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How do federal safety-net programs (SNAP, SSI, TANF) and housing assistance contribute to California’s budget?
Executive summary
Federal safety‑net programs — SNAP (CalFresh), TANF (CalWORKs), and SSI/SSP — and federal housing assistance materially affect California’s budget through large federally funded benefit flows, state‑administered programs that the state sometimes tops up, and occasional state costs when federal funding or rules change. California’s CalWORKs budget is about $7 billion annually under the Governor’s 2024‑25 and 2025‑26 proposals (state and county roles noted) [1]; SNAP/CalFresh is primarily federally funded though some program design and one‑time state choices have shifted costs into the General Fund [2]; SSI/SSP grant levels and state SSP choices affect state spending and Medicaid eligibility [3].
1. How the federal programs plug into California’s books: federal funding, state administration
SNAP (CalFresh) is a federal program that provides monthly food assistance but is administered by the State of California and counties; the federal government generally funds benefits while the state operates the program [2]. TANF funds the state CalWORKs program, which is administered by counties under CDSS oversight — California’s Governor proposed roughly $7 billion in CalWORKs funding for 2024‑25 and 2025‑26 in his budget [1]. SSI is a federal benefit, but California adds a state supplementary payment (SSP); the state has discretion over SSP increases, and SSP levels interact with federal Medicaid funding rules [3].
2. When federal rules shift costs to California: examples and mechanics
State budgets can face new costs when federal policies change or expire. For example, one temporary federal policy that let states use federal funds to replace stolen SNAP benefits ended, prompting California to return to replacing stolen benefits from state funds — a shift described as moving from a mix of state and federal funds back to state General Fund coverage in 2025‑26 analyses [2]. Similarly, program rule changes tied to TANF performance measures or caseload calculations can affect state responsibilities and potential need for additional discretionary funding if California participates in federal pilots [1] [4].
3. Courts, shutdowns and the immediate budgetary impacts: SNAP in the 2025 federal shutdown
A 2025 federal shutdown produced immediate disruption: California reported 5.5 million residents temporarily losing about $1.1 billion in November SNAP assistance amid the shutdown and legal battles with the Trump administration [5]. Federal court orders and subsequent federal agency memos led to a back‑and‑forth in whether full November benefits should be issued; federal guidance later said states that sent full benefit files did so without authorization and must undo those steps [6]. Local and state agencies began issuing and then adjusting payments as courts and federal memos evolved [7] [8] [9] [6].
4. TANF pilot, performance metrics and potential state costs
California was selected as one of five states for a federal TANF pilot to test alternative performance measures focused on long‑term employment and family well‑being; initial work under the pilot runs Oct. 2024–Sept. 2025 and California may need additional programmatic and discretionary funds to implement pilot changes in 2025‑26 and beyond [1] [4]. The pilot also temporarily exempts participating states from standard Work Participation Rate (WPR) requirements for FY2025, which can alter the state’s compliance calculations and fiscal risk profile [4].
5. SSI/SSP and housing links: cost pressures from living‑cost gaps
The LAO points out that fair market rents in California have risen much faster than SSI/SSP grant levels over the last decade, increasing pressure on beneficiaries and on state policy choices around SSP supplements and housing supports; the state is required to maintain SSP at nominal March 1983 levels to keep federal Medicaid funds, but beyond that the state sets SSP policy [3]. Available sources do not mention detailed federal housing assistance dollar flows into California’s state budget in this packet; not found in current reporting.
6. Bigger policy shifts that change long‑run fiscal exposure
Congressional action in 2025 tightened SNAP eligibility and work rules and is estimated to reduce federal SNAP spending by roughly $186.7 billion over the next decade — a national change that will affect states’ caseloads, program administration, and possible state policy responses [10]. These federal changes can force California to decide whether to absorb coverage or benefit gaps with state funds, change eligibility practices, or adjust outreach and administrative investments [2] [10].
7. What to watch next — where fiscal pressure can appear
Watch three areas for state budget impact: [11] federal funding continuity (shutdowns or appropriations fights) that can create short‑term gaps and legal battles over benefit issuance [5] [6]; [12] implementation costs and discretionary funding tied to federal pilot programs and rebased performance metrics for TANF/CalWORKs [1] [4]; and [13] federal statutory changes (like SNAP rule changes) that reduce federal spending and could compel California to backfill benefits or absorb administrative burdens [10] [2].
Limitations: this analysis relies only on the provided documents and snippets; available sources do not mention granular FY2024‑25 or FY2025‑26 dollar totals for SNAP or federal housing assistance specific to California beyond the programmatic and policy summaries cited above [2] [5] [8].