SNAP Confusion…On Us

by Tom Yamachika, President, Tax Foundation Hawaii

We wrote a few weeks ago about the Supplemental Nutrition Assistance Program, or SNAP.  In that article we mentioned that under the One Big Beautiful Bill Act, States’ feet are going to be held to the fire because if States make mistakes (as judged by the federal government) in how they administer SNAP benefits, they will be sent a big and not-so-beautiful bill for tens or hundreds of millions of dollars depending on how bad their error rate is.

But it looks like the Feds aren’t going to make it easy for States to follow the rules.  The rules, they are a-changin’.

Specifically, updated guidance came out from USDA on October 31.  Although the law (7 U.S.C. section 2025(c)(3)) and SNAP regulations say that States are allowed a transition period of 120 days to digest any new guidance and train their staff to implement it properly, this particular guidance was effective the next day.  What about the 120-day transition period?  The guidance said that it was being measured from the effective date of OBBBA, which was enacted 119 days earlier.

According to a letter from New York Attorney General Letitia James on behalf of 21 States, Hawaii among them, the guidance is problematic not only because there isn’t much time for States to assimilate it, but also because it contains mistakes.

For example, the new guidance says that immigrants in certain categories, namely Refugees, Individuals Granted Asylum, Parolees, and Deportation Withheld are “Not Eligible” for SNAP.  Because other categories of immigrants are labeled “Not Eligible Unless an LPR [Lawful Permanent Resident],” the guidance seems to say that an individual in any of the “Not Eligible” categories is ineligible forever, even if the individual later gets a green card.  But, as the attorneys general point out, that isn’t what the federal law says.  Specific provisions in the law explicitly allow for refugees and individuals granted asylum to become LPR, at which point they can become eligible for SNAP.

The attorneys general point out another significant mistake in the guidance where it lists categories of immigrant individuals who need to wait five years before becoming eligible for SNAP.  Specifically, green card holders who entered the country as Refugees, Individuals Granted Asylum, and Deportation Withheld, as well as those who entered the country with status legally equivalent to refugee status, such as Afghan and Ukrainian Parolees, Iraqi and Afghan Special Immigrants, and Victims of Severe Trafficking, would be eligible for SNAP without the waiting period.

If this sounds complicated, that’s because it is.  But the problem is on us, because if our government implements the program incorrectly and our error rate winds up in excess of 6%, then our State will be staring down a bill for $36 million, $73 million, or $109 million.  Of course, none of this mega-penalty is included in our state budget, meaning if we get hit with it, lawmakers will have to come up with it somehow – and that “somehow” will usually fall on the backs of us, the taxpayers.

Of course, reality might not be as bad as the theory.  The mega-penalties don’t go into effect until federal fiscal year 2028, and the federal law providing for calculation of the error rate does not penalize the States for “actions based on policy information approved or disseminated, in writing,” by USDA,

Hopefully, that will be enough time for our government and the Feds to correct the screw-ups and work out any other kinks in the system.  Before we taxpayers get clobbered.