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Emergency Financial Managers appointed under PA 72

Wednesday, August 8, 2012

LANSING, Mich. - Emergency financial managers (EFMs) were appointed today in the four cities and three school districts under a financial emergency. Appointments to the cities were made by the Local Emergency Financial Assistance Loan Board and appointments to the school districts were made by the governor. 

The actions were taken following the Board of State Canvassers certification of petitions for the referendum of Public Act 4 of 2011, the Local Government and School District Fiscal Accountability Act. The Canvassers certification placed the repeal of PA 4 on the November ballot and immediately suspended the act and reinstated its predecessor, PA 72 of 1990.


Attorney General Bill Schuette issued a formal opinion Monday, Aug. 6, stating that, upon suspension of PA 4, "1990 PA 72 is revived until certification of the November 2012 general election results." 


"My administration is deeply committed to addressing the needs of struggling communities and schools," said Gov. Rick Snyder. "This is not just about finances but the quality of life for citizens and ensuring public safety, health and welfare."


The Local Emergency Financial Assistance Loan Board appointed EFMs Joyce Parker in Ecorse, Joe Harris in Benton Harbor, Louis Schimmel in Pontiac and Ed Kurtz in Flint. Parker, Harris and Schimmel all were serving as emergency managers under PA 4 and Kurtz replaces Mike Brown in Flint, who was ineligible to serve under PA 72 because he previously served as interim mayor.


"The action taken today was necessary to ensure continuity in these communities experiencing financial emergencies," said Deputy Treasurer Roger Fraser.  "The three EFMs who were re-appointed have been making positive changes to return their respective cities to prosperity. Mr. Kurtz has proved his ability to assist struggling cities in the past and will be a steadying hand through this period of transition in Flint."


Snyder appointed Roy Roberts in Detroit Public Schools, Donald Weatherspoon in Muskegon Heights Schools and Joyce Parker in Highland Park Schools as EFMs to continue oversight for the struggling school districts. In compliance with PA 72, State Superintendent of Public Instruction Mike Flanagan made recommendations to the governor for EFMs at Detroit Public Schools, Highland Park Schools and Muskegon Heights Public Schools. Under the law, the superintendent submits to the governor the names of not more than three nominees for the governor's consideration.


In addition to the names of those who have been serving as emergency managers in those districts, Flanagan submitted the names of two education experts from the Michigan Department of Education for the EFMs at Detroit Public Schools and Highland Park Schools.


"Our utmost priority is providing the students of these three school districts with the quality education they need and deserve," Flanagan said. "For that to happen, the schools must be financially sound. MDE is committed to supporting and assisting the work of every emergency financial manager to help the students in those districts achieve and succeed."


The suspension of PA 4 is prospective only. Actions taken by an EM under PA 4, or Consent Agreements reached prior to the suspension of PA 4, remain in effect.


The Local Emergency Financial Assistance Loan Board consists of Treasurer Andy Dillon, state Budget Director John Nixon, and Licensing and Regulatory Affairs Director Steven Hilfinger.  The board was assigned by Snyder the responsibility to manage the financial emergencies per PA 72 of 1990.