Key facts
- FY25 error rate
- 12.49%
- National average
- 10.62%
- Potential federal penalty
- $300 million
- Cost per taxpayer
- $90 annually
- Cost-sharing requirement
- 15% of SNAP benefit costs, currently $298.9 million
- Effective date
- FY28, starting October 2027
Background
A new study by the Fiscal Alliance Foundation, titled 'SNAP in Massachusetts: How the food stamp program is failing Bay State taxpayers,' warns that Massachusetts could face $300 million in federal penalties if its SNAP payment error rate does not improve. The penalty would be equivalent to an additional $90 per taxpayer annually.
The study attributes the high error rate to policies at the Department of Transitional Assistance (DTA) and decisions made by the Healey administration. It cites geographic waivers, discretionary exemptions, Broad-Based Categorical Eligibility, simplified reporting standards, and lengthy recertification periods as contributing factors.
According to the latest USDA data released on June 24, Massachusetts' SNAP payment error rate for FY25 is 12.49%, above the national average of 10.62%. This rate is slightly down from 14.10% in FY24, but still significantly above the federal threshold of 6%.
Current situation
The study says that under the 2025 reconciliation law, states with payment error rates above the national average must cover 15% of their SNAP benefit costs. For Massachusetts, this currently totals $298.9 million. The cost-sharing requirement is expected to take effect in FY28, which starts in October 2027.
Massachusetts received over $2.6 billion in federal SNAP funding in FY24, equating to $364 million in erred payments that year, of which $338 million was in overpayments. Over the last four fiscal years, the total erred payments amount to $1.4 billion.
The study also notes that Massachusetts has the highest SNAP enrollment and expenditures per capita in New England, along with the highest payment error rate. Enrollment has increased by 40% over the past decade, from 785,000 recipients in FY16 to over 1 million in FY25, and to 1.1 million in 2026.
| Fiscal Year | Error Rate | Enrollment | Erred Payments |
|---|---|---|---|
| FY24 | 14.10% | Not specified | $364 million |
| FY25 | 12.49% | Over 1 million | Nearly $300 million |
| FY16 | Not specified | 785,000 | Not specified |
| 2026 | Not specified | 1.1 million | Not specified |
Impacts
If the error rate does not improve, Massachusetts taxpayers could face an additional $90 per year in taxes to cover the federal penalty. The state could also be required to cover 15% of its SNAP benefit costs, currently $298.9 million, starting in FY28.
The study says that at 12.49%, more than $1 in every $10 spent on SNAP in Massachusetts is considered improper. This could lead to reduced federal funding and increased scrutiny of the state's administration of the program.
The Healey administration has launched chip-enabled EBT cards to combat fraud from skimmers, but the study argues that policy decisions, such as waiving work requirements and asset limits, have contributed to the high error rate.
Future outlook
Scenario analysis: The possibilities below are not certain predictions.
If Massachusetts reduces its error rate in FY2026, it could lower its cost-sharing liability, but the study says recent trends indicate this is highly unlikely. The state would need to significantly improve its payment accuracy to avoid the penalty.
If the error rate remains above the national average, the federal cost-sharing requirement will take effect in FY28, potentially costing the state $298.9 million. The state could also face continued pressure from the federal government to reform its SNAP administration.
The study comes as Healey continues to refuse to hand over SNAP recipient information, including immigration status, to the Trump administration and the USDA. The outcome of this dispute could affect future federal oversight and funding.
Source: lowellsun.com
