MUSKEGON, Mich. — The attorney for the city of Muskegon has issued his opinion on the city's purchase of gift cards as a "Coronavirus Economic Relief Program."
The 116-page opinion includes receipts for the purchase of $195,000 in gift cards city staff made from 37 Muskegon establishments in March.
The purchases were made between March 2, 2020 to July 10, 2020. The 37 purchases were between $3,000, and $7,000.
According to city leaders relief program was meant to provide immediate support downtown restaurants impacted by the coronavirus and the state's stay home order.
In July, members of Muskegon Citizens For A Strong City began asking city leaders to provide the public with additional information on the purchases.
Those inquiries, and others questions during city commission meetings lead to a review of the purchases by the city's attorney.
The review determined funds to purchase the gift cards were taken from the city's public improvement fund. According to the attorney the purchase of gift cards to support local businesses "cannot be justified," from that fund.
Muskegon Mayor Stephen Gawron tells 13 ON YOUR SIDE the expenditure has since been shifted to the city's economic development fund, which according to the attorney's opinion is an appropriate fund for the expenditures.
The review also found City Manager Frank Peterson did provide notice to City Commissioners by e-mail that gift card purchases would be made as part of a Coronavirus Economic Relief Program, but a procedural error was made because the City Commission never authorized the expenditure.
City attorney John Schrier's opinion letter suggests city leaders review and revise the city's purchasing policy.
Attorney Schrier also provided city leaders with guidance on how the gift cards can and cannot be used. It's his opinion gift cards cannot be given to local charities. The gift cards can however be sold, used to provide food for election workers, or given in lieu of cash as part of a city employee's compensation. Schrier also provided city leaders with several other very specific ways the gift cards can be distributed.
Mayor Gawron tells 13 ON YOUR SIDE any missteps in the "Coronavirus Economic Relief Program," will result in a review of polices and procedures.
The city remains in possession of $192,000 in gift cards.
►Make it easy to keep up to date with more stories like this. Download the 13 ON YOUR SIDE app now.
Have a news tip? Email news@13onyourside.com, visit our Facebook page or Twitter. Subscribe to our YouTube channel.