A nurse treats a patient with coronavirus in the intensive care unit at a hospital on May 1, 2020 in Leonardtown, Maryland. Photo by Win McNamee/Getty Images.
Just 60% of the more than 1 million people who received $487.45 for working frontline jobs during the COVID-19 pandemic in Minnesota clearly deserved the bonuses, according to a state audit released on Tuesday.
The Office of the Legislative Auditor estimates 9% of recipients were not eligible for the payments, while for the rest, it just wasn’t clear whether they should have received checks meant for nurses, first responders, prison guards, sales clerks, janitors and other workers who couldn’t stay home during the pandemic.
The auditor analyzed just a fraction of recipients from the Minnesota Frontline Worker Pay Program and found numerous payouts to suspicious applicants, including people who used the same identification numbers, people who listed home and work addresses outside of the state, and people who used “high-risk bank routing numbers.”
The auditors also identified payouts to 290 people who died before they received a bonus, including one person who died two years prior to the application date opening.
The report says the Department of Labor and Industry, which oversaw the program, did not adequately investigate clearly fraudulent applications, nor did they ensure the contractors they hired retained enough data to evaluate the payouts. The Department of Revenue also did not verify the income of all applicants to ensure they were eligible.
Roughly 85% of those who applied for a bonus received one, according to the report.
“Remember, this program was set-up as a zero-sum game with a fixed amount of state funding — $500 million — to be divided equally among all eligible applicants,” Legislative Auditor Judy Randall told the Legislative Audit Commission on Tuesday. “The more applicants who were approved, the less each applicant received.”
Indeed, when lawmakers passed the funding with near unanimity, they believed workers would receive $750.
Fraud and waste have come to define pandemic relief programs, from the Paycheck Protection Program to the Federal Child Nutrition Program, as government agencies were directed to quickly pay out billions of dollars.
In the frontline worker pay program, a divided Legislature didn’t agree to the funding until more than two years into the pandemic and wanted to get the money into workers’ bank accounts as quickly as possible.
Randall said her office has reported its finding to the FBI, the Attorney General’s office and the Ramsey County attorney, while the report recommends the state Department of Revenue try to recoup erroneous payments.
The Office of the Legislative Auditor is part of the legislative branch and typically focuses its critiques on state agencies under the executive branch. But their report on the frontline worker pay program offered a diplomatic rebuke to state lawmakers for how the law was written.
For example, the program included requirements that couldn’t easily be verified, like if people worked in-person and in close proximity to others, so the Department of Labor and Industry had to essentially take applicants at their word.
The auditors reached out to the employers of a small sample of recipients to verify if workers did work in person and in close proximity to others for at least 120 hours between March 2020 and June 2021, but in many cases the employers either didn’t respond or said “don’t know.”
“The overarching theme of the findings is that the issue is with the program itself, not how it was implemented,” DLI Commissioner Nicole Blissenbach told the Legislative Audit Commission on Tuesday.
Blissenbach also noted in her department’s response that the auditor revised its report after the agency showed some flagged applicants were indeed eligible for the benefit and said they might have been able to prove eligibility for others if given more time.
Sen. Ann Rest, DFL-New Hope, agreed that lawmakers shouldered some of the blame, and thanked the auditors for not taking an “apologist view” either for the state agencies or the Legislature.
“Where did the carelessness happen? It happened in the Legislature,” Rest said.
But Randall said even a flawed law doesn’t absolve state agencies.
“The law does not say, ‘definitely stop fraud,’ but I would expect we all think we should try to stop fraud,” Randall said.
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