emergency manager

Politics
4:25 pm
Tue April 19, 2011

First legal challenges to emergency manager law

Robert Bobb, Detroit Public Schools emergency financial manager, says the new emergency manager law has already helped him in his role.
Sarah Hulett Michigan Radio

The controversial emergency financial manager law gives broad powers to state-appointed officials who are brought in to help struggling cities and school districts.

It was signed into law last month by Governor Rick Snyder, now, as MPRN's Rick Pluta reports, two Detroit pension fund boards have filed a lawsuit challenging the state's emergency financial manager law. They say the law "illegally threatens contracts and collective bargaining agreements."

Under the law, emergency managers can strip power from locally elected officials and dissolve union contracts.

Pluta spoke with the emergency manager in charge of the Detroit Public Schools, Robert Bobb. He says these legal challenges won't help: 

"Because the legislation as it is is to kind of help escalate the resolution of problems and issues in localities and in school districts and any type of prolonged litigation does not really help advance what needs to be advanced to right the ship," says Bobb.

The Detroit News reports that the lawsuit was filed by Detroit's General Retirement System and the Police and Fire Retirement System:

The law "represents an imminent threat to the constitutional rights of plaintiffs and other members of the Detroit Retirement Systems," the funds' lawyer Ronald A. King wrote in the lawsuit.

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Politics
4:13 pm
Mon April 18, 2011

Officials receive training on new emergency financial manager law

More than 300 local officials and prospective emergency managers are in Lansing today and tomorrow to be trained in the state's new fiscal crisis law.

The law gives sweeping authority to emergency managers named to run school districts and local governments that can no longer pay their bills.

Terry Stanton of the Michigan Department of Treasury says the goal is for the state to intervene earlier to avoid the drastic step of a state takeover.

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Politics
4:05 pm
Mon April 18, 2011

Critics take step toward recalling Gov. Snyder

A group opposed to Governor Rick Snyder submitted language today for a recall petition.  It’s the beginning of what may be a long process. 

The group, Michigan Citizens United, is behind the recall campaign.    Gerald Rozner is the group’s spokesman.  He says Gov. Snyder deserves to be recalled for signing legislation that gives state appointed financial managers broad powers to void city union contracts and plans to increase taxes on pensioners. 

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Politics
11:00 am
Sat April 16, 2011

Benton Harbor EMF takes action

Benton Harbor appears to be the first city to come under a sweeping new Michigan law that allows emergency managers to take almost complete control of municipalities and school districts.

Benton Harbor emergency Manager Joseph Harris issued an order this week preventing city officials from doing anything more than calling meetings to order… adjourning them and approving minutes of meetings.

In other words, their decision-making powers have been suspended.

A financial emergency was declared in Benton Harbor in February 2010 by then-Governor Granholm after the city’s budget deficit grew by double digits.

A state board named former Detroit auditor general and chief financial officer Harris to run the city… with the power to control all spending and renegotiate union contracts.

Union leaders are critical of Harris’ move to take most powers away from city leaders. The AFL-CIO represents administrative workers and others in Benton Harbor.

Politics
10:42 am
Sat April 16, 2011

Emergency Manager of Benton Harbor strips power from elected officials

Main Street in Benton Harbor
Google Maps

Joseph Harris, the state-appointed Emergency Financial Manager of Benton Harbor, has stripped control from city officials.

It's the first time an emergency financial manager has used broad new powers granted to them by state legislators and Governor Rick Snyder.

Harris issued an order "prohibiting all action by all city boards, commissions and authorities, except as authorized by the emergency manager."

Here's the language from the order:

NOW, THEREFORE BE IT RESOLVED AS FOLLOWS:
1. Absent prior express written authorization and approval by the Emergency Manager, no City Board, Commission or Authority shall take any action for or on behalf of the City whatsoever other than:

i) Call a meeting to order.
ii) Approve of meeting minutes.
iii) Adjourn a meeting.

2. That all prior resolutions, or acts of any kind of the City in conflict herewith are and the same shall be, to the extent of such conflict, rescinded.

