The recently federally enacted “One Big Beautiful Bill Act” (H.R. 1) is set to create fiscal impacts for the state of Utah and could lead to future financial responsibilities related to the Supplemental Nutrition Assistance Program (SNAP). This new legislation changes the funding structure for both the administrative costs and the benefits provided through the program.
Changes to Administrative Costs
H.R. 1 modifies the match rate for SNAP administrative costs. Previously, the state and federal government split these costs with a 50/50 match rate. The new law, effective in Fiscal Year (FY) 2027, shifts this responsibility, requiring Utah to pay 75% of administrative costs while the federal share drops to 25%. Based on past administrative costs, this change is projected to increase Utah’s ongoing burden by approximately $13 million annually.
Potential Changes to Benefit Costs
The cost of SNAP benefits, which were previously 100% federally funded, is also changing. H.R. 1 introduces a requirement for the state to contribute to benefit costs if its payment error rate exceeds a certain threshold. According to the USDA, Utah’s 2024 error rate was 5.74%, primarily due to overpayments. However, if the error rate were to increase to 6% or more, Utah would be required to contribute to the cost of benefits, increasing Utah’s share by $20 million. It’s crucial for the state to maintain this low error rate to avoid these new costs. This change will go into effect in FY 2028.
Other Provisions in H.R. 1
Beyond funding, H.R. 1 includes other provisions that will affect Utah’s SNAP program:
- Changes for Able Bodied Adults Without Dependents (ABAWDs): The work requirement for this group is increasing from ages 18-54 to 18-64. It also narrows the work requirement exemption for caregivers and parents by lowering the age of a “dependent child” from under 18 years to 14 years. DWS will need to update its eligibility system and provide staff support to eligible individuals.
- Low Income Home Energy Assistance Program (LIHEAP) Payments: The new law restricts how LIHEAP payments of $20 or more can be used to qualify for the standard utility allowance, which may affect the benefit amounts for some SNAP recipients. It also prohibits using household internet costs in the shelter expense deduction.
- Expiration of SNAP-Ed: The National Education and Obesity Prevention Grant Program, known as SNAP-Ed, will expire after FY 2025. DWS will no longer contract with Utah State University for these services.
- Citizenship Requirements for SNAP benefits: These requirements have changed for individuals residing in the United States. This change will likely result in some individuals currently eligible possibly losing SNAP eligibility. DWS will need to make one-time changes to the eligibility enterprise system and evaluate those whose eligibility for SNAP may be impacted.
An issue brief detailing these impacts and more is available here: Oh SNAP! How Much is That Going to Cost?