Bill Text: MS HB627 | 2014 | Regular Session | Introduced
Bill Title: "Municipalities Government Responsibility Act"; create.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2014-02-04 - Died In Committee [HB627 Detail]
Download: Mississippi-2014-HB627-Introduced.html
MISSISSIPPI LEGISLATURE
2014 Regular Session
To: Municipalities; Appropriations
By: Representative Gipson
House Bill 627
AN ACT TO CREATE THE MUNICIPAL GOVERNMENT RESPONSIBILITY ACT; TO PROVIDE THAT THE PURPOSE OF THIS ACT IS TO PROTECT THE CREDIT OF THE STATE AND ITS MUNICIPAL POLITICAL SUBDIVISIONS AND THAT IT IS A VALID PUBLIC PURPOSE FOR THE STATE TO TAKE ACTION AND TO ASSIST A MUNICIPALITY THAT HAS FAILED TO PROVIDE SERVICES TO THE CITIZENS OF THIS STATE; TO AUTHORIZE THE GOVERNOR TO APPOINT A REVIEW TEAM TO ASSESS THE FINANCIAL CONDITION AND ABILITY OF A MUNICIPALITY OR MUNICIPALLY OWNED UTILITY; TO DEFINE THE POWERS AND DUTIES OF THE REVIEW TEAM; TO REQUIRE THE REVIEW TEAM TO CREATE A REPORT ABOUT THE FINANCIAL CONDITIONS AND SERVICE PROVISIONS OF THE MUNICIPALITY; TO AUTHORIZE THE GOVERNOR TO APPOINT AN EMERGENCY MANAGER TO MANAGE A MUNICIPALITY OR MUNICIPALLY OWNED UTILITY UNDER CERTAIN CONDITIONS; TO PROVIDE THE POWERS AND DUTIES OF THE EMERGENCY MANAGER; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act shall be known and may be cited as the "Municipal Government Responsibility Act."
SECTION 2. The Legislature hereby determines that the public health and welfare of the citizens of this state
would be adversely affected by the failure of municipalities to perform their duties to provide services as required by law and that the survival of municipalities is vitally necessary to the interests of the people of this state to provide necessary governmental services.
The Legislature further determines that it is vitally necessary to protect the credit of the state and its municipal political subdivisions and that it is a valid public purpose for the state to take action and to assist a municipality that has failed to provide services to the citizens of this state who live in such municipality. The Legislature, therefore, determines that the authority and powers conferred by this act constitute a necessary program and serve a valid public purpose.
SECTION 3. The following words shall have the following meanings for the purposes of this act, unless the context clearly requires otherwise:
(a) "Chief administrative officer" means any of the following:
(i) The city manager of a city or, if a city does not employ a city manager, the mayor of the city.
(ii) The chief operating officer of an authority or a public utility owned by a municipality.
(b) "Emergency manager" means the emergency financial manager appointed under the provisions of this act.
(c) "Local government" means a municipality or a
public utility owned by a municipality.
(d) "Review team" means the review team designated under the provisions of this act.
SECTION 4. The Governor shall appoint a review team of the State Treasurer, the State Auditor, a nominee of the Lieutenant Governor, a nominee of the Speaker of the House of Representatives, and other state officials or other persons with relevant professional experience to serve as a review team to undertake a local management review if one (1) or more of the following occur:
(a) The governing body of a local government, by resolution, requests assistance under this act in meeting the ordinary needs of government. The resolution shall identify the existing financial and service conditions that make the request for assistance necessary. The resolution required by this subsection shall be handled in the same manner that any other resolution is adopted by a local government.
(b) The Governor has been informed by the state treasurer that he or she has conducted a preliminary review of a local government financial situation and has determined that one (1) or more conditions indicative of a serious financial problem may exist within the local government.
(c) If twenty percent (20%) of the qualified electors of any municipality, by petition, assert that the municipality has failed to provide services, such petition shall specify the services that have not been provided by the municipality.
SECTION 5. (1) The review team appointed by the Governor shall have full power in its review to perform all of the following functions:
(a) Examine the books and records of the local government.
(b) Utilize the services of other state agencies and employees.
(c) Sign a consent agreement with the chief administrative officer of the local government. The agreement
may provide for remedial measures considered necessary including a long-range financial recovery plan requiring specific local actions. The agreement may utilize state financial management and technical assistance as necessary in order to alleviate the local financial problem. The agreement may also provide for periodic fiscal status reports to the State Treasurer. In order for the consent agreement to go into effect, it shall be approved, by resolution, by the governing body of the local government.
