HHS launches review of Minnesota’s federal funding use under Walz

The Department of Health and Human Services (HHS) has launched a review of how Minnesota used billions of dollars in federal social service funding, requesting detailed records from Gov. Tim Walz’s administration and other government entities after reports raised questions about whether portions of the funds were misused, according to letters first obtained by the New York Post.

The letters were sent Monday by Alex Adams, assistant secretary of the Department of Children and Families, to Walz, Minneapolis Mayor Jacob Frey and a nonprofit that co-administers Head Start programs, The Washington Post reported.

According to the newspaper, Adams said the Department of Health and Human Services is trying to determine whether federal safety net funds were diverted or mismanaged and whether this misuse “has been used to fuel illegal and mass migration” to Minnesota.

Adams told the outlet that the review is focused on “holding American taxpayers accountable” and on ensuring federal benefit programs are not compromised.

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Minnesota received more than $8.6 billion in ACF funding between fiscal years 2019 and 2025 through more than 1,000 federal grants, The Washington Post reported. In fiscal year 2025 alone, the state received more than $690 million for safety net programs under president Biden, according to federal spending records reviewed by the newspaper.

In the letters, Adams requested what The Washington Post called a “comprehensive list” of all state entities that received ACF funding during that period, along with detailed administrative data. The newspaper stated that the information required includes the names of beneficiaries, addresses, dates of birth, social security numbers and immigration numbers, where possible.

Adams told the newspaper that the Department of Health and Human Services had “legitimate reason to believe they were improperly using taxpayer money,” citing recent fraud investigations and allegations involving the Minnesota Department of Human Services. According to the newspaper, the letters referenced public statements by hundreds of Department of Homeland Security employees, alleging that fraud warnings were ignored, and whistleblowers faced retaliation.

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Minneapolis Mayor Jacob Frey speaks during a news conference at City Hall after a mass shooting at Annunciation Catholic School on August 28, 2025 in Minneapolis. (Stephen Maturin/Getty Images)

The review comes amid increased scrutiny of Minnesota’s handling of federal funds in the wake of several high-profile fraud cases. Federal prosecutors have charged dozens of individuals in connection with the Feed Our Future scheme, in which more than $250 million intended for child nutrition programs was diverted to purchase luxury real estate. Many of the defendants had ties to non-profit organizations serving the Somali community in Minnesota.

The newspaper also cited Pew Research Center data showing that the number of unauthorized immigrants in Minnesota increased by about 40,000 people between 2019 and 2023, reaching an estimated 130,000 residents, or about 2% of the state’s population.

Men participate in the weekly Friday prayer session at the Abu Bakar Al Siddiq Islamic Center amid reports of an ongoing federal immigration operation targeting the Somali community in Minneapolis, Minnesota, United States, December 5, 2025. (Tim Evans/Reuters)

According to the newspaper, ACF’s review includes several key federal programs, including the Community Services Block Grant, the Social Services Block Grant, the Low-Income Home Energy Assistance Program, Class IV-E foster care, Refugee Cash and Medical Assistance, the Child Care and Development Fund, and Parents in Community Action, a Head Start grant winner.

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“The Trump administration has made clear its commitment to eliminating fraud, protecting taxpayer dollars, and ensuring program integrity across all federal benefits programs,” Adams wrote in the letters, according to the newspaper. “This information is necessary for ACF to conduct a comprehensive review of the program’s operations and assess the extent of any irregularities that may have occurred.”

Fox News Digital reached out to Governor Walz, Mayor Jacob Frey and HHS for comment but did not receive an immediate response.