Judge says lawsuit targeting Michigan emergency manager law can go ahead on racial grounds

Associated Press

Critics of Michigan's emergency manager law can challenge it as discrimination against blacks, a judge said Wednesday in allowing a lawsuit to move forward against an extraordinary tool used by Gov. Rick Snyder to try to fix the finances of poor cities and schools.

U.S. District Judge George Caram Steeh swept aside most of the lawsuit. But he said opponents at this early stage of the case have made a "plausible" claim that the law could violate the U.S. Constitution by having a disproportionate impact on communities with large black populations.

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When the lawsuit was filed earlier this year, attorneys said 52 percent of Michigan's black residents were living in communities with emergency managers or strict financial oversight from the state. Most were in Detroit.

The law "confers enormous discretion to state decision-makers and creates a significant potential for discriminatory decisions," Steeh said. Emergency managers have exceptional power to run local governments and school districts, while elected officials typically are pushed aside for 18 months or more.

Steeh's 39-page ruling was released seven months after he heard arguments. The case was allowed to proceed at that time only after the plaintiffs agreed it wouldn't affect Detroit's bankruptcy.

Snyder appointed Kevyn Orr as Detroit's emergency manager in March 2013. Four months later, they decided that bankruptcy was the best solution to get rid of billions of dollars of debt. On Nov. 7, a judge approved the city's plan to get out of bankruptcy.

Michigan voters overturned Snyder's first emergency manager law in the 2012 election. But he and fellow Republicans in the Legislature came back with another version just weeks later.

Flint, Hamtramck, Lincoln Park, Detroit schools, Highland Park schools and Muskegon Heights schools have emergency managers. Ten other local governments or school districts are under some type of state oversight under the same law, known as Public Act 436.

During arguments in April, Assistant Attorney General Michael Murphy denied that the law targeted blacks.

"The only color we're dealing with here is green — it's cash," Murphy said.

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