Some liking shown, but inspector general office bill again fails to get committee approval

A second attempt to get an Office of Inspector General bill through a House committee struck out, but optimism remains that a third time could be the charm.

There was at least some progress Tuesday by the House State Government Finance and Policy Committee, although the result was the same.

Members again voted along party lines, failing to advance HF1338/SF856*. A party-line vote last Thursday prevented a delete-all amendment from even being considered.  

The bill would establish an Office of Inspector General that operates independently from state agencies, whose duties would include inspecting, evaluating, and investigating executive branch agencies and programs to identify fraud, and recommend changes to prevent unlawful activity with the goal of ensuring proper use of public funds. It was passed 60-7 by the Senate in May 2025, but no House vote was taken.

Rep. Matt Norris

Rep. Matt Norris (DFL-Blaine) sponsors the bill with Sen. Heather Gustafson (DFL-Vadnais Heights). He said a delete-all amendment he offered — Gustafson was not involved in drafting the amendment — would keep about 90% of the Senate bill, including independence and it would fix some unconstitutional provisions.

Norris said the amendment would, in part, cover all projected costs for office operations, eliminate duplication of the financial crimes division within the Bureau of Criminal Apprehension, and allow for the office to oversee the work of current inspector generals within state agencies.

Committee Co-Chair Rep. Jim Nash (R-Waconia) said the delete-all amendment is a “large departure” from what was passed in the Senate.

Two of nine amendments to the delete-all amendment were adopted: one to change effective dates from 2026 to 2027 and one to add “facilitate information sharing between agencies” and “alerting other agencies when a person suspected of committing fraud … may also be participating in, or applying to participate in, a program administered by another agency.”

Nash said a few of the other amendments have potential, including the establishment of best practice standards, but need further agreement from all stakeholders.

Rep. Patti Anderson (R-Dellwood), who sponsors HF1, an Office of Inspector General bill that was approved by five House committees last session, agreed. “We have to do this collaboratively, we can’t just go off on our own,” she said, adding a bipartisan, bicameral working group on the issue would soon get together.

Still the result is that after about 90 minutes of committee discussion nothing changed.

Anderson and Rep. Ginny Klevorn (DFL-Plymouth), a committee co-chair, noted a Monday report from Tim O’Malley, the state’s program integrity director, shows that much fraud prevention work needs to be done.

“Now that we have that information to build this office upon, I think we should incorporate that information,” Klevorn said. “It is very clear from the conversation that we had today this bill is not ready. We’ve heard repeatedly that private conversations will continue. I ask on our side we let that work continue and when this bill is ready, we can give it a yes vote.”

Nash noted the longer the state government committee “keeps it hostage” means less time for other committees to address areas within their jurisdiction.

Rep. Jon Koznick (R-Lakeville) agrees there was good committee discussion, but Minnesotans want action. “The mental gymnastics to say we need to keep the bill here and not continue to work on it throughout other areas in committees in the Legislature is incredible. … When you do these mental gymnastics about not passing the bill forward and say you’re tough on fraud but then you vote no is amazing.”