CHOICES
A publication of AAEA
The Supplemental Nutrition Assistance Program (SNAP) provides electronic benefits for low-income households and individuals to purchase food. In fiscal year 2024, SNAP served about 42 million people each month, or about 1 in every 8 Americans. The average monthly benefit was $187 per person, and the total cost of the program was just under $100 billion (Jones, Todd, and Toossi. 2025). About 40% of SNAP beneficiaries are children under 18 years old and another 20% are adults 60 and older (Monkovic and Ward, 2025). SNAP boosts food spending, which has ripple effects on the farm, rural, and overall economy; reduces food insecurity; and lifts people from poverty. SNAP has historical ties to farming and agriculture and its authorization roughly every 5 years through the Nutrition Title of the Farm Bill has generated a reliable political coalition uniting farm and food interests.
Recent changes to the SNAP program through Public Law 119-21, or One Big Beautiful Bill (OBBB), include common flare points in Farm Bill and budgetary debates on the extent of work requirements and to whom they apply, the tightening of rules for deducting expenses, and on eligibility for noncitizen refugees and individuals granted asylum (Aussenberg, 2025; Huang, Zhang, and Hinds, 2026). The OBBB also requires states to pay a greater share of the program’s administrative costs and, for the first time, ties benefit costs for states to their payment error rates—the rates at which participants are mistakenly given too much or too little benefits. This shift could potentially break SNAP’s status as an entitlement program, depending upon how states react, and decrease participation in SNAP, with disproportionate effects on agriculture and rural interests.
This article discusses (1) SNAP’s history and unique role in the safety net, (2) its connection to the agricultural economy, and (3) how the OBBB changes further the move to a safety net more focused on supporting workand with greater state-level responsibility for funding the program. It then describes the effects of these changes and what is most at risk.
SNAP was designed to boost food spending for eligible low-income households to help them meet their food needs. Eligibility is primarily determined by income, with gross income at 130% of federal poverty guidelines and net income (minus allowable deductions) at 100% of poverty (USDA-FNS, 2025a). Benefits decrease as household earnings and other resources increase.
SNAP helps the USDA meet its mission to improve food security (Gregory, Rabbitt and Ribar, 2015; Gundersen, Kreider, and Pepper, 2017). SNAP lifted 3.6 million individuals out of poverty in 2024 (Schrider and Bijou, 2025). It plays a significant role in lifting the incomes of the poorest (Jolliffe et al., 2023), thus reducing the depth and severity of poverty (Tiehen, Jolliffe, and Gundersen, 2012). These effects are stronger for children (Tiehen, Jolliffe and Gundersen, 2012).
SNAP has several unique components that make it a cornerstone of the US safety net. The program’s broad eligibility criteria with few categorical eligibility requirements means it reaches a large swath of the low-income population. SNAP is an appropriated entitlement program, meaning that if a household meets the eligibility criteria, the federal government will appropriate enough funds to cover the benefits of all who choose to participate. Benefit levels are the same across the US (with exceptions for Alaska and Hawaii, where food costs are consistently higher). And, until the OBBB, SNAP benefits have been entirely funded by the federal government, although states share administrative costs with the federal government.
SNAP’s design contrasts to other safety net programs that are more explicitly work-based and that require higher state cost shares. For example, the Temporary Assistance for Needy Families (TANF) and Medicaid programs give states leverage in determining eligibility criteria and the types of services that are provided or the health care services that are covered. TANF provides cash assistance to a narrower population than SNAP—only low-income families with children—and enforces work requirements and time limits for benefit receipt for most participants. It is partially funded through federal block grants that give states set grant amounts to spend as they see fit. TANF rules and benefit generosity levels vary widely across states (Falk, 2025). Medicaid, which provides health insurance for low-income populations, has a federal-state cost share structure and gives leverage to states to choose eligibility and coverage, including through the Affordable Care Act (ACA) and with federal funding, the option to expand coverage to higher income adults that are not covered with basic Medicaid coverage. These features result in variation across states for regular Medicaid eligibility and coverage (Fox et al, 2020) and in ACA expansion coverage, for which 10 states have opted out (Kaiser Family Foundation, 2026). The Earned Income Tax Credit, which subsidizes earnings for low-earning workers, has a substantial impact on reducing poverty (Schrider and Bijou, 2025), but it does not have the reach of SNAP among low-income households because it is earnings based and substantially less generous for childless households.
