Michigan Invests $37.5 Million to Combat SNAP Errors Amid Rising Fraud Concerns

Michigan faces a potential $300 million federal fine after its SNAP payment error rate climbed to 9.89% in fiscal year 2025—far exceeding the federal target of 6%.

The state of Michigan is spending $37.5 million to lower its payment error rate for the Supplemental Nutrition Assistance Program (SNAP). The state's payment error rate for fiscal year 2024 was approximately 9.53%, which could lead to a $300 million federal fine in fiscal year 2028.

According to data released by the U.S. Department of Agriculture on June 24, the error rate increased to 9.89% in fiscal year 2025.

The federal government recommends states target a six percent error rate to avoid bearing a larger share of costs. The U.S. Department of Agriculture expects Michigan to cover the costs of payment errors because the state administers the program.

The fiscal year 2026 budget includes over $30 million for Food Assistance Reinvestment to reduce SNAP error rates, according to a 2025 press release. The press release did not specify how the spending would lower the error rate for 1.4 million residents who rely on the program.

Spending Breakdown

A records request by Michigan Capitol Confidential obtained the following spending categories:

Data Sharing Issue

The federal government has worked with neighboring states like Ohio to lower error rates and capture alleged SNAP criminals who spend benefits out-of-state. However, Michigan has refused to share SNAP data with the federal government.

According to over 500 pages of SNAP fraud police reports obtained by CapCon, a majority of SNAP fraud in Michigan involves out-of-state spending of benefits. Stolen benefits are reportedly spent in states such as New York, Maryland, Florida, and Texas.

Michigan residents have no recourse, as local governments cannot pursue these cases, but federal action would require data sharing.

Leadership Change

Governor Gretchen Whitmer announced that MDHHS Director Elizabeth Hertel will leave the agency effective June 30. She will be replaced by Amy Epkey, who has worked at the Michigan Department of Environment, Great Lakes, and Energy and the Michigan Department of Agriculture and Rural Development.

House Oversight Chairman Jason Woolford (R-Howell) commented on the change, stating:

"For too long, bureaucrats operated without meaningful accountability while hardworking Michigan families paid the price. Seniors, parents, and vulnerable residents were forced to navigate broken systems, while taxpayers watched billions of dollars flow through programs riddled with waste, fraud risks, and administrative failures."