Michigan Governor Rick Snyder (R) signed into law yesterday a bill that gives options to cities and school districts for dealing with severe financial problems, including bankruptcy, Reuters reported yesterday. The law, passed by the Republican-controlled legislature earlier this month, allows local elected officials to choose between chapter 9 municipal bankruptcy, if the move is approved by the governor; an emergency manager; arbitration with a neutral party; or a consent agreement laying out terms for fixing the government's finances. It replaces a controversial law repealed by Michigan voters on Nov. 6 that made it easier for the state to intervene in fiscally troubled cities and schools and gave state-appointed emergency managers running the governments the power to suspend collective bargaining agreements with workers.
For more information on chapter 9 and municipalities dealing with financial distress, be sure to pre-order ABI's latest publication, Municipalities in Peril: The ABI Guide to Chapter 9, Second Edition.