The federal government froze $10 billion in childcare funding from five Democratic-led states on Tuesday, citing systemic fraud following a welfare fraud scandal in Minnesota.
In letters from Administration for Children and Families, a division of the Department of Health and Human Services, Minnesota, Colorado, California, Illinois and New York will lose access to three major childcare funds. Funding will be frozen until investigations into each state are concluded.
The largest freeze is from the Temporary Assistance for Needy Families program, which provides cash assistance for family living expenses. Around $7.3 billion is cut off from TANF, $2.4 billion from the Child Care and Development Fund and $870 million from the Social Services Block Grant program.
The freeze is being justified in part because of the social services scandal in Minnesota, which found some Minnesotans fraudulently using pandemic and social safety funds without providing social services. Prior to these most recent funding stops, $185 million in annual aid to Minnesota day care centers was frozen.
Some of the accused individuals belong to the state’s Somali diaspora and President Donald Trump said they should be sent “back to where they came from.” Gov. Tim Walz ended his re-election campaign on Monday amid the state’s fraud scandal.
Leaders from the other four states affected by this freeze are questioning why their funding is being cut off. Sen. Kirsten Gillibrand, D-N.Y., told The New York Times the freeze has “nothing to do with fraud,” but is “political retribution that punishes poor children in need of assistance.”
“I demand that President Trump unfreeze this funding and stop this brazen attack on our children,” Gillibrand said.
“Donald Trump has declared war on Colorado,” Sen. Micheal Bennet, D-Colo., said on X Tuesday. “I will pursue all available options to ensure that Trump’s latest political attack against our state is stopped.”
Rep. Diana DeGette, D-Colo., said in a statement she is exploring legal options to release the funds and New York Gov. Kathy Hochul also said she was prepared to go to court over the freeze.
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Claims that non-citizens were using funds were cited by the department, but specific evidence was not provided. According to Axios, which obtained the letters sent to each state, “Requests for documents repeatedly refer to ‘Minnesota’ in letters addressed to other states.”
A spokesperson for HHS, Andrew Nixon, directly addressed the partisan divide in the freeze. “For too long, Democrat-led states and governors have been complicit in allowing massive amounts of fraud to occur under their watch,” Nixon said. “Under the Trump Administration, we are ensuring that federal taxpayer dollars are being used for legitimate purposes.”
“Rather than making life easier and more affordable for our families, Donald Trump is stripping away child care from Illinois families who are just trying to go to work,” Illinois Gov. JB Pritzker said in a statement Tuesday. “This is wrong, it is cruel, and we will take every step possible to defend the kids and families depending on all of us right now.”