During economic downturns when households have lower incomes, they become eligible for more benefits. Participants spend benefits quickly and thoroughly—most benefits are spent within 2 weeks of issuance (Tiehen, Newman, and Kirlin, 2017). Spent benefits work their way through food retailers and the rest of the economy. As a result, the program is a strong multiplier for economic activity during recessions—generating an estimated $1.54 in economic activity for every $1 spent on benefits (Canning and Stacy, 2019). Because of its entitlement status, no legislative or regulatory changes are needed to prompt this automatic stabilizer (GAO, 2025). Importantly, the costs of additional benefits during poor economic times are paid by the federal government, meaning that states, most of whom must balance their budgets annually, do not have to pick up the additional costs when tax revenues are falling.
A feature of the SNAP program before the OBBB was its responsiveness in protecting households from income loss during downturns, which was not true for the TANF program (Bitler and Hoynes, 2016). Figure 1 shows trends in unemployment, the official US poverty rate, the rate of low or very low food security, and the number of SNAP participants from 1980 to 2024, with recessionary periods shaded in gray. The SNAP caseload rises during recessions and periods of higher poverty and food insecurity, and falls, albeit with a lag, during recovery periods. An exception is during the period of 2003–2007, when the unemployment rate fell but the caseload continued to increase. The figure also shows food insecurity rose and remained elevated during the 2022–2024 pandemic recovery period, when inflation was relatively high and the SNAP caseload stayed elevated even though poverty and unemployment were decreasing or relatively low.
SNAP is also unique among safety net programs for its ties to farmers, agricultural and food production, and rural economies. There are several reasons why. First, the share of the population with incomes below poverty tends to be greater in nonmetropolitan (rural) areas than in metropolitan areas (urban and suburban) (Shrider and Bijou, 2025). SNAP’s ability to lift households out of poverty and alleviate deep poverty is stronger in rural areas (Tiehen, Jolliffe, and Gundersen, 2012).
Second, SNAP boosts food spending—participants spend more on food from SNAP benefits than they would if given a similar benefit in cash, with estimates ranging from 16.5 cents to 65 cents for every dollar in benefits (Canning and Stacy, 2019). Increased food spending is concentrated on food-at-home spending, for which a greater share of every dollar spent by consumers is received by farms (the farm share), relative to food away from home spending, for which a greater share of every dollar goes to nonfarm components of the food supply chain (processing and manufacturing, transportation, and labor) (Baker and Zachary, 2026).
Third, the share of total output from food production is greater in rural areas, making increases in economic activity due to SNAP of greater importance (Vogel, Miller and Ralston, 2021). The increased economic activity from SNAP also crosses urban and rural geographic distinctions. While both the absolute numbers of SNAP participants and economic output generated through SNAP benefits are larger in urban areas, the spillover effects across urban and rural areas are economically meaningful. Increases in economic output in urban areas induced by the spending of SNAP benefits between 2009 and 2014, while the nation recovered from the Great Recession, accounted for 61% of the increase in economic activity from SNAP in rural areas (Vogel, Miller, and Ralston, 2021). In other words, more than half of the increase in SNAP-induced economic activity in rural areas during these years came from urban consumers and producers. The interdependence of rural and urban areas on farm and food production and consumption resulted in a long and well-documented political coalition between agricultural and anti-poverty stakeholders. This coalition has helped produce past Farm Bills that jointly set federal government support for farmers and agricultural producers with that of consumers through authorization of SNAP (Coppess, 2018). While the OBBB changes are not the only time that changes to SNAP have been made outside of the Farm Bill process, these recent changes in funding structure are potentially some of the most consequential.
SNAP has both general and Able-Bodied Adults Without Dependents (ABAWDs) work requirements that mean participants who do not work enough, nor engage in approved activities, may face a time limit on benefit receipt, have benefits reduced, or be cut from receiving benefits altogether. In some states, approved activities may include mandatory or voluntary participation in employment and training programs. The extent and targeted population for work requirements has been a point of debate in recent Farm Bill reauthorizations. The most recent Farm Bill (2018) left work requirements largely untouched. However, ABAWD work requirements were a critical part of the negotiations and final passage of the Fiscal Responsibility Act of 2023 (FRA), which tightened ABAWD work requirements for some and loosened them for others. In contrast, the OBBB tightened work requirements by increasing the upper age limit subject to ABAWD work requirements from 54 to 64, lowering the maximum age of dependents that exempt adults in the household from work requirements from under 18 to under 14, and ended the exemption for veterans, those experiencing homelessness, and some individuals in foster care (Aussenberg, 2025). The bill also tightened exemptions for areas with high unemployment rates. Alaska and Hawaii were exempted from some of these tighter work requirement rules.
