Conyers: Emergency Manager bill ‘raises serious constitutional concerns’

Legislation to allow a state-appointed Emergency Manager to replace local officials and terminate contracts is an opportunistic Republican power grab aimed at crushing workers rights and disenfranchising minority communities, Rep. John Conyers (D-Detroit) said yesterday.

The takeover provision of the legislation – allowing the dissolution of locally elected bodies — implicitly targets minority communities that are disproportionately impacted by the economic downturn, without providing meaningful support for improved economic opportunity.

Worse yet, this bill raises serious constitutional concerns. Article I, Section 10 of the U.S. Constitution explicitly prohibits any State from impairing a contract, which is exactly what this legislation does. As the Supreme Court has held in Home Building & Loan Association v. Blaisdell (1934), the sanctity of contracts cannot be impaired by a state law “which renders them invalid, or releases or extinguishes them . . . . Not only are existing laws read into contracts in order to fix obligations as between the parties, but the reservation of essential attributes of sovereign power is also read into contracts as a postulate of the legal order.”

Further, the bill empowers this financial czar with the Governor’s approval to force a municipality into bankruptcy, a power that will surely be used to extract further concessions from hardworking public sector workers. And, by making the risk of bankruptcy a reality, the bill will make it more not less expensive for municipalities to obtain financing given this risk, which will make the financial circumstances of municipalities even worse.

Conyers is the first of Michigan’s Congressional delegation to speak out against HB4214 which has been approved by both chambers of the legislature and is expected to be finalized next week.