(2) The review team shall report its findings to the Governor within sixty (60) days after their appointment, or
earlier if required by the Governor. Upon request, the Governor may grant one (1) thirty-day extension of this time limit. A copy of the report to the Governor shall be sent to the chief administrative officer and the governing body of the municipality, the Speaker of the House of Representatives, and the Lieutenant Governor. The review team shall include one (1) of the following conclusions in its report:
(a) A failure to provide services to the residents of the municipality does exist.
(b) A failure to provide services does not exist and the residents are provided services.
(c) A serious financial problem exists in the municipality, but a consent agreement containing a plan to resolve the problem has been adopted.
(d) A municipal emergency exists because no satisfactory plan exists to resolve a serious financial problem.
(3) In the report to the Governor under subsection (2) of this section, the review team shall inform the Governor if one (1) or more of the following conditions exist, have occurred, or are likely to exist or occur, if remedial action is not taken:
(a) A default in the payment of principal or interest upon bonded obligations or notes for which no funds or
insufficient funds are on hand and segregated in a special trust fund.
(b) Failure for a period of thirty (30) days or more beyond the due date to transfer one (1) or more of the following to the appropriate agency:
(i) Taxes withheld on the income of employees.
(ii) Taxes collected by the government as agent for another governmental unit, school district, or other entity or taxing authority.
(iii) Any contribution required by a pension, retirement, or benefit plan.
(c) Failure for a period of thirty (30) days or more to pay wages and salaries or other compensation owed to employees or retirees.
(d) The total amount of accounts payable for the current fiscal year, as determined by the State Treasurer's uniform chart of accounts, is in excess of ten percent (10%) of the total expenditures of the local government in that fiscal year.
(e) Failure to eliminate an existing deficit in any fund of the local government within the two (2) year period preceding the end of the local government's fiscal year during which the review team report is received.
(f) Projection of a deficit in the general fund of the local government for the current fiscal year in excess of ten percent (10%) of the budgeted revenues for the general fund.
SECTION 6. (1) Within thirty (30) days after receipt of the report required by this act, the Governor shall make one (1) of the following determinations:
(a) A failure to provide services to the residents of the municipality does exist.
(b) A failure to provide services does not exist and the residents are provided services.
(c) A serious financial problem does not exist in the local government.
(d) A serious financial problem exists in the local government, but a consent agreement containing a plan to resolve the problem has been adopted.
(e) A local government financial emergency exists because no satisfactory plan to resolve a serious financial problem exists.
(2) If the Governor determines pursuant to subsection (1) of this section that a financial emergency exists, the Governor shall provide the governing body and chief administrative officer of the local government with a written notification of the determination, findings of fact utilized as the basis upon which this determination was made, a concise and explicit statement of the underlying facts supporting the factual findings, and notice that the chief administrative officer or the governing body of the local government has ten (10) days after the date of this notification to request a hearing conducted by the Governor or the Governor's designee. Following the hearing, or if no hearing is requested following the expiration of the deadline by which a hearing may be requested, the Governor shall either confirm or revoke, in writing, the determination of the existence of a municipal emergency. If confirmed, the Governor shall provide a written report of the findings of fact of the continuing or newly developed conditions or events providing a basis for the confirmation of a local financial emergency, and a concise and explicit statement of the underlying facts supporting these factual findings.
SECTION 7. If the Governor determines that an emergency exists, the Governor shall assign the responsibility for managing the local government to an emergency manager. The manager shall be chosen solely on the basis of his or her competence and shall not have been either an elected or appointed official or employee of the municipality. The emergency financial manager need not be a resident of the local government for which he or she is appointed. The emergency financial manager shall serve at the pleasure of the Governor and shall be compensated as determined by the Governor.
SECTION 8. The manager shall issue to the appropriate officials or employees of the local government the orders the manager considers necessary to accomplish the purposes of this act, including, but not limited to, orders for the timely and satisfactory implementation of a financial plan developed by such manager. An order issued under this section is binding on the local officials or employees to whom it is issued.
SECTION 9. (1) The manager may take one (1) or more of the following additional actions with respect to a unit of local government in which a financial emergency has been determined to exist:
(a) Analyze factors and circumstances contributing to the financial condition of the unit of local government and recommend steps to be taken to correct the condition.
