lets states choose between 2025 or 2026 rates, creating political tension over fairness and the timing of penalties as lawmakers negotiate Farm Bill and oversight changes.