Preschool children playing with colorful shapes and toys in a child care center. (Getty Images)

The Wisconsin Department of Children and Families Sec.-designee Jeff Pertl told reporters that he is confident in the state’s child care accountability measures and isn’t concerned about the state potentially losing federal funding. 

Last week, the Trump administration froze over $10 billion in federal child care funds designated for Minnesota and four other states amid fraud allegations. The funds cover child care subsidies, social services and cash support for low-income families. 

Pertl told reporters that “nothing can stop the president from politicizing an issue.” 

“I think we all see that playing out in a variety of ways all across the country right now, and I think that concerns everyone frankly,” Pertl said. 

Even with the politicization of the issue, Pertl expressed confidence in Wisconsin’s system. 

The Wisconsin Shares program is a subsidy program for low-income families where funds are paid to parents on an EBT card that is then used to pay a child care provider. According to the agency, this program is the main way that federal child care funding is utilized in Wisconsin. There is also some funding that goes towards quality improvement for programs, training and technical assistance.

Pertl said January payments have already gone out to families and he said he doesn’t expect any issues with February payments or other future payments. 

“People are using them. Folks should have confidence in the system,” Pertl said. “We’re likely to see an increase, maybe, in reporting requirements, but our system is well positioned to be able to meet those and continue to move forward. It may be administratively burdensome, and maybe more paperwork and things we’ve got to collect, but we’re confident that our system, particularly because of its unique history, is probably one of the best systems in the country for being able to navigate some of the questions that are coming in.” 

Wisconsin dealt with significant fraud involving improper payments a decade ago, which led to the state beefing up its accountability measures. 

A 2009 Pulitzer prize-winning investigation by the Milwaukee Journal Sentinel uncovered fraud within the WisconsinShares program that led to criminal indictments and prompted the state to implement protections. 

An audit that year by the Legislative Audit Bureau found there was an estimated $16.7 to $18.5 million in improper subsidy payments made and child care providers were estimated to have received an additional $4 million in improper subsidy payments as a result of errors or fraudulent reporting.

Assembly Speaker Robin Vos (R-Rochester), who was in the Legislature at the time, told the Milwaukee Journal Sentinel in December that he remembers the work that was undertaken to address the issue in 2009. 

“I want to definitely make sure it’s not happening again,” Vos said. He noted that he hasn’t heard of specific examples of fraud happening, but he doesn’t “want to assume that it’s not.”

Gov. Tony Evers also told reporters this week that Wisconsin is “in a good place.” 

“There’s lots of auditing going on… so I think we’re in a great place,” he said. 

Some of the reforms that the state has adopted relating to ensuring proper payments include expanding program integrity staff, improving attendance tracking and reporting, implementing fingerprint background checks, expanding the list of crimes that prohibit someone from running  a child care center, adopting YoungStar, which is the quality rating system in the state, and moving to using EBT cards. 

The state has also passed laws to allow DCF to collect money from providers if they go out of business and to suspend or revoke licenses and subsidy payments to people previously convicted of crimes relating to the operation of a business. 

Those measures can help ensure accountability.

“How do you know when it’s fraud? How do you know when a kid just stopped showing up?” Pertl asked. “When we do the licensing visit or get a tip or we’re checking the enrollment and attendance records, if there’s discrepancies… that’s going to trigger a review. It might trigger a claw-back and recovery of money.”

Wisconsin DCF also maintains a list on its website of child care centers that have been suspended or terminated from the WisconsinShares program. 

The federal government conducts monitoring checks every three years. In recent years, Wisconsin has had a low payment error rate. In 2023, the last time the check happened, Wisconsin’s error rate was 2.9%. In 2020, it was 1.81% and in 2017, it was 4.35%. In 2013, the error rate was 18.84%. 

Pertl noted that the changes made by the state were a bipartisan effort under the administrations of former Govs. Jim Doyle, a Democrat, and Scott Walker, a Republican. 

“There are certainly some very significant issues going on in Minnesota and there is no question that the president politicizes this for an agenda and targets folks for it,” Pertl said. “I think what you’ve seen [Gov. Evers] say and what you see Wisconsin leaders doing is showing that we have a strong system that has navigated these issues, that has high integrity, that addresses these things when they come, and so we’re confident about our ability to continue to run a robust and great child care system.”

Gov. Tim Walz announces he will step down from the 2026 gubernatorial election Monday, Jan. 5, 2026 at the Minnesota State Capitol. (Photo by Nicole Neri/Minnesota Reformer)

The moment Gov. Tim Walz was cooked was little remarked upon at the time, but in retrospect illustrates how he and his administration were sleeping through an enveloping crisis.

At the late 2024 budget forecast, he said disability and autism services were driving state government spending beyond expectations. When he was asked about potential fraud in the autism program — about which we’d reported an FBI investigation six months prior — he seemed unfamiliar. I traded texts with an incredulous reporter who was there and wound up publishing a column called, “Minnesota: an easy mark.” 