3. This order shall be effective immediately.

The Detroit News reported that Harris issued the order because the city has been ineffective at governing:

Benton Harbor has struggled with a controversial trash hauling contract, lawsuits related to the contract, new competition for water services and city officials who sometimes clashed to the point that meetings dragged on for hours, Joseph said.

"I have seen for more than 30 years the mismanagement of funds and personnel in the city," Joseph said. "Infighting has been going on for decades."

It probably comes as no surprise that the relationship between Harris and government officials has been contentious.

In 2010, according to South Bend NBC affiliate WNDU , City Commissioner Duane Seats compared Harris to a disease within the city after Harris fired nine police officers, and worked to eliminate the city's fire department:

"Right now there's no cure for him, but I decree and declare that these city commissioners that we have now and with the citizens help we will find a cure. We will find a cure for this disease that we have here in the 49022 that's called Joe must go," said Seats.

In a statement published on the Daily Kos, Michigan's AFL-CIO president Mark Gaffney called the order from Harris "sad for democracy in Michigan": 

"It comes after the announcement of Robert Bobb in Detroit ordering layoff of every single public school teacher in the Detroit Public School system. With the stripping of all power of duly elected officials in Benton harbor and the attack on Detroit school teachers, we can now see the true nature of the Emergency Manager system."

One elected official in Benton Harbor wasn't bothered by Harris' order. City Commissioner Bryan Joseph was quoted in the Detroit News saying, "It doesn't bother me, I'm in favor of it." According to the News, state-appointed emergency financial managers are working in four places in Michigan:

Detroit
11:12 am
Tue April 12, 2011

Detroit mayor warns a state takeover is "inevitable" without union concessions

Detroit mayor Dave Bing dleivers his budget proposal to the city council
(courtesy City of Detroit)

Detroit’s mayor says the city’s unions will have to give big contract concessions or the city of Detroit may end up in the hands of a state appointed Emergency Financial Manager. Mayor Dave Bing outlined his budget plan to the city council this morning.

Bing says pension and health care costs threaten to force the city into insolvency.  

“If we are unable or unwilling to make these changes, an Emergency Financial Manager will be appointed by the state to make them for us.  It’s that simple.”  

The city is facing a $155 million budget deficit. The mayor says that could grow to over a billion dollars in five years, unless deep cuts are made now. 

Michigan’s new Emergency Financial Manager law gives the state appointed administrator broad powers to throw out union contracts and make budget decisions.

Education
9:02 am
Mon April 11, 2011

Rethinking Public Schools

There's been a flurry of speculation lately that perhaps the best choice to replace Robert Bobb as Emergency Financial Manager of the Detroit Public Schools might be ... Robert Bobb himself.

Bobb's contract expires at the end of June. While he has faced endless financial problems, his main frustration during his two-year stint running the schools seems to have been a court decision that his powers did not extend to determining what kids actually learn.

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Education
9:56 am
Fri April 8, 2011

Robert Bobb hints he may want to stay on as Detroit Schools EFM

Detroit Public Schools Emergency Financial Manager Robert Bobb
(photo by Steve Carmody/Michigan Radio)

Detroit schools emergency financial manager Robert Bobb says he's willing to consider staying on the job beyond June in the wake of Michigan's new financial oversight law. Robert Bobb told the Detroit News  editorial page that he's "not lobbying for the job." But he says the "pace of change" possible under the new law is appealing.

Bobb was hired in 2009 by then-Gov. Jennifer Granholm to fix the district's finances. His latest contract was extended through June by Gov. Rick Snyder, who signed a law giving Bobb and other emergency financial managers the right to oversee not just a school district's finances but also its academics. 

Snyder's office says if Bobb is interested in staying he would be among the candidates considered.

Politics
4:22 pm
Thu April 7, 2011

ACLU wants to know more about the genesis of Michigan's emergency financial manager law

The American Civil Liberties Union wants to know more about the creation of Michigan’s Emergency Financial Manager law. The legislation gives broad new powers to managers appointed by the state to run financially troubled cities and school districts. Those powers include voiding union contracts. 

Kary Moss is with the ACLU of Michigan. She says the ACLU is filing Freedom of Information requests to learn more about who wrote the law. 

