The One Big Beautiful Bill Act made dramatic changes to who will be eligible for the Supplemental Nutrition Assistance Program (SNAP) and thousands of New Yorkers will no longer be eligible for the food assistance benefit.
New York States counties have to figure out who is no longer eligible for SNAP or they will face large penalties. The costs of SNAP, like administration and benefits, are being shifted to New York counties. And they only have months to figure it out.
WAMC spoke with Executive Director, Stephen Acquario, and Director of Finance and Intergovernmental Affairs, Dave Lucas, at the New York State Association of Counties, to explain these changes.
Guerra:
So, the big issue is that New York has thousands of people who are not supposed to be receiving, the Supplemental Nutrition Assistance Program (SNAP) because the Trump is trying to get rid of fraud and waste. Why are there so many people now who are on SNAP in New York “in error”?
Acquario:
In the late teens, 2018, 2019, the state's error rate was not as high as it is right now. And what caused that? Well, rules changed during the COVID era and individuals, either on Medicaid or in health and human services programs like SNAP - some of the eligibility requirements were waived. In other words, everybody became eligible, and so we simply processed benefits pursuant to the direction of the United States, and now we have a hangover of an error rate.
Guerra:
Can you explain what’s meant by this error rate?
Acquario:
An error in this system, in the SNAP system, doesn't mean fraud. It's a paperwork error. Someone didn't file something timely. They underestimated their income or overestimated their income, their household dynamic changed. Someone else moved in. Someone moved out.
Guerra:
As I understand the feds are shifting a lot of the costs of SNAP back to the state and in New York a lot of that work of administering SNAP is handled by the counties. How are those costs being shifted from the federal government onto to New York counties?
Acquario:
So, it really is a double whammy, the first whammy being the administrative cost shift, which we're talking about a program here for Dutchess County alone is $1.5 million. If you look at Westchester, one of the hardest hit counties in the state of New York, that's $4.5 million that the United States is withholding and the county is absorbing.
Guerra:
And what is the secondary whammy in this situation?
Acquario:
The second whammy is the actual benefit. And right now, in the state of New York, we're looking at $7 billion is the actual benefit. That's the second whammy. $7 billion is paid for by the United States to the people of New York State. And of that, outside of New York City, it's just under 3 billion. Let's call it $2.7 billion in SNAP benefits meaning an electronic benefit transfer card or a benefit is actually provided to the New Yorkers outside of the city of New York. $2.7 billion [to upstate NY]. And a piece of that $2.7 [Billion], a percentage of that is going to be shifted to the counties and to the state. If that error rate is high, higher than the federal government thinks it should be right.
Guerra:
Could you explain for me the timeline for these changes and possible penalties looks like?
Lucas:
So [on] October 1, 2026 is the administrative cost shift which kicks in at that point in time. October 1, 2027 is when any potential benefit penalty would have to be paid. But like I said, we're already operating in the year that would determine what the penalty would be in 2027 and we already know, with the six months of data, our error rate is too high, and getting it lower is not likely to occur.
Guerra:
How much are the penalties New York is looking at right now?
Lucas:
We're halfway through the federal fiscal year right now. We already know our error rate is close to 15%. If we're over 10% we get a maximum penalty, which is 15% of the benefit costs. Six months into the year, it's almost impossible for the state to get under 10% or really the target is 6% because if you're below 6% there's no penalty on the benefits. That's the problem we have. We already know we're not going to make it for the first year when the benefit penalties [are] in. And then it's up to the state to determine, does the state pay the penalty, or do they pass it down to the counties and New York City. At the 15% threshold that maximum penalty [would] probably be somewhere between $1.3 and $1.5 billion.