More recently, Walz faced the full force of the right-wing propaganda machine in the past two months. It was a frightening sight to behold, and a healthier democracy would never be host to such a parasitical malignancy.

Although restoring American democratic habits of mind to eviscerate that propaganda machine should be on our lengthy, long-term to-do list, the lesson here for me is that the most underrated tool in the political toolbox is … governing.

Deadly dull, I know, but the word governor even has the word “govern” in it: competently administering programs to help people who need it; ensuring Minnesota’s children are learning literacy and numeracy; and managing the state’s vast infrastructure assets. That’s the job.

Former St. Paul Mayor Melvin Carter, another one-time rising star in Minnesota politics, recently faced the same sort of governing reckoning as Walz, when Mayor Kaohly Her pulled off an upset November victory promising to make stuff work again. May Democratic elected officials everywhere take notice.

We live in perilous times, no question, but Minnesotans are right to expect a minimum level of competency in these matters of public administration. It’s especially important for the party of government, i.e., the Democratic-Farmer-Labor Party, to pay attention to details, like whether a 3,000% increase in spending on the autism program is reasonable, especially when some of the providers had ties to Feeding Our Future.

Tim Walz is at heart a decent man, and he doesn’t deserve what’s been thrown at him in recent weeks — especially a despicable allegation leveled by the president of the United States and the odious propagandist Nick Shirley that Walz was involved in the assassination of former House Speaker Melissa Hortman.

He made some mistakes, but he’s not evil, unlike some of the loudest and most influential voices in American politics today, whose greed and lust for power are boundless.

Walz’s first term was marked by almost constant crisis, none of it his doing. He was a mostly steady hand, even as Republicans came to despise him during the pandemic and the aftermath of the police murder of George Floyd.

His second term comprised major legislative accomplishments — for which the credit mostly belongs to Hortman and the late Sen. Kari Dziedzic — as well as his (again, in retrospect) disastrous candidacy for vice president. All the while, thieves were stealing the people’s money with gusto.

Walz has served the community of Mankato, the people of Minnesota and his country.

And now he has saved us from what would have been a deeply divisive campaign, and which would have put the state of Minnesota under federal siege.

Unlike former President Joe Biden, who doomed his party and the country with his insistence on running for a second term, Walz is stepping aside before any more damage is done to his state and the DFL. He says he’ll focus all his energies on cleaning up the mess.

He deserves our thanks for that service and for making this decision.

Minnesota Reformer is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Minnesota Reformer maintains editorial independence. Contact Editor J. Patrick Coolican for questions: info@minnesotareformer.com.

A preschool teacher prepares lunch for students inside a day care center. (Photo by Billy Hustace/Getty Images)

WASHINGTON — States must now provide “justification” that federal child care funds they receive are spent on “legitimate” providers in order to get those dollars, President Donald Trump’s administration announced. 

The Tuesday shift in policy came following allegations of fraud in Minnesota’s child care programs, which prompted the U.S. Department of Health and Human Services to freeze all child care payments to the state. 

HHS could not offer many specifics on how the review process will play out for other states, but clarified that the money in question is provided through the multibillion-dollar federal Child Care and Development Fund, or CCDF. 

“States will be required to provide documentation, such as written justification, receipts, or photographic evidence, demonstrating that funds are supporting legitimate child care providers,” Emily Hilliard, a spokesperson for HHS, said in a statement to States Newsroom on Wednesday. 

CCDF provides federal funding to states, territories and tribes to help low-income families obtain child care. 

The program, administered within the Office of Child Care under HHS’ Administration for Children and Families, combines funding from the Child Care and Development Block Grant, or CCDBG, and the Child Care Entitlement to States, or CCES. 

Funding for CCDF in fiscal year 2025 stood at roughly $12.3 billion — comprising $8.75 billion from CCDBG and $3.55 billion from CCES. 

Head Start — a separate program that provides early childhood education, nutritious meals, health screenings and other support services to low-income families — does not appear to be affected. 

In a Tuesday social media post announcing the move, Health and Human Services Deputy Secretary Jim O’Neill said he had “activated our defend the spend system for all ACF payments” and “starting today, all ACF payments across America will require a justification and a receipt or photo evidence before we send money to a state.” 

He clarified in a separate post shortly after that “funds will be released only when states prove they are being spent legitimately.” 

Funds undergo ‘regular audits’

“Federal funding enables millions of parents in every state and Congressional district to access and afford quality child care,” Sarah Rittling, executive director of First Five Years Fund, a federal advocacy group, said in a Wednesday statement. 

Rittling added that “these funds are essential to the nation’s well-being, allowing parents to work while ensuring their children are cared for and safe.” 



She also described the reports of potential fraud as “deeply concerning” and pointed out that “state oversight through regular audits is required by law to ensure that every dollar intended to protect and support young children is used properly and effectively.” 

“At the same time, we must ensure that nothing takes away from making sure funds for child care continue to reach the children and families who depend on them,” she said.