[Note: This is a Repost of an earlier Diary of mine. The only change is in the Title.]
Isn't sad so many folks don't much follow local politics?
If they did, they might have been able to react in time to do something about the warnings, posted by this Public Affairs group in Michigan:
Public Affairs Associates, Lansing, Michigan
PAAdvisory -- March 4, 2011
EMERGENCY FINANCIAL MANAGER REFORM NEARS PASSAGE
Again, while not quite in line with State Treasurer Andy Dillon’s hope for enactment by the end of February, the Senate Committee on Education took a step closer by passing House Bills 4214, 4216, 4217 and 4218, the final pieces of a legislative package to reform the statutes governing emergency financial managers (EFMs) for school districts and municipalities. The action means the House and Senate are now in agreement on the differences that had remained and the package could be bound for the Governor’s desk as soon as next week.
In addressing many of the controversial aspects of the package, including eliminating the measure allowing a private firm to serve as an EFM and altering the powers of an EFM in regard to asset sales (anything over $50,000 and the closure of a school building would now require approval by the State Treasurer), Republicans had hoped to obtain some Democratic support -- a goal not-yet achieved.
Governor Rick Snyder’s budget recommendations include a $471 per-pupil funding cut to school districts as well as cuts to revenue sharing for counties and municipalities -- a proposal that has many close to the issue agreeing that the recommendations, if adopted, could result in a drastic increase in the amount of local governmental units finding themselves under the control of an EFM [Emergency Financial Manager].
Guess what. It passed.
Too many people in Michigan, were too busy just trying to "make ends meet" I guess ...
So WHAT was in this Public Law that empowered Michigan Governor Rick Snyder, with the executive authority to appoint his own Emergency Financial Manager to take over the Financial Affairs of Michigan Local Governments and School Boards?
Hmmm? Good Question ...
House Bill 4218 (2011)
Public Act 7 of 2011 (Effective: 3/16/2011)
Sponsors Al Pscholka - (primary), Tom McMillin
Categories: Cities, home rule; Local government, other
Cities; home rule; reference to local government and school district fiscal accountability act; provide for in the home rule city act.
Amends sec. 36a of 1909 PA 279 (MCL 117.36a).
TIE BAR WITH: HB 4214'11
Fine print please ...
REVISED SUMMARY AS PASSED BY THE SENATE
(Date Completed: 3-18-11) [Governor Snyder signed the Bill 3-17-11]
This document analyzes: HB4214, HB4216, HB4217, HB4218, SB0157, SB0158
House Bill 4214 (S-4) would repeal the Local Government Fiscal Responsibility Act, and create the "Local Government and School District Fiscal Accountability Act", which similarly would provide for the review, management, and control of the financial and other operations of a local government (a municipal government or a school district). In particular, the bill would do the following:
-- Require the Governor to appoint a review team if a finding of probable financial stress were made.
-- Require the Governor to make a similar determination after receiving the review team's report and, following the opportunity for a hearing, confirm or revoke a determination that a financial emergency existed.
-- Require the Governor to declare the local government in receivership and appoint an emergency manager, upon confirmation of a financial emergency.
-- Require the emergency manager to develop a financial and operating plan for the local government.
-- Require the plan to provide for, among other things, the modification, termination, or renegotiation of contracts, and, for school districts, an academic and educational plan.
-- Authorize an emergency manager to reject, modify, or terminate the terms of an existing contract or a collective bargaining agreement (CBA).
-- Allow an emergency manager to order millage elections.
-- Allow an emergency manager to take certain actions with respect to a municipal government's pension fund and board, if the fund were not actuarially funded at a level of 80% or more.
-- Authorize an emergency manager to disincorporate or dissolve a municipal government with the approval of the Governor; or recommend consolidation with another municipal government.
-- Limit the authority of an emergency manager to sell assets valued at $50,000 or more, or to sell a public utility.
-- Require an emergency manager to submit contracts valued at $50,000 or more to competitive bidding, except as authorized by the State Treasurer.
-- Eliminate the salary and benefits of the chief administrative officer and governing body members during a receivership, except as restored by the emergency manager.
-- Provide that the local governing body and chief administrative officer could not exercise any of the powers of those offices during the receivership.
-- Allow an emergency manager to recommend to the Governor and the State Treasurer that a local government be allowed to proceed under Federal bankruptcy law.
-- Exempt a local government in receivership from collective bargaining requirements for five years or until the receivership was terminated, whichever occurred first.
-- Require an emergency manager to adopt a two-year budget for the local government before the receivership terminated.
-- Allow the State Treasurer, in a consent agreement, to grant to local officials the powers prescribed for an emergency manager, except the power to reject, modify, or terminate CBAs [collective bargaining agreements].
-- Provide that an emergency manager would serve at the pleasure of the Governor but would be subject to impeachment by the Legislature as provided in the Constitution.
WOW! ... talk about your Executive "Power Grabs".
The State Treasurer sure does seem to hold a "lot of power" in some of those EMF clauses, especially for those that have to do with the "reassignment of Contracts" -- worth more than $50,000.
I wonder what his story is ... the current Michigan State Treasurer?
Detroit Free Press, Opinion, Commentary
by Andy Dillon -- Mar. 20, 2011
Andy Dillon is Treasurer for the State of Michigan.
The primary motivation for this law was the new fiscal reality facing local governments throughout Michigan and the recognition that the old ways of doing things weren't working. The new approach is not a power grab or an effort to subvert collective bargaining rights. In fact, the goal is to give local executives and their partners the tools and incentives they need to avoid financial emergencies and maintain local control.
The greatest point of contention with this process is that, if local management and their labor counterparts can't or won't make the tough decisions necessary to address financial problems -- and after a number of preliminary steps -- an emergency manager may be given the power to modify or terminate provisions within a collectively bargained contract.
It's in these rare instances, when parties have been unable to compromise, that an emergency manager may be necessary to avoid disruption of essential services or access to a quality education, and it will only be in these instances when this provision of the law should or will take effect.
I have personal experience with instances when the state and individual bargaining units couldn't reach a compromise. Just last year, when the state asked unions to forgo a 3% pay raise, the answer was "no thank you" -- end of discussion. As a result, funding for essential services was cut.
As state treasurer, I hope we never have to appoint an emergency manager. Fortunately, because of the way the law is written, whether this happens will be determined by local officials, not bureaucrats in Lansing.
Huh? ... "determined by local officials" ... What's that, you're saying Andy Dillion?
Perhaps, Andy Dillon, State Treasurer, and final arbiter of many of the clauses in Michigan's Public Act 7 of 2011 -- perhaps he is referring to this one clause in the Act,
that is the sole "EFM Tool" that is still in the hands of the Citizens and Not the State Executives and their Appointees:
-- Authorize the review team to sign a consent agreement with the local government's chief administrative officer, and provide that a consent agreement could include a continuing operations plan or a recovery plan.
SOOO ... the Local Administrator "must consent to" the EMF Agreement, before it can proceed?
THERE MUST BE A "CONSENT AGREEMENT" -- with the Local Administrative Officer, in order for the Emergency Financial Manager to get their dismantling show on the road.
Michigan Citizens, I would strongly suggest you Find out who your "local government's chief administrative officer" is --
and then proceed to give that "local elected official" a good piece of your mind, BEFORE they decide to "sign on the EFM dotted line" ...
AFTERWARDS, it will be too late;
It will be all over, but for the shouting. and heartache. and regret. and the local worker pain.
Consenting to this Conservative CEO Power Grab, is the very LAST THING we should be doing.