Fraud Hearings in Washington, D.C. and St. Paul

In Washington, D.C. this week, Governor Tim Walz and Attorney General Keith Ellison testified before the U.S. House Oversight Committee, facing intense questioning from Republican lawmakers over how fraud was allowed in state programs. Critics accused the state of inaction and even misrepresentation of facts, while Walz and Ellison defended their record and emphasized convictions and oversight efforts. The partisan exchanges underscored broader political tensions over fraud oversight and enforcement.

Closer to home in Minnesota, the House State Government Finance and Policy Committee heard two Republican-sponsored fraud prevention bills. Representative Jim Nash’s H.F. 3683 would require state budget and economic forecasts to account for the estimated impact of fraud and improper payments. Representative Harry Niska’s Fraud Isn’t Free bill (H.F. 3395) would require an agency head to take a 25% salary cut in the event of significant loss due to fraud, impose a 10% budget cut on agencies that fail to protect public funds, and bar employees found grossly negligent or involved in fraud from state employment for five years. Each bill failed to pass on party-line votes after debate over the workability and punitive aspects of the two bills.

Supplemental Budget to be Released Soon

With the February Forecast in the rear-view mirror, capitol insiders are now waiting for the release of Governor Tim Walz’s supplemental budget. With an announced surplus in the current biennium (FY 26-27) of $3.7 billion and a positive number of $377 million in FY 28-29, legislators have begun to discuss tax reduction and spending proposals. After the forecast announcement, Walz said responsible budgeting is needed, including modest budget decisions this session.

DFL Touts Affordability Agenda

While Republicans advocated for tax cuts, including joining the federal government in banning taxes on overtime and tips, following the February Forecast, the House DFL Caucus released a wide-ranging package of approximately 20 proposals that they say would cut daily costs for average Minnesotans. Some proposals, like banning private equity firms from buying single family homes, wouldn’t cost the state anything. Other parts of the plan address health care, childcare, energy and grocery costs through a variety of different means.

Minnesota Prepares for Driverless Cars

Earlier this week, the Minnesota House Transportation Committee had a first look at H.F. 3513, a bill to regulate autonomous vehicles. The Minnesota Department of Transportation has been studying the issue for several years, but this year’s legislation marks the most comprehensive attempt for the legislature to put some guidelines in Minnesota law. The hearing included testimony from well over a dozen people and highlighted both the potential of the emerging technology as well as concerns about it. Eventually, the committee deadlocked on whether to advance the bill to the next committee, and left the bill in the Transportation Committee’s jurisdiction for additional work.

Private Equity Role in Medicine

Two bills (H.F. 2771 and H.F. 2779) that consider the appropriate role for private equity companies to be involved with health care entities were on the agenda in the House Health Finance and Policy Committee earlier this week. This is an issue that has been debated for multiple years by the Minnesota Legislature, though it appears that consensus is likely to remain elusive. The issues under discussion include whether private equity firms should be able to buy or invest in nursing homes, clinics and other health care facilities, and if such investments should be limited, as well as what decision-making ability these firms should have if they do invest in health care facilities. The bills were laid over for further consideration.

March 6, 2026