Feb 27, 2020
Write-off of funds owed to Michigan fund by Cherry Growers Inc. reported

The state of Michigan is out nearly $2.3 million after it ran out of options to recoup a performance-based grant from a northern Michigan company that went under.

According to a report by, the loss became official on Tuesday, Feb. 25, when the Michigan Strategic Fund Board voted to write-off $2,288,363 that it will not recover, according to state officials. Cherry Growers Inc. in Grawn, Grand Traverse County, filed for Chapter 11 bankruptcy before it paid back any of a $2.5 million performance-based state grant it received in 2012, the state said.

Circumstances that led to the bankruptcy include failed apple and cherry crops in 2012 coupled with a large capital investment that same year; the $2.5 million MSF grant was part of the capital investment funding, according to an MSF document explaining the write-off.

MLive reported Cherry Growers filed for bankruptcy in 2017, the document said. MSF, part of the Michigan Economic Development Corporation, eventually collected $211,637.20 on its $2.5 million claim in the bankruptcy proceedings.

“The MEDC has a strong compliance process that identifies and tracks defaults under the various programs,” said Otie McKinley, MEDC communications manager. “Sometimes the result is a write-off of the funds owed to the MSF, which is only after we have exhausted all other options for repayment and claw back.”

“In this particular case, it was a performance-based grant, so while the company is required to meet the milestones in order to receive the disbursements, sometimes there are variables outside of their control that impact their performance,” he added.

For more on the MLive report, visit

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