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Michigan lawmakers concerned over state grant spending

State lawmakers question grant spending at Michigan agency
State lawmakers question grant spending at Michigan agency 02:42

(CBS DETROIT) - Lawmakers allege a Metro Detroit businesswoman spent more than $4,000 on a coffeemaker from a direct legislative grant allocated through the Michigan Economic Development Corporation (MEDC), of which she was a board member. 

Fay Beydoun recieved a $20 million grant that was allocated in the 2022 state budget by the Legislature. Financial reports allege that Beydoun has spent the first portion of that money on a $4,500 coffeemaker, $11,000 on a flight to Budapest and $408,000 on salaries for herself and one other employee.

"I am not convinced that the SOAR funds and the MEDC and the corporate welfare and the handouts and the tax incentives are helping Michigan residents," said state Rep. Donni Steele. 

Steele is not alone in her concern. Republican Rep. Steve Carra and Republican Sen. Jim Runestad both issued statements earlier this week calling for improved oversight. 

"The MEDC must answer for the negligence and corruption demonstrated by this grant. This is supposed to be an organization that builds Michigan's economy. Instead, what we are seeing is a grave misuse of funds to support its board members' own living standard," he said. 

Steele told CBS News Detroit she feels the responsibility of oversight falls on the Legislature. 

"That's what our statutory duties are, is to pass a budget," she said. "I'm on appropriations [committee]. I've been on there for over a year. And every time I pick up a piece of paper, there's 27 layers of paper underneath of what's going on in that budget. And so if I'm supposed to be the oversight, why am I the last one to know of what actually is going on?"

In a statement, the MEDC said it is the legislator who decides who gets these grants and who sets requirements.

"Our role is to administer these grants per the parameters set forth by the Legislature, of which the MEDC has auditing and compliance processes in place which align with those requirements," the organization wrote. "Should there be discrepancies in expenditures found during the time in which expenses are verified, appropriate actions will take place." 

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