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Human services spending dominated by DHS; direct care and treatment to split into new agency
Summary
Nonpartisan fiscal staff told the House Finance and Policy Committee that the Department of Human Services accounts for the vast majority of state human services spending and outlined transfers that will shift programs to a new Department of Direct Care and Treatment and to the Department of Children, Youth and Families.
Nonpartisan fiscal analysts told the House Finance and Policy Committee in an informational briefing that the Department of Human Services accounted for an overwhelming share of Minnesota’s human services spending for the current biennium.
"An all funds number that is $57,000,000,000 in total spending for the current biennium," said Doug Berg, fiscal analyst for the committee, adding that DHS makes up roughly 96% of that total in the current biennium. The analysts also provided a general‑fund breakdown showing a DHS general‑fund base of about $20,500,000,000 for the current biennium.
The committee was briefed on several agency reorganizations that affect budgeting this session. Direct Care and Treatment (DCT) will separate from DHS and become its own agency on June 30, 2025; when the legislature appropriates money for DCT it will be to the new agency, the analysts said. The Department of Children, Youth and Families (DCYF) has already taken on parts of the children and families administration; some residual homelessness and prevention accounts will remain at DHS.
Why it matters: The fiscal scope and ongoing agency transfers shape how the Legislature will draft appropriations and which committees oversee specific programs. Fiscal staff emphasized that large forecasted programs such as Medical Assistance make up the majority of the appropriation work the committee will do.
Key details provided by staff: - All‑funds spending for the current biennium: about $57,000,000,000, with DHS representing the largest share. - General‑fund portion of DHS in the current biennium: about $20,500,000,000 (with a $146,000,000 federal offset noted in the materials). - Medical Assistance general‑fund base cited as approximately $7,000,000,000 per year. - Direct Care and Treatment was shown with a general‑fund base near $1,100,000,000 and will be appropriated to a new agency beginning with the 2026‑27 biennium. - Grant programs remaining with DHS were shown at a base of about $636,000,000 for the upcoming biennium.
Fiscal staff also explained budget technicalities important to lawmakers: forecasted programs change with usage and the February forecast; grant program bases typically carry forward unless the Legislature acts; and the biennial "tails" (out‑year columns) set baseline amounts but are not direct appropriations.
The briefing was informational; staff repeatedly noted that figures reflect the November 2024 forecast and that final numbers can change in the February forecast. Committee members asked follow‑up questions about specific accounts and were told staff would provide more detail on some items after the hearing.
