By Deena Winter
Star Tribune
MINNEAPOLIS — An innovative Minneapolis program tapping unarmed mental health workers to respond to some 911 calls is in limbo five years after the city launched it to better help people in crisis and reduce police use of force.
The behavioral crisis response team program faces new scrutiny over poor city oversight and disagreement among city leaders over which vendor should run the program. A new audit this week found a series of red flags, including a lack of documentation that made it difficult to assess what services the city was paying for.
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That mirrors similar findings in other city programs all started in the wake of George Floyd’s killing by Minneapolis police. Auditors have warned in the past that inadequate contract management is a “top risk” to the city.
Internal documents also revealed earlier this year that there were concerns about oversight of the behavioral crisis response team and how hiring a private contractor “hindered” city control over it. The program started in 2021 as the city expanded its alternatives to police after Floyd’s death. Since then, it’s diverted an average of 10,000 calls per year from police and has been lauded for freeing up officers to handle other calls while keeping people in mental health crises out of jail. But it’s also cost the city more than $25 million.
Canopy Roots LLC was a startup therapy practice in Minneapolis when it won the first contract in 2021 to launch the program. Its contract was extended three times until this year, when the city opened a competitive bidding process for the first time.
City officials said Canopy Roots’ bid was significantly higher than the other proposals. In the new audit, auditors said Canopy Roots often billed at or above their budget, rather than actual costs, and billed the city for exactly the same amount in one category on 13 invoices, despite significant variations in staffing and working hours.
After examining similar programs nationwide, city officials concluded the program should be expanded to a “mobile crisis response” program that responds to a lot more issues, such as homelessness and drug abuse, and do more follow-up work with people they encounter.
After a bidding process, staff recommended the city hire a new vendor next year. They asked the City Council to approve a $5.9 million contract with Community Bridges Inc., an Arizona -based company that runs the program in several U.S. cities.
But last week, the City Council voted 7-5 to reject that contract and waive procurement rules to allow the city to continue contracting with Canopy Roots for up to 18 months. Mayor Jacob Frey is expected to veto the council’s decision. If he vetoes it, the council would not appear to have the votes to override him, putting the program in limbo.
The audit released this week reviewed the program dating back to 2025, when the City Council moved oversight of the program to the Minneapolis Fire Department.
The audit found that the city has no performance targets and is unable to detect billing anomalies or evaluate how well Canopy Roots is doing the work. With no performance standards, access to dispatch data or itemized documentation, the city couldn’t tell if it received the services it paid for, auditors said.
Fire officials responded to the audit with a damning letter saying they inherited a contract that had no defined operational expectations and no oversight framework. In the three years before the program was transferred to the Fire Department, no service data had been collected from Canopy Roots, the letter said.
“MFD inherited a strained vendor relationship and a program lacking foundational administrative controls,” the letter said. “The vendor had already begun altering service practices, including declining certain responses, and no prior department had established expectations for reporting, credential monitoring, or detailed invoicing.”
When auditors sampled nine invoices worth $3.5 million, the fire department provided workbooks, payroll registers and a small number of receipts for supplies, but the payroll registers only covered part of the billing period for six invoices and none of it for the other three.
Canopy Roots’ payroll registers showed what staff were paid, but not the hours they worked, so the city couldn’t confirm billed staff costs against actual hours.
Auditors weren’t able to get timecards or daily time records from Canopy Roots, nor supporting documentation for more than $317,000 in expenses for legal work, insurance, office space and consulting costs.
After the audit was presented to the city’s Audit Committee, committee member Wajdi Al-Mowafak asked whether the city intends to go back and reconcile payments made to Canopy Roots.
Michael Kawaters, director of special reviews and advisory services for the city auditor’s office, said he wasn’t sure; that was outside the scope of the audit.
The debate over which vendor to hire for the program has divided the City Council — again. Progressive council members opposed expanding the program, saying it could threaten a program that’s working. Some of the more moderate council members wanted to wait for the audit to come out before making a decision on a vendor.
Council Member Robin Wonsley said the program has been “widely celebrated” while Council Member Linea Palmisano said the program was “thrown into chaos” by the council rejecting the contract with the Arizona company.
But some City Council members questioned whether that company, Community Bridges, would have enough time to take over the program in January and have enough local connections and insight into Minneapolis. Some suggested the city bring the program “in house” and run it, although city officials said that would face legal hurdles.
Frey said in an interview he’s hopeful they can come to an agreement on a path forward.
“The same council members who, for years, have voiced a desire to reduce the number of calls that go to police are now preventing a reduction in the number of calls that go to police,” Frey said.
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