Lawmakers Hammer State Auditor Over Lawsuit Against Counties

Otto, Rebecca Otto
Credit: rebeccaotto.com

Otto faces pushback from Republicans over her use of state funds

St. Paul, MN – MN Republicans are questioning State Auditor Rebecca Otto’s use of state funds in her lawsuit against Becker, Wright, and Ramsey counties.

Otto sued the state and three counties over a 2015 law allowing counties to bypass the state auditor and use a private auditing office instead. Otto claims the law is unconstitutional and only the state auditor should have the power to determine who audits county books.

Otto appeared before a House finance committee Wednesday. The hearing was supposed to focus on the agency’s budget for the next two years, but the attention quickly turned to the lawsuit and her use of taxpayer dollars to fund over $250,000 in litigation costs.

“There’s some confusion around what the law means, and so we are in the courts,” Otto said during the hearing. “It’s complicated right now.”

During the two-and-a-half hour hearing, Republicans pushed Otto to explain where she got the money to fund the legal battle. Otto claims the money came from “unexpected salary savings.” She also admitted to transferring some money from the pension division.

Rep. Jim Nash (R – Waconia) proposed legislation that would only allow the state auditor’s office to fund lawsuits through the “constitutional office” division. No other interoffice transfers would be allowed.

The legal battle has not only been costly for the state, but the counties in question have also racked up large bills. In addition to the legislation limiting the state auditor’s office use of funds, Republicans have also proposed a bill that would force the state auditor’s office to absorb the counties’ litigation costs.

Wright County Chief Deputy Attorney Brian Asleson said the lawsuit cost the taxpayers in his county approximately $42,000 so far. Becker County Commissioner Barry Nelson said his county has faced similar costs.

“It is very hard for counties of our size to continue on with litigation with the state,” Nelson said. “It is not Minnesotan.”

In 2016 a district court ruled the new law was constitutional, however, both counties and the state auditor’s office have appealed different elements of the ruling. The Court of Appeals will hear oral arguments on March 9th.