What is SNAP?
SNAP provides monthly benefits that eligible households can use to purchase groceries at authorized retailers. The program is funded by the federal government and administered in Tennessee by the Tennessee Department of Human Services.
Beyond helping families afford food, SNAP is an important part of the hunger-relief system. It helps households purchase food directly while food banks and community partners provide additional support to neighbors experiencing food insecurity.
Current SNAP Policy Changes
What Recent Federal Changes Could Mean for Tennessee
Recent federal changes to SNAP will shift additional program costs to states beginning in federal fiscal year 2027. For Tennessee, these changes could affect the state budget, SNAP administration and the resources available to support the program.
Beginning in federal fiscal year 2028, states may also be required to pay a portion of SNAP benefit costs based on their payment error rates. Understanding how those error rates are calculated is important to understanding the potential impact on Tennessee.
Understanding SNAP Error Rates
SNAP payment error rates measure how accurately states determine household eligibility and benefit amounts. An error can result in either an overpayment or an underpayment and does not necessarily indicate fraud.
During the COVID-19 pandemic, required state reporting to the USDA Food and Nutrition Service (FNS) was paused. When reporting resumed, states were managing larger caseloads, staffing shortages, outdated technology and new reporting requirements. These factors contributed to higher error rates in many states.
What is the difference?
A SNAP payment error is an unintentional mistake in determining eligibility or the correct benefit amount. Fraud, by contrast, involves intentional deception. Payment error rates measure errors in benefit calculations and eligibility determinations, not the rate of fraud in the program.
How does it actually work?
SNAP uses a quality control (QC) system to measure how accurately states determine eligibility and benefit amounts.
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State Review: Each month, state agencies select a sample of households participating in SNAP. Staff review household circumstances and benefit calculations to identify overpayments and underpayments.
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Corrections: When errors are identified, benefit amounts are corrected. Overpayments may need to be repaid, while underpayments are restored to the household.
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Federal Review: USDA reviews a sample of state cases to validate the findings and determine whether reviews were completed accurately and consistently with federal policy.
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Analysis: USDA analyzes the review data and calculates national and state payment error rates.
States with high payment error rates may be required to submit Corrective Action Plans outlining steps to improve program accuracy.
Why do payment errors happen?
SNAP payment error rates can be influenced by a number of factors beyond basic program integrity, including:
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Complex Cases: Changes in work hours, income, household composition or custody can make eligibility and benefit calculations more complicated.
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Technology Challenges: Eligibility systems and technology changes can create processing challenges for state agencies and staff.
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State Policies: Verification requirements, certification periods and data-matching practices can affect how errors are identified and reported.
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Federal Requirements: Changes to federal quality control policies and reporting requirements can also affect state payment error rates.
SNAP Cost Shifts and Tennessee’s State Budget
Federal legislation passed in 2025 changes how SNAP costs are shared between the federal government and states. These changes will increase Tennessee’s share of administrative costs and could require the state to contribute toward SNAP benefit costs based on its payment error rate.
Administrative Costs
Beginning in federal fiscal year 2027, the federal share of SNAP administrative costs will decrease from 50% to 25%. States, including Tennessee, will be responsible for the remaining 75% of administrative costs.
Benefit Costs
Beginning in federal fiscal year 2028, states will also be required to contribute toward SNAP benefit costs if their payment error rates exceed certain thresholds:
- Below 6%: No state contribution
- 6% to less than 8%: 5% state contribution
- 8% to less than 10%: 10% state contribution
- 10% or higher: 15% state contribution
Impact on Tennessee’s State Budget
Tennessee must begin accounting for the increased state share of SNAP administrative costs in its FY2027 budget. During state budget hearings, Tennessee Department of Human Services Commissioner Clarence Carter requested approximately $58 million to cover the additional administrative costs from October 2026 through June 2027. The estimated cost for a full year is approximately $77 million.
Beginning October 1, 2027, Tennessee could also be responsible for a portion of SNAP benefit costs if the state’s payment error rate remains above 6%. Tennessee’s most recent payment error rate was 9.44%, which could result in an estimated $171 million in additional state costs.*
*Source: Food Research & Action Center report, June 2026.
Second Harvest’s Advocacy Response
Since fall 2025, Second Harvest Food Bank of Northeast Tennessee has worked to educate elected officials, community partners and neighbors about the potential impacts of federal SNAP changes. During the federal government shutdown, Second Harvest continued these efforts through web-based trainings for neighbors and community partners, highlighting both immediate and long-term impacts.
In spring 2026, Second Harvest conducted additional advocacy trainings focused on H.R. 1 and its implications for Tennessee’s FY2027 budget. Throughout 2026, we have continued communicating with federal and state elected officials about the increased administrative cost share and the potential SNAP benefit cost shift tied to Tennessee’s payment error rate.
Broad-Based Categorical Eligibility
Broad-Based Categorical Eligibility (BBCE), also known as categorical eligibility or Cat-El, gives states flexibility in how they determine SNAP eligibility. Tennessee implemented changes under this policy in 2026.
What Changed in Tennessee?
The changes include:
- Increasing the income eligibility limit from 130% up to 200% of the federal poverty level
- Eliminating the asset test
How Can This Help Tennessee Families?
These changes can:
- Allow low-income households to build savings without automatically losing SNAP eligibility
- Simplify SNAP administration
- Allow more eligible families to access nutrition assistance
During legislative hearings, the Tennessee Department of Human Services indicated that implementing categorical eligibility could also help reduce Tennessee’s SNAP payment error rate by as much as 2 percentage points.
Take Action
Your voice can help protect access to SNAP and other nutrition programs. Contact your elected officials to share why these programs matter to families and communities across Northeast Tennessee.