Minnesota’s Democrat Governor Tim Walz is pushing a $10 million emergency relief package for small businesses he claims were harmed by the Trump administration’s immigration enforcement operation.
The move is prompting immediate backlash from Republicans who warn the plan risks fueling more taxpayer-funded fraud in a state already plagued by massive corruption scandals.
Walz unveiled the proposal Thursday after Border Czar Tom Homan announced the end of Operation Metro Surge in Minnesota.
The plan would distribute forgivable loans ranging from $2,500 to $25,000 to businesses that demonstrate “substantial revenue loss” tied to the federal enforcement effort.
However, those businesses could have only been impacted by the federal operation if they were either employing illegal aliens, run by them, or relying on their businesses.
Walz framed the proposal as an economic recovery from federal action.
“The campaign of retribution by the federal administration has been more than a short-term disruption; it has inflicted long-term damage on Minnesota communities,” Walz said.
“Recovery will not happen overnight.
“Families, workers, and business owners are feeling the effects, and our responsibility is clear: we will help rebuild, stabilize these businesses, protect jobs, and ensure Minnesota’s economy can recover and thrive.”
He later demanded the federal government “pay for what they broke,” claiming law enforcement operations left “deep damage” and “generational trauma.”
Fraud-Plagued State Faces New Spending Push
The proposal arrives as Minnesota remains under intense scrutiny for large-scale taxpayer fraud spanning multiple public programs.
President Donald Trump previously stated that fraud in the state exceeded $19 billion.
Federal prosecutions in recent years have targeted welfare, food assistance, autism services, and daycare funding schemes, with investigators alleging hundreds of millions of dollars were stolen from taxpayers.
Against that backdrop, Republicans warned Walz’s new relief program could open another pathway for abuse.
Republicans Warn of ‘New Avenue for Fraud’
House Majority Whip Tom Emmer (R-MN) responded bluntly:
“BREAKING: Tim Walz opens up a new avenue for fraud in Minnesota.”
State Sen. Michael Holmstrom (R-MN) rejected the proposal outright:
“Immediate NO from me,” Holmstrom said, adding Minnesota taxpayers “do not deserve to have more money stolen from them.”
Rep. Eli Crane (R-AZ) referenced fraud allegations tied to Minnesota daycare centers:
“Does that include learing centers?” he wrote, pointing to facilities accused of receiving public funds without providing services.
The remark alluded to the “Quality Learing Center,” highlighted in investigative footage showing daycare sites allegedly collecting taxpayer money while appearing inactive.
Walz Highlights Business Complaints
Walz’s office promoted testimony from Henry Garnica, owner of CentroMex in East St. Paul.
Garnica claims immigration enforcement severely impacted his business.
“Sales are down, we have limited hours, and we have had to change how we operate,” Garnica said.
“This proposed forgivable loan package would give businesses like mine breathing room — to keep employees on payroll and keep our doors open.
“For some of us, it could mean the difference between surviving and closing for good.”
Clash Reflects Broader Immigration Divide
Walz’s proposal underscores the widening divide between state Democrats seeking to counter federal immigration enforcement and the Trump administration’s focus on law enforcement, fraud prevention, and border security.
With Minnesota already facing sweeping corruption investigations and billions in alleged fraud, the fight over Walz’s bailout plan highlights a central question of whether taxpayer dollars should fund recovery from immigration enforcement or be safeguarded from further abuse.
READ MORE – Holocaust Museum Blasts Tim Walz for Comparing Trump’s ICE Operations to Anne Frank
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