A recent report by the Alabama Policy Institute's new Alabama Department of Government Efficiency (ALDOGE) claims Innovate Alabama awarded millions of taxpayer dollars to companies statewide promoting diversity, equity and inclusion (DEI) initiatives.
Innovate Alabama, a private entity, uses public funds to represent the state's tech sector. The organization focuses on entrepreneurship and fosters business development.
Innovate Alabama awards grants, tax credits and small business credits.
The API listed 236 recipients awarded over $107 million. The API reported that several recipients are for-profit companies, and those must be female or African-American-owned.
API president Stephanie Smith said the organization's mission does not always align with its results.
"Only 200 of those organizations have any information whatsoever online," Smith told "Rightside Radio's" Phil Williams. "And a decent amount of that money is being used to promote DEI."
An example Smith used was a massive $5.9 million tax credit to Bronze Valley, a non-profit based in Birmingham.
"The largest amount that went out this year was $5.9 million to a group called Bronze Valley Venture Capital, specifically to promote diversity and inclusion in the field of technology," Smith explained.
"When you pull up their website, 'Bronze Valley,' it is very specifically directed toward DEI kind of principles," she revealed.
Smith questioned why some restaurants and food shops are on the list, including a convenience store that received an over $1 million loan.
"So, taxpayer dollars went to, were funneled to this Innovate board. The Innovate board decides, and their staff, because they have pretty large staff, decides where that money goes with the influence of those on the board, I'm sure," she said.
"And then that money is then, in turn, either used for something like building a convenience store or building a new kitchen in the back of your Mexican restaurant, or it is then redistributed again in a third layer for something like this Bronze Valley Venture Capital.
"They're taking money off the top for, you know, to use for their actual business, but then they're also redistributing that to promote diversity and inclusion," Smith said.
Several on the list were awarded federally-funded State Small Business Credit Initiative loans that must be paid back.
While she believes some recipients are worthy of the grants, Smith said more information needs to be available to taxpayers.
"There's no accountability to the taxpayers about whether or not this money is used wisely," Smith said. "And there's no accountability to the taxpayers on jobs."
"Economic development funds shouldn't be used to prefer certain businesses that have little bearing upon statewide success," the report by the API stated. "Economic development funds should have accountability measures to ensure proper use of taxpayer funding. Economic development funds should be clawed back if the monies aren't used for a promised or proper purpose."
"Innovate Funds — taxpayer dollars — are being misused for the promotion of certain businesses without any accountability," it continued.
The state contributes around $20 million annually for investment programs, loans and initiatives for Innovate Alabama. Some of those programs offer help for "underrepresented groups including women, minorities and rural founders."
The Innovate Alabama Board decides where the money goes for grants. The board includes Gov. Kay Ivey, Finance Director Bill Poole, Workforce Sec. Greg Reed, House Minority Leader Anthony Daniels (D-Huntsville), State Sen. President Pro-Tem Garlan Gudger (R-Cullman), State Rep. Danny Garrett (R-Trussville), Senate Minority Leader Bobby Singleton (D-Greensboro), among others.
The full list of funding compiled by the API can be read below.
Innovate Data by Erica Thomas on Scribd
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