Better oversight is a must in state government

Opinion editor's note: Editorials represent the opinions of the Star Tribune Editorial Board, which operates independently from the newsroom.

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Minnesota Gov. Tim Walz and newly installed DFL majorities in the House and Senate have signaled that they are presenting a united front of shared values and priorities, possibly ending the gridlock that has marked far too many earlier sessions under divided control.

That is a welcome development. After three years of pandemic-driven legislating, it's time for lawmakers to return to the broad array of challenges facing this state, many of which have been exacerbated by the need to cope with a wily virus that has yet to be fully conquered.

But there is one overriding need that should be a top priority: restoring trust in government's ability to manage the funds entrusted to its care.

The Feeding Our Future scandal that broke last fall continues to have repercussions. It represents a shameful low point, in which 50 individuals were indicted federally for their alleged roles in a $250 million fraud scheme that stole money that should have been used to feed children during the COVID-19 pandemic. It was the largest pandemic relief fraud scheme in the nation and one of the largest federal fraud cases in state history.

FBI Director Christopher Wray said at the time charges were filed that "defendants went to great lengths to exploit a program designed to feed underserved children … fraudulently diverting millions of dollars … for their own personal gain." Andrew Luger, U.S. attorney for Minnesota, called it a "brazen scheme of staggering proportions."

In a shameless display of gall, Feeding Our Future even took the Minnesota Department of Education to court when the agency, suspecting wrongdoing, correctly attempted to stop payments. Regrettably, the DOE lacked the necessary documentation to persuade a judge and the payouts — and fraud — continued.

Those details are worth remembering. They define the breadth and depth of a fraud that must never be repeated. Sadly, this is not the only time Minnesota has had issues tracking grants to nonprofits, and the DOE, which helped administer the federal child nutrition funds, is not the only agency. The legislative auditor has reports going back years detailing smaller-scale shortcomings in oversight involving the state Department of Human Services, as the Star Tribune Editorial Board noted in September.

To his credit, Walz has proposed a fraud prevention plan that would involve installing an inspector general at the DOE, along with funds to provide additional oversight and an increase in auditors and enhanced fraud investigation capabilities.

"It became clear that we need better eyes on all this, and we need to restore faith in government," Walz told an editorial writer. Walz noted that when he served in Congress he partnered with Republican colleagues to increase oversight for the Department of Veterans Affairs after the administration had weakened it. "Good oversight is absolutely an integral part of making government more efficient, more accountable," he said.

An inspector is needed at the DOE, but improved oversight should go further. The best approach would be an Office of Inspector General independent of other agencies, with strong investigative capabilities.

When asked about such a possibility, Walz said that he sees an education IG as a prototype that would be expanded to other departments. He wants the Bureau of Criminal Apprehension to assist with investigations of suspected criminal fraud. "I want an aggressive plan to address not only this moment," he said, "but to look across all state agencies … . I've worked in government long enough to know that even if you stop fraud in one agency, you have to figure the same tactics will be tried in another agency. We need to learn how to plug all the loopholes."

To that end, Walz said, an Office of the Inspector General should be "as independent as possible" and empowered to do things "the legislative auditor doesn't have the capacity to do." While he was in Congress, Walz said, federal reports showed a return of roughly $8 for every dollar spent on auditing and oversight.

Should these changes come to pass, they'll mean more work for government agencies administering funds and more work for the nonprofits receiving them. That's unfortunate, but there is a higher need here. The state must be able to prove that funds are being used effectively.

We are convinced that, by and large, nonprofits in this state are careful stewards of the public funds they receive. But incidents such as Feeding Our Future and others point to a lack of oversight and accountability that cannot go on.

Democrats have ambitious ideas for improving the lives of Minnesotans and the funding needed to make them a reality. We hope they save a little of it to provide the means to ensure it is all well-spent.

Editorial Board members are David Banks, Jill Burcum, Scott Gillespie, Denise Johnson, Patricia Lopez, John Rash and D.J. Tice. Star Tribune Opinion staff members Maggie Kelly and Elena Neuzil also contribute, and Star Tribune Publisher and CEO Michael J. Klingensmith serves as an adviser to the board.