New SNAP Cost-Sharing Rules Set to Cost States Billions Starting 2027
6 verified5 unconfirmed1 contested
New federal cost-sharing requirements for the Supplemental Nutrition Assistance Program (SNAP) will take effect in fall 2027, forcing states with high payment error rates to fund a portion of benefits from their own budgets. The rules were included in the One Big Beautiful Bill Act, signed into law by President Donald Trump in July 2025. According to the U.S. Department of Agriculture, the national SNAP improper payment rate stood at 10.62% in 2025, a slight decline from the previous year. The Center on Budget and Policy Priorities estimated that states could face combined costs of roughly $9 billion. Many states could owe over $100 million annually. Some state officials have criticized the policy, arguing it will not improve payment accuracy and could strain state budgets. Others note the threat of penalties has already prompted states to invest in technology and training to reduce errors.
What’s verified
The One Big Beautiful Bill Act, signed in July 2025, introduced state cost-sharing requirements for SNAP based on payment error rates.
Starting in fall 2027, states with an error rate above 6% must fund 5% to 15% of their SNAP benefit payments.
The USDA reported a national SNAP improper payment rate of 10.62% in 2025, with overpayments far more common than underpayments.
The Center on Budget and Policy Priorities estimated states could face combined costs of around $9 billion; many states could owe over $100 million annually.
New Jersey Human Services Commissioner Stephen Cha criticized the penalty, saying it would not improve payment accuracy and would burden state and county governments.
A survey by the Urban Institute and the American Public Human Services Association found that 11% of states see withdrawal from SNAP as a potential risk and that states are making operational investments to improve accuracy.
Where accounts differ
Number of states affected: One source reports that as many as 36 states will face the new cost-sharing requirements. Another source reports that only nine states had error rates below the 6% threshold, implying 41 states are above it.
Not yet confirmed
The claim that more than 4 million Americans have lost SNAP benefits appears in only one source.
Specific state cost estimates for Michigan ($300 million), Texas ($725 million), and New York (more than $1 billion) appear in only one source.
Oklahoma Governor Kevin Stitt’s comments suggesting increased stigma around food assistance appear in only one source.
The detail that overpayments are about seven times as common as underpayments appears in only one source.
An Alaska exemption from the new rules appears in only one source.
Misconceptions
Some characterizations of the error rate equate it with fraud, but the sources note that the rate primarily captures unintentional overpayments and underpayments, not intentional fraud.
Key figures
President Donald Trump
Agriculture Secretary Brooke Rollins
Stephen Cha, Commissioner of the New Jersey Department of Human Services
Katie Bergh, Senior Policy Analyst at the Center on Budget and Policy Priorities
Gina Plata-Nino, SNAP Director at the Food Research & Action Center
Matthew Chase, CEO of the National Association of Counties
Oklahoma Governor Kevin Stitt
Romina Boccia and Tyler Turmin, budget policy experts at the Cato Institute
Sources: stateline.org, reason.com
