By Rich McKay
Dec 31 (Reuters) – Republican President Donald Trump’s administration has announced a freeze on child day care payments to Democratic-led Minnesota, ramping up what the state’s governor had characterized as a political confrontation over immigration and allegations of widespread fraud in social services programs.
“The funds are frozen until the state proves taxpayer dollars are being spent legitimately and in accordance with the law,” Trump’s Health and Human Services Department said on Wednesday in an email to Reuters.
The department did not respond to a Reuters request for details about how much money had been blocked. Assistant Secretary Alex Adams, who oversees the department’s Administration for Children and Families, referred on social media to $185 million in annual child care funds for Minnesota, the amount the state received in the last fiscal year, according to agency records.
GOVERNOR SAYS STATE HAS CRACKED DOWN ON FRAUD
Minnesota Governor Tim Walz, a Democrat, said on X that Trump was “using an issue he doesn’t give a damn about as an excuse to hurt working Minnesotans.”
“We’ve spent years cracking down on fraudsters,” Walz added on X.
The Trump administration has in recent weeks focused on Minnesota as it says rampant fraud is being committed by immigrants in the welfare system. Administration officials have frequently and sharply criticized the state’s Somali community, the largest in the country, as well as Walz, the 2024 Democratic vice presidential nominee, and Democratic Representative Ilhan Omar, a Somali American who represents a Minneapolis-based district in Congress.
Trump repeated such rhetoric on Truth Social on Wednesday, a day after Deputy HHS Secretary Jim O’Neill posted on social media about the day care funding freeze.
FBI DEPLOYED PERSONNEL TO MINNESOTA
U.S. Centers for Medicare and Medicaid Services Administrator Mehmet Oz issued an ultimatum this month, calling on Walz to address what he said was systemic fraud in the state’s Medicaid system.
“We are done footing the bill for your incompetence,” Oz said.
The FBI has deployed personnel and investigative resources to Minnesota to “dismantle large-scale fraud schemes exploiting federal programs,” Director Kash Patel said on Sunday on social media.
Before Tuesday’s announcement, CMS had said in a December 5 letter it would require corrective measures within 60 days. In a letter to Walz, Oz said Minnesota must provide his agency with weekly updates, freeze high-risk provider enrollment, verify existing providers, and submit a plan to prevent future fraud, or face federal funding cuts.
The Trump administration has tried to block a wide range of federal aid this year to pressure states to comply with its immigration crackdown, including disaster aid and transportation funding. Many of those attempts have been struck down in court, including an effort that sought to ban some immigrant children from preschool programs. The administration has successfully slashed foreign aid, diversity grants and other types of funding.
(Reporting by Rich McKay in Atlanta, additional reporting by Andy Sullivan and Ahmed Aboulenein in Washington; editing by Donna Bryson and Rod Nickel)
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