Michigan passes ‘financial martial law’ bill


JENNIFER EPSTEIN
Politico
March 17, 2011

Michigan legislators have approved a bill authorizing state-appointed emergency financial managers to break union contracts that struggling cities and school districts have with their workers.

Following up on the state Senate’s passage of the bill last week, the House passed the bill 62-48 on Tuesday, sending the legislation to Republican Gov. Rick Snyder for final approval. Snyder, who asked for the expanded powers for emergency financial managers, is expected to sign the bill into law.

Supporters say the bill gives the state a way to step into distressed municipalities and schools before they collapse. It also gives emergency financial managers broad authority to end employee union contracts, and to nullify elected boards and councils.

The bill’s sponsor, Republican Rep. Al Pscholka, said Tuesday that it would give the state the power it needs to dig important institutions out of financial holes. “For years we have allowed cities and schools to be on the verge of bankruptcy without any intervention,” he told Reuters. “When the state finally does arrive, in many cases we find the financial records in disarray and leave emergency managers with very few good options to balance the books.”

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