With Minnesota House Republicans in the majority — for now at least — they’re moving forward with a slate of legislation and other moves they say will better address waste, fraud and abuse in state government.

How far they go will depend on what ideas Democratic-Farmer-Labor lawmakers will support. And while at least one proposal shows signs of traction, DFLers aren’t eager to let the GOP use the opportunity to blame their leadership for major government fraud.

House Republicans say there’s been more than half a billion dollars of known fraud in Minnesota since 2018, a figure that includes more than $250 million in pandemic-era federal meal aid the state lost to an alleged scheme that federal prosecutors say centered around the nonprofit Feeding Our Future.

It’s one of the main issues the GOP campaigned on in the 2024 election, and it gained them a tied House in the November elections after two years of DFL-controlled state government. The GOP currently has a slim majority and it may be temporary as a March 11 special election in a heavily DFL Roseville-area district may return the 67-67 split.

House fraud committee

Control of committees will be split again once a tie returns, but as part of a deal that got DFLers to return to the Capitol after a weeks-long session boycott, Republicans will keep control of a newly created panel dedicated to addressing fraud in state government for two years.

In the last two weeks, the House Fraud Prevention and State Agency Oversight Committee has held hearings that Republicans hope will highlight the issues they say led to major fraud at the state departments of Education and Human Services.

“The mission of this committee is to ensure that taxpayer money is not going to the greedy, but is going to serve the needy,” said fraud committee Chair Kristin Robbins, R-Maple Grove, who said it isn’t a partisan issue. “The Legislature appropriates money and we also have a duty to exercise oversight of executive branch agencies tasked with spending it.”

At its first hearing on Feb. 10, GOP members of the committee called the Office of the Legislative Auditor to explain its past review that found “pervasive noncompliance” in the state’s grant management policies between 2018 and 2022, when agencies distributed more than half a billion dollars a year to nonprofits.

That audit, first published in 2023, found the Education Department and many other state agencies administering hundreds of millions of dollars in grants didn’t follow state rules, and that government officials had little authority to enforce compliance.

It’s a 2-year-old report, but GOP members of the committee said it highlights ongoing issues with the way the state issues grants.

DFL points to past efforts to combat fraud

DFLers pointed out that they had passed measures to address some of those problems and that there would be an update on the progress on some of those in an upcoming report from the Office of Grants Management, an office that had its staffing boosted by the Legislature in 2023.

“They went from four people to 12 in response to this audit … because I think that there was a recognition by both the auditor and the legislators that wasn’t enough,” Rep. Emma Greenman, DFL-Minneapolis, told the committee.

In response to fraud, Democrats in 2023 boosted the number of grants management employees, created a new inspector general position at the Department of Education, and gave department commissioners the ability to cut off grants not in the state’s best interest, according to the Senate DFL.

The moves came after the Feeding Our Future scandal became widely publicized. Democrats also point to the 70 people who were indicted by the federal government in connection to the case as a sign that fraud is taken seriously in the state. More than 30 have pleaded guilty so far, and the alleged ringleader is currently on trial.

DFL Gov. Tim Walz has taken action, too. In January, he signed an executive order to create a fraud investigation unit at the Minnesota Bureau of Criminal Apprehension.

Committee’s powers

The new House fraud committee has held two hearings so far and the next is scheduled for Monday, when Department of Human Services Commissioner Shireen Gandhi is set to testify.

So far, its meetings have been informational. Robbins has said the committee could consider bills, including some fraud-related measures that have already been advancing in the GOP-controlled House.

The committee’s powers are limited. Republicans control a 5-3 majority, but it won’t be enough for them to file a subpoena on their own. That requires a two-thirds majority on any committee, so they’ll need DFL support to launch any serious investigation of a government agency.

Even if Republicans can get any of their fraud measures to the House floor, they face another hurdle: Republicans have 67 seats — short of the 68 needed to pass any bills. No matter what, they need one Democrat to join them.

The DFL also has a one-seat majority in the Senate. In that chamber, the only anti-fraud measure that has gained any serious traction so far is a measure to create an Office of Inspector General that would give oversight at multiple state offices.

Other measures

What bills are Republicans hoping to pass in order to curb fraud? One establishes a centralized inspector general office for state government that unifies all six governor-appointed inspectors general across state agencies. It requires the state to halt payments when fraud is suspected and create a fraud reporting hotline. The House version advanced through a committee last week.

A similar bill is backed by Senate Democrats. Sen. Heather Gustafson, DFL-Vadnais Heights, is carrying the bill, which recently advanced through the Senate Judiciary and Public Safety Committee. GOP Sen. Michael Kreun of Blaine is also a sponsor. Senate Republicans have a separate bill, too, though their version is not likely to get far because they are in the minority.

Another GOP proposal would create stricter reporting requirements for fraud in state agencies. Employees are currently encouraged to report suspected fraud to the legislative auditor, but a review by that office last summer found that didn’t happen. Republicans say that needs to be strengthened, and their bill would require immediate reporting to law enforcement, and chairs and ranking minority members of relevant legislative committees.

A third House fraud bill requires the Office of the Legislative Auditor to submit an annual report to the Legislature detailing agency progress on anti-fraud measures.

In addition to sponsoring bills and holding hearings with their new fraud committee, House Republicans also have attempted to enlist the aid of the Trump administration.

On Feb. 10, Robbins, House Speaker Lisa Demuth and Majority Leader Harry Niska sent a letter to new Attorney General Pam Bondi to investigate fraud in Minnesota.

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