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With $2.3 million state loan, Benton Harbor emergency manager prepares an exit

Benton Harbor City Hall pictured in the summer of 2011.
Lindsey Smith
Michigan Radio
Benton Harbor City Hall pictured in the summer of 2011.

Benton Harbor’s emergency manager is planning his exit. That’s after the state agreed to loan the city more than $2 million.

When Benton Harbor officially began its financial emergency, Jennifer Granholm was the governor. During the last four years, the city has operated under three different versions of Michigan’s emergency manager law. That’s how long it’s been.

“It would be a fair assessment to say this is a big deal,” emergency manager Tony Saunders said. He’s only been in Benton Harbor for one year.

“It’s been a very long year,” Saunders said. He praised city staff for their efforts. “They’ve done an excellent job at making this happen and they’ve sacrificed a ton. This is a little bittersweet for me to move on but yet complete the job at the same time,” he said.

With this new state loan, the city can pay off vendors, restructure some debt and operate in the black. City commissioners voted narrowly against the plan,but did not present an alternative to the state's Emergency Loan Board that made the decision Tuesday.

Before he goes, emergency manager Tony Saunders says he’ll hire a new city manager.

He’ll issue executive orders to try to keep the city commission from facing the same problems that got the city into the mess in the first place. One example, Saunders said, would be to mandate regular contributions to the pension fund. Another may be to change the reporting structure of city staff.

“We want in general make sure that we safeguard the city from future failure or to try to mitigate that potential as much as possible,” Saunders said.

“They’ve had an emergency manager for some time now. So it would be a little naive to think that once the emergency manager leaves, the public body is ready to take the reins back. So we want to make sure that we’re allowing a proper transition,” Saunders said.

Gov. Rick Snyder would have to approve Saunders’ recommendation that the financial emergency is over. If that happens, the governor would appoint a board to help with the transition back to local control.

Lindsey Smith helps lead the station'sAmplify Team. She previously served as Michigan Public's Morning News Editor, Investigative Reporter and West Michigan Reporter.
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