Mar 1, 2026
Jerralee King wasn't expecting to job-hunt at 84.
But that's where things stood after the Texas Health and Human Services Commission informed the Houston widow that it had made an "agency error" when it approved her for food stamps in 2021, according to ABC13 Houston (1). For three and a half years, King received between $112 and $348 a month through the Supplemental Nutrition Assistance Program while living alone on Social Security. Then, last year, the benefits stopped. Months later came a letter: she had never actually qualified. The state failed to input the correct resource amount on her application. And she owed every dollar back — $8,927.
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"Hopefully they'll be hiring old ladies at that point," King said.
Under federal law, SNAP recipients must repay overpayments regardless of who caused the error — and nothing in the application warns them that could happen. "There's not really anything in the application that will warn them that there's the potential for the agency to make an error that would result in the overpayment like that," Marty Orozco, litigation director for public benefits at Lone Star Legal Aid, told ABC13.
When King couldn't pay, the U.S. Department of the Treasury warned it would begin garnishing up to 15% of her Social Security — about $200 a month — through the Treasury Offset Program (TOP) (2), a centralized federal debt-collection system that intercepted $197.9 million in delinquent SNAP debt in fiscal year 2024 alone.
A $10.5 billion problem, and climbing
King's case barely registers in the larger picture. The national SNAP overpayment rate hit 9.26% in fiscal year 2024, according to the USDA (3), with an overall payment error rate of 10.93%. A March 2025 report from the Government Accountability Office (4) found that SNAP accounted for $10.5 billion in improper payments in fiscal year 2024, making it one of the five federal programs with the largest error totals.
The numbers have been moving in the wrong direction for over a decade. Analysis from the Mercatus Center at George Mason University (5) found overpayment rates rose from just over 2% in 2012 to 6% by 2019 — before the pandemic pushed them past 10%. A Congressional Research Service brief (6) attributed the post-2021 surge to pandemic-era policy changes, the return to pre-pandemic rules, and chronic understaffing at state agencies.
Only eight states met the 6% error threshold in fiscal year 2024. Forty-four states were required to submit corrective action plans, according to USDA. Texas posted a 5.77% overpayment rate and an overall error rate around 8% — better than average, but still above the federal threshold.
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And these are errors, not fraud. The CRS brief makes that explicit: the payment error rate measures mistakes by agencies and recipients, not intentional lawbreaking.
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The One Big Beautiful Bill Act could make the problem worse
The One Big Beautiful Bill Act, signed into law on July 4, 2025, requires states to partially fund SNAP benefits for the first time if their error rate exceeds 6%, starting in fiscal year 2028. The penalties are tiered: states between 6% and 8% pay 5% of benefit costs; 8% to 10% pay 10%; above 10%, 15%.
Based on current rates, the vast majority of states would face cost-sharing. Analysis from the Brookings Institution's Hamilton Project (7) found only three states have maintained rates below 6% consistently since 2017. Projections from the Alliance for Opportunity (8) estimate Florida could face penalties exceeding $1 billion and California's exposure could reach $1.8 billion.
Critics warn the law also cuts federal administrative funding states need to hire caseworkers, upgrade systems, and actually reduce errors — creating a risk that states hit the target by making applications harder rather than fixing internal accuracy.
Two collection systems, one fixed income
King was also caught between two government collection tracks that have both gotten more aggressive.
On the SNAP side, the Treasury Offset Program garnishes Social Security to recover food stamp debt. On the Social Security side, the SSA itself ratcheted up its own overpayment recovery in 2025 — announcing a 100% clawback rate in March before pulling back to 50% after public backlash, according to SSA press releases and current policy guidance (9). The Biden administration had capped it at 10% just a year earlier, after reports that full withholding pushed some seniors into homelessness.
About 40% of Social Security beneficiaries depend on the program for 90% or more of their income. For someone like King — a senior on a fixed check, facing a SNAP debt she didn't create — there's not much left over after the government takes its cut.
Read More: Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
What recipients should know
SNAP recipients should monitor their benefits monthly and flag anything unusual immediately. A sudden increase could signal an error that will eventually become a bill. Recipients who receive overpayment notices have the right to dispute the claim, request a hearing, or negotiate a repayment plan. In some states, small agency-error overpayments aren't pursued — Massachusetts, for example, waives recovery on agency errors under $600, according to Massachusetts Legal Services (10).
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Even after someone stops receiving SNAP, the debt can be referred to the Treasury Offset Program, which can intercept tax refunds and garnish Social Security. Legal aid organizations like Lone Star Legal Aid can help recipients challenge claims or negotiate terms.
Jerralee King, thankfully, saw a happy ending
King's story ultimately reached thousands of viewers after ABC13 aired its investigation. Days later, an anonymous donor paid her full $8,927 balance, according to a follow-up report from the station (11). Through tears, King said she wished she could thank whoever it was.
But she was the rare case that got a camera crew and a generous stranger. The overpayment rate is still hovering near 10%. States are pushing out billions in erroneous payments every year. And the people on the receiving end — disproportionately seniors, people with disabilities, and families stretched thin — still bear full financial responsibility when the government's paperwork goes wrong.
"I wouldn't take a quarter from the government if they begged me to," King said. "At this point or for any reason for any kind of help."
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
ABC13 Houston / KTRK (1, 11); U.S. Department of the Treasury (2); USDA Food and Nutrition Service (3); U.S. Government Accountability Office (4); Mercatus Center at George Mason University (5); Congressional Research Service (6); Brookings Institution / Hamilton Project (7); Alliance for Opportunity (8); U.S. Social Security Administration (9, 9a); Massachusetts Legal Services (10)
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Rudro is an Editor with Moneywise. His work has appeared on Yahoo Finance, MSN Money and The Financial Post. He previously served as Managing Editor of Oola, and as the Content Lead of Tickld before that. Rudro holds a Bachelor of Science in Psychology from the University of Toronto.
