State offers Benton Harbor schools 4th emergency loan in 4 years, this one is the largest

May 23, 2016

The state is giving Benton Harbor Area Schools another emergency loan.

The southwest Michigan school district of roughly 2,200 students has already received more than $5 million in emergency loans from the state’s Emergency Loan Board. A Michigan treasury department spokesman says last week the appointed board approved another one, this time for $3.3 million, making it the largest loan the board has given the district so far.

BHAS got emergency loans in September 2012 and December 2013. It got a third in July 2015, after lawmakers increased the amount of money the Emergency Loan Board could lend schools.

Benton Harbor schools will use the money from this loan to settle court cases, the spokesman said. Two companies sued the district last year because they said they had not gotten paid for janitorial and bussing services they provided.

The district’s general fund has a more than $14 million deficit, according to the latest audit. It’s been under a financial emergency for almost two years.