Olive Branch Approves “Bridge Loan” to Help Pay Bills
(Olive Branch, MS) Budgets in cities all over Mississippi get tight this time of year.
That’s why many look to do a little creative financing.
But most taxpayers haven’t a clue it’s going on.
”Something I really don’t’ know about to tell you the truth,” said Sharilyn Clifton, who adds she’s very familiar with borrowing money until payday.
That’s not much different than what a lot of cities like Olive Branch do this time of year.
”We’re at the point right now where that revenue stream has been rather low over the last few months and it’s getting ready to ramp up and we want to make sure there’s money in the bank to pay the bills,” said Olive Branch Mayor Sam Rikard.
Problem is, property tax money doesn’t start coming in until February or March, and by late December or January, cities’ bank accounts get awfully low.
In big business, they call what Olive Branch is doing, a “bridge loan.”
That means getting money to tide you over until payday.
Olive Branch Aldermen gave the city permission to borrow up to one million dollars from the city’s gas utility fund.
Some cities even borrow from banks.
Mayor Rikard says there’s a good chance he won’t need that much, ”In this case, we may not have to borrow a dime. We asked for the authority last year to borrow two million and we ended up borrowing $450,000 for two to three weeks.”
In the unlikely event tax money doesn’t come in, taxpayers would be on the hook but in a town the size of Olive Branch that almost never happens.
”I guess if the government was borrowing money and paying themselves back, I don’t see why it would be a problem” said Clifton who calls it ‘good financial management.’