The Trump administration has suspended $129 million in federal benefit payments to Minnesota, citing alleged large-scale fraud involving local non-profits and private businesses. The decision, announced by U.S. Department of Agriculture (USDA) Secretary Brooke Rollins, has triggered sharp backlash from state officials, civil rights advocates, and Democratic leaders—setting the stage for a major legal and political showdown.

In a letter shared publicly on social media, Rollins informed Minnesota Governor Tim Walz and Minneapolis Mayor Jacob Frey that the federal government would halt benefit payments until the state provides detailed justifications for its spending.

“Despite a staggering, wide-reaching fraud scandal, your administrations refuse to provide basic information or take common-sense measures to stop fraud,” Rollins wrote. “The Trump administration refuses to allow such fraud to continue.”

The USDA has demanded:

The freeze affects funding intended for low-income families, food assistance programs, and vulnerable residents across the state.

City and state officials say the funding suspension is politically motivated and harmful to residents in need.

“We’re communicating with state partners to understand the impacts of such a blanket cut to funding meant for residents most in need,” said Brian Feintech, spokesperson for the City of Minneapolis.
“What’s abundantly clear is that Minneapolis is the latest target of the Trump administration – willing to harm Americans in service to its perceived political gain.”

Minnesota Attorney General Keith Ellison responded even more forcefully, posting on X:

“I will not allow you to take from Minnesotans in need. I’ll see you in court.”

Governor Walz’s office has not yet issued a formal statement, but legal action is widely expected.

The USDA’s move comes just days after a federal judge blocked the White House from freezing childcare subsidies and family assistance funds in five Democratic-led states, including Minnesota. The ruling suggested that the administration may be overstepping its authority when withholding congressionally approved funding.

Notably, the Department of Health and Human Services (HHS) has not explained why Minnesota and certain Democratic states are being targeted, raising concerns about selective enforcement and political retaliation.

Over the past year, the Trump administration has focused heavily on alleged fraud in Minnesota—particularly cases involving the state’s Somali immigrant population.

Federal prosecutors estimate that up to $9 billion may have been stolen through various schemes linked to local organizations. In December 2025, FBI Director Kash Patel announced that the agency had dismantled a $250 million fraud operation that misused federal food aid during the COVID-19 pandemic. That investigation led to:

In response to these cases, President Trump ended legal protections for Somali migrants in Minnesota in November 2025, claiming:

“Somali gangs are terrorizing the people of that great State, and BILLIONS of Dollars are missing. Send them back to where they came from.”

Shortly after the USDA announcement, Trump launched a xenophobic attack during a cabinet meeting, targeting both Somali immigrants and Rep. Ilhan Omar, a U.S. citizen and Minnesota congresswoman.

“They contribute nothing. I don’t want them in our country,” Trump said.
He also referred to Omar as “garbage,” intensifying criticism from civil rights groups and Democratic leaders nationwide.

The remarks further polarized the state and fueled accusations that federal actions against Minnesota are driven more by ideology than evidence.

Amid mounting pressure, Governor Tim Walz recently announced he will not seek a third term. While acknowledging concerns about fraud oversight, Walz said the crisis has been weaponized politically.

“I won’t mince words here,” he said.
“Donald Trump and his allies – in Washington, in St. Paul and online – want to make our state a colder, meaner place.”

His departure signals a shift in Minnesota’s political landscape as the state prepares for a new chapter of leadership—and potential courtroom battles with the federal government.

The suspension of $129 million in federal benefits could have serious consequences, including:

Advocacy groups warn that innocent residents may suffer while fraud investigations continue.

Legal challenges are expected in the coming weeks as Minnesota seeks to restore funding. Meanwhile, federal agencies continue expanding investigations into benefit fraud, with Minnesota remaining a focal point.

Whether the freeze will stand—or be overturned like the childcare subsidy ruling—may determine how far the Trump administration can go in using funding as a political and enforcement tool.