Transcript Highlights:

• Significant controls reviewed for OMB include P-card receipt reconciliations, P-card approvals, and approval
• We have begun depositing checks in accordance with OMB, so this has been implemented, and we do deposit
• That would be through OMB. That provides that.

Summary: The committee was called to order, the Pledge of Allegiance and prayer were offered, and the minutes from the previous meeting were approved. Members then received a memo summarizing major audit items and began hearing audit presentations from the State Auditor’s Office and private auditors on a range of state agencies and organizations. Several audits were reported as clean, including the Bank of North Dakota, the North Dakota Guaranteed Student Loan Program, the Office of the Governor, the Office of the State Treasurer, the Office of Management and Budget, the Department of Transportation’s flexible transportation fund, Lake Region State College, and the Department of Environmental Quality. The North Dakota Stockmen’s Association also received an unmodified opinion, though repeat findings were noted for limited segregation of duties and financial statement preparation due to its small staff. The Council on the Arts audit found two findings: payroll charged to federal awards without adequate timekeeping records, and unallowable expenditures from a restricted cultural endowment fund. The Department of Public Instruction audit identified unsupported scholarship applications in the paraprofessional-to-teacher program, though additional testing showed the funds were used for their intended purpose. The most extensive discussion centered on the North Dakota Racing Commission audit, which identified four findings: overspending the promotion fund’s 25% operating limit, grant conditions not being met, improper Breeders Fund awards, and improper procurement for advertising services. Racing Commission director Bruce Johnson acknowledged complacency and weak controls, said the agency would tighten procedures, and explained that the commission had since worked with procurement and would follow the rules more closely. Auditors also explained that the commission would now be audited every two years because of the findings. Another major discussion involved the University of North Dakota School of Law, where auditors found a lack of documentation supporting admissions decisions for post-baccalaureate programs. UND officials said they remain in good standing with the American Bar Association but agreed better documentation and tools are needed; the committee pressed for more transparency and follow-up on admissions criteria. The committee also received an update on Dakota College at Bottineau, where Minot State University reported that bank reconciliations had been brought current after a significant backlog and would now be maintained through shared services. Members requested a written follow-up report on the issues and corrective actions. Finally, the North Dakota Fair Association explained that its foundation has been dissolved and remaining funds were transferred to another nonprofit for continued support of the state fair, and the Department of Public Instruction provided an update on school meal debt, saying the reported amount was about $1.1 million from a partial district survey and that debt remains a local issue, though it could be revisited if school meal funding changes.

Transcript Highlights:

• We've talked about this: myself and the Governor's Office, OMB, and the Department of Emergency Services
• She is leading our team on our unified command, our chief people officer with OMB, and different agencies
• OMB, and different agencies that have subject matter expertise, NDIT.

Bills: HB1623

Committee: Joint Appropriations

Summary: The committee first heard House Bill 1624, the “Universal Lunch Bill,” from Rep. Mike Nathie. He argued the proposal should be placed in Century Code rather than the Constitution so future legislatures can adjust it if state finances tighten, and said the bill would start the program a year earlier with a $65 million appropriation for one school year. DPI testified that the estimate did not include nonpublic schools that do not participate, and members questioned the impact on Title I, free-and-reduced applications, private-school accountability, breakfast mandates for schools that do not currently serve breakfast, and whether the funding could come from the DPI budget or other sources. Supporters, including North Dakota United, the North Dakota Catholic Conference, a pediatrician, and the American Heart Association, said universal meals improve student health and learning, reduce family costs, and are better handled in statute than by constitutional amendment. No opposition testimony was offered, and the chair closed the hearing for later work-session action. The committee then took up House Bill 1627, introduced by Rep. Tye Dressler, which would raise the income threshold for the state-funded school lunch program from 225% to 300% of poverty, with an estimated cost of about $7 million for 2026-27. Dressler said the bill is intended as a targeted, budget-friendly alternative to the ballot measure and emphasized that the state should maximize federal meal dollars while improving participation in the current program. Members questioned whether raising the threshold would actually increase utilization, whether a dollar amount would be clearer than a percentage, and how the change would affect federal reimbursements and application rates. DPI said it could quickly calculate additional percentage levels, and the chair closed the hearing, directing DPI to prepare more numbers for the work session. Finally, the committee opened Senate Bill 2403, presented by Sen. Schiable, to create a short-term bridge-loan program for financially distressed hospitals, centered on Jacobson Memorial Hospital in Elgin. The bill would authorize up to $5 million per loan, with a $10 million appropriation available on a first-come, first-served basis, and would run only through June 30, 2027. Schiable said the hospital’s debt and operating problems threaten local health care, ambulance service, and the community’s economy, and that the proposal was designed narrowly with Bank of North Dakota review to avoid creating a broad precedent. Committee members asked whether the appropriation could be reduced and whether the bank would still apply commercial feasibility and repayment standards; Schiable said yes, the bank would still evaluate the loan and could reject it if it was not sound.

