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Fiscal Health, Municipal, News, Opinion

At least for now, Michigan closes the chapter on Emergency Financial Managers

By: Bob Kittle and Katrina Powell

The State of Michigan Department of the Treasury sent out a press release on June 27, 2018 announcing that for the first time in 18 years, neither a school district or municipality in Michigan has an emergency manager. You can read the press release in its entirety here, but following is an excerpt.

“LANSING, Mich. – State Treasurer Nick Khouri today announced that no Michigan municipality or school district is under state financial oversight through an emergency manager for the first time in nearly 18 years. The…announcement comes after releasing Highland Park School District from receivership under the Local Financial Stability and Choice Act. Since 2000, there has been an emergency manager providing financial oversight somewhere in Michigan.”

For many years the Emergency Financial Manager (later changed to Emergency Manager or EM) concept was regularly maligned by some constituents, citing it as an overreach of state government at the loss of local control and racially motivated. The term carpetbagger was bandied about as well. One respected national government trade publication headlined a 2012 article, Emergency Financial Managers: Michigan’s Unwelcome Savior. As local government financial advisors ourselves, (Katrina was the State-appointed City Manager for Hamtramck from 2014 to 2017) we, but especially Katrina, have been on the receiving end of some hurtful and untrue verbal attacks about roles and motives.

Municipal, Opinion

Jobs, Jobs, Jobs or People, People, People?

I get a kick when politicians say they are going to create jobs when there are so many jobs out there now, just not enough people to fill them.

In the public sector, this is really going to hit home in the next 3-10 years, when the tail end of the baby-boomers reach the age of retirement, or 65. When I ask local government leaders what percentage of their workforce will retire in the next decade, they tell me at least 30%, which could even be low. Those who can retire with a pension at age 55 for example, will not stick around to 65; but some of them will continue to work post retirement as 1099s or will part time it at another local government due to the shortage their leaving has on the overall public sector workforce.

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