FNS administers all USDA domestic nutrition assistance programs, including the Supplemental Nutrition Assistance Program (SNAP). SNAP is the cornerstone of USDA’s nutrition assistance programs and is the largest program in the domestic hunger safety net. SNAP provides nutrition assistance benefits via an electronic benefit transfer (EBT) card to millions of low-income people. These benefits help supplement household food budgets so recipients can purchase more healthy food.

FNS is directly responsible for the authorization and oversight of retailers who accept SNAP benefits. This is accomplished jointly by the Retailer Policy Division (RPD) within SNAP, and the Office of Retailer Operations and Compliance.

Currently, approximately 260,000 retailers are authorized to accept SNAP. Thousands of direct marketing farmers and farmers’ markets (DMFs and FMs) apply for SNAP authorization each year. Since 2012, FNS has supported the participation of DMFs and FMs in their efforts to attract more SNAP customers. FNS has supported individual DMFs (and FMs on behalf of DMFs), which meet specific requirements, in procuring low- or no-cost wireless electronic benefit transfer (EBT) point-of-sale (POS) devices through the SNAP EBT equipment program. 

FNS has also awarded grants to provide: a) an e-commerce platform that enables DMFs to accept SNAP benefits online (SNAP/Federal Nutrition Programs Participation Assistance for Farmers and Farmers’ Markets), and b) a SNAP Mobile Transaction Processing Application and card reader that enable a DMF to accept SNAP by using their own smartphone as a POS device (Mobile Application Cooperative Agreement, SNAP Farmers and Markets).

Eligibility

Nonprofits having a 501(c)(3) status AND accredited institutions of higher education. All applicant organizations must be domestic entities and shall be owned, operated, and located within the 50 United States, the District of Columbia, Guam, or the United States Virgin Islands.

The Supplemental Nutrition Assistance Program (SNAP), authorized under the Food and Nutrition Act of 2008, as amended, is the cornerstone of the nation’s nutrition assistance safety net. The United States Department of Agriculture (USDA) Food and Nutrition Service (FNS) certifies low-income Americans to participate in the program and authorizes and monitors retailers to accept SNAP benefits for eligible food products. Currently, around 40 million low-income Americans receive SNAP benefits, and more than 250,000 retailers are authorized to accept SNAP benefits.

Section 4208 of the Agricultural Improvement Act of 2018, PL 115-334, (“Farm Bill”) authorizes USDA, on a competitive basis, to enter cooperative agreements with governmental entities or nonprofit organizations to carry out Healthy Fluid Milk Incentives (HFMI) projects. The Further Consolidated Appropriations Act, 2024, (PL 118-42) provides $2,583,428 for HFMI for fiscal year 2024.

FNS announces, through this request for applications (RFA), the availability of $2,583,428 in total grant funding to award one cooperative agreement.

Eligibility

Eligible entities who can submit applications include government agencies (state, local, territory, or tribal agencies) and non-profit organizations.

Key Requirement for FY 2024 Applicants

FNS is limiting proposals to project designs that will either:

1. Deliver HFMI incentives as an automatic discount at the point of purchase or
2. Through integration with state electronic benefit transfer (EBT) systems to automatically deposit earned HFMI incentives onto SNAP households EBT cards (See Project Design on page 12 and in the scoring criteria on page 35 of the RFA).

Purpose and Key Objectives

The primary purpose of the HFMI project is to develop and test methods to increase the purchase and consumption of qualifying fluid milk by SNAP households by providing them an incentive at the point of purchase at authorized retailer locations. “Qualifying fluid milk” includes all varieties of pasteurized cow’s milk that (1) is without flavoring or sweeteners, (2) is consistent with the most recent dietary recommendations, (3) is packaged in liquid form, and (4) contains vitamins A and D at levels consistent with the Food and Drug Administration, state, and local standards for fluid milk.

WASHINGTON, June 28, 2024 – USDA’s Food and Nutrition Service today released the fiscal year 2023 Supplemental Nutrition Assistance Program Payment Error Rates, detailing high rates that demand urgent state actions to improve.

SNAP payment errors occur when a state agency certifies a household to receive either too much or not enough SNAP benefits. For fiscal year 2023 (Oct. 1, 2022 – Sept. 30, 2023), the overpayment error rate for SNAP is 10.03%, with an underpayment error rate of 1.64%, in line with the previous year.

Payment error rates are not synonymous with fraud, but rather reflect how accurately states determine eligibility and benefit amounts. Payment errors are largely due to unintentional mistakes, either by the state agency or the household, that affect the accurate determination of eligibility or benefit amounts.

“SNAP is a cornerstone of our nation’s safety net, and accurate benefits are crucial for families in need and for public trust,” said Administrator for the Food and Nutrition Service Cindy Long. “We cannot tolerate high error rates in a program that impacts millions of lives. States must take immediate action to improve the accuracy of SNAP payments—or they will face financial penalties.”

While the administration of SNAP is a state responsibility, FNS has been actively engaged in supporting states in both decreasing payment errors and improving the timeliness of payments, another key measure of SNAP performance. To help states analyze root causes of SNAP performance issues and identify responses, FNS has offered onsite visits, virtual trainings, and updated guidance and tools on effective practices. Additionally, FNS has awarded technology grants to state agencies to improve SNAP application and eligibility determination systems.

USDA has also requested funds and additional proposals in the President’s FY25 Budget to improve payment accuracy and enhance program integrity, including funding for quality control and computer systems to support state access to SNAP integrity tools, and establishing a new Office of Training and Development to support states in resolving payment accuracy issues.

States must address persistent post-pandemic error rates in order to avoid financial penalties. All states that performed poorly this year will be required to submit a corrective action plan addressing the root causes of errors to improve payment accuracy. In addition, states with high error rates for two consecutive years are assessed a financial penalty. These penalties can be paid immediately to USDA or settled by investing 50% of the amount in activities that are focused on improving the state’s administration of SNAP. The remaining 50% is held at-risk for future payment to USDA if the state continues to have a high error rate.

“We are sending a clear message to all states: accuracy in SNAP is non-negotiable,” Administrator Long emphasized. “We expect state leadership at all levels to be fully engaged in this effort to improve.”

The state-by-state rates of payment errors can be accessed here.

USDA’s Food and Nutrition Service works to end hunger and improve food and nutrition security through a suite of more than 16 nutrition assistance programs, such as the school breakfast and lunch programs, WIC and SNAP. Together, these programs serve 1 in 4 Americans over the course of a year, promoting consistent and equitable access to healthy, safe, and affordable food essential to optimal health and well-being. FNS also provides science-based nutrition recommendations through the co-development of the Dietary Guidelines for Americans. FNS’s report, “Leveraging the White House Conference to Promote and Elevate Nutrition Security: The Role of the USDA Food and Nutrition Service,” highlights ways the agency will support the Biden-Harris Administration’s National Strategy, released in conjunction with the historic White House Conference on Hunger, Nutrition, and Health in September 2022. To learn more about FNS, visit www.fns.usda.gov and follow @USDANutrition.

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