Minnesota Supreme Court hears arguments over private firms auditing counties

State Auditor Rebecca Otto asked the Minnesota Supreme Court on Wednesday to overturn a 2015 law that lets counties privately contract for audits, with her attorney arguing it turns her constitutional office into an "empty shell."

Otto's appeal to the state's high court is a last-ditch effort to overturn a law that gives the state's 87 counties the option to use private companies to check their spending. Two lower courts have already ruled against Otto's efforts to overturn the law.

Minnesota counties spend about $6 billion a year. Joe Dixon, the attorney representing Otto, said her office protects the public by helping oversee the use of taxpayer dollars. Private firms would serve the counties rather than the public interest, he told the court.

However, Chief Justice Lorie Skjerven Gildea questioned whether protecting taxpayer money was originally specified as a core function of the auditor's office. The court must decide what the core functions of the auditor's office are and whether the 2015 law encroaches on them.

Attorney Scott Anderson, who is representing Wright and Becker counties, said the core functions of Otto's office cannot be determined by recent work but by the original role of the state auditor.

When the office was first formed, auditing counties was not one of its responsibilities.

Dixon also argued the 2015 law violated the state Constitution's single subject clause, which says a law should not "embrace more than one subject." It is important for residents to know what's in a law, Dixon said, and the 2015 legislation jammed too many things together.

Otto, a DFLer who is running for governor, sued Wright and Becker counties after they told her office they planned to hire private firms. She also sued Ramsey County after county officials would not sign a contract with her office.

"As a constitutional officer I swore an oath to uphold the Constitution. By pursuing clarity from the courts I have fulfilled my oath and done everything in my power to protect the people's office," Otto said in a statement Wednesday.

In addition to auditing counties, Otto's office can audit other entities, like cities and school districts. But 60 percent of her budget comes from county audit fees, Dixon said, and removing that role would result in "a dismantling of the office."