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Michigan governor signs new emergency-manager law

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LANSING, Mich. (AP) — Gov. Rick Snyder put a new emergency-manager law on the books in Michigan on Thursday, weeks after voters repealed a version that gave sweeping powers to a single person to overhaul financially distressed communities.

The new law will give local governments and ailing schools the opportunity to choose their own remedy. If a review team finds that a financial emergency exists, they have four options, including an emergency manager, bankruptcy or a reform plan with the state.

"This legislation demonstrates that we clearly heard, recognized and respected the will of the voters," Mr. Snyder said in a statement. "It builds in local control and options while also ensuring the tools to protect ... residents, students and taxpayers."

The law won't kick in until late March. Under the old law, the power to send an emergency manager rested solely with the governor. It was a threat to labor unions because managers had the power to throw out contracts.

A manager still would have the power to change or cancel contracts under the new law, but local officials could develop an alternative if it generates equal financial savings. Local governments can remove a manager after one year with a two-thirds vote of its governing board.

The law includes a $770,000 state appropriation to cover managers' salaries, a provision that would shield it from another statewide vote because spending bills are immune to referendums.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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