GRAND RAPIDS– Michigan Gov. Gretchen Whitmer said Friday she was frustrated with over $100 million in pet projects approved just days before she took office – but said she can do little to halt the spending.
Michigan legislators, on the last day of the lame duck session in December, approved a $1.3-billion spending bill that included $115 million for mostly small projects across the state that were largely championed by Republican senators and representatives.
She pointed as an example to a grant for the Lowell Showboat, which will get $1 million in taxpayer money. In a gathering at the Michigan Press Association on Friday, Whitmer said voters would “prefer” if the state was spending money on roads and ensuring quality drinking water.
Whitmer said she directed her budget office to look into the propriety of the lame-duck spending. She said the office concluded that the projects – of which then-Republican Gov. Rick Snyder vetoed but one – must be funded.
“It’s already law,” Whitmer said “All the legal analysis has come back that for the most part we have to abide by them.”
Bridge Magazine has reported that one of the controversial grants involved $10 million to bring water and sewer lines to largely vacant land near Ann Arbor owned by a company headed by Bobby Schostak, a former chairman of the state Republican Party. (It was the second $10 million grant made to the company.)
The township had not asked for the money and it’s advocate in the legislature was not immediately known – most grants had one. It was not until this week that Arlan Meekhof, the Republican Senate Majority Leader during lame duck, conceded that he was the main proponent for the award, even those his district is more than 150 miles away.
After reviewing the lame-duck grants at the governor’s request, the state department of technology, management and budget decided the legislation and the grants were valid and would be funded, DTMB spokesman Kurt Weiss confirmed.
“The current governor doesn’t like it but we’ve (concluded) we need to live up to the letter of the law,” he said.
A number of the grants were for parks and museums and others for roads, bridges and dams. Almost all came with a request from a specific lawmaker; the Salem Township grant that benefitted Schostak’s company did not, raising questions among the state’s budget staff, Weiss said.
“We know there are some grants that are problematic and there are concerns that will have to be addressed when it comes to making the best use of taxpayer dollars, and so we will be taking measures to ensure the money is spent in the most efficient and effective manner possible,” Weiss said in an email to Bridge.
Schostak, chair of the state Republican Party from 2011 to 2015, is CEO of Schostak Brothers & Co., which has spent over $28 million acquiring more than 560 acres in Salem Township along M-14 near the Gotfredson Road exit.
The land is largely vacant though the township has anticipated commercial and residential development in the area. It has long held, however, that developers would bear the cost of bringing water and sewer to the area.
But the Schostak company has sought government grants before, in 2009, and in 2017 when the legislature awarded the first $10 million. The earlier grant was a last-minute add to the state budget bill and was not part of any committee discussion, nor was the second $10 million grant in December.
The Michigan Economic Development Corp. was directed by the legislature to handle the grant. In a statement to Bridge, the MEDC said the grant was not part of any existing program offered by MEDC, which promotes business across the state, spokesperson Kathy Achtenberg said.
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