Wintry mix Thursday night, another storm Friday

MPR News helps you turn down the noise and build shared understanding. Turn up your support for this public resource and keep trusted journalism accessible to all. 

Turn Up Your Support

The Minnesota Office of the Legislative Auditor says a program run within the Department of Human Services does not have appropriate oversight of funds it is disbursing. 

 presented to a committee of lawmakers on Tuesday, found that the Behavioral Health Administration did not comply with certain requirements and did not have adequate internal control over grant funds. 

The Behavioral Health Administration, or BHA, is a division of DHS responsible for administering grants to programs meant to help children and adults treat different mental health conditions and substance abuse disorders. BHA partners with counties, providers and tribes to deliver services. The division has more than 200 employees. 

During OLA’s audit, which spanned from July 2022 to December 2024, auditors visited different program sites, reviewed finances and spoke to BHA staff members. Within that time period, BHA managed 830 unique grant agreements that received $426 million in state and federal funding. 

Legislative Audit Commissioners, DHS leader respond to audit finding fraud risk

Judy Randall, the state’s legislative auditor, noted that her team identified a number of documents BHA either backdated or created after the audit began. Because of this, OLA said they could not fully rely on documentation provided by the department. 

“It is frankly unacceptable for the agencies we audit to do this type of activity,” Randall said. “In the 27 years I’ve been with OLA, I have never seen this before.”

During the hearing, temporary commissioner Shireen Gandhi said DHS is working to implement recommendations presented by OLA. 

“The findings provide us with a roadmap for our focus going forward to continue strengthening oversight and integrity of behavioral health grants,” said Gandhi. “I take the report seriously, I accept responsibility for the findings.”

Gandhi could not answer specifically whether all BHA grantees were providing services to people who need it, but said DHS has the authority to cancel any contracts suspected of being fraudulent. 

“The work that we're doing now to shore up the internal controls is going to give me much greater confidence in the future in answering that question,” said Gandhi. “I think we strive to always achieve outcomes, and we are putting in tighter internal controls so that we can, with more confidence, tell you that we are achieving that with the dollars we're spending.”

The findings in the OLA come amid a swirl of questions surrounding the integrity of Minnesota’s social service programs. On Monday, Gov. Tim Walz announced he would not seek a third term as allegations of fraud in childcare centers garnered national attention. 

Some members of the Legislative Audit Commission signaled the audit findings could be indicative of more fraud in another program run by DHS. 

“We have another rogue agency that is acting not in the spirit and manner of the law but is rogue and working outside of the law,” said Sen. Steve Drazkowski, R-Mazeppa.”I just can’t believe what we have in this state government in the state of Minnesota.”

Last March, the Department of Human Services 

 through Trump administration federal funding cuts. The grants included drug prevention programs in schools, treatment and recovery programs for mental health and substance use, and harm reduction strategies amid the nation’s opioid epidemic.

Politics and Government News

Shows

Morning Edition

NewsPartners

Homepage

Fraud in Minnesota

Ellie Roth

Author

The findings in a new report by the Office of the Legislative Auditor say the Behavioral Health Administration within the Department of Human Services is failing to provide adequate oversight to disburse grant funding.

minnesota state capital building and snow

Audit finds weak oversight, fraud risk in DHS grants

Go Deeper.

Like this?

News you can use in your inbox