Month: June 2025

On Monday, June 30, the U.S. Department of Agriculture released payment error rate (PER) data for the Supplemental Nutrition Assistance Program (SNAP) for the federal fiscal year 2024. This is usually an interesting, albeit wonky data point for advocates and state agencies: one of three performance metrics states are evaluated on through SNAP’s Quality Control process.

But now, the SNAP payment error rate potentially has multi-million dollar implications for states, thanks to Republican proposals in the ongoing budget reconciliation process that would require states to cost-share on SNAP benefits for the first time in the history of the program. The proposal would use states’ payment error rates to determine what percentage of SNAP benefits the states would be required to cover.

Iowa’s SNAP payment error rate (PER) for FY 2024 was 6.14%. This was significantly lower than the national average of 10.93%, though slightly worse than Iowa’s PER of 5.19% in FY 2023 (learn more about the history of the SNAP payment error rate in Iowa).

Iowa’s overall SNAP payment error rate of 6.14% includes an overpayment rate of 5.30% and an underpayment rate of 0.84%. Keep in mind: the payment error rate measures the accuracy of state agencies in determining SNAP eligibility and benefit amounts. The payment error rate does not represent program fraud. When overpayments are identified, the state is required to recoup those costs from program participants, often through garnishing tax returns or reducing future benefit amounts.

In the context of the reconciliation bill currently being debating in Congress, this means that unless Iowa could successfully get its PER back under 6% in FY 2025 or FY 2026, the state would be required to cover an estimated $27 million in SNAP benefit costs annually starting in FY 2028. But if Iowa’s payment error rate continues to slip, we could be on the hook for tens of millions more.

The current proposal, literally being debated in the Senate at the time this post was published, would require states to cover 75% of administrative costs for SNAP (currently 50%), and would also require states to cover a portion of the cost of SNAP benefits, based on the states’ payment error rate.

• For states with a PER below 6%, the cost-share would be 0%
• For states with a PER between 6-8%, the cost-share would be 5%
• For states with a PER between 8-10%, the cost-share would be 10%
• For states with a PER exceeding 10%, the cost-share would be 15%

A late amendment to pass the Senate Parliamentarian would allow states to choose their payment error rate from either FY 2025 or FY 2026 to determine their level of cost-share on benefits, beginning in FY 2028. The additional 25% cost-share on administrative expenses would begin a year earlier in FY 2027.

If these SNAP cost-share provisions pass and are signed into law, the state of Iowa could be on the hook for upwards of $40 million annually.

It’s not too late to contact Iowa’s Senators and House Representatives, and urge them to drop the SNAP cost-sharing provisions included in the budget reconciliation bill!

Last week, the U.S. Senate Committee on Agriculture, Nutrition, and Forestry released their budget reconciliation language, proposing the largest cut to SNAP in the history of the program.

Now is a critical time to contact your Senators and urge them to vote NO on the Senate budget reconciliation bill and the incredibly harmful cuts to SNAP contained within.

The Senate bill would:

• shift billions in additional administrative costs and benefit costs to the states, likely prompting states to slash eligibility or cut human services programs and leading to longer wait times for people to receive their benefits
  
  
• expand harsh work reporting requirements for older adults (ages 55-64), parents and caretakers of children ages 10+, veterans, people experiencing homelessness, and young adults aging out of foster care, putting 40,000 Iowans at risk of losing their SNAP benefits in part or in whole
  
  
• kick hundreds of thousands of refugees and asylees off SNAP (including approximately 4,000 in Iowa), some of the most vulnerable members of our society
  
  
• eliminate the SNAP Nutrition Education Program (SNAP-Ed), which supports a variety of important nutrition education efforts in the state of Iowa
  
  
• eliminate deductions for certain utility costs, reducing benefit amounts for families
  
  
• freeze future updates to the Thrifty Food Plan, which is used to calculate SNAP benefit amounts

For more information about the specific cuts to SNAP included in the Senate reconciliation bill, keep reading. Questions? Contact us at iowahungercoalition@gmail.com.

Cost-Shifting Benefits Would Take a Wrecking Ball to State Budgets

Like the House version, the Senate reconciliation bill proposes shifting billions of dollars in administrative and benefit costs to the states. This policy would put states on the hook for tens, if not hundreds of millions of additional annual costs, likely prompting states to slash eligibility for SNAP or eliminate programs.

Currently, states pay 50% of the administrative costs for the program, with the federal government covering the other half of administrative costs and 100% of the cost of benefits. The Senate proposal would require states to cover 75% of the administrative costs beginning in FY 2027 and includes a cost-share provision on benefits beginning in FY 2028 based on a state’s SNAP payment error rate (PER).

• For states with a PER below 6%, the cost-share would be 0%
• For states with a PER between 6-8%, the cost-share would be 5%
• For states with a PER between 8-10%, the cost-share would be 10%
• For states with a PER exceeding 10%, the cost-share would be 15%

While Iowa’s payment error rate is currently 5.19%, our PER was as high as 12.5% as recently as FY 2019. Had the Senate proposal been in place at the time, the state of Iowa would have needed to cover $64 million in SNAP benefit costs for FY 2019. And even if Iowa does manage to avoid any cost-shifting for benefits, we would still be on the hook for $15+ million in additional administrative costs every year.

And while Iowa has been successful at reducing its payment error rate over the past few years, SNAP application processing timeliness is the worst its been in 20 years. This is one unintended consequence we could see from states focusing greater attention on payment error rates: people waiting longer to receive the SNAP benefits they need and qualify for.

Expanding Work Requirements (That Don’t Work)

Another large focus of both the House and Senate versions of the reconciliation bill has been expanding work reporting requirements (also known as the three-month time limit) for Able-Bodied Adults Without Dependents (ABAWDs). The Senate version would:

• redefine “dependents,” effectively creating work requirements for parents and caregivers of children ages 10 and up
• expand work requirements to older adults ages 55-64
• eliminate exemptions for veterans, people experiencing homelessness, and young adults aging out of foster care

Here’s the thing about work requirements: they don’t work. They don’t increase employment. They don’t increase earnings. They just kick people off SNAP, leaving them worse off than they were before. A recent study by the Yale School of Public Health found:

• people with chronic conditions are more likely to lose SNAP coverage due to work requirements than those without chronic conditions
• some of the poorest households were most negatively impacted by SNAP work requirements, and were the least likely to be re-enrolled
• many beneficiaries who lose SNAP due to work requirements are receiving income, pointing to the administrative hurdles that cause people to lose access due to work reporting requirements, even when they may be employed

A recent study from the Brookings Institute also found that the work requirement policies included in the Senate reconciliation bill would inhibit SNAP’s recession-fighting abilities.

The Center on Budget and Policy Priorities estimates that the proposed changes to work requirements in the Senate reconciliation bill would put 22,000 Iowans at risk of being kicked off SNAP entirely, with another 18,000 Iowans seeing their household benefits reduced. This means that 15% of SNAP participants in Iowa are at risk of having their benefits eliminated in part or in total.