JEFFERSON CITY, Mo. (AP) — A state audit says more than $7 million in funds meant for Missouri highways was improperly spent by the state transportation department.The report released Thursday says the Department of Transportation used nearly $3.8 million of road funds for safety grants to local entities.It says the department also spent nearly $1.9 million from road funds to settle employee discrimination lawsuits, and paid nearly $1.5 million to employees on administrative leave who were subsequently laid off.The department said that spending was within its rights, but it would try to find other funding sources for some expenses.The audit comes as the transportation department has been warning of a funding shortfall that will prevent it from adequately maintaining all of Missouri's roads and bridges.