Snyder Signs New Emergency Manager Bill Citing the Need for Government Oversight

The new bill will take effect in the spring and offers more choices for struggling municipalities and school districts, the governor's office said.

Gov. Rick Snyder signed a new emergency manager bill into law Thursday that will take effect in the spring for financially troubled local governments and school districts.

According to a press release from the governor's office, Senate Bill 865, sponsored by state Sen. Phil Pavlov, allows for more public input and gives financially troubled cities and school districts a choice of four options — mediation; a consent agreement; an emergency manager; or Chapter 9 bankruptcy.

Snyder said the bill strengthens the current financial manager law to handle severe financial stress in some municipalities, but also takes into account voters’ concerns regarding the previous emergency manager law expressed during the November election.

“This legislation demonstrates that we clearly heard, recognized and respected the will of the voters,” Snyder said. “It builds in local control and options while also ensuring the tools to protect communities and schools districts’ residents, students and taxpayers.”

The bill is now Public Act 436 of 2012.

Snyder also signed three bills to address fiscal oversight on school district loans and ensure continuation of the School Bond Loan Program and the School Loan Revolving Fund. The legislation caps the outstanding loan value at $1.8 billion and also prevents schools from rolling over debt and creating an unsustainable situation by establishing a single, final repayment date.

 “These new laws recognize the vital importance of financially stable, economically vibrant communities to Michigan’s future,” Snyder said. “They also respect the needs of citizens and taxpayers by delivering greater oversight and efficiency. Our reinvention of government is delivering meaningful reforms that will keep Michigan on the path to prosperity.”

Visit www.legislature.mi.gov for more information on the bills.

For an infographic breaking down the new emergency manager process, visit http://1.usa.gov/10nn11q.


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