Transcript Highlights:

• And again, I must thank OMB. And Vassali's been around. She's been around, right?

Committee: Joint Finance

Summary: The Joint Finance Committee met to review and vote on the fiscal year 2027 Grants and Aid Act, which was expected to be pre-filed as Senate Bill 337. Members first reviewed Section 1, covering county seat payments, paramedic operations, senior center allocations, senior center transportation, and Homeland Security grants. They approved Section 1 after discussion of how senior center transportation is being moved from DART to grant-in-aid and how some organizations can appear in both the senior center formula and the general aging category. The committee then worked through Section 2, which included one-time appropriations and the various grant categories for aging, arts/historical/recreation, economic housing or labor services, family and youth services, health or disability services, and neighborhood and community services. Members discussed several specific items, including New Castle County reassessment-related funding, Friends of Cooch’s Bridge, Slaughter Neck Community Action Organization, Plastic-Free Delaware, Love, Inc. of the Delmarva, and the Southern Delaware Horse Retirement Association. One aging line for Slaughter Neck was reduced back to flat funding after members questioned a large increase, and the revised category total was adjusted accordingly. Each of the Section 2 subcategories was then adopted. Section 3, covering fire companies and public service ambulance companies, was approved with increases across apparatus, ambulance, rescue truck, aerial truck, rescue boat, substation, and insurance rebate equalization funding. Section 4, for veterans organizations and youth programs such as Boys State, Girls State, and Trooper Youth Week, was also adopted. The committee then approved the epilogue sections, which included eligibility, audit, payment, and reporting rules; special provisions for the Wilmington Senior Center contingency; conditions tied to several one-time appropriations; withholding funding from Merri-Dell Volunteer Fire Company pending a corrective report; and reprogramming $1,485,000 from a prior SMART food program appropriation toward SNAP/WIC-related food access initiatives. The meeting ended with remarks thanking staff and noting that it was likely the last JFC meeting for two members, followed by adjournment.

Transcript Highlights:

• And that is why OMB encouraged agencies to require AI tools to work with other companies' products.

Committees: Senate Senate Armed Services Subcommittee on Personnel , Senate Senate Armed Services Subcommittee on Strategic Forces

Keywords: defense industrial base, small business, workforce development, acquisition processes, national security, cybersecurity, critical minerals

Summary: The meeting of the committee revolved around critical discussions on enhancing the defense industrial base, focusing on small business engagement and the importance of streamlined processes in defense contracting. There was a significant emphasis on the need for more investment in the defense manufacturing sector, particularly in the face of competition from countries like China. Some members expressed frustration over the treatment of small businesses, citing barriers that prevent these innovative companies from effectively participating in defense contracts. The need for a workforce capable of meeting the common challenges posed by evolving technologies and geopolitical threats was also highlighted throughout the meeting.