The OBBB also increased state administrative cost shares. Previously, states were reimbursed by the federal government for half of the costs to administer SNAP. Beginning in FY 2027, states will only be reimbursed for 25% of administrative costs. This shift in responsibility is estimated to cost states $24.7 billion over the next decade (Aussenberg, 2025).
And, for the first time beginning potentially as soon as the 2028 fiscal year, states may be responsible for the costs of benefits if their payment error rates are too high. SNAP has an extensive quality control (QC) system to ensure correct benefit levels are provided to beneficiaries, which includes a review of a sample of cases by both the Food and Nutrition Service and each state (USDA-FNS, 2025b). FNS then calculates payment error rates—the combination of over and underpayments, relative to total dollars of benefits issued—for each state and publishes them in June of each year. Prior to the OBBB, if state payment error rates were above 6%, the state would be required to develop an action plan to address the high payment errors or review almost all cases and may have faced penalties if error rates were consistently high. Under the OBBB, states with payment error rates over 6% will be required to share the costs of SNAP benefits with the degree and timing of cost sharing depending on the error rate (Aussenberg, 2025, Huang, Zhang and Hinds, 2026). The Congressional Budget Office estimates that the new benefit sharing will shift costs from the federal government to states by $35 billion over the next decade (CBO, 2025).
Figure 2 shows the national SNAP payment error rates (PERs) overall and by its components of overpayments and underpayments over the past 30 years. PERs were not calculated for 2015 or 2016 because of data quality issues, and Congress directed the USDA to suspend the QC system during the COVID-19 pandemic. The figure shows PERs trended up between 1995 and 1998 andthen decreased substantially through 2013. Rates trended up between 2014 and 2019 but weresubstantially higher in 2022 with an historic peak in 2023. Rates dropped almost a percentage point in 2024 but still averaged about 11% (USDA-FNS, 2025c). In 2023, the USDA reported that error rates were high because states did not verify some benefit eligibility elements (GAO, 2024). Increases may also have been due to temporary policies implemented to address food insecurity during COVID-19 that may have contributed to increased participation rates among eligible households, which was 88% in 2022 (the latest year of published estimates) up from what had been a fairly steady 80% rate prior to COVID-19 (USDA-FNS, 2025d).
SNAP has roots in the New Deal response to the Great Depression to alleviate both farm surplus and food insecurity among poor households. But the original program ended in 1943 when the farm economy stabilized. The modern program is more aligned with the War on Poverty and Great Society programs, knitted with the Civil Rights enforcement of the period. The broad eligibility rules and entitlement to benefits that aresolely funded and level-set by the federal government help ensure equal access to benefits for the poor. In the
past 2 decades, the USDA has allowed some waivers for states to set program rules, such as vehicle asset limits and lengths of certification, and, beginning in 2026, waivers to restrict which foods can be purchased with SNAP. However, SNAP’s universality and federally funded entitlement and cost structure have changed little since the program’s implementation in the early 1970s, even during profound changes to other safety net programs. Time will tell how the OBBB changes impact participation, federal and state spending, and other important program outcomes such as food spending, food security, poverty, and health. However, there is reason to hypothesize these changes will have bigger impacts than previous changes to SNAP.
Research on the impact of SNAP work requirements on labor supply is mixed but broadly shows that the requirements do not lead to increases in employment or work effort but do lead to declines in participation (Ku, Brantley, and Pillai, 2019; Bauer and East, 2025; Schanzenbach, 2025). These effects are reflected in the CBO estimates of the budgetary impact of the OBBB work requirements—estimating a fall of $68.6 billion in SNAP spending and an average of 2.4 million participants leaving SNAP in an average month over the 2025–2034 period (CBO, 2025).
