At a Glance
- HHS has frozen federal child-care funding to Minnesota.
- The freeze follows a viral video alleging fraud by Somali-run centers.
- Subsidies for about 23,000 low-income children could be cut.
- Why it matters: Families and providers face sudden loss of essential care and jobs.
The Trump-era Department of Health and Human Services has halted all federal child-care payments to Minnesota, citing fraud concerns that stem from a viral video. The freeze threatens the livelihoods of thousands of low-income families and the 23,000 children who rely on subsidized care.
Federal Freeze and the Fraud Allegations
HHS announced it would stop any further Child Care Assistance Program (CCAP) allotments to all states, but Deputy Secretary Jim O’Neill singled out Minnesota in a Fox News interview. O’Neill said the state would not receive funds until the agency is confident there is no fraud. The funding normally supports about 23,000 children from low-income families.
Jim O’Neill stated:
> “We are not going to spend money on Minnesota until we’re confident there is no fraud.”
- O’Neill also said: “We have turned off the money spigot, and we are finding the fraud.”
- HHS is tightening verification for all states.
- Minnesota has a Jan. 9 deadline to provide records.
State Response and Provider Concerns
Minnesota’s Department of Children, Youth, and Families learned of the freeze only after social-media posts, saying there was no official notice until late Tuesday night. The state has a Jan. 9 deadline to provide attendance records, inspection reports, and parent feedback. Providers warn that without federal money, many will have to close or lay off staff.
Clare Sanford said:
> “The only families who are eligible to get this funding are already very low income and economically vulnerable families.”
- The freeze could trigger a cascade of job and housing losses.
- Providers are already audited by state and county officials.
- Many fear sudden closure if payments stop.
Karen DeVos said:
> “If we’re not getting paid for doing the work, then we either have to let go of those children and let go of staff, or eventually close our doors. Which is terrifying.”
Audit Demands and Federal Oversight
O’Neill has demanded comprehensive audits of the centers highlighted in Shirley’s video and is tightening verification for all states. HHS spokesperson Andrew Nixon said it will scrutinize any center suspected of fraud and request administrative data that has never been asked for before.
Andrew Nixon said:
> “We’re simply asking for administrative data.”
| Event | Date | Action |
|---|---|---|
| Video release by Nick Shirley | Unspecified | Alleged fraud claims |
| HHS freeze announced | Tuesday | Stop all CCAP funds |
| Minnesota deadline | Jan. 9 | Provide records |
Key Takeaways
- HHS has halted federal child-care payments to Minnesota, citing fraud.
- The freeze could cut subsidies for 23,000 low-income children.
- Providers face potential closure if payments cease.
The federal freeze underscores a broader effort to root out alleged fraud, but it also threatens the stability of child-care services for Minnesota’s most vulnerable families.
