Atlantic City makes rest of $8.4M school tax payment

ATLANTIC CITY, N.J. -- Atlantic City made the rest of a tax payment it owed to its school system on Tuesday, hours before a judge was to consider freezing the city's cash until the debt was paid.

At a court hearing scheduled for Tuesday afternoon, the state Education department was to seek an order to force the nearly broke city to pay its entire debt to the schools.

A ruling against the city could force a partial government shutdown.

Last week, the city paid half of an $8.4 million installment that was due to the schools. It paid the remaining $4.2 million on Tuesday.

The city collects money from property taxes, part of which funds the school system.

The city still owes the schools about $25.5 million by the end of the school year.