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[Note:  This is a Repost of an earlier Diary of mine. The only change is in the Title.]

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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?


Andy Dillon: Emergency financial manager would be put in place only if necessary

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?

How so?

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.



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Comment Preferences

  •  Tip Jar (30+ / 0-)

    I don't plan to make a habit of reposts,

    but commenters mentioned, my earlier Title,

    [The Tools in the Toolkit of the Emergency Financial Manager, Minus One.]

    hardly suited the importance of the material.


    Here's to reaching the Target Audiences.


    Got Time?
    Take ten, to find something else informative and fun to read. Thx.

    by jamess on Tue Apr 19, 2011 at 07:09:06 PM PDT

  •  This is a Big Fucking Deal (12+ / 0-)

    It's worth reposting once in the morning and once in the evening.

     This represents eminent domain on steroids and crystal meth.

    ~a little change goes a long way~

    by missliberties on Tue Apr 19, 2011 at 07:22:18 PM PDT

    •  I thought so too (6+ / 0-)

      BFD in the total "range of possibilities" and

      as far as those corrective actions can go.


      And if you read the intro article, that group interpret Public Act 7, as regard to the sale of public assets:

      ... altering the powers of an EFM in regard to asset sales 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).


      Earlier today, folks were saying we should be calling the State Treasurer, since he is a Democrat,  (in theory)

      and voice our concerns with the EFM process
      (that according to him "is rarely to happen".)


      thx missliberties for the interest, and feedback.


      Got Time?
      Take ten, to find something else informative and fun to read. Thx.

      by jamess on Tue Apr 19, 2011 at 07:47:42 PM PDT

      [ Parent ]

  •  jamess - can an EFM be appointed (3+ / 0-)
    Recommended by:
    jamess, jolux, Eric Nelson

    even if the political entity has passed a balanced budget in a timely manner?

    "let's talk about that"

    by VClib on Tue Apr 19, 2011 at 07:27:22 PM PDT

    •  not sure (4+ / 0-)
      Recommended by:
      VClib, hopeful human, jolux, Eric Nelson

      first there must be a finding of "probable financial stress" by a "review team" ...

      -- Require the Governor to appoint a review team if a finding of probable financial stress were made.

      there's no telling what sort of "creative math" the review team will be using

      -- and they are also appointed by the Governor, I believe.


      Got Time?
      Take ten, to find something else informative and fun to read. Thx.

      by jamess on Tue Apr 19, 2011 at 07:39:19 PM PDT

      [ Parent ]

      •  Yes appointed by the Governor (3+ / 0-)

        This is such a clear violation of the peoples will.

         I say this violates the Constitution of the United States of America.

         It is also kind of a double dog dare for Federal Intervention, which sets up the framing for States vs the Feds, just like during the Civil War.

         Yes I do believe Republicans are that evil.

        ~a little change goes a long way~

        by missliberties on Tue Apr 19, 2011 at 08:03:33 PM PDT

        [ Parent ]

        •  missl - I am not a lawyer or constitutional expert (1+ / 0-)
          Recommended by:
          jamess

          But from what I have read all of these issues with local cities, towns and counties are governed by the state constitution and there is no federal constitutional issues. Apparently the state can just eliminate cities if the state constitution allows it. The counties, cities and towns are creations of the state which can take them away as easily as they were formed.

          "let's talk about that"

          by VClib on Tue Apr 19, 2011 at 09:35:29 PM PDT

          [ Parent ]

    •  I think there are all kinds (3+ / 0-)
      Recommended by:
      jamess, jolux, Eric Nelson

      of ridiculous parameters for a city not meeting it's debt obligations and being subject to the being dissolved by the State Governors appointed Czar.

      ~a little change goes a long way~

      by missliberties on Tue Apr 19, 2011 at 08:00:13 PM PDT

      [ Parent ]

  •  Tipped and Rec'd again. (5+ / 0-)

    Just as excellent the second time. ;)

    I hope more people see/read it.

    •  thank you Marjmar (4+ / 0-)
      Recommended by:
      Marjmar, jolux, Eric Nelson, Hector Solon

      I appreciate support,
      again.


      Got Time?
      Take ten, to find something else informative and fun to read. Thx.

      by jamess on Tue Apr 19, 2011 at 07:48:23 PM PDT

      [ Parent ]

      •  Got a "hot list"... (0+ / 0-)

        ... from me and Lord knows don't hit that button much.

        Like the fact that you are into the language though, it might be very interesting to see if any of the phases and/or concepts can be traced now to WI government docs, like the bill summary. Lot of work, but that would be great if they could be linked. Also look at the legal firm Foley & Lardner, they wrote bills in WI, and they are one of the firms behind the EFM law in Michigan too (they wrote stuff about what to change in PA 72 anyway). Slick bastards, those folks.

