A federal judge in Oregon has ruled that 22 states and the District of Columbia do not owe hundreds of millions of dollars in SNAP penalties, deciding last week that the Trump administration's implementation deadline was "unlawful and arbitrary."

Oregon Federal District Court Judge Mustafa Kasubhai issued the ruling in a case brought last November by a 22-state coalition co-led by Oregon and New York. The states faced fines for providing Supplemental Nutrition Assistance Program benefits to lawful permanent residents — Green Card holders such as former refugees and people granted asylum — who were not U.S. citizens.

The Trump administration later reversed its position on eligibility for lawful permanent residents but continued to argue the states owed penalties for missing a "grace period" that had effectively expired before the administration finished issuing implementation guidance, according to Oregon State Attorney General Dan Rayfield, who led the suit.

"The court's ruling means that Oregon will continue to effectively manage the SNAP program, and our vulnerable neighbors will get the food they need," Rayfield said in a statement.

The court found the administration's guidance improperly excluded certain lawful permanent residents from food assistance they are legally entitled to receive. The ruling also struck down the deadline as it applied to other SNAP eligibility calculation changes under the 2025 Republican budget bill. According to Rayfield's office, the decision clarifies that the standard five-year SNAP waiting period does not apply to lawful permanent residents who were previously refugees, asylees or other humanitarian immigrants.

The dispute traces back to the One Big Beautiful Bill Act, which passed last July. The law mandated multiple SNAP changes, including new work requirements and eligibility revisions, with a Nov. 1 implementation deadline. But the administration did not release all the necessary guidance documents in time for states to comply, the lawsuit argued.

Judge Kasubhai wrote that the administration's guidance "caused widespread confusion."

"In the past, state agencies have waited until USDA issues guidance before implementing statutory changes to SNAP to ensure compliance with USDA's interpretation of the law," he said. "For plaintiffs' SNAP programs and those who depend on them, the consequences are severe."

The court had previously issued an injunction protecting the states from penalties while the case proceeded. With last week's ruling, states retain both the injunction's protections and a judicial determination that the deadline itself violated the law.

For grocers and SNAP-authorized retailers, the ruling preserves existing benefit flows to humanitarian-program Green Card holders in the 22 plaintiff states and D.C., removing the compliance uncertainty that followed the missed Nov. 1 guidance timeline.