An audit conducted by State Auditor Diana DiZoglio’s Office has brought to light a series of missteps in the Massachusetts Growth Capital Corporation's (MGCC) handling of the COVID-19 Small Business Relief Grant Program (SBRGP). The MGCC, rooted in the state’s Executive Office of Economic Development since 2010, plays a crucial role in enabling small businesses via loans and managerial support. Their bread and butter includes collaborating with institutions and nonprofits to finance projects that offer job opportunities, especially in economically underprivileged areas within Massachusetts.
DiZoglio’s audit, which delved into activities from March 1, 2020, to June 30, 2022, uncovered that the MGCC didle out grants exceeding their contractual limits set by the EOED, prompting concerns over misappropriation of taxpayer funds and diminishing resources for other initiatives. Particularly concerning was the inconsistent application of priority scoring for applicants serving key demographics, such as people of color, women, and veterans. This means not everyone who may have been eligible for expedited grant receipt under the contract's terms necessarily got their due, and some might have missed out altogether if the funds ran dry.
Faults included offering grants to ineligible entities, which could lead to misallocation of taxpayer money and reduced funding for state programs. Employee oversights involved a lack of information security training for those handling SBRGP funds, delays in report filings, and inaccurate reconciliation of received funds. "The Massachusetts Growth Capital Corporation is an important resource for our small businesses, including those that are BIPOC-owned, women-owned, veteran-owned, and Gateway City-based," Auditor DiZoglio stated. "These findings reveal a need for this administration to right the wrongs that occurred under the previous administration to better serve our communities and protect taxpayer dollars," she added. According to the Massachusetts official website, the MGCC has committed to improving the highlighted areas. DiZoglio’s team is set to review progress in approximately six months.
