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Snyder signs emergency financial manager law

BY KATIE BURKE

Published December 31, 2012

After a heated state-wide debate that began with the passage of Public Act 4 in March 2011, Republican Gov. Rick Snyder gave the final word Friday on emergency financial manager legislation.

The law was passed after Michigan voters repealed Public Act 4 on Nov. 6. It is one of approximately 282 that were passed by the state legislature during an unusually active lame-duck session.

The signed bill differs from the previous EMF legislation by allowing communities to choose between declaring bankruptcy or allowing a financial manager to be appointed by the state. The law is set to go into effect Spring 2013.

Part of the bill prevents the possibility of voters challenging it via referendum, protecting it from the fate of Public Act 4.

Snyder said in a statement that the legislation is vital to Michigan's recovery.

“These new laws recognize the vital importance of financially stable, economically vibrant communities to Michigan’s future,” Snyder said.

He added that continued change and "meaningful reforms" in local administration is beneficial to the state’s progress.

State Representative Jeff Irwin (D – Ann Arbor) said the passing of the law is a direct affront to the Michigan voters who defeated Proposal 1 in November.

“(If) the citizens reject an issue at the ballot box and then one month later the governor goes and re-signs the same legislation, I think there are going to be a lot of voters who take that as disrespectful,” Irwin said.

He said the added component of the bankruptcy option is not a plausible alternative for communities in financial distress, since a bankruptcy judge would fill a similar role to a emergency financial manager.

“I think the inclusion of that choice in the legislation is probably for show,” Irwin said. “The whole purpose of the emergency manager legislation is to divert communities from bankruptcy.”

Irwin predicted that Snyder’s approval is likely to decline. In addition to other controversial bills he signed during the hurried session, including right-to-work legislation, there was little analysis of the new law or conversation with the voters who initially rejected it.

“The governor will take a popularity hit,” Irwin said.