On December 31, 2025, the Trump administration announced a freeze on federal child care payments to Minnesota, a state governed by the Democratic Party. Governor Tim Walz condemned this action as politically motivated, asserting that it is part of a broader strategy to undermine social services and target immigrant communities, particularly the state's Somali population, which is the largest in the United States.

The U.S. Department of Health and Human Services (HHS) stated that the funding would remain frozen until Minnesota could demonstrate appropriate and legal use of taxpayer dollars. While the specific amount of funding affected was not disclosed, Assistant Secretary Alex Adams noted that Minnesota received approximately $185 million in child care funds in the previous fiscal year.

Governor Walz emphasized that the state has been actively addressing fraud issues, referencing the conviction of 57 individuals linked to a $300 million fraud scheme associated with the Feeding Our Future initiative. He criticized the administration for using fraud allegations as a pretext to harm working families in Minnesota.

The freeze follows a viral video by right-wing influencer Nick Shirley, which alleges extensive fraud within government programs, particularly involving daycare centers operated by individuals of Somali descent. State officials have countered that all centers featured in the video were inspected recently, with no evidence of fraud found. The manager of one center indicated that children were present during Shirley's visit, but safety protocols prevented access to the premises.

Despite the lack of substantiated evidence, Republican leaders have leveraged the video's claims to target Somali and immigrant communities. Vice President JD Vance suggested that immigrants are undermining financial and political stability in Minnesota, while GOP Majority Whip Tom Emmer has called for the denaturalization of individuals implicated in fraud.

Federal investigations into the allegations have been initiated by agencies including the FBI and the Department of Homeland Security. Assistant U.S. Attorney Joe Thompson indicated that social services fraud in Minnesota could potentially reach $9 billion across various federally supported programs, a claim that the governor's office has labeled as speculative and exaggerated.

The Trump administration's focus on Minnesota and its Somali population has been part of a broader narrative that includes derogatory remarks made by Trump regarding Somali immigrants, contributing to a contentious political climate surrounding this issue. Additionally, the U.S. Centers for Medicare and Medicaid Services (CMS) has demanded corrective actions regarding alleged systemic fraud in Minnesota's Medicaid system, further complicating the state's funding landscape.