New EM law in the works includes bankruptcy option - Los Angeles News | FOX 11 LA KTTV

New EM law in the works includes bankruptcy option

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By Tim Skubick
Fox 2 News


LANSING, Mich. (WJBK) -- The voters said no to the governor's original emergency manager law, so the governor is offering Plan B that would include more public input.

An AFSCME lobbyist argues that's exactly what the voters wanted -- a restoration of democracy.

"I think the voters very clearly said that what they want is democracy at the local unit of government, that they expect their elected officials to have a clear role in the decisions on any financial problems that occur," said Nic Ciaramitaro.

Dick Posthumus, the governor's lobbyist, said they heard the voters, who were saying, "We were taking decision making away from the local units of government.  This would give it back to them."

The Republicans are offering three choices -- vote for an emergency manager, vote for bankruptcy or work out a consent agreement such as the one in Detroit.

"We will offer some things and one of them will be an emergency financial manager potentially.  Maybe you go on with the kind of agreement that they're talking about now or maybe if you don't want to and you have to go into federal bankruptcy, you can explain that to your constituents," said Senate GOP leader Randy Richardville.

Unions oppose giving the emergency manager the right to cancel union contracts, but the administration argues that must stay.

"If they go that route, it'd be just like a bankruptcy judge.  They'd have to have the ability to cancel contracts and reset that municipality so that they can get themselves back on sound footing," Posthumus said.

The new EM law could be ready by the end of the year.

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