Wednesday, November 07, 2012

Michigan Banker's Emergency Manager Law Goes Down in Flames

Michigan's toughened emergency manager law rejected

7:11 AM, November 7, 2012
By Paul Egan
Detroit Free Press Lansing Bureau

LANSING — Michigan voters have rejected the state’s toughened emergency manager law, Public Act 4 of 2011.

With 93% of precincts reporting, 52% of state voters said no to keeping the controversial law, while 48% said yes.

The outcome is a blow to Gov. Rick Snyder, who was successful in opposing five proposed constitutional amendments Tuesday, including one that would have required a statewide vote on the proposed public bridge to Canada that he champions.

It also puts in doubt the status of emergency financial managers in Michigan cities and school districts who have been operating under the former law, Public Act 72 of 1990, since Public Act 4 was suspended in August.

And the repeal clouds the issue of the financial stability agreement between the state and the financially troubled city of Detroit, which was approved pursuant to the law.

The group Stand up for Democracy, which pushed for the repeal of the emergency manager law, takes the position that the 1990 law has already been repealed and there is no emergency manager law today.

Snyder argues otherwise, though there has also been discussion of passing a replacement law during the pending lame duck session of the Legislature.

Snyder and state Treasurer Andy Dillon have said the city’s fiscal stability agreement with the state would survive a repeal of Public Act 4, but Detroit Mayor Dave Bing said Tuesday night the emergency manager law “gives us the tool to move our agenda forward,” Bing said. “From my vantage point, if it were to fail, we’d have a problem going forward.”

He added: “There are a lot of people who have a lot of agendas, but I have one agenda, and that’s to move forward.“

Michigan has emergency financial managers in Flint, Benton Harbor, Pontiac, Ecorse and Allen Park and in the school districts of Detroit, Highland Park and Muskegon Heights.

Public Act 4 used the term “emergency manager” for those appointed by the governor to take control of financially distressed cities and school districts. The old 1990 law used the term “emergency financial managers.”

The most controversial aspect of the toughened law was one that allowed emergency managers to amend or scrap collective bargaining agreements under certain circumstances.

Staff writer Matt Helms contributed. Contact Paul Egan: 517-372-8660 or

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