“This legislation was passed and signed pretty quickly.   And all that we are trying to do right now is get some more information about ‘What prompted it?’, ‘How is it going to be implemented?’, just so the public can have more information."

Moss says they also want to know who was involved in drafting the legislation. 

"Who was really at the table…when it was drafted...andconceived and discussed.”

Governor Snyder says the law encourages cities and school districts to make financial changes, before an Emergency Financial Manager would be appointed.

The governor’s office has not commented on the ACLU request.

Politics
6:38 pm
Wed April 6, 2011

Poll: Most Michiganders dislike emergency manager law

Fifty percent of people in Michigan are opposed to a new law that gives sweeping powers to emergency financial managers overseeing troubled cities and school districts. That’s according to a recent survey commissioned by the newsletter Inside Michigan Politics.

Bill Ballenger is editor of the newsletter. He says most people do not live in areas that would be affected by the new law because their local governments are running smoothly.

“If you ask them, do you want to give the power to the state to come in and completely play Big Foot here and come in and crush your collective bargaining rights, dissolve your municipality, and mandate your millage elections when in fact they’ve been doing everything right, they’re going to say no.”

Ballenger says he thinks misinformation about who the legislation would affect is causing many people to be upset. Governor Rick Snyder’s administration says no more than 10 local governments in the state would be in danger of being taken over by an emergency manager.

Education
6:42 am
Tue April 5, 2011

Meetings in Detroit to detail school closings

The first of several workshops to educate Detroit parents on the schools district’s future plans is scheduled for this afternoon, the Associated Press reports. From the AP:

The Detroit Public Schools' Parents Speakers Bureau will hold the meetings starting Tuesday afternoon at Priest Elementary and Central High. Six other meetings are scheduled through April 14.

Thirty schools are slated to be closed this year and two more in 2012 as part of the district's plan to help eliminate a $327 million budget deficit.

District officials say they hope to turn over 18 of the buildings to charter operators as neighborhood schools. Schools not selected as charters will close. An additional 27 schools also have been identified as possible candidates for charters.

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Politics
5:31 pm
Thu March 31, 2011

Snyder and Republican leaders point to progress and sticking points

Republican Governor Rick Snyder and the Republican leadership in the State House and Senate outlined progress and sticking points.
Lester Graham Michigan Radio

Governor Snyder, House Speaker Jase Bolger and Senate Majority Leader Randy Richardville say they have worked well together to approve many measures so far this year – including the expansion of power for emergency financial managers.

But one area they do not seem to agree on is how and where to reform taxes.

Richardville said "we actually have been disagreeing quite a bit," but he says those disagreements are fine because they are still listening to each other.

"It’s not about disagreement, it’s about passion. Everybody that got elected ran as hard as they could to get here, and is passionate about getting here," said Richardville, "but we have respect for the other passions in the room, so we’re going to get there."

Disagreement over taxing pensions

One area where they disagree is Governor Snyder’s proposal to tax pensions.

Snyder says he stands by his plan, even after receiving a cool reception from many Republican legislators:

"For higher income people, for people who have the wherewithal to say they’re also contributing to our system – I think that’s a fair answer. Because that’s the part of it that is, people shouldn’t just look at what they’re asked to give up, but when you look at where they’re ending up. Are they being treated fairly in respect to the other citizens in our state?”

Governor Snyder often stresses that low-income people on pensions would not be subject to painful tax increases.

Some Republicans state senators say there is no pension tax they would agree to, even one that only focuses on the very wealthy.

Democrats feel left out

Democratic lawmakers say they have been left out of negotiations so far.

Democratic state Senator Bert Johnson says many of the Republican proposals are the reason why thousands of angry people have protested at the Capitol in recent weeks.

"I think we would do well – all of us here in this Legislature – to realize what it being said out on the front steps of the Capitol, what is being said out on the lawns of the Capitol. I think these are not crazy people – these are people who have elected all of us. These are people who go out, and they vote, and they vote in numbers and they’re carrying their concerns to the Capitol."

Johnson says Democratic lawmakers have been ignored in much of the work that has been done so far. He says Snyder will soon find that he needs Democratic votes as he tries to approve parts of his tax plan that are unpopular with Republicans.