Transcript Highlights:

• gives the authority for that to be done with the salary and wages, according to the guidelines that the OMB

Committee: House Appropriations

Summary: The committee met to consider Senate Bill 2012, the Department of Transportation budget, with Representative Brandenburg presenting a detailed House amendment package and Speaker Robin Weisz explaining the overall funding strategy. The discussion focused on restructuring transportation funding streams, including moving Prairie Dog money into a flexible transportation fund, adjusting gas tax distributions, increasing the legacy earnings transfer from 7% to 8%, and authorizing a $155 million bond for Highway 85. Members also discussed DOT operations, bridge funding, rest areas, electronic titling, and the use of funds for grants to counties, cities, and townships. A separate provision would let the DOT consider whether local ordinances or policies unreasonably restrict permitted agriculture or energy projects when scoring grant applications, which drew significant debate about local control and whether the language was punitive. Testimony from Brandenburg and Weisz emphasized that the plan was intended to provide more predictable funding, preserve the ability to match federal dollars, and direct money where needs are greatest through a grant process. Weisz said the package was designed to simplify multiple revenue buckets, ensure DOT can meet federal match requirements, and free up money for the general fund while still supporting transportation needs. Several members raised concerns about whether cities, counties, and townships would receive as much as under the prior Prairie Dog structure, whether the bridge allocation was correctly reflected in the bill, and whether the local-policy language would penalize subdivisions that oppose energy projects. Supporters argued the state needed to protect revenue tied to energy development and that local governments would still receive distributions plus additional grant opportunities. The committee adopted the House amendment to SB 2012 by a vote of 19-1-3, then rejected an amendment to remove the local-policy language on a 5-15-3 vote. The committee then passed SB 2012 as amended on a 20-0-3 vote, with Representative Brandenburg designated as the carrier. The chair announced that Senate Bill 2014 would not be taken up at that time and the committee recessed until called back.

Transcript Highlights:

• So the federal government does put out an OMB compliance supplement, and we perform our procedures in
• controls related to the compliance to make sure that there are appropriate internal controls. put out an OMB
• compliance supplement and put out an OMB compliance supplement and we<00:59:08.000><c> perform</c><00

Summary: The committee first approved the March 21 minutes and then took up a consent calendar, withdrawing several items before adopting the remainder. It also moved item FIS 25103 to the table by a 6-4 vote after Senator Gray argued the Executive Council had not yet acted on a prior $5 million approval and that the committee should avoid adding to the rainy day fund draw. The committee then approved item 25106 for the Department of Natural and Cultural Resources/State Library after hearing that the department expected about a $400,000 lapse to return to the state. A major discussion centered on New Hampshire Police Standards and Training (item 2577). Senator Gray questioned whether a proposed equipment purchase could be delayed to the next biennium in light of the state’s deficit and rainy day fund use. The agency said the equipment was needed now for scenario training, vendors had already been identified, and delaying would likely increase costs and force continued reliance on unpaid volunteer help. The committee ultimately approved the item. The committee also approved Department of Energy item 2587 after hearing that federal weatherization funds are drawn down on a reimbursement basis, and item 2588 after similar testimony that weatherization work must be completed and inspected before reimbursement, limiting how quickly funds can be expended. Item 250094 had been withdrawn. Later, the committee discussed Senator Carson’s request for an LBA review of the YDC claims settlement fund, with members expressing concern about administrative costs, attorney fees, settlement-loan payoffs, and the need for more detailed reporting. The committee voted to direct LBA to conduct the audit described in Senator Carson’s memo, with the additional request that the review include the term over which attorney fees are paid. The meeting then moved on to an HHS staff item, where members began questioning the timing of dashboard data and reporting delays.

Transcript Highlights:

• We go through an OMB A-133 audit, so we take the accounting very seriously.
• We go through an OMB A-133 audit, so we take the accounting very seriously.
• We go through an OMB A-133 audit, so we take the accounting very seriously.
• We go through an OMB A-133 audit, so we take the accounting very seriously.
• We go through an OMB A-133 audit, so we take the accounting very seriously.

