Benton Harbor Mayor Marcus Muhammad is calling for city commissioners to approve the emergency transfer of $420,000 in income tax money to the general fund so the city can continue to pay its regular bills.
The city commission on Monday voted against the transfer, five to four, with some members demanding a thorough explanation from the city manager of how the dollars will be used. Speaking at a press conference Wednesday, Muhammad said the funds would be used to pay the contractor running the water plant, the trash collectors, and all kinds of other contractors the city owes money to.
“And if those bills are not paid, if we don’t pay those types of contractors, then that will bring our local government to a screeching halt,” Muhammad said.
Muhammad said money — including state revenue sharing dollars — expected to come in over the next few months will be inadequate to meet all of those obligations.
“State share revenue, which will be receiving that in the next couple months in April, is only $330,000, which has shrunk considerably.”
However, Muhammad said when things like trash collection and marijuana tax revenue eventually start to roll in, the city will be on more secure footing.
“The $420,000 will allow for us to continue to operate seamlessly until we begin to get more revenue in.”
Muhammad said the city traditionally runs into cash flow problems this time of year. He added the city income tax has enabled Benton Harbor to weather periods like this.
The city commission has a special meeting scheduled for tonight to further discuss the transfer. Muhammad is not expected to be there because he’s in Lansing meeting with Governor Gretchen Whitmer.
