Purpose of the Bill

The bill aims to enhance the integrity and accountability of financial dealings between the state of Minnesota and the federal government. It seeks to ensure that federal funds managed by the state are protected from fraud and misuse.

Main Provisions

• The bill mandates that any contract between Minnesota state or its agencies and the federal government includes a clause.
• This clause must allow the state to withhold federal funds from recipients if there is a reasonable suspicion of fraud.
• This provision is specifically targeted at situations where state officials or employees suspect that a recipient obtained federal funds through deception or illegal means.

Significant Changes

• This bill introduces a new requirement for state contracts involving federal funds. Previously, there was no specific mandate for such contracts to include a provision for withholding funds based on suspected fraud.
• By adding this requirement, the bill provides the state with a mechanism to preemptively stop fraudulent or deceptive payments.

Relevant Terms

• Federal contracts
• Withholding payments
• Fraudulent payments
• Deceptive act
• State government contracts