Michigan auditor general to look into child care program performance

• Child care subsidy programs have faced increased scrutiny following claims of widespread program fraud from the Trump administration.
• A Republican state lawmaker called for a program evaluation that the auditor general recently decided to add to its docket in 2026.

Michigan’s auditor general plans to review the state’s child care subsidy program, and among the factors for the decision is a request for an audit from State Senate Republican Leader Aric Nesbitt. 

Nesbitt, who is running for governor, called for an audit of the program after Trump administration claims of widespread child care subsidy fraud in Minnesota and across the nation.  

Nesbitt’s request is one of several factors that led the auditor general to put the program on its 2026 docket, which includes around 30 other programs. Other factors that inform this kind of decision include whether there’s available staff to carry out the audit, the program’s audit history and general public interest in the program, said Kelly Miller, Office of the Auditor General spokesperson, in an email.

The specifics of what the audit will cover are not yet known, since auditors have to first identify areas of concern or improvement before figuring out what the scope of the evaluation will look like, Miller wrote.

The auditor general carries out annual financial audits on each major state subsidy program using federal dollars, but given its limited time and resource, the office must be selective in which programs receive performance audits.

Financial audits make sure a program is complying with federal requirements tied to federal dollars, performance audits put a magnifying glass to some specific program element, often related to policies and procedures. Past Michigan child care subsidy performance audits have identified problems including a lack of systems to track the accuracy of payments to child care providers and insufficient background vetting of licensed providers. 

The last performance audit of Michigan’s child care subsidy system came out in November 2025, though it didn’t focus on evaluating how well the program manages fraud and improper payments. Instead, it focused on an issue that continues to come up consistently for providers and families utilizing the program: poor communication practices by the state’s early childhood agency, MiLEAP, which administers the program, that leave child care providers and parents stranded when payments are late or kids can’t get turned onto the subsidy.

MiLEAP did not respond to requests for comment but department spokesperson Aundreana Jones-Poole said in a statement earlier this month that “MiLEAP has a zero-tolerance policy for fraud or abuse of funds meant to benefit Michigan families.”

Sen. Nesbitt, R-Porter Township, said in a press release that he welcomed the audit, calling it “good news for legitimate, law-abiding child care providers and the many families who struggle to find affordable childcare throughout our state. It’s time to root out waste, fraud and abuse and hold our state agencies accountable for everyone who is fighting to make it in Michigan.”

Auditor general investigations are two of several state oversight measures intended to track a program’s integrity and curb potential program fraud: MiLEAP randomly audits licensed providers across Michigan to check time and attendance records and make sure billing is accurate and the Inspector General for the Michigan Department for Health and Human Services carries out fraud investigations each year.

The federal government’s Office of Child Care also audits every state’s subsidy program. States are grouped in cohorts that are evaluated in 3-year cycles. Michigan’s next federal audit is also coming up in March 2026, according to the Early Childhood Investment Corporation, a Michigan-based early childhood nonprofit. Federal audits look at how programs tackle fraud and address subsidy payment errors.

MiLEAP did not respond to questions about how the department will prepare for both a state and federal audit falling around the same time.

Beki San Martin is a fellow at the Detroit Free Press who covers child care, early childhood education and other issues that affect the lives of children ages 5 and under and their families in metro Detroit and across Michigan. Contact her at rsanmartin@freepress.com.

This fellowship is supported by the Bainum Family Foundation. The Free Press retains editorial control of this work.