(b) Amend, revise, approve, or disapprove the budget of the unit of local government, and limit the total amount appropriated or expended during the balance of the financial emergency.
(c) Require and approve or disapprove, or amend or revise a plan for paying all outstanding obligations of the unit of local government.
(d) Require and prescribe the form of special reports to be made by the finance officer of the unit of local government to its governing body, the creditors of the unit of local government, the emergency financial manager, or the public.
(e) Examine all records and books of account, and require under the procedures of the uniform budgeting and accounting, the attendance of witnesses and the production of books, papers, contracts, and other documents relevant to an analysis of the financial condition of the unit of local government.
(f) Make, approve, or disapprove any appropriation, contract, expenditure, or loan, the creation of any new position, or the filling of any vacancy in a permanent position by any appointing authority.
(g) Review payrolls or other claims against the unit of local government before payment.
(h) Exercise all of the authority of the unit of local government to renegotiate existing labor contracts and act as an agent of the unit of local government in collective bargaining with employees or representatives and approve any contract or agreement.
(i) Notwithstanding the provisions of any charter to the contrary, consolidate departments of the unit of local government or transfer functions from one (1) department to another and to appoint, supervise, and, at his or her discretion, remove heads of departments, the clerk of the unit of local government, and any other position in the unit of local government.
(j) Employ or contract for, at the expense of the unit of local government and with the approval of the local emergency financial assistance loan board, auditors and other technical personnel considered necessary to implement this article.
(k) Require compliance with the orders of the emergency financial manager by court action if necessary.
(l) Except as restricted by charter or otherwise, sell or otherwise use the assets of the unit of local government to meet past or current obligations, provided the use of assets for this purpose does not endanger the public health, safety, or welfare of residents of the unit of local government.
(m) Apply for a loan from the state on behalf of the unit of local government, subject to the conditions of the emergency municipal loan act in a sufficient amount to pay the expenses of the emergency financial manager and for other lawful purposes.
(n) Approve or disapprove of the issuance of obligations of the unit of local government on behalf of the municipality.
(o) Enter into agreements with other units of local government for the provision of services.
(p) Exercise the authority and responsibilities of the chief administrative officer and governing body concerning the adoption, amendment, and enforcement of ordinances or resolutions affecting the financial condition of the unit of local government.
(q) Reduce, suspend, or eliminate the salary, or other compensation of the chief administrative officer and members of the governing body of the unit of local government during the financial emergency. This subdivision does not authorize an emergency financial manager to impair vested retirement benefits. If an emergency financial manager has reduced, suspended, or eliminated the salary or other compensation of the chief administrative officer and members of the governing body of a unit of local government before the effective date of the amendatory act that added this subdivision, the reduction, suspension, or elimination is valid to the same extent had it occurred after the effective date of the amendatory act that added this
subdivision.
(2) If a financial emergency exists under the local government fiscal responsibility act, the emergency manager shall make a determination as to whether possible criminal conduct contributed to the financial emergency. If the manager determines that there is reason to believe that criminal conduct has occurred, the manager shall refer the matter to the Attorney General and the local prosecuting attorney for investigation. The determination required under this subsection shall be made
by one (1) of the following dates, whichever is later:
(a) Within ninety (90) days after the effective date of the amendatory act that added this subsection.
(b) Within one hundred eighty (180) days after the date the emergency financial manager is appointed.
(3) Not later than ninety (90) days after the completion of the emergency financial manager's term, the governing body of the unit of local government shall review any ordinance implemented by the emergency financial manager during his or her term, except any ordinance enacted to assure the payment of principal and interest
on bonds.
SECTION 10. Elected officials of a local government shall provide the assistance and information necessary and properly requested by a review team, the local emergency financial assistance loan board, or the emergency financial manager in the effectuation of their duties and powers and of the purposes of this article. Failure of an elected official of a local government to abide by this article shall be considered gross neglect of duty, which the emergency financial manager shall report to the local emergency financial assistance loan board. Following review and a hearing with the local government elected official, the local emergency financial assistance loan board may recommend to the Governor that the Governor remove the elected official from office. If the Governor removes the elected official from office, the resulting vacancy in office shall be filled as prescribed by law.
SECTION 11. The Governor may determine whether a local government may operate without an emergency manager at any time.
SECTION 12. This act shall not be construed to give the emergency manager the power to impose taxes, over and above those already authorized, without the approval at an election of a majority of the qualified electors voting on the question.
SECTION 13. This act shall take effect and be in force from and after its passage.
