Overview
- Health and Human Services initially halted all federal child-care payments to Minnesota, then applied enhanced verification nationwide to Child Care and Development Fund disbursements.
- Deputy Secretary Jim O’Neill demanded a comprehensive audit of Minnesota centers flagged in a viral video, including attendance, licensing, inspection and complaint records.
- Federal officials said the FBI and Homeland Security Investigations have surged resources in Minnesota as broader probes of suspected program fraud continue.
- Minnesota leaders, including Gov. Tim Walz and Attorney General Keith Ellison, denounced the move as politicized and warned it could unlawfully cut off critical services.
- Providers and advocates cautioned that pulling or delaying roughly $185 million in annual subsidies could force legitimate centers to close and disrupt care for tens of thousands of children, as some centers disputed the video’s claims with licenses and records.