Dear Friends,
Committee work is in full swing here at the Capitol, as many bills are being heard in hopes of allowing them to advance before we reach our committee deadlines. Our education committees are currently reviewing various education programs to help us determine if they are working, and if so, if they are useful.
REVISED STATE BUDGET FORECAST
Budget officials in Minnesota have delivered their latest financial outlook to lawmakers, offering a mixed picture of the state’s fiscal future.
For the current biennium, the state is now projected to have a $3.7 billion surplus in Fiscal Years 2026–27 — an increase of $1.3 billion over the November forecast. However, the outlook shifts in the following cycle. For Fiscal Years 2028–29, Minnesota faces a projected $3.4 billion structural deficit.
The positive takeaway is that the economy is performing better than previously expected. State revenues are coming in higher, providing short-term breathing room. Yet despite that improvement, the longer-term structural deficit remains. Expanding spending commitments or raising taxes now will deepen the financial imbalance in future years.
WALZ ADMINISTRATION REDACTS MAJORITY OF AUTISM SERVICES PROGRAM FRAUD REPORT
A newly released review of Minnesota’s autism services program is raising fresh questions about oversight, transparency, and taxpayer protection.
The analysis, conducted by Optum, examined billing practices within Minnesota’s autism services system. However, lawmakers were denied access to roughly 90 percent of the report’s contents due to the Walz administration blacking them out, leaving only limited findings.
Based on the limited data the administration allowed us to see; the results were troubling. The review indicated that up to 90 percent of claims may have been fraudulent. The report also highlighted a dramatic rise in the number of providers billing the state for autism-related services. In a five-year span, the number of providers increased from 41 to 328. Some approved providers appeared to lack basic information, such as a website or listed phone number, yet were still authorized to receive taxpayer funds. Over that same period, average billing per client reportedly rose by approximately 3,000 percent.
Estimates suggest that roughly $9 billion has been lost to fraud across various programs in recent years. Full access to the report would allow for a more complete understanding of the scope of the problem and help guide reforms aimed at protecting vulnerable families while ensuring the correct use of taxpayer dollars.
LOCAL VISITORS
It was a real pleasure to meet with a group of Region 2 school administrators who came to visit. I appreciated hearing from them about PSEO, school discipline, and burdensome and costly state mandates. One fun note, one of those administrators, Waseca schools' Superintendent Eric Hudspith, is a former teacher colleague from the Albert Lea Schools. It was great to see Eric after so many years!
I also had a nice visit with some local constituents representing the Minnesota Farmers' Union. They shared with me about local agriculture issues and the cost and scarcity of healthcare in our area.
One of the high points of my job as state representative is when young people from my area come to visit me at the Capitol. It was such a pleasure to see this amazing group of Albert Lea high school students and chat with them and answer questions.
Their intelligence and knowledge of the issues impressed me. Kudos to Mr. Haney and the other educators involved who do such a great job educating these young people, and for taking the time and effort to giving them an experience like this. These young people are our future leaders!
I love seeing the sea of white shirted uniforms at the Capitol! Our Minnesota sheriffs from throughout the state gathered here for their Day on the Hill. Thank you to Freeborn County Sheriff, Ryan Shea, for being here and sharing with me important issues related to county public safety.
Unfunded mandates again rise toward the top of the issues - this time for law enforcement. One example Sheriff Shea shared with me is the unfunded/underfunded law enforcement training mandates that create extra costs which must be passed on to local taxpayers. It's good training, but it's not funded.
These unfunded mandates are the hidden taxes passed into law that we rarely hear about. They force costs down to the county and city levels in the form of increased property taxes or higher fees - for things like required law enforcement training, increased paperwork for local governments, and summer unemployment costs for schools. All the while, the lawmakers who pass these mandates can brag that they "didn't raise taxes."
My fix for this? Require state government to fund what it mandates. What the state mandates it should pay for - if not, we should not be able to mandate it.
Have a good weekend,
Peggy