Michigan’s Emergency Manager Law Repeal Headed for Ballot

By: - August 6, 2012 12:00 am

The Michigan Supreme Court has resolved a dispute about whether opponents of the state’s emergency manager law had used the correct type size on their ballot initiative petitions, which was challenging their validity. In a 4-3 ruling Friday (August 3), the court ruled that the question to repeal  the 2011 law can go on the Nov. 6 ballot.

The ruling means that the law will be suspended until a vote can be taken once the measure is certified for the ballot, as required under state law. That is expected to happen this week, reports the Detroit Free Press.

“While I fully support the right of all citizens to express their views, suspension of the Local Government and School District Fiscal Accountability Act may adversely affect Michigan communities and school districts mired in financial emergencies. It promises to make eventual solutions to those emergencies more painful,” Governor Rick Snyder said in a statement released Friday after the ruling.

What the suspension of the law means until the election is up for debate and will likely involve further court battles. After the measure is certified for the ballot, the governor, the attorney general and other administration officials contend that current state emergency managers will be reappointed under a previous law that allowed for state oversight of financially distressed localities for the 21 years before the new, more powerful law was passed.

Under this scenario, the emergency managers currently placed in the four cities and three school districts under state oversight will be governed by different processes and lack many of the powers given to them by the 2011 law, including the power to modify union contracts and privatize services. Everything they have done to this point will remain in place. There are also three cities operating under consent agreements, including Detroit, and the terms of their state oversight will be affected as well.

Opponents of the law argue that once the measure is certified for the ballot, the previous law allowing for state oversight will be suspended as well and all current emergency managers must be sent home immediately until a vote is taken. “Our position is that the emergency manager law in Michigan is dead until such time as there’s an election in November and people either vote it in or vote it out,” said Herbert Sanders, the lead attorney for the group pushing the repeal, told the Detroit Free Press.

Opponents of the law are also hoping that at least some of the actions taken under the current law will be voided, including the imposition of labor contracts on Detroit city employees.

Administration officials are urging the legislature to pass a replacement statute that provides many of the same features of the new law to clear up the confusion and provide continuity for the localities and school districts operating under state oversight.

Former State Treasurer Robert Kleine, who oversaw the state’s program under the milder version of the law from 2006 to 2010, told Stateline that he believes many of the changes included in the 2011 revision of the law were necessary in order for the state to provide effective oversight.

He says he hopes the courts uphold the law he operated under until a vote is taken. “From a practical standpoint, that is the only thing that makes sense,” he says. “Otherwise it would cause a heck of a mess. It would create a tremendous problem if the emergency managers had to leave their posts. That would be very inefficient.”

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Melissa Maynard

Melissa Maynard oversees the Pew state fiscal health project’s Fiscal 50 online resource, which helps policymakers understand fiscal, economic, and demographic trends affecting their states by tracking tax revenue, reserves, employment rates, Medicaid spending, and other issues important to long-term fiscal health.