Committee: Senate Health and Human Services

Transcript Highlights:

• provide in terms of an update on your work to support the Olympics in. 2028, including any work with the OMB

Committee: Senate Environment and Public Works Committee

Keywords: surface transportation, infrastructure reauthorization, bipartisan collaboration, safety, federal programs, funding challenges, bureaucracy, transportation needs, critical projects, public testimony

Summary: The committee meeting focused on the development of the next surface transportation reauthorization bill. Discussions centered around key principles aimed at improving the safety and reliability of the transportation network, reforming federal programs for efficiency, and addressing the diverse transportation needs across various states. Members emphasized the importance of bipartisan collaboration to streamline processes, eliminate bureaucratic delays, and ensure timely funding for critical infrastructure projects. There were also notable conversations about specific projects and funding challenges, reflecting the urgency for action and commitment to modernizing America's infrastructure.

Transcript Highlights:

• We have a white card present and will provide information as requested from Clifton Langla with OMB.
• We have a white card present and we'll provide information of requested from Clifton Langla with OMB.

Committee: House Administration of Criminal Justice

Summary: The committee first handled several housekeeping items, voluntarily deferring HB 123, HB 255, and HB 994 without objection. It then took up SCR 3 by Senator Brock Myers, which would delay and revise implementation of a state police rule affecting criminal history background checks for licensed ambulance personnel and certain health care workers. After adopting Amendment Set 434 to remove a provision involving parish and local law enforcement checks, the committee reported SCR 3 as amended favorably. The committee also heard HB 978 by Rep. Lecombe, which as amended raises the population threshold for municipalities required to remit certain special costs to the District Indigent Defender Fund from under 5,000 to under 9,000; with support from the town of Addis and related stakeholders, the bill was reported favorably as amended. The committee then considered HB 967 by Rep. Moore, which sought to remove language limiting parole eligibility for certain pre-July 2, 1973 life-sentenced offenders to those who had pleaded guilty, thereby allowing a small group of elderly inmates convicted at trial to seek parole consideration. Supporters argued the bill would only create an opportunity for review, not release, and cited rehabilitation and fairness concerns; opponents, including district attorneys and corrections officials, argued the 2022 law already addressed the intended group and that the current bill would reopen cases involving serious violent crimes. After extended debate, the motion to report HB 967 favorably failed on an 8-3 vote. Finally, the committee took up HB 1107 by Rep. Melerine, a bill on determining intellectual disability in capital cases. The bill, as amended, raised the burden of proof to clear and convincing evidence, set an IQ threshold framework, required expert reports and Daubert-type reliability review, and limited the article to post-conviction capital cases. The Attorney General’s office and district attorneys supported the bill as a way to create clearer procedures and speed resolution of Atkins claims, while criminal defense lawyers, disability advocates, clergy, and medical experts opposed it as inconsistent with current clinical standards and potentially unconstitutional, warning that rigid IQ cutoffs and presumptions could wrongly expose people with intellectual disabilities to execution. The transcript ends during closing remarks on HB 1107, with no final committee vote shown.

Transcript Highlights:

• understanding that the Department of Veterans Affairs leadership is meeting later this morning with OMB

Committee: Senate Senate Veterans' Affairs

Transcript Highlights:

• So, um, but this is a similar situation to OMB, where they're in charge of grants management.
• this is a similar So, um but but this is a similar situation<01:34:21.480><c> to</c><01:34:21.880><c> OMB
• where</c><01:34:23.360><c> the</c><01:34:23.840><c> they're</c><01:34:24.520><c> they</c> situation to OMB
• where the they're they situation to OMB where the they're they they're<01:34:25.480><c> in</c><01:34

Committee: House Fraud Prevention and State Agency Oversight Policy

Transcript Highlights:

• So, I want to ask a little bit more about rescissions and impoundments and the new OMB rule that has

Committee: House State Government & Tribal Relations

Transcript Highlights:

• Just last week, Russell Vought at the federal OMB announced plans to eliminate peer review and give unilateral

