On Tuesday, a Michigan judge ordered that authority be returned to the Mayor and City Council of Flint, Michigan stalling the test case of Michigan Governor Rick Snyder’s plan to replace municipal leaders with corporate financial managers in cities and towns that are failing economically. The order issued by Ingham County Circuit Court Judge Rosemarie Aquilina, says that a state review board violated open meetings laws during the emergency manager appointment process.
A similar plan in Detroit was also halted by a different judge for open meetings rules violations. In Detroit, state officials are working on a hybrid option which provides the state with more control over city finances without going so far as to remove municipal authority to appoint a financial manager. State officials plan to appeal both rulings.
The ruling may also halt plans by Flint’s financial manger Michael Brown, who was working on three initiatives to address the city’s finances. Brown was planning to borrow $20 million in municipal bonds.
The bonds, called “fiscal stabilization bonds,” are longer term bonds that can be paid out over a period of up to 25 years. Currently, Flint is prohibited from borrowing money until have a deficit elimination plan that is proposed and approved.