The bad news: SNAP is about to cost the state a lot more money — potentially more than $50 million a year if Arkansas doesn’t lower its error rate. The state is already looking at at least $25 million in new costs under the One Big Beautiful Bill (HR1).
The good news: SNAP operations are “effectively back to normal,” officials said, after the federal shutdown delayed November benefits by about a week.
On Monday, the Arkansas House and Senate Joint Public Health Committee zeroed in on HR1 and its sweeping new rules that could leave Arkansas on the hook for tens of millions of dollars if the state can’t rein in its SNAP error rate.
SNAP Is Back Up and Running, But Bigger Changes Are Ahead
DHS Secretary Janet Mann and SNAP Director Mary Franklin opened with a quick status update: SNAP is fully operational, November benefits are out the door, and daily case approvals are back on schedule. Deloitte, the state’s system integrator, made required programming changes during the shutdown at no additional cost, which lawmakers appreciated.
But the conversation quickly shifted to HR1 and what it means for the state budget in the coming years.
The Cost Shift: HR1 Moves More SNAP Administration Costs to States
Under HR1, Arkansas will face two major financial changes:
State share of SNAP administration jumps from 50% to 75%.
Beginning October 1, 2026, states must cover 75% of administrative costs, up from the long-standing 50–50 split.
Arkansas’ estimated price tag: about $25 million a year.
States will pay a share of SNAP benefits if their error rate stays above 6%.
Starting October 1, 2027, states will begin contributing directly to benefit costs based on their error rate:
- Under 6%: no cost
- 6% to 9.99%: state pays 5% of SNAP benefits
- 10% and above: state pays 10%, and eventually 15%
Arkansas is currently sitting at 7.01% — better than last year’s 9.56%, but still higher than the federal threshold.
At today’s rate, Franklin said, Arkansas would owe around $25 million annually. A 9–10% rate would cost significantly more, and DHS agreed to calculate those additional scenarios for lawmakers.
Why Arkansas’ Error Rate Is High — and Why It Matters Now
Franklin explained that SNAP errors fall into two categories:
- Income errors (the biggest driver), either misreported or mis-entered
- Shelter deduction errors, usually miscalculated housing expenses
Crucially, federal law counts both agency and client mistakes against the state. Even if a client fails to report wages, the error still inflates Arkansas’ error rate.
Right now, DHS estimates a 60/40 split — with more errors caused by the agency than by clients.
That drew sharp concern from Rep. Howard Beaty, who said the situation is “a huge problem” now that federal law ties accuracy to state costs.
DHS outlined several steps underway to bring the rate down:
- Monthly refresher training for staff
- Targeted reviews of problem areas
- “Second-party” supervisory audits
- A new plain-language internal bulletin, Prevention in a SNAP
- Increased referrals to special investigators
- Outreach to lower-error states to study best practices
- Education efforts for beneficiaries
- Enhanced cross-state checks through the new National Accuracy Clearinghouse
The takeaway: Arkansas is improving, but not fast enough to avoid major financial hits if the rate stays above 6%.
New Work Requirements Are Now in Effect
HR1 also expanded SNAP work requirements beginning November:
- Able-bodied adults without dependents now include adults up to age 64 (previously 54).
- Parents of children ages 14–18 are now required to meet work thresholds unless exempt.
- Noncompliant recipients may receive only three months of benefits in a 36-month period.
No one has lost benefits yet because the three-month window has not closed. DHS expects meaningful numbers early next year.
Will SNAP Enrollment Drop? Too Soon to Tell
Lawmakers asked whether Arkansas has early data on recipients losing benefits due to the new rules. Franklin said not yet. Because recertification happens every six months, and the work-rule clock only started in November, meaningful numbers won’t appear until after the New Year.
Enrollment has remained steady at 243,000–247,000 individuals throughout the past year.
Looking Ahead: HR1 Brings More Risk, More Scrutiny, and More Cost Exposure
What emerged from today’s meeting is a clear picture of the pressure HR1 places on states:
- Administrative costs will jump sharply in 2026.
- Benefit costs could shift to the state in 2027 if error rates remain above 6%.
- Work requirements are expanding to thousands of additional Arkansas families.
- Federal oversight and data-sharing tools are growing, bringing more real-time eligibility checks and potential case closures.
For Arkansas, the most immediate question is whether the state can push its error rate below 6% in time — and whether its current mix of training, audits, technology upgrades, and caseworker support will be enough to avoid a series of multimillion-dollar budget hits.
