CHICAGO - Michigan Wednesday launched a financial investigation into two more local governments in the metro Detroit region.
The state treasurer said it would begin reviews next week of the books of Highland Park and Royal Oak Township, the first step toward a possible state takeover.
The Highland Park School District is already under emergency management.
Highland Park, which is located in Wayne County and has been under state control before, has failed to deposit its minimum pension payments, ended its fiscal year with a deficit and violated the terms of its deficit elimination plan, the state said.
Royal Oak Township, located in triple-A rated Oakland County, also failed to make its minimum pension payment or file timely financial reports. It has also breached state laws, including the uniform budgeting act and the municipal finance act.
The state has 30 days to complete the preliminary reviews. The town will have five days to provide comment on the report before it is submitted to the Local Emergency Financial Assistance Loan Board. If the board and Gov. Rick Snyder determine that a financial emergency exists, local officials have four options: a consent agreement with the state; an emergency manager; a neutral evaluator; or Chapter 9 bankruptcy, with Snyder’s approval.
The state currently has eight local governments under emergency management, including three school districts. The Pontiac School District operates under a consent agreement with the state.