Michigan lawmakers defend $1.4B in no-bid grants — months after approval

• Months after approving nearly $1.4 billion in grants, Michigan lawmakers offer justifications for the spending
• Critics say the disclosures are too late to have positive impact, that grants benefit the politically connected
• Sponsors say the money will improve their communities

When Michigan’s Democratic-led state Legislature approved nearly $1.4 billion in no-bid grants last year, legislative leaders added new rules that promised more transparency — eventually.

Lawmakers were required to tell the State Budget Office which grants they’d sponsored by January, nearly a half year after adding the earmarks to a $82 billion budget signed by Gov. Gretchen Whitmer in July.

Now, months before the law will require the state to publish the information on a public-facing web site, Bridge Michigan has obtained each lawmaker’s written “justification” for the grants they sponsored.

The new information, released to Bridge by the State Budget Office earlier this month, is often vague, lacking specifics or proof that the recipient is qualified to handle an influx of state cash.

Related:

• See who sponsored $1B in Michigan earmarks: Did your rep bring home pork?
• Michigan budget steers millions of no-bid tax dollars to for-profit firms
• Political funds flow to Michigan lawmaker who secured $18M earmark
• Michigan attorney general investigating $25M grant to ex-House speaker’s aide

And it does little to quell the complaint that the new disclosures are coming far too late, months after lawmakers approved hundreds of grants that totalled nearly $1.4 billion combined.

“Transparency without timeliness isn't really transparency,” said Steve Johnson, a former Republican state representative who has long been critical of the state’s grants process in which top lawmakers — Republican and Democrat — have made grant spending decisions in private.

Last summer, as part of last-minute negotiations on the state budget, lawmakers approved more than 350 grants to build fire stations, a jail in Macomb County, improve parks and help nonprofits that train workers, offer arts and cultural experiences, assist military veterans and more.

In the justifications released this month, some lawmakers submitted answers that clearly spell out how the money will help.

For instance, state Sen. Stephanie Chang, D-Detroit, said the $700,000 grant she sponsored for the unhoused community in Detroit would benefit 70,000 or more Detroiters who would learn how to produce and distribute cold-weather clothing.

Fellow Detroiter and state Rep. Donovan McKinney, a Democrat, defended a $400,000 grant for a mentoring program offered by the Sound Mind Body Academy, saying it will allow for 100 students to go on a college tour. And the expansion of the academy, also supported by the grant, would allow it to serve an additional 1,000 students, he said. 

But others were less clear. 

Sen. Sarah Anthony, D-Lansing, and Rep. Kara Hope, D-Holt, submitted just two words in defense of a $500,000 grant they sponsored for the Mikey 23 Foundation:  “Building trade.” The nonprofit provides skilled-trades training for youth in the Lansing area.

And state Rep. Will Snyder, D-Muskegon, backed an $18 million grant for a private developer to convert a former factory site to housing. His written justification did not mention that the developer is a for-profit firm, nor why the funding is a sound use of taxpayer dollars. 

“The purpose of the project is for the rehabilitation of the former Shaw Walker Furniture Co. manufacturing site in Muskegon to support housing under Section 1012(3) of Part 2 of Article 9 of PA 119 of 2023,” Snyder wrote.

In February, Bridge disclosed that Snyder received more than $15,000 in political contributions from officials of the private developer. Snyder told Bridge last month that he was not promised any contributions for his support.

“Zealous” advocate

Rep. Jim Haadsma, D-Battle Creek, successfully sponsored five grants totalling $10.25 million to aid the Battle Creek airport, a museum, community center, theater and job training facility.

He told Bridge he is a “zealous” advocate for his community and did not get everything he asked for. 

“I'm the guy who's responsible for making the pitch for my district to make economic development more likely in the district I represent and (make) the quality of life better in the district I represent,” Haadsma said. “And I think that that's what we're called upon to do as representatives of a district, is to advocate the most strenuously for our community.”

In the past, the grants have worked well for some communities, funding museums, parks and other projects across Michigan. But some have raised eyebrows — and caught the attention of investigators.

In 2018, lawmakers approved a $10 million grant for vaguely described utility work in Washtenaw County. It turned out the money was intended to help bring water and sewer lines to a private development sought by a company in which former Michigan Republican Party Chairman Robert Schostak was a principal.

No lawmaker claimed to sponsor the grant for more than a month until then-Senate Majority Leader Arlan Meekhof, R-Grand Haven, said it was him. Meekhof’s district was over 150 miles away from the project’s location.

And last year, the Michigan Attorney General’s office said it was investigating two other recent grants: A $2 million earmark from 2019 to pursue a launch site in the state for rockets, and a $25 million earmark for a Clare health complex that was added to the by former House Speaker Jason Wentworth, R-Farwell. 

One of Wentworth’s former aides formed the nonprofit that got the grant, which was later suspended amid the probe.

Is there a better way?

Critics of the grants process, including Johnson and state Rep. Jim DeSana, a Monroe County Republican, say the lack of full and timely disclosure invites problems.

Johnson said there are better ways to do it.

The state could fund pots of money and have competitive grants judged based on objective criteria, he suggested. Or legislators could openly discuss the grants in committee hearings long before there is a vote, like the Legislature does for most policy and spending decisions.

“I mean, if you really believe in the project you want to give money to, well then talk about it,” Johnson said.

But Johnson admits lawmakers might not want to have that discussion because lawmakers like Haadsma, who got a grant to help a theater in Albion, would have to face lawmakers who have community theaters in their own districts that might have equally important needs.

Republicans avoided those public debates when they controlled the Legislature and sent far more grants to Republican districts, and Democrats are doing the same since taking control in 2023, Johnson said.

“Everyone knows it’s politics being played because people say ‘well why is your theater getting three million dollars and not this theater over here?’ And the obvious answer is because one person has more political connections than the other person,” he said.

“And no one wants to talk about that part.”

Editor's note: This article was updated at 10:06 a.m. March 28 to correct the total amount of grants awarded. Data provided by the state had incorrectly listed each of four grants for skilled trades development by the combined total of $28 million, rather than their individual amounts, which ranged from $4 million to $8 million.