You need:

use strict;
use warnings;

use Data::Dumper;

my %a;
$a{'WI'}{'GreenBay'}{'Color'} = 'Black';

foreach my $update ("WI,GreenBay,White") {
    my ($state,$city,$color) = split /,/, $update;
    my $h = $a{$state}{$city};
    $h->{'Color'} = $color;
};

print Dumper(\%a), "\n";
__DATA__
$VAR1 = {
          'WI' => {
                    'GreenBay' => {
                                    'Color' => 'White'
                                  }
                  }
        };
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Note that using strictures will catch your spelling error ($updtate) when you split (which is why your hash appears to be empty). Also note that $a{$state}{$city} is already a reference to your "inner hash" (i.e., a hash of hashes already uses a reference).