It’s time to empower the State Auditor to fight waste and fraud

In a moment of reflection, Legislative Auditor Judy Randall hit the nail on head when it comes to fraud and mismanagement in the Walz administration. After releasing two scathing audits of government programs run amok (Feeding Our Future and frontline worker pay), Randall told a legislative oversight committee Thursday there needs to be a change in mindset from the bureaucrats in charge of handing out taxpayer money.

“The state agencies don’t necessarily approach their work with an oversight and regulatory mindset. The Department of Education in particular, they look to work with their programs, they look to work with school districts, they look to work with their grantees. We haven’t seen evidence of the skillset that is needed — not trusting people. 

Managing this type of program, overseeing this type of money, whether it’s this, whether it’s the frontline worker pay, there’s certainly a place for the technical assistance, but there’s also a place for folks who are skeptical.

One of our conclusions is that the folks who were getting these complaints were not the folks with that regulatory mindset.”

This mindset problem is not new to the Walz administration — it was also prevalent in Mark Dayton’s eight-year reign as governor. In bigger agencies like Health and Human Services, the “work with the grantee” “give all the money away” mindset has been there from the beginning. It’s ingrained in the type of person who signs up to work at a social service agency. They want to help people. It’s the culture of state government.

But it’s a culture that needs to change.

If you interviewed the bureaucrats or their funders in the DFL legislative caucuses, they would speak of compassion and empathy for our fellow citizens who have fallen on hard times. But when so much of the money is wasted or stolen, their compassion just looks foolish. Outside of the taxpayers who pay the bills, the people most hurt by fraud and waste in government are those who might actually need a little help from a government program.

In Minnesota, Democrats don’t seem to care. They feign outrage over fraud in one program while simultaneously funding the next one. Leaders like Gov. Tim Walz judge effectiveness not by results but by inputs: how much money did we confiscate from taxpayers to spend on program X or Y?

For example, Walz recently posted about a new summer EBT program “to put food on the table for thousands of families!”

Walz sleeps at night believing Minnesota families in need will be better off because of this program. The rest of us look for measurable results, like the fact that there were 2 million more visits to Minnesota food shelves in 2023 than in 2022.  

The “compassion before results” culture needs to change fast, as my colleague Martha Njolomole laid out in her recent report, Ticking Timebomb, Minnesota’s vast and expanding welfare system. State welfare spending (by bureaucrats with the wrong mindset) is “a fiscal time bomb, gradually inching the state toward a fiscal crisis.”

Empower the State Auditor

One of the “shut the barn door after the horse left” solutions discussed in the legislative oversight hearing was the hiring of an Inspector General inside the Department of Education. Chairman Rick Hansen (DFL-South St. Paul) asked if there needs to be one in every agency (I didn’t look it up, but I’m pretty sure Hansen has voted against Republican proposals for independent IGs in the past).

Here’s a radical idea: what if we empowered an executive office already directly elected by the voters with the title of State Auditor to become an independent inspector general of state government agencies? The office of State Auditor has never been very powerful, but that could easily change with legislation.

The legislature could expand the auditor’s subpoena powers and give them authority to independently investigate waste, fraud and abuse in state-funded programs. As an independently elected office, they would answer only to the voters, not a governor who appointed them or the legislative caucuses who often close ranks and protect the party involved (as we are seeing with the recent Walz scandals).

The current office of the Legislative Auditor could be folded into this newly-empowered executive office, no longer answering to a legislative committee. The State Auditor could also continue their current function of auditing local governments.

Imagine the political campaigns for this office: “Elect me and I’ll aggressively root out fraud and waste in state government.” “I will investigate waste better than my opponent!” Taxpayers would be well-served by a truly independent office dedicated to program integrity and accountability. Instead of waiting for the mindset of state agencies to change, let’s empower the State Auditor to be a true guardian of the taxpayer. 

Other notes from the oversight hearing

Sen. Ann Rest made a great speech about the buck rolling down the middle of the street and stopping with no one. As someone first elected to the legislature in 1984, Rest has had plenty of time to offer solutions to this problem. When you stay in the legislature for 40 years, you end up voting for solutions to problems created by your earlier votes decades ago.

Rep. Rick Hansen, who chairs the oversight committee, blamed the situation on “evil” and sounded shocked that there were people in this world who would take advantage of the pandemic to steal money. It would be charitable to call him naïve. He’s simply covering for Gov. Walz.

The weakest performance in the room was from Education Commissioner Willie Jett who was asked if anyone at MDE had been disciplined over this massive screw-up. “That’s not who I am as a person, that’s not who I am as Commissioner of Education, you’re not gonna hear me place blame.” He read this statement from a paper handed to him by his agency lawyer. He read all of his statements that way. It was embarrassing. And to think Tim Pawlenty’s highly accomplished Commissioner of Education, Cheri Yecke was deemed not qualified to be commissioner and bounced by the DFL Senate in 2004. We’ve come a long way, baby.

As for Gov. Tim Walz, he was absent from the hearing and absent from press reports about the auditor’s report. If the press tried to contact him for comment, their readers wouldn’t know. You can’t even find a “Gov. Walz refused to comment” or “Gov. Walz was unavailable for comment” in any of the stories. Walz is a master of avoiding accountability for scandals occurring at his agencies and the Capitol press mostly lets him get away with it. Perhaps he will field a question about it next week when he announces another generous and compassionate funding program.

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