While lower participation will reduce costs to the federal government, work requirements may have an additional cost to governments and participants—the costs to administer and comply with more complex eligibility rules. Implementing work requirements adds burden to potentially eligible individuals, who must regularly prove they are meeting the work requirements in addition to income and other eligibility provisions. Eligible people may not apply, and participating individuals may be cut from the program, even though they may be eligible (Cook, Cox, and East, 2026). Program administrators may also face higher costs to assess and prove eligibility and to monitor and assess compliance.
It is hard to predict the impact of the increases in state administrative costs and potential benefit costs will have because it depends on how states react. The increase in cost share from 50/50 to 75/25 means that states will now have to budget more to operate the SNAP program by either raising taxes or cutting other programs. States may also incur greater costs to reduce their payment error rates by more carefully assessing eligibility and benefit amounts. These higher costs mean states may have to make tradeoffs between focusing on reducing food insecurity and poverty by reaching as many eligible households as possible versus reducing payment errors; at the same time, they need to enforce new work requirements and shoulder a greater share of administrative costs for the program. Table 1 shows payment error rates for states in fiscal year 2024. Only 10 states have payment error rates below 6%. The other 38 states (excluding Alaska and Hawaii) and the District of Columbia will have to reduce their payment error rates, sometimes significantly, by FY 2028 (although states with especially high error rates may delay benefit cost sharing, Aussenberg, 2025). Table 1 also shows state poverty (2025) and 3-year average food insecurity (2022–2024) prevalence estimates, along with the latest SNAP participation rate estimates (FY 2022). Some states with below average participation rates also have high poverty and food insecurity rates. For example, Arkansas’ poverty and food insecurity rates are 15.5% and 19.4%, respectively. Its SNAP participation rate is among the lowest across states, reaching only 59% of those who are eligible in 2022. Given its payment error rate of almost 10%, Arkansas is one of the states that would have to pay for some benefit costs. So would Massachusetts, which has relatively low poverty (9.7%) and food insecurity (11.7%), near complete coverage of eligible SNAP households (participation rates estimated at 100%), but also a high payment error rate (14.1%).
How states make these tradeoffs is likely to vary. States with sufficient resources or commitments to a stronger safety net may find ways to take on the additional costs of the programs, but that will come with tradeoffs to higher taxes or cuts to other programs. Some states may discourage participation in SNAP, potentially by reducing office hours, cutting the number of case workers, or reducing outreach efforts. Finally, some states, especially those with greater need and a lower tax base, could reduce benefits or even opt out of the SNAP program altogether, effectively ending the entitlement.
The shifts in costs to the states put SNAP’s cornerstone status at risk. At risk is SNAP’s broad universality to low-income populations, which has helped reduce disparities in food security and poverty across rural and urban areas (Tiehen, Jolliffe, and Gundersen, 2012) and across race and ethnicity (Ku, 2023). Studies of SNAP’s rollout in the 1970s show the program had a substantial impact on improving health and self-sufficiency (Hoynes, Schanzenbach, and Almond, 2016) and birth outcomes, especially for Black children (Almond, Hoynes, and Schanzenbach, 2011).
If states must fund part of the costs of benefits or decide to opt out of the program, SNAP’s role as an automatic stabilizer during economic downturns is at risk. Using the Analysis of Taxes, Transfers, and Income Security (ATTIS) model, (Wheaton, Waxman, and Giannarelli, 2025) estimated that states would have to pay almost $1 billion ($980 million) in additional benefit costs in the first year of a recession that was as deep as the Great Recession, assuming a 10% benefit cost share for states. State cost shares could be waived during recessions if lawmakers can pass such legislation. But a powerful automatic tool for getting cash into the economy quickly during slack economic times is at risk.
The long-standing political coalition that has married farm and agriculture interests to food assistance interests to pass legislation that benefits both parties could be at risk as well. With fewer SNAP participants and potentially reduced benefit levels or even no SNAP program in some states, food spending could decrease. Farmers and rural areas could be disproportionately impacted because of SNAP’s ties to farm and rural economies.
OBBB provisions chip away at the entitlement and universal aspects of SNAP. Impacts are yet to be determined and depend heavily on how states will react to new cost sharing requirements. Lessons from other safety net programs with greater program discretion and state cost share requirements suggest we can expect increased variation in state generosity that is likely to decrease SNAP participation and program outlays. The impacts of changes to a cornerstone of the safety net may not be felt evenly because of SNAPs ties to the rural and agriculture economies.
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