Staring at $500 million in frozen child care payments, Ellison sues Trump (again)

Minnesota Attorney General Keith Ellison filed a lawsuit Thursday after The Trump administration said this week it is freezing payments that help Minnesotans with child care, job training, and other parental support services.

Attorneys general from four other states — California, Colorado, Illinois and New York — were part of the lawsuit as Trump additionally suspended child care payments in these states. The case was filed in New York federal court on the we’ve-seen-this-movie-before grounds that Trump is unconstitutionally undermining Congress’s power to appropriate money. 

A YouTube video from right-wing content creator Nick Shirley inspired the Trump administration’s payment suspension. The video claimed to show abandoned Minneapolis child care centers run by Somali immigrants that still collected taxpayer money.

But I obtained the letters the Trump administration sent to Minnesota officials. And the reasons federal officials gave for payment suspension were more generic concerns over undocumented immigrant patients than specific allegations of nefarious day care centers.

This is a fast-moving story. Here is what we know now about how this political battle might impact the lives of Minnesotans.

Can you say more about the letters freezing child care payments?

So, the sprawling U.S. Department of Health and Human Services includes a division called the Administration for Children and Families.

On Monday, Alex Adams, assistant secretary of the Administration for Children and Families, wrote to the Minnesota Department of Children, Youth and Families that his federal division is temporarily restricting money from the Child Care and Development Fund.

According to Minnesota Management and Budget, the state is anticipated to receive over $200 million yearly from this federal fund. It is meant to “increase the availability, affordability and quality of child-care services for low-income families where the parents are working or attending training or educational programs.”

Then on Tuesday, Adams sent a letter stating that the Administration for Children and Families is also suspending money toward Temporary Assistance for Needy Families. And he typed a separate communique that the feds were not letting the state of Minnesota draw down from the social services block grant.

The Department of Children Youth and Families did not respond to requests by deadline to answer how much money the state could lose from these three suspended payments. But back of the napkin math using state budget figures suggest that these suspended payments could top over $500 million. 

In each of these three letters, Adams asks for a mountain of information from the Department of Children Youth and Families before these payments are allowed to resume. 

For example, in the Temporary Assistance for Needy Families letter, Adams writes, “I am requesting that the State of Minnesota provide the complete universe of TANF administrative data that exist or are in the state’s possession for all recipients for all available years, and at least until 2022 to 2025.”

Adams wants all this information by Jan. 20. 

Related: Trump administration says it’s withholding social safety net money from Minnesota, 4 others states over fraud concerns

Further on in the letter, Adams indicates why he is making such an exhaustive data request. He wants “the policies, procedures, system controls and verification records used by Minnesota to confirm citizenship or qualified alien status” to program “applicants and recipients.”

So far, at least, the social services fraud scandal engulfing Minnesota politics right now has utterly nothing to do with program recipients. 

In fact, it is about often low-income recipients allegedly getting ripped off by phony social services providers, like the housing services companies that face federal criminal charges.

Asked why they are focusing on the immigration status of program recipients, Emily Hilliard, a spokesperson for the U.S. Health and Human Services, emailed, “HHS has a responsibility to ensure that the federal taxpayer dollars are used for the purposes outlined by Congress.”

What do we learn from Ellison’s lawsuit?

According to the lawsuit, part of the reason the Trump administration letters focus on recipients is that the letters to California, Colorado, Illinois and New York use almost identical wording.

Minnesota, at least, has a legitimate social services fraud scandal to reckon with. The lawsuit argued that the only nexus between Minnesota and these other states is that they all have Democratic governors and attorneys general. 

The lawsuit points out that these funds are drawn down periodically by state governments and contractors who administer these three programs. In other words, family care providers and families themselves may face immediate effects.

“Agencies must immediately expend resources to consider ways to reduce program liabilities to account for a decrease in program funds,” the lawsuit reads. 

These may include reducing program eligibility and increasing the co-pay for families, according to the lawsuit. 

So, these programs are now flung into the claustrophobic vortex of Trump v. state AG’s litigation. In this galaxy, state AG’s often win in court, but — as the saga of the Supplemental Nutrition Assistance Program shows — court wins are not necessarily determinative.

Asked to respond to the lawsuit, Hilliard of the U.S. Health and Human Services pointed to a message on X by Mike Stuart, general counsel for the federal agency.

“It’s unfortunate that these Attorney Generals from these Democrat-led states are less focused on reducing fraud and more focused on partisan political stunts,” Stuart wrote. “HHS stands by its decision to take this action to defend American taxpayers. We identified serious concerns in these states that warranted immediate review and action.”

Stay tuned for more next week regarding Minnesota child care programs. 

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