Legislative Update
Friends and Neighbors,
Happy Flag Day! I hope you've all had a great summer so far! This week the Office of the Legislative Auditor, a nonpartisan legislative watchdog, released reports on two separate instances of massive fraud - both costing taxpayers over $200 million. I'll share the details of each below.
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I also had the wonderful opportunity to hear from so many of you at a town hall on Saturday with my friends Rep. Novotony and Sens. Lucero and Bahr! Thanks to everyone who came out!
Frontline Worker Pay Fraud
On Tuesday, the OLA released a review of the Minnesota Frontline Worker Pay Program. The OLA is nonpartisan and works on "strengthening accountability and providing legislative oversight of Minnesota state government."
The Legislative Auditor discovered that the Walz Administration approved payments for ineligible individuals or those whose eligibility couldn't be verified through the frontline worker pay program passed in 2022. This included fraudulent duplicate applications, many of which came from individuals who had passed away long before the program started. Additionally, the Department of Revenue failed to verify that all applicants met the adjusted gross income requirements.
The total amount of fraudulent payments is approximately $200 million.
This program allocated a $500 million pool of funds for frontline workers who worked in-person during the pandemic. It was expected that fewer than 500,000 eligible applicants would share this pool. Ultimately, over 1 million applicants were approved, which significantly reduced the amount legitimate frontline workers received due to fraudulent claims. This situation could have been avoided if the responsible agencies had properly performed their duties.
If you or someone you know was a frontline worker, I share your frustration and anger over this situation. It's inexcusable, and the state agency leaders who allowed this to happen should be held accountable.
Feeding Our Future Fraud
Yesterday morning the Legislative Auditor released another report on the Minnesota Department of Education's lack of oversight of the Feeding Our Future fraud scheme. Unfortunately, this situation is even more troubling and highlights the incompetence within the Minnesota Department of Education (MDE) in various ways.
MDE was tasked with overseeing a program to feed hungry children during the Covid pandemic, which included approving and verifying applicants, reviewing operations, making payments for services that met guidelines, and ensuring the program was properly monitored and administered.
However, the Legislative Auditor found that MDE’s actions and inactions "created opportunities for fraud."
MDE:
- Failed to act on warning signs known prior to the Covid-19 pandemic and before the alleged fraud.
- Did not effectively use its authority to hold Feeding Our Future accountable to program requirements.
- Was ill-prepared to respond to issues encountered with Feeding Our Future.
MDE received over 30 complaints from various sources during this period. Instead of investigating, the MDE either ignored the complaints or inexplicably asked Feeding Our Future to investigate itself. Even when the MDE found Feeding Our Future “seriously delinquent" twice, they took no action and continued making payments.
It is evident that this $250 million+ fraud could have been prevented if the MDE had performed even the most basic aspects of their job. They allowed the situation to escalate despite being aware of significant issues.
Minnesota once had a reputation for competent and clean government, but that seems to be deteriorating. We must remain vigilant to prevent further instances of fraud and restore trust in our state agencies.
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