Congressman Peters & Conyers summon the cavalry, ask Government Accountability Office to investigate Michigan Emergency Managers



Congressmen Gary Peters and John Conyers have asked the Government Accountability Office to look into the efficacy of the Emergency Financial Manager Law in Michigan as well as whether or not it has resulted in any conflicts of interest or other improprieties as the law has been enforced.

In their letter to Comptroller Gene Dodaro (pdf), they write:

We write to request that the Government Accountability Office (GAO) conduct a study of the Michigan emergency manager law, including the operation of federally-funded programs (such as education, transportation, Medicaid, and public safety) in jurisdictions declared in financial crisis, and placed under the authority of an emergency financial manager.

The refer to specific items such as “misuse of federal or other funds”, “efficacy in apply for and obtaining federal grants, loans, and other funds”, prevention of “conflicts of interest, self-dealing or other mismanagement of such funds”, whether actions by EFMs has resulted in “greater dependency actions on federal government programs”, and “an overall assessment of costs, benefits, fiscal or other efficacy of” emergency managers.

Congressman Conyers said in a statement, “It is difficult to identify a single instance where an emergency manager has succeeded in turning around the financial fortunes of a city or jurisdiction. The history of the emergency manager Law in Michigan is replete with fiscal mismanagement and conflicts of interest. In the absence of any sort of checks or balances at the state level, it is vital that the GAO examine the law and its impact, particularly the impact on federal funding.”

Congressman Peters made a similar statement saying, “By focusing only on short-term budgetary patches, emergency managers have failed to address the long-term systemic issues confronting older urban areas. The consistent record of poor results we’ve seen from emergency managers is why I’m joining with Congressman John Conyers in calling for a GAO review.”

Congressman Peters knows about this first hand. He stepped in to make sure the Pontiac Emergency Manager Lou Schimmel didn’t allow his city to miss out on over $1 million in federal dollars over a year ago. Here’s what I wrote then:

Like Mighty Mouse saving the day, Congressman Gary Peters stepped in to save the city of Pontiac from a completely assinine decision by Emergency Manager Lou Schimmel that would have cost the city millions in federal grant funding. Congressman Peters has now confirmed that the total amount is $1.4 million. This is Exhibit A why Emergency Managers are bad for Michigan: Schimmel took the easy way out and it almost cost Pontiac, a city in deep financial trouble, over $1 million.

In December of 2011, Congressman Conyers appealed to the U.S. Department of Justice to conduct an investigation of their own. He also confirmed that Sec. Eric Holder was already investigating. Though I have inquired with his staff, so far there’s been no word on how that is going.

The letter they sent to Comptroller Dodaro point out specific instances of EFMs engaging in questionable or even illegal actions as well as times when the actions of the EFMs have proven to be ineffective.

I’m pleased to see these two men getting involved in this debate. What remains to be seen is if they can get the attention of the federal government. So far, that goal seems to have eluded them.

By the way, if you look at the footnotes in their letter, you’ll see that I am cited as one of the sources. See? Bloggers CAN make a difference!

[Graphic by Chris Savage | Eclectablog]