States Take Responsibility for SNAP Costs as Federal Government Cuts Wasteful Spending
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A new federal rule will require states to cover 75% of SNAP’s administrative expenses, saving taxpayers $3.4 billion annually and encouraging fiscal discipline at the state level.
Effective Thursday, the federal government is taking decisive action to rein in out-of-control spending by reducing its share of the Supplemental Nutrition Assistance Program’s (SNAP) administrative costs. Under the new rule, states will now be responsible for three-quarters of expenses such as staffing and training, a move projected to save taxpayers $16.9 billion over five years, or about $3.4 billion each year.
The Food Research & Action Center estimates that states may need to allocate between $3 million and $670 million to replace the lost federal funding for administrative functions. Major states like California, New York, Pennsylvania, Texas, and Michigan—often plagued by bloated bureaucracies—will feel the greatest impact. Some states have already begun the necessary process of adjusting budgets, and additional reforms are expected to further streamline government spending.
Starting in October 2027, states with SNAP error rates—measuring over- and under-payments—of 6% or higher could be required to fund a portion of the food benefits themselves. The Center on Budget and Policy Priorities projects that nearly half of the states could each incur $100 million or more in new costs, and that California and New York could face liabilities exceeding $1 billion if they fail to improve program integrity. This measure will incentivize states to crack down on waste, fraud, and abuse.
“And we may see some states decide that they need to withdraw from the program entirely,” said Katie Bergh, senior policy analyst at the Center on Budget and Policy Priorities.
Bergh noted that the previous funding model propped up inefficient programs in states with poor fiscal management. The changes are part of the One Big Beautiful Bill Act, enacted in July 2025, which also introduced stricter work requirements and limited eligibility for a small group of non-citizens. Since the law’s passage, SNAP enrollment has dropped from 42 million to 36 million as of June, reflecting a move toward personal responsibility and reduced dependency.
The U.S. Department of Agriculture, which oversees SNAP, has not responded to requests for comment.