Emergency Management

The State of Michigan can gain control over local governments or school districts deemed to be fiscally failing under the Local Financial Stability and Choice Act, Public Act 436 of 2012 and Public Act 72 of 1990. PA 436, commonly known as the Emergency Management Law, was passed in response to a 2012 referendum initiative vote.

Following two reviews for financial stress, the Governor can determine if ‘a financial emergency exists within the local government’ and place an Emergency Manager over the government or school district. An Emergency Manager is a person hired by the Governor who takes on the role of lead administrator for the government or school district at which they are appointed–meaning in a city, the Mayor would no longer have the powers of the executive branch. PA 436 also allows for the formation of a consent agreement which is a mechanism for local leaders to offer alternative plans versus those put forth by the Manager.