Michigan: Double payment concerns suspended $25M Clare health campus grant

• Michigan officials say they shut down a controversial Clare project over double-dipping concerns
• Records show a nonprofit led by a former legislative aide paid $820,000 to a consulting firm that he also led 
• A state investigation into the deal is ongoing

Double payment concerns this year prompted Michigan officials to suspend a $25 million grant to build a health campus in Clare and order an investigation, a state spokesperson told Bridge Thursday.

At issue are two firms led by project leader David Coker, a onetime aide to former House Speaker Jason Wentworth, who secured state funding for the health and fitness facility before he left office last year. 

A nonprofit Coker created, Complete Health Park, paid IW Consulting more than $820,000 days after the Dec. 1 start of the project, Bridge Michigan reported on Wednesday. 

Related:

• Records: Firm of ex-aide to Michigan speaker paid $820K within days of grant
• ‘Red flags’ surround $25M health campus pushed by ex-Michigan House speaker
• Michigan paid $10M before ‘red flags’ froze ex-House speaker’s pet project
• Timeline: How $25 million deal to ex-House aide raised ‘red flags,’ faltered

Coker also leads IW Consulting, whose business address is his home.

According to an agreement between the state and Complete Health Park, costs incurred prior to Dec. 1 were not eligible for reimbursement.

But records obtained through the Freedom of Information Act show IW Consulting billed Complete Health Park $623,000 in management fees on Dec. 5 and $182,200 on Dec. 6 for 911 hours of work at $200 an hour.

“When the department learned in March 2023 that the invoices reflected the work of one person which could have resulted in duplicate billing/payment, the department paused the work and referred the matter to the Office of Inspector General,” Lynn Sutfin, a spokesperson for MDHHS, said in an email to Bridge.

Sutfin repeated Thursday that the state “paused” funding for the project in March, even though documents obtained this week by Bridge show the state first sent a  “stop work” letter to Coker on May 4, the day after Bridge’s initial story raising questions about the project. 

Bridge asked MDHHS, through Sutfin, for documentation supporting that the project was suspended in March. She did not respond by early Thursday evening.

Nearly $10 million in taxpayer money has already been spent on the project, Bridge has reported. 

Coker did not respond to requests for comment from Bridge, and he has previously defended the project to Bridge.

The $25 million grant was included in a 2022 budget bill, and Wentworth extolled the value of the grant and other projects he supported. The state awarded the project to Complete Health Park, which Coker formed in 2022, without competitive bids.

The health department’s inspector general is investigating the grant and spending because of what Sutfin has called “red flags.”

The deal also included a $3.5 million land purchase that benefited Rep. Tom Kunse, R-Clare, who succeeded the term-limited Wentworth in Lansing. 

Kunse has denied wrongdoing and said he expressed concerns to the state about the project before it was suspended.

Bridge reported Thursday on new details to emerge from the cache of documents about the grant, including payments to IW Consulting and $150,000 to Beta Sole Foundation for marketing and website development.

State records show Coker helped create the nonprofit in 2017; one of his daughters received a college scholarship from it.

The foundation had been run by Anthony Demasi, a friend of Coker who was sentenced to 60 months in prison in 2010 for  fraud and is now facing new federal charges of aggravated identity theft on allegations of applying for credit cards in the name of former Beta Sole employees. 

Demasi has pleaded not guilty to those charges, and has said he’s rebuilt his life and business after earlier missteps.

Demasi was listed in grant paperwork as project manager of the health complex, but he has told Bridge the title was inflated and his work was limited.

Coker is a former chair of the Clare County Republican Party and a current elected member of the Clare County Road Commission. He is also now manager of the Clare Area Chamber of Commerce.