USDA Suspends More Than $129 Million in Payments to Minnesota, Citing Fraud

In an announcement reported on January 9 and 10, 2026, Agriculture Secretary Brooke Rollins suspended more than $129 million in USDA award payments to the State of Minnesota and the City of Minneapolis, citing the state's handling of fraud allegations. Rollins wrote that "despite a staggering, wide-reaching fraud scandal, your Administrations refuse to provide basic information or take common sense measures to stop fraud," and demanded that officials justify all federal spending since January 20, 2025, within 30 days. Affected funding touched nutrition programs, housing stabilization services and daycare funding.

Conditioning already-appropriated formula funds on a state's compliance with executive demands is the mechanism at issue; the people who lose benefits are program recipients rather than the officials whose conduct is disputed. The suspension followed a separate freeze of child care funds to Minnesota and four other Democratic-led states.

Minnesota Attorney General Keith Ellison said he would challenge the suspension: "I will not allow you to take from Minnesotans in need. I'll see you in court."