California legislative analyst warns SNAP cuts will strain, family state budgets
California’s nonpartisan Legislative Analyst’s Office warned that the federal One Big Beautiful Bill Act could strip hundreds of millions of dollars a year in CalFresh food aid from low-income Californians and shift billions in costs to state and counties.
The LAO’s report, released Thursday, came as the federal shutdown and SNAP delays have driven more families to the state’s food banks.
House Resolution 1 of 2025 reshapes the supplemental nutrition assistance program, known nationally as SNAP and in California as CalFresh, by tightening eligibility, cutting benefits and shifting substantial financial responsibility from Washington to Sacramento and county governments.
CalFresh delivered more than $12.5 billion in food assistance to an average of 5.5 million Californians in 3.3 million households in the 2024-25 fiscal year, the LAO noted.
Since the bill passed in July, demand has noticeably climbed at food distribution sites in El Dorado, Nevada and Placer counties, said Lisa Heinrich, development director for Feeding the Foothills. Stagnating wages, inflation and other factors are pushing even dual-income families into food lines, she said.
“Everyone knows that a vast increase in food prices is impacting all of our wallets, but it absolutely can really hurt someone who is on CalFresh,” she said. “People utilize food banks to help keep their pantry stocked when their grocery budget only goes so far during the month.”
Expanded work rules could drop nearly half a million adults
The LAO report concludes that expanded work requirements for “able-bodied adults without dependents” are poised to be one of most disruptive pieces of HR 1.
Under prior rules, these adults were generally limited to three months of benefits in a three-year period unless they worked or trained at least 20 hours a week. But California had a statewide waiver of that time limit through Jan. 1 based on a finding of insufficient jobs.
HR 1 extends this time limit to adults up to age 64, up from 54, and applies them to adults whose youngest child is 14 or older, down from age 18. Previous exemptions for foster youth, veterans and people experiencing homelessness were eliminated.
The law also narrows when regions can qualify for time-limit waivers. California’s statewide ended Nov. 2, leaving only Colusa, Imperial and Tulare counties temporarily exempt. All have regularly reported double-digit unemployment rates.
The California Department of Social Services estimates about 610,000 state residents fall under the new 20-hour work threshold. Roughly 495,000 are not meeting it and could lose benefits when the state starts enforcement.
For now, implementation is paused while California interprets federal guidance, trains counties and updates computer systems.
Nationally, the rollout has collided with the government shutdown and delayed November benefits created dangerous confusion, said Lindsey Haynes-Maslow, a professor at UNC Chapel Hill whose research focuses on food and health policy.
Federal policy changes are happening so quickly, she said, that “there could be a change before I finish this briefing.”
The new federal work requirements took effect when the program was shut down, she said, leaving many states without staff or clear direction to implement them fairly.
Economist Craig Gunderson, a SNAP researcher at Baylor University, was blunter in addressing work requirements: “They’re dumb.”
SNAP doesn’t discourage work, and people who are not working in a strong labor market often face deeper, unaddressed issues.
“There’s a lot of people with mental health challenges that are undiagnosed,” he said, “and they’re struggling with those.”
HR 1 goes beyond work rules. It also removes SNAP eligibility for many immigrants who have long qualified, including refugees, asylum seekers, parolees, battered noncitizens and trafficking survivors.
While California has not yet implemented this change, CDSS estimates that 73,900 state residents could lose CalFresh eligibility as a consequence.
Another change ends federal funding for nutrition education programs administered by state agencies, universities and nonprofits. California most recently received $132 million for such programs, but that money will disappear after September 2026.
Benefit calculations tightened as food costs remain high
HR 1 also modifies how the federal government calculates the so-called Thrifty Food Plan, used to determine the maximum SNAP benefits. Beginning Oct. 1, the benchmark cannot grow faster than inflation, even if food prices outpace them. Maximum benefits for very large households are also capped.
Each household’s final SNAP benefits are based on “countable income,” which is reduced by major expenses such as rent and utilities. Because utility bills vary widely, most states deduct a fixed standard utility allowance instead of requiring households to submit actual bills. This allowance lowers countable income and typically results in a higher benefit.
All California CalFresh enrollees previously qualified to use it, but as of Oct. 31, HR 1 restricts automatic use to only households with elderly or disabled members. Other participants must use actual utility costs, often lower than the allowance.
CDSS estimates that roughly 444,000 Californians will see their benefits drop as a result, and 18,000 will lose their benefit entirely. While the average CalFresh benefit is $190 per person per month, the LAO estimated that those cut off could lose up to $300 a month, depending on household size and income.
The reduction in benefits will end in hunger for SNAP families who live paycheck to paycheck and, in some cases, hand to mouth, said Diane Whitmore Schanzenbach, an economist at Georgetown University.
One out of every eight Americans receives food assistance through SNAP, Schanzenbach said, and that has made it the nation’s primary line of defense against hunger.
“SNAP recipients are between 20% and 30% less likely to be food-insecure than eligible non-participants,” Gunderson said. “This is an astounding success story.”
Gunderson said he worries about people with mental health conditions and those who are socially isolated: Food disruptions represent a great crisis for them, he said, and they often don’t have a person they can rely upon to help.
Fiscal consequences for states and counties
Beyond direct hits to households, the LAO report highlights sweeping budget changes that California must make.
Starting in October 2027, states with a CalFresh payment error rate of 6% or higher must cover a share of SNAP benefits. California’s most recently published error rate was near 11%, which would require the state to pay 15% of SNAP benefits — roughly $2 billion annually — unless it significantly reduces that error rate.
Beginning October 2026, the federal reimbursement for CalFresh administration will drop from 50% to 25%. The state and counties will have to pay the remaining 75%, amounting to about $450 million for the state and $200 million for counties in added administrative costs annually, according to the LAO.
To soften the transition, state lawmakers set aside:
• $39.9 million for system upgrades and work to lower the error rate.
• $20 million for food banks, in addition to a $52 million increase.
• Up to $35 million to help state and county workers implement new federal rules, including those for able-bodied adults with no children.
While significant, those measures will not fully offset the loss of federal dollars. On the ground at food banks around the state and nation, staffers and volunteers don’t need a spreadsheet to see the impact.
“There’s a gap that food banks are struggling to fill,” Feeding the Foothills’ Heinrich said.
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