Overview
- The USDA released FY2025 quality-control data on June 24 showing a national payment error rate of 10.62 percent, equal to about $10.1 billion in overpayments and underpayments.
- A law passed in July 2025 sets a sliding cost-share that will require states with error rates of 6% to 8% to pay 5% of benefits, 8% to 10% to pay 10%, and above 10% to pay 15%, with most payments taking effect on October 1, 2027 and states allowed to use either their 2025 or 2026 rates to determine exposure.
- States with PERs at or above 6% must submit Corrective Action Plans to the USDA, and jurisdictions with rates at or above 13.34% — including Alaska, the District of Columbia, New Mexico, Delaware, and Georgia — get a one-year delay on cost-share obligations.
- Many state agencies are already analyzing root causes and planning staff and technology investments, while some officials say they may narrow eligibility, cut services, or in rare cases consider leaving SNAP if the new liabilities are unsustainable; several states such as Florida, Arizona, and Illinois face particularly large potential bills.
- The payment error rate measures administrative mistakes that cause people to get too much or too little in benefits rather than proven fraud, and its release comes as SNAP enrollment fell to about 37 million people after expanded work requirements last year, heightening the stakes for low-income households and state budgets.