Note: The following e-newsletter was sent to Sen. Leonard Christian’s subscribers May 8, 2026. To subscribe to Sen. Christian’s e-newsletters, click here.

Dear Friends and Neighbors,

If your bookkeeper found a $37 million discrepancy in your accounts, wouldn’t you want to get to the bottom of it? Wouldn’t you be the least little bit curious? Well, that’s what’s happened in Washington state’s childcare programs, and all Olympia can do is shrug.

A couple weeks after we adjourned our session in March, the State Auditor’s office issued a scathing report questioning $37 million in payments made to childcare providers by the Department of Children, Youth and Families. DCYF responded that the audit turned up no direct evidence of fraud. And that’s where it ends. Here it is a month later, and there are no more questions. There is no more investigation. We have a $37 million problem, and nobody is interested in looking further.

Talk about red flags. The lack of curiosity we are seeing from state officials regarding the possibility of daycare fraud is the reddest flag we could possibly imagine. The more they tell us not to look, the more urgent investigation becomes. Yet the veil of state secrecy keeps getting pulled tighter.

Minnesota case prompts questions in this state

The questions we are asking in Washington state are an outgrowth of the biggest government corruption story of the decade. A spate of major social-service fraud cases perpetrated by Somali immigrants in the state of Minnesota led an independent reporter to start visiting state-subsidized daycare facilities in the Minneapolis area. He discovered daycare centers where no daycare was occurring, an organized fraud that appears to have bilked taxpayers in that state of $100 million or more. The story triggered a federal investigation, and reporters in every other state naturally started wondering if the same thing might be happening there.

Sure enough, when reporters started knocking on the doors of numerous daycares operated out of private homes in the Seattle area, they found the same thing. No signs of daycare activity. No parents dropping kids off, no kids playing outside. The response from state officials was swift. Taking the lead of Minnesota Democrats, they declared that inquiry is racist. The attorney general’s office issued a press release hinting that reporters could be prosecuted for hate crimes. At a news conference earlier this year, legislative Democrats told reporters they should stop investigating the matter themselves and wait for the state auditor to issue a new report on state childcare programs – because they could trust the authorities to do their job.

Audit is a big fizzle

And now that report is finally here. It says Washington has a massive problem on its hands. Many childcare operators flunk basic paperwork requirements, it says, and cannot provide attendance logs or parental signatures when asked. Some overbill the state for services. The state’s policy is to pay first and ask questions later, and this results in overpayments in about two-thirds of cases. The auditor’s office took those numbers and extrapolated and concluded that $37 million was paid out improperly.

But it didn’t identify any fraud cases – it wasn’t that type of audit. So the auditor’s office didn’t ask the right questions, the answers didn’t go very deep, and now the work is done and nobody is following up. Apparently DCYF believes a promise to do better next time is sufficient.

State expands secrecy of daycare records

About the only thing that has happened due to this new concern about daycare payments is that the state has gotten mighty selective about the public records it does release. A 2016 initiative requires the state to withhold personal information for daycare providers working from home. This includes names, addresses, driver’s license numbers and so forth. The idea is to protect caregivers and their clients from identity theft and other financial crimes by preventing the release of public records that could be used to victimize them. Well and good, but now state government is using this law as a pretext to withhold information about daycare spending.

In announcing $56 million in grants for early learning programs, the state Department of Commerce last month claimed the law required it to omit the names and addresses of 20 in-home childcare operations that had been awarded as much as $300,000 apiece. Yet nothing in the law says business names and addresses must be concealed, and clearly announcements of this type have nothing to do with identity theft.

This obvious misuse of agency authority serves no legitimate purpose. All it does is make it harder for the public to see where their money is being spent. When the state goes to such great lengths to avoid scrutiny, it only heightens suspicions that fraud is being covered up.

 

New developments in session’s biggest stories

 

The 2026 Legislature adjourned March 12, and in the weeks since we have seen some major developments in some of the biggest stories of the session. Here’s a quick rundown of some of the top headlines.

• BIG DCYF PAYOUTS CONTINUE: One of the things that got the state in financial trouble this year is the fact that last year’s Legislature set aside nothing for tort claims. That was a half-billion dollar expense all by itself, a new state record, most of it due to claims against the Department of Children, Youth and Families for poor supervision of children under its care. We covered it in this year’s budget, but the hits just keep coming. Last month a Pierce County jury ordered the state to pay $130 million for its failure to intervene in an abuse case that led to the death of a two-year-old girl. Attorneys say the award is the highest ever from a jury in a Washington-state wrongful death case. As usual, the facts are appalling, and Washington taxpayers are stuck with the tab. If it wasn’t for the size of the award we would probably think it routine – and that may be the biggest problem at all.
• MOODY’S PUTS STATE ON NOTICE: Nine irresponsible budgets in a row have finally forced Moody’s Investor’s Service to take note. The influential credit rating agency has downgraded its outlook for state finances from “stable” to “negative,” pointing out that Washington keeps spending more money than it takes in, and keeps using reserves and accounting gimmicks to balance the books. This has been the pattern ever since our Democratic colleagues took full control of the Legislature in the 2018 session, and the biggest surprise is that it has taken Moody’s this long to say something about it. Now that the outlook has been downgraded, the next shoe to drop is the state’s bond rating. It remains high for now, but Moody’s warns Washington doesn’t have any wiggle room the next time there is a downturn in the economy, and the state will find itself in deep trouble.
• WAITING FOR NEXT MOVE ON INCOME TAX: Majority Democrats in the Legislature this year passed an income tax in flagrant violation of the constitution, and we are seeing the start of legal skirmishes as the issue forces a showdown before the state Supreme Court. Legislative Democrats hope to convince the court to overturn its 93-year-old ruling that a graduated income tax requires a constitutional amendment. This week the Supreme Court ruled that a referendum cannot be filed against the income tax, because the Legislature tacked on an “necessity clause.” The court won’t rule on whether the income is a necessity because it won’t presume to second-guess the legislative branch.And here’s an interesting thing. The idea for the emergency clause came from the state attorney general’s office. Documents turned up by a press public-records request show that the Attorney General’s office has been offering legal advice to legislative Democrats on this matter for some time. It’s not illegal, but still there is something mighty strange about the fact that the state’s top legal office is giving the Legislature advice on how to break the law.

Thanks for reading,

 

 

Leonard Christian

4th Legislative District

 

Contact me!

If you have a comment about state government, or a concern with a state agency, I hope you will reach out to my office. The session is over, but I serve you year-round.

Mailing address: Post Office Box 40404, Olympia, WA  98504

Email: Leonard.Christian@leg.wa.gov

Phone: (360) 786-7606

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