        See comment below for more praise and a couple tips on more stuff.

  •  Tipped, Rec'd and tweeted (3+ / 0-)
    Recommended by:
    jolux, jamess, Eric Nelson

    into the highly active hashtags for #winunion, #madmi and #miunion

    Loyalty to petrified opinion never yet broke a chain or freed a human soul in this world--and never will. Mark Twain

    by whoknu on Tue Apr 19, 2011 at 08:04:08 PM PDT

  •  It's so important that this news is aired. (2+ / 0-)
    Recommended by:
    jamess, Eric Nelson

    Thanks for this well-written diary - keep republishing it until the news is noticed!!

  •  Rachel is calling it "Republican Marshall Law" (1+ / 0-)
    Recommended by:
    jamess

    EMF's..expanding from within their normal stomping grounds - private corporate sector  into "managing" public townships, local governances, everything, they want it all.
    Their first attempt of this recent strategy & target goal for now: Steal Jean Klock Park bequeathed to the people of Benton park MI. from the poor people to build a golf course high end play land for the rich.

    Mayor Virg Bernero of Lansing Michigan puts it:

    "Corporatizing America"

    "Power Grab" is dead nuts on.

    t'd & r'd jamess excellent word out

  •  Super piece of work... (1+ / 0-)
    Recommended by:
    jamess

    ... here. The bill analysis LINK you posted is very important to anyone researching this whole EFM mess. had it marked and downloaded, but never got time to get back to it.

    Great work. Just keep on plugging, there is soooo much yet to reveal in this whole story.

    Here's one: Dillon got $35k (for his 'run' at Dem nomination for Gov) from the Business Leaders for Michigan (look at the BLM origins too) who were, IMHO, the force behind 'picking' Snyder, who wasn't there first pick BTW.

    Couple others (working several items, but not these):

    Dillon's ties to the 9 or is it 11? legal firms behind the EFM training/consulting/services (like SRR -  Bloomberg story), and other ties these firms have to Snyder and others. Take Mr Al Pscholka (former Upton staffer) and those investors that want to build a new 'Bay Harbor' like up at Petoskey in Benton Harbor. The board up there at Bay Harbor (Foundation) has ties directly to Snyder like William Parfet (Snyder's campaign treasurer for example), and dime to a dollar connections back to the Benton Harbor investors (mentioned in Eclectablog and Maddow).

    This is a bottomless pit of stories, good Snyder scandal spelunking!

  •  I've been complaining about this EFM law since (0+ / 0-)

    early March.

    One of my comments from that time:

    From Gongwer:

    The Senate voted this afternoon to pass a controversial package of bills granting state-appointed emergency managers sweeping new powers to run financially troubled local governments and school districts.

    The main bill, HB 4214, passed 26-12. Among other powers, it would enable emergency managers to void union contracts, give academic powers to managers running school districts and authorize managers to schedule millage elections. Municipal emergency managers also would have the power to dissolve or disincorporate the government with approval of the governor.

    Today's session was much more sedate than Tuesday's session that saw the gallery and the rest of the Capitol packed with protesters although there was still some applause by union activists watching while Senate Minority Leader Gretchen Whitmer (D-East Lansing) blasted the GOP.

    The session also saw a rare tie-breaking vote by the lieutenant governor, Lt. Governor Brian Calley, when the Senate split 19-19 on an amendment to cap the salary of emergency managers to no more than the governor's. Seven Republicans sided with all 12 Democrats to force the tie.
    -----------------------------
    These EFMs will have kinglike authority to sell off city/township/school district assets, equipment,  buildings, or land, call for a millage increase, effectively terminate whichever & how many city/township/school district employees they like, and they will charge the city/township/school to do so.  EFM's will have the capability to earn in the $100,000 - $200,000 salary range, that guess who has to pay:  Yep, the city/township/school district receiving the screwing (I mean, services.)  The salary cap that was voted down would have kept the pay of EFMs to below $176,000 a year.

    The state will essentially replace the local elected officials with governor-appointed treasury-dept minions that have NO ties to these communities and that the local citizens DID NOT ELECT TO REPRESENT THEM.

    Can anyone say taxation without representation???  We're forced to pay these EFMs' wages, but we don't get to pick who we get?  Sounds like a dictatorship to me!

    One person can make a difference--and everyone should try. --John F. Kennedy

    by GypsyT on Sat Apr 23, 2011 at 03:14:22 PM PDT

  •  Rec'd and hotlisted (0+ / 0-)

    Thanks, jamess, for putting this info all in one convenient place.

    One person can make a difference--and everyone should try. --John F. Kennedy

    by GypsyT on Sat Apr 23, 2011 at 03:17:52 PM PDT

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