Misusing state funds

The fact that misusing taxpayer dollars is not a crime may come as a surprise to many. Rep. Ryan Winkler (DFL-Golden Valley) certainly found it surprising.

Following a rash of recent scandals involving fraud and financial mismanagement at state agencies, Winkler wondered why the state employees involved were being fired but not prosecuted. It turns out that knowingly misappropriating state money is not actually a crime.

That would change under the provisions of HF7. Sponsored by Winkler, the bill would specify that anyone who intentionally misuses state funds is guilty of a gross misdemeanor, and ask the appropriate authorities to prosecute violators.

The House State and Local Government Operations Reform, Technology and Elections Committee approved the bill March 18 and referred it to the House Public Safety Policy and Oversight Committee.

Currently, misappropriating state money is grounds for dismissal of a state employee. In cases where a criminal investigation is warranted, county attorneys can file charges; however, only cases that involve a specific offense, such as fraud, can be prosecuted.

“The basic thrust of the bill is simply to clarify that misspending public funds … actually constitutes a crime,” Winkler said.

The bill also contains a provision asking Minnesota Management and Budget to establish a best practices policy for investigating employee misconduct. Winkler said the policy is necessary to ensure that investigations of employee misconduct do not compromise potential criminal prosecutions.

Some committee members expressed concern that the bill’s language applied only to executive branch agencies. Rep. Morrie Lanning (R-Moorhead) suggested including employees of the Legislature and the court system in the bill.

A companion, SF107, sponsored by Sen. Ann Rest (DFL-New Hope), was held over March 9 by the Senate State Government Budget Division for possible omnibus bill inclusion.