Summary — HB 4773 (2025)
Status snapshot
- Introduced: March 13, 2025 (Rep. Ann Bollin).
- Committee and floor history: committee hearings and substitute reported in April 2025; passed the House on May 15, 2025 (readings, record votes documented). Bill text electronically reproduced August 19, 2025 and referred to Committee on Appropriations. Companion: SB 1240. Title includes tie-bar with HB 4771'25.
- Bill amends 2018 PA 540 (Economic Development Incentive Evaluation Act): modifies section 3 (definitions) and adds a new section 7a.
Purpose
- Require recurring, formal audits by the Auditor General of all disbursements for SOAR (Strategic Outreach and Attraction Reserve) programs and SOAR-funded projects, with the express objective of identifying unspent or recoverable funds and ensuring those funds are returned to Michigan’s general fund when required.
Key provisions
- Definitions update (amends Sec. 3): clarifies and expands the list of “economic development incentives” covered by the act and explicitly references SOAR and SOAR programs (critical industry program — MCL 125.2088s — and strategic site readiness program — MCL 125.2088t).
- New Sec. 7a (audits of SOAR):
- Annual requirement: Auditor General must audit each disbursement for any SOAR program or SOAR project at least once per year.
- Audit scope: determine whether
- monies are subject to repayment/clawback and whether those repayments were deposited into the general fund per sections 88s/88t (MCL 125.2088s/125.2088t);
- funds allocated to SOAR programs remained unexpended, unallocated, or unobligated at fiscal year-end and whether such funds reverted to the general fund as required;
- projects were canceled or placed on definite/indefinite hold, and whether disbursements were halted and funds reverted when not resumed within one year;
- written agreements are not in default and required backups/reports/invoices/proof of work were submitted, reviewed and approved by the Michigan Economic Development Corporation (MEDC).
- Audit procedures: must comply with 2003 PA 1 (audit/examination definitions and standards).
- Reporting: Auditor General must submit findings to the Department of Technology, Management & Budget, Department of Treasury, the Michigan Strategic Fund, legislative fiscal agencies, and appropriations committees — and publish the report on the Auditor General’s website — within 30 days after completion of the audit.
- Follow-up: After the report, Department of Treasury and the Michigan Strategic Fund are directed to take all actions necessary to ensure required repayments are collected and returned to the general fund.
- Clarifies that these audits are additional to contractor evaluations required under the Economic Development Incentive Evaluation Act and do not relieve other duties.
Who is affected
- State oversight bodies: Office of the Auditor General, Department of Treasury, Department of Technology, Management & Budget, Michigan Strategic Fund, MEDC.
- Recipients of SOAR funding: private companies, nonprofits, academic institutions and projects funded in whole/part by SOAR.
- Taxpayers/general fund: potential return of unspent or clawed-back SOAR dollars to the state general fund.
- Contractors and evaluators who currently review economic development incentives (audits are additive).
Procedural/timeline highlights
- Audits required at least annually.
- Auditor General must publish and distribute findings within 30 days of completing each audit.
- If audits identify recoverable funds or unspent allocations, Treasury and the Strategic Fund must act to ensure funds are repaid/deposited into the general fund.
Potential impacts
- Increased transparency and oversight of SOAR expenditures.
- Greater likelihood unspent, unobligated, or clawed-back SOAR funds are returned to the general fund.
- Additional administrative and compliance workload for MEDC, Strategic Fund, Treasury and audited recipients.
- Potential cost-savings to the state if recoveries are substantial; possible short-term administrative costs to implement audit processes and follow-ups.
For more detail
- Bill text amends 2018 PA 540 and cites SOAR statutory provisions (Michigan Trust Fund Act Sec. 4 — SOAR: MCL 12.254; Michigan Strategic Fund Act Secs. 88s & 88t — MCL 125.2088s and 125.2088t).
