USDA Suspends $129M in Minnesota and Minneapolis Awards Amid Fraud Probe, Leaving Scope of Food‑Aid Cuts Unclear
The USDA has suspended just over $129 million in active and future federal award payments to Minnesota and Minneapolis amid a wide‑ranging fraud investigation, Agriculture Secretary Brooke Rollins said in a Jan. 9 letter to Gov. Tim Walz and Minneapolis Mayor Jacob Frey that demands justification for all USDA‑related spending since Jan. 20 and requires case‑by‑case payment approvals going forward. The suspension is tied by officials to alleged fraud in programs including Feeding Our Future, Housing Stabilization Services and daycare claims and comes as federal prosecutors are being sent to assist the probe; state officials say the $129 million figure appears to exclude SNAP and school‑lunch funds and has already created uncertainty for other programs, while Minnesota’s attorney general has vowed to fight the move in court.
📌 Key Facts
- USDA suspended "just over $129 million" in active and future award payments to Minnesota, according to Brooke Rollins' Jan. 9 letter, though the full scope of food‑aid cuts is unclear because that figure appears to exclude SNAP (more than $850 million to Minnesotans in 2024) and the National School Lunch Program (more than $240 million in the last budget year).
- Rollins' letter — addressed to Gov. Tim Walz and Minneapolis Mayor Jacob Frey — demands justification for all USDA‑related federal spending to Minnesota from Jan. 20 of last year to the present within 30 days and says all payments going forward will require case‑by‑case "payment justification."
- The USDA action is explicitly tied to alleged fraud involving Feeding Our Future, the Housing Stabilization Services program and daycare‑center claims; the letter cites the 2022 Feeding Our Future investigation, in which 78 people were charged and 57 convicted.
- U.S. officials told CBS News that the Justice Department is sending a team of federal prosecutors to Minnesota to assist the wide‑ranging social‑services fraud investigation.
- Treasury Secretary Scott Bessent announced a new IRS task force and related measures, saying Minnesota will be "the genesis for a national rollout" of anti‑fraud protocols, procedures and collaborations.
- Minnesota officials report immediate program disruptions: Agriculture Commissioner Thom Peterson said the state has received pause notices for some programs, including a University of Minnesota poultry testing lab, raising uncertainty over who would pay to cull birds if avian influenza is detected.
- Minnesota Attorney General Keith Ellison pledged to challenge the freeze in court, saying he "will not allow you to take from Minnesotans in need."
- The USDA freeze is situated within a broader Trump administration pressure campaign on Minnesota — including immigration crackdowns, threatened freezes of other social‑service funds and a new federal lawsuit — a series of actions Gov. Walz said contributed to his decision to drop his reelection bid.
📊 Relevant Data
Somali immigration to Minnesota began in the early 1990s as refugees fleeing civil war in Somalia, with resettlement facilitated by voluntary agencies such as Lutheran Social Services and Catholic Charities, drawn to the state's strong social services, job opportunities, and growing community networks.
How Minnesota became a hub for Somali immigrants in the U.S. — NPR
In Minnesota, 54% of Somali-headed households receive food stamps (SNAP benefits), compared to the state average of about 8% of households participating in SNAP; additionally, 73% of Somali households have at least one member on Medicaid.
Somali Immigrants in Minnesota — Center for Immigration Studies
Minnesota's Somali population has grown to approximately 107,000 people as of 2024, representing about 2% of the state's total population, with nearly 58% born in the U.S. and 87% of foreign-born Somalis being naturalized citizens.
By the numbers: Minnesota's Somali population, according to census data — KTTC
27% of Somali immigrant households in Minnesota receive cash welfare, based on data from 2014 to 2023, which is significantly higher than the national average for immigrant households.
Probing Trump's Verbal Attack on Somalis — FactCheck.org
📊 Analysis & Commentary (1)
"A skeptical deep dive arguing the Minnesota funding freezes respond to real oversight failures but are politically blunt, risk harming legitimate recipients, and should be replaced by targeted forensic audits and smarter controls rather than broad federal suspensions."
📰 Source Timeline (3)
Follow how coverage of this story developed over time
- ABC details that Agriculture Secretary Brooke Rollins’ Jan. 9 letter to Gov. Tim Walz and Minneapolis Mayor Jacob Frey cites 78 people charged and 57 convicted in the 2022 USDA‑funded Feeding Our Future‑related fraud case.
- The article explains that the more than $129 million figure appears not to include Supplemental Nutrition Assistance Program benefits, which sent more than $850 million to Minnesotans in 2024, or the National School Lunch Program, which provided more than $240 million in the last budget year.
- Minnesota Agriculture Commissioner Thom Peterson says the state has already received pause notices for some programs, including a University of Minnesota poultry testing lab, creating uncertainty over who would pay to cull birds if avian influenza is detected.
- The piece situates the USDA freeze within a broader Trump administration pressure campaign on Minnesota, including immigration crackdowns, threatened freezes of other social‑service funds, and a new federal lawsuit, and notes Walz dropped his reelection bid citing the strain of fending off these attacks.
- Brooke Rollins’ letter specifies that as of Friday evening the USDA payments suspended to Minnesota total 'just over $129 million' in active and future awards.
- Rollins’ letter is addressed not only to Gov. Tim Walz but also to Minneapolis Mayor Jacob Frey, and she demands justification for all USDA-related federal spending to Minnesota from Jan. 20 of last year to the present within 30 days.
- Rollins states that all payments going forward will require case-by-case 'payment justification' from state/local officials.
- Minnesota Attorney General Keith Ellison publicly responds on social media, promising to fight the move in court: 'I will not allow you to take from Minnesotans in need. I'll see you in court.'
- The article explicitly links USDA’s action to alleged fraud in Feeding Our Future, the Housing Stabilization Services program, and daycare-center claims, quoting Rollins’ criticism that Walz and Frey have 'refuse[d] to provide basic information or take common sense measures to stop fraud.'
- The piece notes U.S. officials told CBS News that DOJ is sending a team of federal prosecutors to Minnesota to assist in the wide‑ranging social‑services fraud investigation.
- It reiterates Treasury Secretary Scott Bessent’s announcement of a new IRS task force and related measures, and quotes him saying Minnesota will be 'the genesis for a national rollout' of anti‑fraud protocols, procedures and collaborations.