Executive order bans garnishment of CARES Act stimulus payments in Minnesota

(FOX 9) - Minnesota Attorney General Keith Ellison hailed Governor Walz's new executive order that protects federal CARES Act and other state, local, and tribal stimulus payments from garnishment by debt collectors.

According to a release from the Attorney General's office, Ellison suggested to Gov. Walz that the state adopt this executive order, which the Attorney General’s Office is able to enforce.
 
“During the pandemic, our number-one job needs to be helping Minnesotans keep a roof over their heads and food on their table while we stay home to protect themselves and each other against COVID-19 — and garnishing stimulus payments is at cross-purposes with that imperative,” Ellison said in the release. “Allies and I proposed this executive order to Governor Walz because of the real threat that debt collectors could make that struggle even harder on Minnesotans — who are already suffering from too much consumer debt — by garnishing payments that are supposed to help them afford their lives during the pandemic."

Under the Order, “Recovery Rebates must be deemed to be ‘government assistance based on need’ under Minnesota Statutes 2019, section 550.37, subdivision 14 (“Government Aid”), making them exempt from all claims—except claims for Domestic Support Obligations—by creditors.” Domestic-support obligations include child and spousal support. The Executive Order also suspends all new consumer-debt garnishments for the duration of the peacetime emergency. 
 
According to the release, the Attorney General’s Office has received numerous reports and complaints from Minnesotans that are unable to keep up with the consumer debt they accrued prior to the COVID-19 pandemic, including reports of consumer-debt garnishments that are impairing Minnesotans’ ability to afford their lives.  

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27, 2020, provides up to $1,200 per adult and $500 per child as Economic Impact Payments. The CARES Act, however, does not explicitly exempt the Economic Impact Payments from garnishment, as Social Security, disability, and veterans’ benefits already are. 

On April 13, 2020, Attorney General Ellison joined a bipartisan group of 24 other attorneys general in asking U.S. Treasury Secretary Stephen Mnuchin to take immediate steps to protect CARES Act payments from garnishment by debt collectors.

With today’s executive order, Minnesota joins seven other states — California, Illinois, Iowa, Maryland, Massachusetts, Rhode Island, and Washington — and the District of Columbia in protecting CARES Act and other state, local, and tribal COVID-19-related economic-support payments from garnishment by debt collectors.

Attorney General Ellison asks any Minnesotan who is facing or being threatened with garnishment of their CARES Act or other economic-support payments, or who is subject to any newly-initiated garnishment during the peacetime emergency, to file a complaint online or call his office at (651) 296-3353 (Metro) or (800) 657-3787 (Greater Minnesota.)