Agreed upon Office of Inspector General bill headed to the House Floor

A bicameral, bipartisan effort to address one of the top topics of this legislative session cleared a key House committee late Wednesday.

And it took quite a while to get to this point.

“This represents a substantial action and a substantial step forward,” said Rep. Matt Norris (DFL-Blaine). “… I want this to be effective on day one and deliver for Minnesotans what they expect out of this office … and deliver the responsible stewardship of taxpayer dollars.”  

“This office” is an Office of Inspector General that would be an independent entity in the executive branch “responsible for ensuring accountability, transparency, and integrity in the operation of state executive branch agencies and programs.” The inspector general would report directly to the governor.

Approved by the House Ways and Means Committee on a split-voice vote, the next stop for the amended HF1338/SF856* is the House Floor. Norris and Sen. Heather Gustafson (DFL-Vadnais Heights) are the sponsors.

Rep. Matt Norris

It was first passed 60-7 by the Senate in May 2025, but no House vote was taken. Based on concerns largely from House DFLers, a working group has gotten together myriad times through the 2026 session to reach this stage.

“This isn’t what each one of us had in mind in the beginning … but through a really, really good process and a lot of good people working on this bill who all want the same thing. We want the fraud to stop. We want to put something in place that can work for the long, long term under many future legislatures, under many future governors,” said Rep. Patti Anderson (R-Dellwood), who sponsors HF1, an Office of Inspector General bill that was approved by five House committees last session.

Eleven specific office duties are prescribed in the bill including 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.

A fiscal note shows a $7.29 million cost in Fiscal Year 2027 and $23.01 million in the 2028-2029 biennium.

[MORE: Spreadsheet from nonpartisan House Fiscal Analysis]

“The cost is significant, but it’s minimal compared to the amount of money taxpayers have lost to fraud in these last years,” said Rep. Paul Torkelson (R-Hanska), a committee co-chair.

Duplication of current work and jurisdictional challenges and an expansion of bureaucracy were among reasons members raised concerns against the bill.

“We’ve got the Office of the Legislative Auditor that will continue to exist. We’ve got the BCA that does investigate cases of fraud in public programs. We’ve got existing inspectors general,” said Rep. Dave Pinto (DFL-St. Paul).

“There are concerns on this side of the table, but we’re moving forward,” said Rep. Cedrick Fazier (DFL-New Hope), a committee co-chair. “… I’m all for innovating and stopping and holding those accountable that commit fraud. If there’s a way to do that without duplicating services and spending money that we don’t need to that we could spend other places, we should do that.”

Norris vowed to work with relevant parties to resolve potential sticking points.

Beginning Jan. 1, 2028, the office would have the authority to appoint licensed peace officers and establish a law enforcement agency to conduct statewide investigations and make arrests. The agency’s primary jurisdiction would be fraud and misuse cases.

“In the meantime the office will have the ability to work with the BCA through an inter-agency agreement for any law enforcement needs they have,” Norris said. “I kind of view the bill as test driving the model working with the BCA to see how that works and whether there is actually a need to create a separate law enforcement agency in the future.”  

Per the agreement, “The Department of Human Services and the attorney general's Medicaid Fraud Control Unit have primary responsibility to investigate fraud in the Medicaid program, but the Anti-Fraud and Waste Bureau may work cooperatively with these agencies."

Current Department of Education inspector general staff would be embedded within the new office; however, they will remain focused on education matters and office at the department.

Four proposed amendments failed to get support including creation of an Inspector General Coordinating Committee to strengthen executive branch work to protect public resources and $15 million for technology modernization to improve data sharing between agencies.