Summary: The Assembly Health Committee heard several bills on June 9. SB 1023 by Senator Laird would require insurers that cover injectable HIV PrEP under the medical benefit to also cover it through the pharmacy benefit, with supporters saying the change would reduce reimbursement delays and expand access, while health plans opposed it as an unnecessary mandate that interferes with benefit design. SB 964 by Senator Smallwood-Quivas would limit prior authorization for certain dose or frequency adjustments to covered medications, especially for chronic complex conditions; medical supporters said it would prevent harmful delays in care, while insurers argued it weakens safety and utilization controls. SB 1323 by Senator Rubio, as amended, would strengthen protections for people in immigration custody receiving medical care by requiring hospitals and facilities to inform staff how to respond to requests and allowing patients to notify family members of their location; it passed with one no vote. SB 1099 by Senator Reyes would clarify local governments’ authority to provide state and local public benefits to all residents under federal PRWORA rules, with supporters saying it would reduce legal uncertainty for safety-net services; it passed, though one member later changed a vote to no on the add-on roll call. The committee also took up SB 895 by Senator Wiener, a proposed $12 billion science research bond for the November ballot that would create a California scientific research funding institute. Supporters from UC, UAW, hospitals, and advocacy groups said the measure would help offset federal cuts, protect research jobs, and sustain California’s leadership in biomedical and other research; there was no opposition, and the bill passed on a party-line style vote with two no votes. SB 944, also by Senator Wiener, would stabilize Medi-Cal coverage for acupuncture, which supporters described as a cost-effective, non-pharmacological treatment for pain and other conditions that has repeatedly been threatened in the budget process; it passed unanimously. The committee also approved consent items SB 918 and SB 1202, and later cleared the remaining measures on call after roll votes and add-on votes were taken.

Transcript Highlights:

• I have one white card present, would provide information if requested: Trela Regis, OMB.

Bills: HB345 , HB503 , HB511 , HB590 , HB655 , HB685 , HB692 , HB707 , HB715 , HB748 , HB776 , HB856 , HB860 , HB868 , HB887 , HB888 , HB896 , HB999 , HB1000 , HB1086 , HB1233

Committee: Senate Transportation, Highways & Public Works

Summary: The Senate Committee on Transportation and Public Works met with five members present and approved the April 29, 2026 minutes. The committee then heard and favorably reported several bills, including HB 1233, which lowers the contract threshold for hospital service districts to use the Seymours program for certain hospital construction projects, and HB 715, which requires aerial applicators operating from public airports to have a transponder and radio; an amendment removing language about airport use of ADS-B data for fees was adopted after sponsors said the issue would be handled in another bill. HB 999 was reported favorably to allow impoundment of out-of-state vehicles operated in Louisiana without liability insurance, and HB 692 was amended to let parishes and municipalities use group purchasing organizations, with a narrowing amendment limiting one-source procurements and assurances that local bidders would not be disadvantaged. The committee also advanced HB 511, creating a grant program for pursuit intervention technology in response to officer safety concerns, and HB 590, which would let OMV issue specialized envelopes or notices for drivers with autism or other disabilities so officers are alerted during traffic stops. HB 503 was reported favorably after a local cleanup change to a golf cart bill for Golden Meadow, and HB 655 was approved to let DOTD use cost-plus contracts for operation and maintenance of state-owned ferries. HB 748 clarified that school board-owned or leased vehicles are exempt from tolls, and HB 860 would allow fillable electronic bids for local government procurement. Later, the committee approved HB 896, a major tolling-related cleanup bill for Plaquemines Parish that addresses customer service center access, administrative fees, and exemptions, with members and local officials criticizing the toll structure and its impact on the parish. HB 1000 was reported favorably as a cleanup measure tied to highway priority program reporting and local district contract limits. HB 887 established a more consistent scoring and ranking process for Seymour projects, with an amendment to avoid conflict with changing FAA grant rules. HB 888, a cleanup bill on temporary tags, was amended with added security features and then reported favorably. HB 1086, a broad electronic title and registration modernization bill, received a lengthy amendment set but was voluntarily held over for a week so members could review the new language. The committee also advanced HB 776 to expand the Port Priority Program to larger projects, with amendments clarifying flexibility and removing private projects from the bill. HB 707 was reported favorably to let the Department of Agriculture and Forestry handle promotional activities for the liquefied petroleum gas commission through a cooperative endeavor agreement. HB 868, a farm safety bill requiring safety chains or other manufacturer-specified equipment on trailers, was reported favorably after testimony about a fatal accident and assurances it would not change engineering standards beyond existing manufacturer requirements. Finally, HB 856 was amended to authorize indefinite delivery/indefinite quantity contracting for DOTD maintenance and construction work, then reported favorably, and the committee later corrected the record on HB 856 by reconsidering and withdrawing one technical amendment set so further floor cleanup could be made. The meeting adjourned without objection.

