Minnesota Gov. Tim Walz tells state agencies to assume federal grants will get cut

CBS News

04-04-2025

Minnesota Gov. Tim Walz told his state agencies to plan for any federal funds they receive to get cut as the Trump administration aims to slash spending and Congress looks
at significant reductions.
The state received more than $23 billion in federal funding this current fiscal year that ends June 30 and those dollars touch many state programs and services, according to Minnesota Department of Management and Budget.
"I'm telling my teams to assume, if you've got a federal grant or federal program, to assume it's going to be cut, and start planning different scenarios accordingly," Walz told reporters Wednesday.
Just this week, the state's health department
laid off dozens of employees
after $220 million in previously approved funds were eliminated. Even more got notices that their jobs
could be at risk.
A federal judge later
blocked the Trump administration's $11 billion in cuts to public health funding
, but it's unclear what impacts that will have in Minnesota.
The governor said the impact was swift and targeted pandemic-era funds that mostly support infectious disease monitoring. Other states
also took a hit
.
Expecting more cuts in the future, Walz said his staff is working on putting together a dashboard for Minnesotans to keep track of what areas are affected and others that could be down the line.
"They're happening so fast without any lead into it," he said.
More than half of federal funding the state receives goes to entitlement programs, the largest being Medicaid which provides health care coverage for 1.2 million Minnesotans, or one-quarter of the state's population.
State Medicaid Director John Connolly in a recent WCCO interview said any reductions to that program would lead to "impossible" choices and that the state would not be able to make up the difference as it stares down a looming $6 billion deficit in future years. Lawmakers and Walz are already planning on trimming down the next
two-year state budget because of it.
"It would likely force us to consider some impossible choices, in terms of eligibility – in other words, who is eligible and can enroll in the program, who qualifies to enroll, the kind of benefits and services that we cover, [and] would we have to reconsider some of the things we pay for in the Medicaid program," Connolly explained.
Legislative Republicans have also expressed fear of cuts impacting Medicaid, writing the state's Congressional delegation in February
asking them to hold the program harmless
in any budget negotiations.
Other federal money the state receives is for SNAP benefits, child care assistance and special education services in schools, among many other grants.
The Minnesota Department of Transportation, for example, receives more than $3 billion in funding to support roads and bridges and transit projects. The agency has the second largest allocation after $12 billion for Medicaid, according to figures from the Minnesota Department of Management and Budget.