Former Bay City Civic Leader Sentenced in Scheme That Bankrupted Historic State Theatre

A Michigan man whose financial misconduct pushed the historic Bay City State Theatre into bankruptcy has been sentenced to federal prison, marking a sobering chapter for one of the region's beloved cultural institutions.

Michael Bacigalupo, 64, of Essexville, was sentenced to 24 months in federal prison by U.S. District Judge David M. Lawson, according to a report from Click On Detroit citing the U.S. Attorney's Office for the Eastern District of Michigan. He was also ordered to pay $196,641.17 in restitution to the Bay County Historical Society and $151,000 to the Bay City State Theatre or its successor, followed by two years of supervised release.

Between June 2020 and November 2023, Bacigalupo simultaneously held three significant civic positions: Director of the Bay City Downtown Development Authority, Chief Operating Officer of the Bay City State Theatre, and Executive Director of the Bay County Historical Society. Prosecutors say he leveraged those overlapping roles to redirect non-profit funds toward an unauthorized renovation of the Wenona Park Bandshell.

According to the report, Bacigalupo secured an $800,000 loan from the Bay County Growth Alliance using the State Theatre building as collateral, falsely claiming the theatre's board had approved the transaction and submitting fabricated board minutes to support the claim. He funneled the loan proceeds into the bandshell project, made partial repayments totaling $277,000, then stopped - leaving a balance of at least $523,000. Saddled with a debt it had never authorized, the State Theatre was forced to declare bankruptcy.

The Bay County Historical Society fared no better. From November 2020 through January 2022, Bacigalupo diverted $231,541 of the society's funds to the same bandshell project, manipulating accounting records and creating phony contractor invoices to cover his tracks. The organization had to halt planned museum renovations and lay off staff as a result.

Bacigalupo also obtained approval for a $900,000 grant from the Michigan Economic Development Corporation by misrepresenting both the purpose of the funds and the identity of the applicant, the report said. When the agency asked for documentation to release the first $450,000, he produced falsified invoices and records - and the grant was ultimately withheld.