Transcript Highlights:

• legislation to move food for peace. and what the Secretary of Agriculture in the A integrity. with OMB

Committee: Senate Agriculture, Nutrition, and Forestry Committee

Keywords: USDA, nominations, Judge Vaden, Tyler Clarkson, agriculture policy, rural America, tariffs, farmer advocacy

Summary: The meeting focused on the nominations of Judge Stephen Alexander Vaden for Deputy Secretary of Agriculture and Mr. Tyler Clarkson for General Counsel at the USDA. Members expressed concerns regarding the challenges farmers and ranchers face, especially in navigating the impacts of recent tariffs imposed by the President. Significant attention was given to how these nominations could influence agriculture policy and support rural communities amidst economic uncertainty. The committee emphasized the necessity for strong leadership in the USDA to advocate for farmer needs and ensure the proper implementation of assistance programs.

Transcript Highlights:

• While some are unlikely to be affected by the executive orders referenced by the OMB, a broad federal

Transcript Highlights:

• But now President Trump and OMB Director Vote are illegally destroying the agency.

Committee: Senate Homeland Security and Governmental Affairs Committee

Keywords: fiscal responsibility, government waste, foreign aid, funding resolution, legislative oversight

Summary: The committee meeting addressed government spending and foreign aid, with a particular emphasis on perceived wasteful expenditures. A significant portion of the meeting was dedicated to discussing a funding resolution for the committee, which received unanimous support from the members present. The chair noted a quorum at the beginning of the meeting, signaling that the committee was ready to conduct its business. Discussions highlighted ongoing debates concerning fiscal responsibility and the necessity of legislative oversight, notably regarding foreign aid allocations and their implications for domestic fiscal health.

Transcript Highlights:

• The state actually moved ahead, I believe OMB did, with something similar, but we never got to the step
• We should be up over 90 probably this year, but the state, we can go on the OMB site and we get our W

Summary: The subcommittee of the Tax Reform and Relief Committee met with a quorum to begin its study of whether the content of North Dakota real estate tax statements should be revised to improve transparency. Legislative Council staff reviewed the background for the study, including House Bill 1176, current statutory requirements for tax statements, and recent changes such as separate line items for bonded debt, primary residence credit, and legacy fund-related amounts. The Tax Department then explained the current statement format and noted that the form is prescribed and approved by the tax commissioner, with changes typically driven by statute and implemented collaboratively with counties and vendors. County officials from the North Dakota Association of Counties described the full annual process for preparing budgets, setting levies, calculating taxable values, and issuing notices and tax statements. They said counties spend significant time coordinating with taxing districts, neighboring counties, and software vendors, and that the new budget hearing notices and valuation notices have not generated much public response. Members raised concerns about the usefulness and clarity of certain line items, especially the legislative tax relief calculation and the primary residence credit, and discussed whether the current statement creates confusion rather than transparency. Testimony also addressed the 3% cap, mill levy worksheets, assessment cycles, and the role of county auditors and tax directors in maintaining accurate values. The committee also heard from software vendors CPT and Tyler Technologies about how legislative changes are programmed into tax systems and how online taxpayer portals can provide more detailed breakdowns of tax bills. Vendors said changes required by law are generally absorbed in contracts rather than billed directly to counties, and they demonstrated web tools and pie-chart style breakdowns that show where tax dollars go. NDACO presented a survey of eight counties estimating tax statement preparation and mailing costs, concluding that outsourced printing tends to be cheaper on average and that total statewide tax statement costs may be roughly $600,000, though the estimate was based on limited data. No votes were taken; the meeting was informational and focused on gathering testimony and identifying issues for possible future recommendations or bill drafts.

