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Dear Neighbor,
Greetings from St. Paul, where we have 16 days until the end of the 2026 session. Lots of bills have been passed and there is still much more work ahead to help Minnesotans. Here’s an update on the latest from the House:
Virtual currency bill
 Yesterday, the House overwhelmingly approved a bill (H.F. 3709) I authored allowing banks and credit unions to hold virtual currency on behalf of customers or members – if they choose to offer this service, not as a mandate.
This bill is necessary because, as cryptocurrency ownership has grown, federal regulators have clarified that banks can provide cryptocurrency custody services, but state law must authorize state-chartered institutions to participate. Passing this law helps keep Minnesota’s financial services industry competitive with other states that are offering these services. This bill is narrow and focused on custody, not investment or trading and, again, banks and credit unions do not have to participate if they don’t want to.
Capitol visitors
 Enjoyed meeting with people from The Arc Minnesota this week (pictured above and below). The Arc promotes and protects the human rights of people with a variety of disabilities, supporting them and their families to foster a lifetime of full inclusion and participation in our communities.
 Local firefighters
 Enjoyed meeting with firefighters from back home during Fire Service Day at the Capitol this week.
Anti-flag bill
I strongly oppose a bill House Democrats have introduced a bill (H.F. 5077) that would reduce local government aid by 10 percent for cities and counties that choose to fly Minnesota’s former state flag instead of the new design adopted in 2024.
LGA is a critical funding source that helps communities pay for essential services like police and fire protection. Using it as leverage to coerce communities or impose penalties puts unnecessary strain on local governments and, ultimately, taxpayers.
This bill amounts to an unfunded mandate. It sends the message that communities must comply with a state directive or face financial consequences. Local leaders and residents should have the freedom to make these decisions without interference from St. Paul.
The new flag was selected by a commission in 2023 and took effect automatically under state law, without a direct vote of the people or the legislature. Since then, several communities have chosen to continue flying the previous flag. Current law does not require local governments to display the official state flag.
The bill does face significant hurdles beyond Republican opposition in our tied House. It also was introduced after key legislative deadlines without a Senate companion.
Former fraud investigator blows whistle on state
A former state fraud investigator told lawmakers a childcare fraud unit was undermined before it was shut down, and he has “no doubt” that oversight could have prevented some of today’s fraud concerns now tied to the state-administered Child Care Assistance Program. Jay Swanson, a former criminal investigator for CCAP under the Minnesota Department of Human Services (DHS), testified Tuesday to the House Fraud Prevention and State Agency Oversight Policy Committee that the unit began with strong agency support in 2014, but began to lose it in 2017 before the unit ended in 2019.
Swanson described widespread fraud and a lack of internal accountability at DHS starting in 2017. He said Minnesota is known in Kenyan refugee camps as the easiest state to defraud and get the most money. Also, Swanson testified about DHS actions to hinder investigations, including superiors pressuring him to change written statements. He resigned in 2019 and testified that much of the fraud could have been prevented if leadership in the Walz administration had acted appropriately.
Click here to see the full hearing (Swanson testifies just after the 23-minute mark).
Meanwhile, federal officers served dozens of warrants this week on suspected fraudulent Medicaid providers in Minnesota. It’s encouraging to see federal law enforcement is now providing accountability on fraud where the Walz administration hasn't. Despite repeated red flags, whistleblower warnings, and a surge in program spending, the governor, the attorney general and the former trifecta had ample opportunity to act. But they did not and now the federal government is addressing the problem. Minnesota taxpayers deserve accountability, and we are finally beginning to see it.
Helpful House links
Here are some links you may find helpful in following the latest goings on at the Capitol:
Please Contact Me
It’s an honor and privilege to work for you at the Capitol. Don’t hesitate to contact my office at any time this session to share your thoughts, concerns or ideas. You can call me at 651-296-6316, or email me at [email protected]. I am here to serve you!
Bernie
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