Nick Krieger (@nckrieger):
In accordance with Michigan’s Local Financial Stability and Choice Act, 2012 PA 436 (hereinafter the “Emergency Manager Law”), the Governor must determine when a distressed local government’s financial emergency has been rectified. Once the financial emergency has been rectified, the emergency manager is dismissed and the Governor may appoint a receivership transition advisory board (“TAB”).
On April 29, 2015, Governor Rick Snyder announced that the financial emergency in the city of Flint had been resolved. At the same time, he appointed a TAB.
Without question, an emergency manager has the sole power to sue in the local government’s name during the pendency of the financial emergency. This necessarily includes the authority to determine if and when the local government can initiate litigation. But may a TAB exercise this same authority once the financial emergency is over and the emergency manager has been removed? I conclude that it may not.
A TAB has only those limited powers enumerated in § 23(5) of the Emergency Manager Law, MCL 141.1563(5). The statute does not give the TAB any authority to determine when or whom a local government may sue.
I recognize that a catch-all provision of the Emergency Manager Law gives a TAB the power to “[p]erform any other duties assigned by the governor at the time the receivership transition advisory board is appointed.” MCL 141.1563(5)(h). Quite simply, however, the Governor may not “assign” to a TAB the power to prevent a city from initiating litigation.
Michigan law provides that each home-rule city is a body corporate with the power to sue and be sued in its own name. And under the Michigan Constitution, provisions of law concerning cities must be “liberally construed in their favor.” Const 1963, art 7, § 34.
To overcome these provisions of law, the Legislature would need to be very specific. As noted, for example, the Emergency Manager Law explicitly transfers the power to commence litigation from the chief administrative officer and governing body (for instance, the mayor and city council) to the emergency manager. And the Home Rule Cities Act expressly confers upon an emergency manager the power to exercise the city’s authority under the statute. However, there are no parallel statutory sections that confer these powers upon the TAB once the financial emergency is resolved and the emergency manager has left office.
Absent sufficient standards, the Legislature may not delegate its legislative power to the Governor. Section 23(5)(h) contains no standards at all, and certainly does not set forth any standards under which the Governor can assign to a TAB the power to veto litigation by a local government or require pre-approval before a local government may sue.
In fact, § 23(5)(g) of the Emergency Manager Law implicitly recognizes the power of a local government to sue and be sued in its own name while a TAB is in place. This subsection gives a TAB authority to review judgment levies under § 6093 of the Revised Judicature Act, but says nothing about a TAB’s power to approve or reject litigation. In turn, § 6093 applies whenever judgments are recovered against local governments “in any action prosecuted by or against them in their name.” If the Legislature had intended to divest a local government of the power to sue in its own name without first seeking approval from the TAB, it strikes me that it would have mentioned this in the text of § 23(5)(g).
It is absolutely true that a local government cannot maintain a cause of action against the state for any activity authorized by the Emergency Manager Law. MCL 141.1572. But this has nothing to do with the specific question at issue here — namely, whether a TAB may require a city to seek pre-approval before initiating litigation.
In enacting the Emergency Manager Law, the Michigan Legislature could have given TABs the power to veto litigation by local governments or prevent them from suing without prior approval. But it did not. Instead, the Legislature strictly limited the authority of TABs to those particular powers listed in § 23(5).
Under the well-known maxim expressio unius est exclusio alterius, the express enumeration of certain powers in § 23(5) necessarily implies the exclusion of others that are not mentioned. See, e.g., Stowers v Wolodzko, 386 Mich 119, 133; 191 NW2d 355 (1971). A TAB does not have the power to determine when a local government can and cannot sue. By passing a resolution that purports to exercise such a power, Flint’s TAB has exceeded its statutory authority.
Of course, this issue would never have arisen if Flint hadn’t been subjected to state receivership under the Emergency Management Law in the first instance. If Snyder and his pals on the TAB can’t comply with the Emergency Manager Law as written, maybe it’s time to consider repealing it altogether.