By Hola Iowa
Both states were below the federal 6% threshold for SNAP payment errors, while most states will face new cost-sharing requirements starting in 2027.
Iowa and Nebraska are among the few states that are not expected to pay a share of federal SNAP benefits under new rules tied to the program’s payment error rates.
The U.S. Department of Agriculture (USDA) released SNAP payment error rates for fiscal year 2025. Iowa recorded a rate of 5.34%, while Nebraska posted a rate of 5.90%, both below the federal 6% threshold.
The lower rates matter for state budgets. Under federal law H.R. 1, known as the One Big Beautiful Bill Act, states with error rates of 6% or higher will have to cover between 5% and 15% of SNAP benefit costs in their state, in most cases starting Oct. 1, 2027.
The published rates do not change the monthly amount families receive. The data first affects how much financial responsibility states may have within the program.
Iowa was at 5.34% and Nebraska at 5.90%
Iowa reported a total SNAP payment error rate of 5.34% in 2025. That figure includes 4.63% in overpayments and 0.71% in underpayments.
Nebraska came in just below the federal threshold, with a total error rate of 5.90%. That figure includes 4.82% in overpayments and 1.08% in underpayments.
Both states are part of the group of jurisdictions with rates below 6%, along with South Dakota, Idaho, Kentucky, Utah, Vermont, Wisconsin, Wyoming and the Virgin Islands.
South Dakota had the lowest rate in the country, at 2.47%. Alaska recorded the highest, at 23.15%.
Most states were above the threshold
The national SNAP payment error rate was 10.62% in 2025.
USDA reported that the rate represents a modest decline from the 10.93% average recorded in 2024. Even so, the federal government estimated $10.1 billion in improper payments nationwide, including both overpayments and underpayments.
The error rate does not measure fraud alone. The process reviews whether states correctly determined who was eligible for SNAP and how much each household should receive.
Errors may include payments above the correct amount, payments below what was owed or benefits issued to households whose eligibility was determined incorrectly.
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Illinois faces a much higher rate
Illinois, which is also part of Hola America News’ coverage region through the Quad Cities and nearby communities, was well above the federal threshold.
The state recorded a total error rate of 14.67% in 2025. That figure includes 13.33% in overpayments and 1.33% in underpayments.
With that result, Illinois would fall into the group of states facing a higher state share under the new federal structure, unless future implementation details or future rates change.
For readers in the Quad Cities, the regional contrast is clear: Iowa was below the 6% threshold, while Illinois was among the states with rates above the national average.
What changes under the new federal rule
SNAP, formerly known as food stamps, has traditionally had the cost of monthly benefits funded by the federal government.
The new rule changes that structure for states with higher error rates. States with an error rate of 6% or higher will have to cover part of the federal benefits issued within their territory.
The percentage will depend on the level of error. The higher the rate, the larger the state share, up to a maximum of 15%.
States below 6% would not have to take on that benefit cost under the 2025 measurement.
USDA also reported that states with rates at or above the threshold will have to submit a corrective action plan to the Food and Nutrition Administration to explain the causes of the errors and the steps planned to correct them.
The change is part of a broader SNAP overhaul
The new state share is part of a broader package of federal changes to SNAP.
An analysis by the Congressional Budget Office estimated that the provisions of H.R. 1 would reduce federal spending on SNAP benefits by $255 billion between 2025 and 2034. The same analysis calculated an $85 billion increase in state spending on benefits during that period.
The changes also alter how administrative costs are divided between the federal government and the states. County and state government organizations have said that adjustment could increase pressure on local budgets, especially in states with county-administered systems.
In Iowa and Nebraska, the most immediate data point is that their 2025 rates place them outside the group that would have to cover part of federal benefits under the 6% threshold.
Families remain under the program’s normal rules
SNAP will continue operating under its regular rules for eligibility, applications, renewals and benefit amounts calculated for each household.
The change published by USDA is tied to state and federal financing of the program, not to an automatic cancellation of benefits for families in Iowa or Nebraska.
Households that already receive SNAP will remain subject to the normal eligibility review, change reporting and renewal processes administered by state agencies.
In Iowa, the program is administered by Iowa Health and Human Services. In Nebraska, it is administered by the Nebraska Department of Health and Human Services.
The new federal cost structure is scheduled to take effect, in most cases, starting Oct. 1, 2027.
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