Mar 4, 2026 By Garrett Neese 4 min read

State Rep. Charity Grimm Krupa formally requested an audit and investigation by several state agencies into the administration of taxpayer funds by the Fay-Penn Economic Development Council after allegations the nonprofit gave preferential treatment to companies affiliated with Fay-Penn officials.

Fay-Penn, Fayette County’s state-designated economic development organization, administers state-supported grant and low-interest loan programs in the area.

“I am not the judge and jury,” Grimm Krupa said on Tuesday. “I just see an issue, and I think that we deserve transparency and accountability, and I’m really hoping that between the attorney general’s office, the auditor general’s office and the inspector general that they’ll do those types of investigations. But they don’t know about things that aren’t brought to their attention.”

She also made a request for an investigation by the state Department of Community and Economic Development.

Grimm Krupa said prior to becoming a state representative three years ago, she had a perception that the organization was “murky” and “always seemed to be developing their own property.” When she took office, she learned it serves as the certified economic development organization for Fayette County.

“Then you realize that millions and millions and millions of dollars in taxpayer funds over the last few decades have been funneled through them,” she said. “And then you learn of these multi-million transactions with board member businesses. It’s really offensive, and it’s really sad, considering the economic decline that Fayette County has been in for decades.”

Fay-Penn had not responded to a message left Tuesday morning seeking comment as of press time.

The new request follows one Grimm Krupa made to the state Attorney General’s office in June 2025, two months after the filing of a whistleblower lawsuit in federal court by Fay-Penn’s former finance director.

Melony Reed of Morgantown, W.Va., alleged she was fired after she reported concerns about conflicts of interest by Fay-Penn board members.

About one month later, she was charged with theft and forgery for allegedly using the agency’s credit cards to pay for about $17,000 in personal expenses. Police contended Reed admitted to buying personal items; however, Reed denied that allegation in filings related to her lawsuit.

In the suit, Reed claimed she raised concerns that Fay-Penn awarded specialized loans to board members, ignoring requests from others who would have qualified. The suit contended about 30% of the loans went to external candidates, while the remaining 70% were handed out internally or to board members.

In October 2024, after she reported her concerns to management at the agency, Reed was placed on leave, and ultimately fired, the lawsuit alleged.

Neither the civil case nor the criminal case has been resolved.

Grimm Krupa cited IRS Form 990 disclosures filed over several years reflecting loans to and from “interested persons,” including businesses listed as being owned by directors.

In the 2023 filing, the most recent available, Fay-Penn listed three loans to director-owned businesses totalling $905,837, as well as a $9.2 million transaction with Fairchance Construction, a firm owned by a board member. That loan was part of more than $20 million in transactions involving Fay-Penn and Fairchance documented in the forms, Grimm Krupa said.

The lawmaker hoped the agencies would use their oversight powers to investigate whether Fay-Penn had properly reported everything they are required to disclose, and whether they’re following proper bidding processes for contracts.

In a release issued Monday, she called for a comprehensive audit of state-administered funds distributed through Fay-Penn. She also asked the departments to look at related-party transactions and board member financial interests, and look at whether Fay-Penn complied with conflict-of-interest regulations and documented recusals.

The state attorney general’s office indicated to Grimm Krupa that it could not comment on pending investigations, or if there was one underway, she said. Grimm Krupa questioned Attorney General Dave Sunday and DCED Secretary Rick Siger about the Fay-Penn situation in general terms during recent budget hearings. In a portion of the hearing posted on Grimm Krupa’s Facebook page, Siger said he would respond to specific questions about Fay-Penn in writing, However, he said would not make “hypothetical blanket statements” about organizational actions benefiting member-owned businesses, though

“Although (Sunday) could not comment on the investigation, he absolutely confirmed and stood with conviction that those types of allegations, his office takes them very seriously, and Secretary Sagar refused to even acknowledge that,” she said.

She hopes the investigations will determine whether Fay-Penn violated grant conditions, procurement standards or state laws.

“If they do their investigations and say, ‘Hey, they did not violate the law,’ then I think you have to have faith in the system as it exists,” she said.