Education
7:07 am
Mon March 21, 2011

Detroit schools still face huge deficit after two-years of emergency management

Detroit Public Schools emergency financial manager, Robert Bobb, has until June to come up with a plan to wipe out a projected $327 million deficit
Sarah Hulett Michigan Radio

Even though the district has had a state-appointed emergency financial manager for two years, Detroit Public Schools still face a deficit of hundreds of millions of dollars.

Robert Bobb, the DPS emergency financial manager, was appointed by Jennifer Granholm in March of 2009.

From the Associated Press:

Robert Bobb has spent the past two years closing dozens of schools and firing principals in an effort to fix the failing Detroit Public Schools. Yet, he still hasn't solved the problem for which he was hired — erasing a legacy budget deficit that now stands at $327 million.

Now, in his final months as the state-appointed emergency financial manager, Bobb is proposing several headline-grabbing ideas — including a radical plan to shut down so many buildings that some high schools could see more than 60 students per class — in an attempt to wipe out the red ink.

The AP reports that it's unclear how Bobb might use new powers granted to emergency financial managers under a new law signed by Governor Rick Snyder last week. They say he "continues to push the charter school plan which is the one receiving the most support in the city at the moment — even from the school board."

Politics
5:16 pm
Thu March 17, 2011

Union workers boo governor at Ford event

Ford asembly line workers Jerome Harris Sr., left, and Bille Rowe were among those who wore red T-shirts in solidarity with other Midwest union members.
Sarah Hulett Michigan Radio

Governor Rick Snyder was greeted with boos at an event to celebrate the launch of the new Ford Focus today.

Workers at Ford’s Michigan Assembly Plant wore red T-shirts to show their solidarity with union workers whose collective bargaining rights are threatened.

Snyder says he wasn’t rattled by the reception.

"I respect people for having differing opinions, particularly when you’re talking about fundamental change."

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Politics
4:26 pm
Thu March 17, 2011

Snyder hopes Emergency Manager law will help struggling cities and schools avoid takeovers

Michigan Governor Rick Snyder (R)
(courtesy of the Michigan governor's office)

Governor Rick Snyder says he expects teams of financial experts will soon start visiting cities and school districts showing early signs of financial stress. That’s part of the new state’s new fiscal emergency law he just signed.

Critics say the law gives too much authority to emergency managers appointed to run local governments that can no longer pay their bills. But the governor says too little attention has been paid to the early assistance the state is offering to local governments. 

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Politics
3:36 pm
Thu March 17, 2011

Democrats want to put collective bargaining right in state constitution

St. Sen. Bert Johnson, Detroit (D)
(courtesy of the Michigan State Senate, Democratic Caucus)

Democrats in the state Legislature want to voters to decide whether collective bargaining rights should be protected in the Michigan Constitution. But they will need a two-thirds majority in a Republican-led House and Senate to get the question on the ballot.   

State Senator Bert Johnson says without a constitutional amendment, collective bargaining rights are subject to change. 

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Politics
5:00 pm
Wed March 16, 2011

Snyder to sign Emergency Financial Managers bills at 5:30pm

Michigan Governor Rick Snyder (R)
(courtesy of the Michigan governor's office)

Governor Snyder’s office has just announced he plans to sign the controversial Emergency Financial Manager bills this afternoon. Unions oppose the bills, because they will enable state appointed financial managers to void union contracts in cities and school districts with serious financial problems.

State Legislature
4:30 pm
Tue March 15, 2011

Item pricing repeal and emergency manager bills clear legislature

Lawmakers moved on the item pricing and emergency fincancial manager bills today.
Lester Graham Michigan Radio

Two controversial measures have cleared the Michigan Legislature and will soon await Governor Snyder's signature.

One would repeal the law that requires store owners to put price tags on most items in their stores, and the other would grant sweeping power to emergency financial managers.

Republican Senate Majority Leader Randy Richardville says he agrees with Governor Rick Snyder that Michigan’s item pricing law is outdated, and it’s time to allow retailers to upgrade their systems.

"I've been a proponent for, I don’t know, most of my career I’d say," said Richardville.