Transcript Highlights:

• ><c> Education</c><00:42:08.079><c> and</c><00:42:08.480><c> OM</c> The Department of Education and OMB
• > plaintiffs</c><00:49:27.760><c> and</c><00:49:28.000><c> the</c> So we're going to go back to the OMB
• preliminary injunction, and litigation is ongoing in the district court over the FY 25 funds because OMB

Summary: The Judiciary Committee held an informational briefing on the State of Hawaii’s affirmative litigation against the federal administration, with no public testimony. Attorney General Lopez and deputies said the office’s goal is to enforce the rule of law, not make partisan points, and noted that Hawaii is involved in 27 ongoing cases. They grouped the cases into four broad areas: immigration, funding freezes and grant terminations, federal agency dismantling/reductions in force, and protecting elections, health, and safety. Several immigration-related cases were discussed in detail. These included a challenge to the federal sharing of Medicaid data with DHS for immigration enforcement, a similar challenge to USDA’s demand for SNAP applicant and recipient data, and litigation over immigration-enforcement conditions attached to federal grants. The office also described the birthright citizenship executive order, saying it conflicts with the 14th Amendment and Supreme Court precedent; lower courts granted preliminary relief, and the U.S. Supreme Court later addressed only the scope of nationwide injunctions, not the merits. In the Department of Transportation case, the court granted a preliminary injunction against the “Duffy directive,” finding the immigration conditions lacked statutory authority, were arbitrary and capricious, and violated the Spending Clause and APA. The briefing also covered multiple funding disputes. In the education funding freeze case, the Department of Education and OMB withheld about $6 billion in formula funds, including roughly $33 million for Hawaii; after suit was filed, the funds were released. Other cases included the termination of over $11 billion in public health grants, which affected Hawaii Department of Health grants, the NIH indirect cost cap case, and NIH grant terminations tied to DEI, transgender issues, and vaccine hesitancy. The speakers said some cases have already resulted in preliminary or permanent injunctions, while others remain on appeal or are still being litigated.

Transcript Highlights:

• ><01:26:03.840><c> recently</c><01:26:04.320><c> when</c><01:26:04.639><c> the</c><01:26:05.040><c> OMB
• </c> received um just recently when the OMB received um just recently when the OMB released<01:26:06.000

Summary: The Government Contracts Committee met with a quorum and approved the July 8 minutes. It then deferred several items from the July agenda, including a Kentucky Education Television contract because the vendor was not yet registered with the Secretary of State, and a University of Louisville contract at the university’s request. The committee also deferred a behavioral health memorandum of agreement and later a Department of Community Based Services contract after questions were raised about the scope of services and the need for additional information. The most extensive discussion involved the Seven Counties Services contract with the Department for Behavioral Health, Developmental, and Intellectual Disabilities. Committee members questioned why the state continues to contract with Seven Counties despite its bankruptcy and pension-related liabilities, how the funding split was determined, whether the services are statutorily required, and whether the state or another provider could deliver the services more efficiently. Agency representatives said Seven Counties is the sole provider of core community mental health services in its region, serves about 24,500 people, and that service needs and acuity remain high even as the number served has declined. A cabinet attorney said the bankruptcy dispute is ongoing and involves roughly $20 million in contested retirement contributions, though members suggested the amount may be higher. Members also raised broader concerns about whether local governments, especially Metro Louisville, should contribute more toward services tied to social determinants of health, and whether the contract includes services beyond what statute requires. The committee requested additional information on the contract scope and possible offsets or recovery of unfunded liabilities, and then voted to defer the Seven Counties contract to the next meeting. The committee also heard a separate DCBS presentation on the Youth Villages Intercept program, where staff explained it was selected because it is an approved evidence-based Family First prevention service, provides intensive in-home and foster care stabilization services, and is headquartered in Tennessee but operates across Kentucky; members asked for clarification on Medicaid billing and additional funding needs.