Senate Finance Committee hearing on mismanagement of state money in St. Paul

Updated: November 13, 2019 07:00 PM

In St. Paul Wednesday afternoon, a hearing to find out more about the mismanagement of state contracts took place. 

It all started with overpayments by the Department of Human Services, totaling $29 million to two Native American tribes for opioid programs.

Those payments should not have been made because they don't follow state and federal guidelines. Since then, KSTP has learned there were more than 1,300 violations across several state departments.

"I do absolutely believe this is the tip of the iceberg and we're going to start jumping into all of these agencies and figuring out where is the money going," said Sen. Julie Rosen, R-Vernon Center. "And is it being appropriated correctly, and is it being used for what it's supposed to be being used for."

Representatives from the Department of Administration, which oversees contracting by state agencies, Minnesota Management and Budget and the Department of Human Services, were all on the hot seat trying to explain why money was handed out, and how, without following state protocols.

Alex Kotze is the Chief Financial Officer at DHS. She said when she first realized there were issues a few years ago with people reporting what are referred to as 16a and 16c violations in her agency, she stepped in to monitor things. She added she takes her job as a steward of taxpayer money very seriously.

"In fiscal year 2019 at DHS, we had 21,886 transactions, in this world of 16a and c violations that is about 1%," Kotze said. "Not that this is okay, but we are working really hard to fix these issues."

Minnesota Management and Budget released information today stating DHS isn't the only violator; in fact, the Department of Employment and Economic Development has more than 580 violations.

Sen. Rosen says she plans to take a deep dive into what money is going where.

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Jessica Miles

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