Federal ‘‘1 Big Beautiful Bill’’ and Rescissions Act bring mixed funding shifts, new state costs for Kansas

Dylan Dear, assistant director of fiscal affairs at the Kansas Legislative Research Department (KLRD), told the Legislative Budget Committee on Aug. 15 that the 1 Big Beautiful Bill Act (known in the memo as OBBA) and a separate Rescissions Act of 2025 will produce a mixture of added federal grant opportunities for Kansas and rescissions of previously unobligated federal balances.

KLRD summarized provisions that affect SNAP and other food programs, Medicaid and CHIP, agriculture and conservation programs, energy and climate programs, public safety grants and a long list of rescinded unobligated balances. The memorandum, Dear said, is a work in progress and KLRD will issue updates as agencies provide firmer numbers.

The most immediate household-level changes flagged by KLRD are to SNAP. OBBA would require the U.S. Department of Agriculture to use the all-items CPI-U (CPIU) to update the Thrifty Food Plan (TFP), instead of a market-based reevaluation; KLRD said that change could cause SNAP benefits to lag food-cost changes over time. OBBA would also expand SNAP work requirements by raising the upper age limit from 54 to 64 and lower the dependent-childcare exemption age to 14. KLRD’s fiscal staff estimated that a new federal state-share framework tied to state SNAP payment error rates could cost Kansas on the order of $40.8 million annually under a circa-9.47% error rate — but noted that the state share does not begin until federal fiscal year 2028. KLRD also reported that OBBA increases state administrative cost sharing beginning federal fiscal year 2027 and estimated a Kansas administrative cost exposure of roughly $19.7 million annually under that change.

On health programs, KLRD said many OBBA Medicaid/CHIP provisions will have "minimal" immediate impact on Kansas because the state is not a Medicaid expansion state. KLRD noted some changes that could impose modest administrative costs, including rules to require address verification or increase eligibility determination frequency and federal recoupment of erroneous payments, which may raise administrative workload.

On agriculture and conservation, single provisions increase mandatory funding for programs that Kansas agencies use — for example, the Agricultural Conservation Easement Program levels rose and the Watershed Protection and Flood Prevention Program was increased to $150 million annually, all of which KLRD said may expand grant opportunities for Kansas land trusts, local governments and producers. KLRD also cited expanded funding for animal disease prevention (rising to very large annual amounts for 2026–2030) and an increase in specialty crop block grants, each identified as possible opportunities for the Kansas Department of Agriculture to pursue new grants.

KLRD’s memo also listed several rescissions of unobligated federal balances that may reduce planned projects. It said specific FEMA BRIC grant awards and a $4.9 billion conditional loan guarantee for the Grain Belt Express were affected: the Department of Energy had terminated the Grain Belt Express conditional commitment and KLRD said rescissions apply to pending BRIC applications and awards not yet obligated — a process KLRD advised will affect applications and awards that have not reached signed contracts.

KLRD flagged a large formula grant created by OBBA: a rural health transformation program with $50 billion in formula grants ($10 billion annually, federal FY 2026–2030). KLRD said the program may open federal support to expand opioid treatment and rural behavioral health services, but it noted states must apply with transformation plans to access the funds.

KLRD also reviewed a $625 million federal allocation for World Cup security costs and other homeland-security appropriations under OBBA; the memorandum noted the allocation is intended for multiple host cities nationwide and that Kansas may receive grants to support related security activities for the Kansas City region.

Why this matters: KLRD’s memo outlines many potential policy and budget consequences state lawmakers and agency budget reviewers must reconcile during the coming fiscal cycles. Some provisions create new federal grant opportunities that require state-level applications to realize funding; others impose new state cost-sharing requirements that would increase Kansas spending if state error rates or other triggers apply. Several provisions are explicitly phased-in a number of years after enactment, so KLRD recommended continued monitoring and updates.

KLRD repeatedly noted uncertainty where implementation depends on forthcoming federal regulation or agency administrative action; the memo cautioned that amounts in the report are projected impacts and that agencies are still confirming whether previously obligated funds will be affected.

Ending: KLRD closed by offering to provide more granular spreadsheets and regular updates as agencies and federal departments clarify how unobligated rescissions, phased funding and new grant programs will work in practice.