New York Attorney General Letitia James is leading a coalition of 21 states in a major legal challenge against the federal government, seeking to block a new rule that would cut off food assistance for thousands of lawful permanent residents, many of whom are refugees and asylum recipients. The lawsuit argues that the new guidance from the Trump administration’s Department of Agriculture (USDA) goes far beyond federal law, threatening a humanitarian crisis and financial chaos for states.
At the center of the dispute is a guidance memo issued by the USDA, which purports to implement the recent “One Big Beautiful Bill” Act of 2025. That bill, signed in July, had already narrowed eligibility for the Supplemental Nutrition Assistance Program, or SNAP, for certain non-citizens. The law made groups like refugees and asylees ineligible for benefits while they hold those statuses, reserving eligibility primarily for US citizens and lawful permanent residents (LPRs) after a standard five-year waiting period.
However, the attorneys general contend the USDA’s interpretation of the new law is a radical overreach. The federal government’s guidance asserts that individuals who entered the country through humanitarian protection programs, such as refugees or asylum seekers, will remain **permanently ineligible** for SNAP benefits, even after they have successfully adjusted their status and obtained a green card to become a Lawful Permanent Resident.
A Quest to Take Food Away
“The federal government’s shameful quest to take food away from children and families continues,” said Attorney General James in a statement announcing the lawsuit. The states are arguing that once a person becomes an LPR, federal law should make them eligible for SNAP after they meet the other statutory requirements. The USDA’s memo, according to the lawsuit, attempts to illegally rewrite those rules.
The impact of the new rule is estimated to be immediate and severe. In New York alone, compliance with the USDA’s guidance would force the state to cut off SNAP benefits for an estimated **35,000 lawful permanent residents**. This includes families who have already gone through the often-difficult process of establishing legal permanent residency and who rely on the assistance to put food on the table. Other states are also reporting significant numbers, with Oregon expecting at least 3,000 individuals to lose their benefits.
The total national scale of the impact from the broader changes in the “One Big Beautiful Bill” is substantial, with the Congressional Budget Office estimating that approximately 90,000 individuals on average would lose eligibility each month as a result of the new law. The current lawsuit specifically targets the LPR group who the states believe should remain eligible.
States Warn of Financial Catastrophe
Beyond the human cost, the coalition of states—which includes California, Illinois, Michigan, and New Jersey—is warning of catastrophic financial consequences. The new guidance comes with a penalty scheme that could saddle states with extreme financial fines if they fail to immediately implement the unlawful restrictions. Some state officials have warned that these penalties could be so severe they might be forced to shut down their entire SNAP programs, a disastrous outcome that would affect millions of Americans who rely on the essential anti-hunger aid.
The legal action, which asks a federal court to strike down the guidance, is the latest front in a broader battle between the administration and states over access to public assistance. The attorneys general are urging the court to intervene quickly to ensure families do not lose their critical food assistance.