Once signed into law, store owners will soon no longer be required to put price tags on almost every item on their shelves.

Richardville says removing price tags will not hurt customers or confuse seniors:

"I don’t think anybody’s trying to maliciously cheat senior citizens. I think if the market demands such, people will make it easy to see what the prices are. Whether it’s individual item pricing, or something different, I think the store owners are pretty responsive to their customers," said Richardville.

Democrats say price tags protect consumers from being overcharged in checkout lines.

The item pricing vote fell mostly along party lines, but that wasn’t the only partisan bill moving through the Legislature.

The Republican-led House also gave final approval to a proposal that gives more authority to emergency managers of cities, townships or school districts.

The legislation passed on party-line votes.

Democratic House Minority Leader Rick Hammel says there are many "union-busting" pieces to the emergency manager bills, including elimination of collective bargaining rights at the local level.

"And on top of that, doing away with contracts of other folks that are just doing business with the local unit of government, so a lot of things that are really problematic for us in this," says Hammel.

Democrats railed against the measure for eliminating collective bargaining rights for public employee unions.

Representatives for the labor movement say they will be at the Capitol all week protesting those and other Republican proposals.

State Legislature
6:48 am
Mon March 14, 2011

Protests to continue at state Capitol

Protests are expected to continue at the state Capitol this week as lawmakers debate local takeover bills
Thetoad Flickr

More protests are expected this week at the state Capitol as lawmakers continue to debate new rules for cities and school districts that run into trouble paying their bills.

The controversy is one of the first big showdowns between Republicans and Democrats this year over government reforms.

Unions and Democrats have pretty much given up on trying to stop the measures. They’ve turned their efforts to limiting its scope to protect bargaining rights, as well as cap emergency manager salaries, and require them to periodically meet with the public – so far without any luck.

Doug Withey is a Teamsters bargainer.

“Every community in the state, every governing body has an open meeting. Have the public involved with that. Nope. Not reasonable. Vote it down.”

But Republicans like Senate Majority Leader Randy Richardville say an emergency takeover would be the last option after all else has failed.

“The intent of the legislation is to get into an emergency situation and fix it before it becomes a catastrophe.”

Governor Rick Snyder says his goal is not more state takeovers.

 “Anytime you have an emergency manager come in, that’s a failure point. The best answer is to put in a better early-warning system – to figure out how to work with communities before they reach the point of needing a financial manager because a lot of things can be done in those earlier stages to avoid the issue and that’s the best answer.”

Right now, Richardville, Governor Snyder and Republicans have the numbers they need in the Legislature to prevail.

Politics
4:50 pm
Fri March 11, 2011

Unions say EFM bills bad for teachers

The scene in Lansing, from February 26
User P.E.C. Flickr

A teachers’ union leader says a proposal in the Legislature to give emergency financial managers sweeping control over school districts is a bad deal for educators.

The Michigan Senate approved the bills this week that would dissolve union contracts and eliminate collective bargaining rights at the local level if an emergency manager were put in control of a school district, city or township.

David Hecker is vice president of the Michigan division of the American Teachers Federation union. He says many financial problems can be better addressed through collective bargaining.

Hecker appeared on public television’s “Off The Record.”

“It either eliminates or severely undercuts collective bargaining – so it hurts the middle class – and it also hurts education. Because, you know, the problem with the EFM bill is if it’s an issue – and it’s an issue, there are districts and there are cities who are in financial difficulties – but you just don’t throw out a solution. You figure out what the problem is, and then you craft a solution.”

“We rather Governor Snyder work with us, we all work with the Legislature, and we work in support of communities, we work in support of the middle class, we work in support of our students. We think the EFM bill works against communities, works against the middle class, and is not good for our students. So Governor Snyder has a choice. We rather work together than become Wisconsin.”

“If people think we need this hammer to come to the table to say ‘yeah, health care costs are increasing, we have to address it. The school district’s in debt, we have to address it,’ we already do that at the table. You know, what do you say to a secretary of Detroit Public Schools who makes 22-thousand dollars a year and just took a three-percent pay cut?”

The House is expected to vote on the emergency financial manager bills next week. Governor Rick Snyder called for the reforms in his State of the State address.

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