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17 Slide #10 State Impacts due to SNAP Changes Impact of Federal Budget Reconciliation on State of North Carolina SNAP Benefit Cost Sharing Effective October 1, 2027 State benefit cost share based on Statewide error rates . State administrative cost share Benefit Cost Share Payment Error Rate State&National Error Rates will increase by an estimated for FFY24 $16 annually beginning Oct 0%Cost Share Less than 6% 8 states 2026. 5%Cost Share Between 6%and 8% 6 states • State benefit cost share would 10%Cost Share Between 8%and 10% 16 states be an estimated $420+ million per year based on 10.21% 15%Cost Share Over 10%* 20 states; NC rate is 10.21% error rate and benefits of over (National average is 10.93%) $2.8 billion Source:NC DHHS Presentation to the Joint Legislative Oversight Committee on Health and Human Services—January 13,2026 https:llwebservices.ncleg.gov/ViewDocSiteFile/104981 ORANGE COUNTY 10 NORTH CAROLINA Commissioner Carter asked what the county-level error rate is for Orange County. Travis Myren said they are tracking a little above 6% Chair Hamilton asked for the definition of an error rate. Travis Myren said it's anything that affects the benefit amount. He said it could be an overpayment or an underpayment, or someone ineligible for receiving a benefit. He said it is anything makes that final benefit amount different than what it should be. Commissioner McKee asked how that is addressed locally. Travis Myren said it is based on a sample from each county. He said only about eight cases are pulled for Orange County. He said the way to drive down error rates is to have employees with a reasonable caseload that are well-trained. He said one issue is that as the county picks up more SNAP administrative costs, it probably can't afford additional staff. Commissioner McKee asked how they determine the breaking point between the cost of additional staff versus the cost of the error rate. He said the error rate would not be perfect, but that county would be well-served to keep this as low as possible. Travis Myren said that's reasonable. Commissioner Bedford clarified that it is based on statewide rates. Commissioner Carter added that's the case unless the legislature changes it. Chair Hamilton clarified that the with the error rate, the cost is currently borne by the state. Travis Myren said yes. He said if the state fails to fund the cost share, the SNAP benefit goes away. He said the benefit is an entitlement and levels are set by the federal government. He said if you can't pay for the benefit as required, you can't run the program. Vice-Chair Fowler asked if it is legal to pull the whole program if it is an entitlement. Travis Myren said it is a state decision to provide the benefit. He said if they choose to not fund the cost share, they can't run the program. Commissioner Bedford asked that this be part of the legislative breakfast agenda. Commissioner Carter said the state budget process is frozen. She asked what the risk timeline is to the program if the budget process isn't resolved.