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Act 436 of 2012
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LOCAL FINANCIAL STABILITY AND CHOICE ACT

Act 436 of 2012

AN ACT to safeguard and assure the financial accountability of local units of government and school districts; to preserve the capacity of local units of government and school districts to provide or cause to be provided necessary services essential to the public health, safety, and welfare; to provide for review, management, planning, and control of the financial operation of local units of government and school districts and the provision of services by local units of government and school districts; to provide criteria to be used in determining the financial condition of local units of government and school districts; to authorize a declaration of the existence of a financial emergency within a local unit of government or school district; to prescribe remedial measures to address a financial emergency within a local unit of government or school district; to provide for a review and appeal process; to provide for the appointment and to prescribe the powers and duties of an emergency manager for a local unit of government or school district; to provide for the modification or termination of contracts under certain circumstances; to provide for the termination of a financial emergency within a local unit of government or school district; to provide a process by which a local unit of government or school district may file for bankruptcy; to prescribe the powers and duties of certain state agencies and officials and officials within local units of government and school districts; to provide for appropriations; and to repeal acts and parts of acts.


History: 2012, Act 436, Eff. Mar. 28, 2013
Compiler's Notes: Enacting section 2 of Act 436 of 2012 provides:"Enacting section 2. It is the intent of the legislature that this act function and be interpreted as a successor statute to former 1988 PA 101, former 1990 PA 72, and former 2011 PA 4, and that whenever possible a reference to former 1988 PA 101, former 1990 PA 72, or former 2011 PA 4, under other laws of this state or to a function or responsibility of an emergency financial manager or emergency manager under former 1988 PA 101, former 1990 PA 72, or former 2011 PA 4, under other laws of this state shall function and be interpreted to reference to this act, with the other laws of this state referencing former 1988 PA 101, former 1990 PA 72, or former 2011 PA 4, including, but not limited to, all of the following: (a) The charter township act, 1947 PA 359, MCL 42.1 to 42.34. (b) 1966 PA 293, MCL 45.501 to 45.521. (c) 1851 PA 156, MCL 46.1 to 46.32. (d) The general law village act, 1895 PA 3, MCL 61.1 to 74.25. (e) The home rule village act, 1909 PA 278, MCL 78.1 to 78.28. (f) The fourth class city act, 1895 PA 215, MCL 81.1 to 113.20. (g) The home rule city act, 1909 PA 279, MCL 117.1 to 117.38. (h) The metropolitan transportation authorities act of 1967, 1967 PA 204, MCL 124.401 to 124.426. (i) 1947 PA 336, MCL 423.201 to 423.217."


© 2009 Legislative Council, State of Michigan

The People of the State of Michigan enact:

DocumentTypeDescription
Section 141.1541SectionShort title.
Section 141.1542SectionDefinitions.
Section 141.1543SectionFindings; declarations.
Section 141.1544SectionDetermination of probable financial stress; preliminary review; conditions; notification to local government; interim report of findings; final report; finding of probable financial stress; appointment of review team for municipal government; appointment of review team for local school district; staff support; duration of appointment.
Section 141.1545SectionReview team; powers; meeting with local government; report; posting on department of treasury's website; contents; appointment of individual or firm to carry out review and submit report.
Section 141.1546SectionDetermination by governor; opportunity for local government to submit statement; determination of financial emergency; notification; hearing; findings of fact by governor; report; resolution by local government to appeal determination.
Section 141.1547SectionLocal government options; approval of resolution by mayor or school board; failure of local governing body to pass resolution; limitation.
Section 141.1548SectionConsent agreement; negotiation and signature; provisions; continuing operations plan; form; amendment of budget adopted by municipal government or school district; recovery plan; terms and provisions; powers granted to chief administrative officer, chief financial officer, governing body, or other local officers; consultant; release from requirements.
Section 141.1549SectionEmergency manager; appointment by governor; powers; qualifications; compensation; private funds; additional staff and assistance; quarterly reports; service; removal of local government from receivership; delegation of duties from governor to state treasurer; applicable state laws; appointment under former act; removal.
Section 141.1550SectionOrders.
Section 141.1551SectionFinancial and operating plan for local government; development and amendment by emergency manager; objectives; submission; modification; form; conduct of public informational meeting; effect of plan adopted under former law.
Section 141.1552SectionAdditional actions by emergency manager; suspension of power of administrative officer and governing body; contracts subject to competitive bidding; sale or transfer of public utility; limitation.
Section 141.1553SectionPendency of receivership; compensation of chief administrative officer and members of local governing body.
Section 141.1554SectionSchool district in receivership; additional actions.
Section 141.1555SectionSale of asset worth more than $50,000.00; payment of benefit upon death of police officer or firefighter.
Section 141.1556SectionCriminal conduct contributing to receivership status.
Section 141.1557SectionReport.
Section 141.1558SectionRecommendation to proceed under chapter 9.
Section 141.1559SectionProposed action; submission to local governing body; approval or disapproval; alternative proposal.
Section 141.1560SectionEmergency manager; immunity from liability; responsibilities of attorney general; costs; insurance; litigation expenses after conclusion of date of service; failure of municipal government or school district to honor and remit legal expenses.
Section 141.1561SectionAdoption and implementation of 2-year budget.
Section 141.1562SectionDetermination that financial emergency rectified; actions by governor.
Section 141.1563SectionReceivership transition advisory board.
Section 141.1564SectionDetermination that financial conditions not corrected; appointment of new emergency manager.
Section 141.1565SectionNeutral evaluation process.
Section 141.1566SectionChapter 9 proceeding.
Section 141.1567SectionDuty of local officials and employees to provide assistance and information; failure to abide by act.
Section 141.1568SectionImposition of taxes; prohibition.
Section 141.1569SectionIssuance of bulletins; rules.
Section 141.1570SectionActions under former law.
Section 141.1571SectionEmergency manager serving prior to effective date of act.
Section 141.1572SectionLiability or cause of action.
Section 141.1573SectionSeverability.
Section 141.1574SectionAppropriation.
Section 141.1575SectionAppropriation.