Municipal Takeover in Michigan: A Rational, Apolitical Response to Financial Distress, or Something Else?

Six of Michigan’s 11 cities that have come under state emergency management since 1990 have also seen changes to their municipal drinking water systems, the most common being rate increases, water shutoffs for no -payment and privatization of water services or infrastructure.

That’s one of the findings of a new study that used Michigan cases to assess the predictability and rationality of municipal takeovers by states, as well as the consequences for public services such as water systems. potable water.

Municipal buy-out policies are often presented by their proponents as rational, apolitical, and technocratic responses to municipal financial difficulties. But a University of Michigan researcher and two University of Toronto colleagues found that a city’s level of financial distress is not a reliable predictor of the likelihood of a state takeover. , while the race and economic status of residents, as well as a city’s level of dependence on state revenue sharing, were better predictors.

The study was published online Sept. 14 in the State and Local Government Review.

“Our results provide evidence that decisions about state takeovers in Michigan are not entirely, or perhaps primarily, driven by objective measures of financial distress. Cities with larger black populations and greater reliance on state funding are more likely to be supported,” said study lead author Sara Hughes, an environmental policy analyst and assistant professor at the UM School for Environment and Sustainability.

“We also find that cities that have taken control are more likely to see changes to their drinking water systems, such as rate increases and privatization. Whether these patterns are the product of racial bias, faulty policy and implementation, or broader political motivations is a question that could be addressed in future research.

The most notorious recent example of water system changes during a Michigan municipal takeover occurred in Flint, which was under emergency management when critical decisions about water supply protocols and water treatment plans were taken, and where emergency managers resisted public concerns about the safety of the city’s drinking water. For nearly 18 months, from April 2014 to October 2015, the City of Flint supplied residents with inadequately treated Flint River water, exposing thousands to high levels of lead and other contaminants. .

The other 10 Michigan cities that went under emergency management between 1990 and 2017, and which were analyzed in the study, are Highland Park, Hamtramck, Three Oaks Village, Pontiac, Ecorse, Benton Harbor, Allen Park, Detroit, River Rouge and Lincoln Park. .

A growing number of cities across the United States are facing serious financial problems requiring state support, and at least 19 states have passed laws allowing for municipal takeover in the event of financial difficulties. In Michigan, municipal takeovers occur under the authority of Public Law 436 of 2012, one of the broadest and most permissive municipal takeover policies in the nation.

To study the implementation and consequences of PA 436 and the laws that preceded it, researchers used a mixed-methods approach. First, financial and demographic data helped them understand state takeover decisions. Second, an analysis of media coverage captured the effects of the takeover on municipal drinking water services.

The goal of the first analysis was to operationalize the financial stress metrics defined by the State of Michigan and identify the broader set of cities that theoretically could have been subject to emergency management but did not. not been.

The researchers also measured community characteristics beyond financial health — including reliance on state revenue sharing, the proportion of black residents, and median household income — that may have increased the likelihood that cities are targeted for emergency management.

Hughes and his co-authors expected that at least one of the financial indicators used by the state, or a composite financial health score based on all indicators, would be able to identify the 11 Michigan cities that have been taken over.

Surprisingly, that was not the case. The financial stress composite score only captured 45% of these cities. But a city’s level of reliance on state revenue sharing captured 82% of takeovers, while the percentage of black residents and median household income correctly predicted 64% and 55% of takeovers. control, respectively.

“These findings support previous work challenging the technocratic and rational basis of state municipal takeover laws and highlighting the politics inherent in municipal takeovers, particularly the biases and structural challenges faced by Black and White communities. poor,” the authors wrote.

The media coverage portion of the two-pronged study showed that Michigan cities that were subject to emergency management were more likely to have changes made to drinking water services than 10 Michigan cities also subject to emergency management. financial constraints that have not been subject to emergency management.

Six of Michigan’s 11 cities under emergency management have seen changes to their drinking water systems that were implemented to save money or reduce expenses. In many cases, these decisions resulted in poor water quality, unreliable service and increased water bills, the researchers said. The 10 comparative cities did not experience such changes.

“Drinking water systems are vulnerable to budget cuts and fee hikes that come with the style of budget balancing that emergency managers bring,” Hughes said. Under the auspices of emergency management, such decisions are made without public input.

The other authors of the study are Andrew Dick and Anna Kopec, doctoral students at the University of Toronto. The work was funded by a grant from the Social Sciences and Humanities Research Council of Canada.

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Sarah J. Greer