States Face New Penalties as SNAP Payment Errors Top $10 Billion, USDA Says

States with error rates above 6 percent must also submit corrective action plans to the USDA’s Food and Nutrition Service, detailing how they will reduce errors.

Kelly McBride Ni

Published: 6/25/2026, 3:32:44 PM EDT

States Face New Penalties as SNAP Payment Errors Top $10 Billion, USDA Says — A close-up shot of a SNAP EBT information sign is displayed at a gas station in Riverwoods, Ill., on Nov. 1, 2025. (Nam Y. Huh/AP Photo)

States with high Supplemental Nutrition Assistance Program (SNAP) payment error rates could soon face new financial penalties after the U.S. Department of Agriculture (USDA) reported that improper SNAP payments totaled an estimated $10.1 billion nationwide in fiscal 2025. The USDA described the amount as “significant waste at the state level.”

The USDA announced on June 24 that the national SNAP payment error rate reached 10.62 percent in fiscal 2025, well above the 6 percent threshold set by Congress. The rate measures how accurately states determine eligibility and benefit amounts for SNAP recipients.

The fiscal year 2025 rate represents a slight improvement from the previous year but still remains high enough to trigger new accountability measures enacted under federal law.

Alaska recorded the nation’s highest payment error rate at 23.15 percent, followed by the District of Columbia at 18.66 percent, New Mexico at 16.81 percent, Delaware at 16.00 percent, and Georgia at 15.21 percent, according to USDA data. Illinois also reported a 14.67 percent error rate, and Oregon reported 14.14 percent.

The payment error rate covers both overpayments and underpayments but does not indicate fraud. Instead, it reflects benefits issued incorrectly because of eligibility or calculation mistakes, administrative errors, or reporting problems.

“These payment error rates are further proof that state accountability is severely lacking in SNAP,” said Agriculture Secretary Brooke Rollins.

“USDA has taken historic action to help interested states curb SNAP waste, and I hope other states, regardless of political leadership, prioritize needy families and the American taxpayer over politics," Rollins said.

USDA said states with payment error rates at or above 6 percent will be required to cover a portion of SNAP benefit costs, as stated in the One Big Beautiful Bill Act that passed last year.

Under the law, states with error rates between 6 percent and 8 percent will be responsible for funding 5 percent of their SNAP benefits. States with higher error rates will face larger cost-sharing requirements, with those at 10 percent or more potentially covering up to 15 percent of benefit costs. USDA said the new requirements could take effect as soon as Oct. 1, 2027.

For states with low error rates, the USDA reported that South Dakota posted the lowest SNAP payment error rate in the nation at 2.47 percent in fiscal 2025. Idaho followed at 3.85 percent, Wyoming at 3.96 percent, Kentucky at 4.70 percent, and Iowa at 5.34 percent.

For SNAP recipients, the new rules are for state agencies with high error rates, and the policy requires states with persistent payment mistakes to improve how they determine eligibility and calculate benefits.

States with error rates above 6 percent must also submit corrective action plans to the USDA’s Food and Nutrition Service, detailing how they will reduce errors. Some states could also face extra financial penalties under the program’s quality-control system.