DALLAS -- Former Michigan state representative Al Pscholka, who chaired the House Appropriations Committee and sponsored the state's controversial emergency manager law, will take over the state budget director's position in mid-February.
Gov. Rick Snyder said on Monday that Pscholka will replace John Roberts when he leaves in February to take a position with Blue Cross Blue Shield of Michigan as vice president for administration-shared services in the Emerging Markets Division.
"Al has been an outstanding partner as we have worked to complete responsible, truly balanced budgets ahead of schedule six years in a row," Snyder said in a statement announcing the appointment. "His experience and commitment to continuing to build upon the strong fiscal foundation we have laid make him an excellent choice to continue serving the people of Michigan as the state's Budget Director."
Pscholka left the legislature at the end of 2016 due to term limits. He served on the House Appropriations Committee for all six years as a state representative and was chair of the committee for the past two years.
Before being elected to the state House, Pscholka served as a Lincoln Township Trustee for eight years. Pscholka was the district director for U.S. Rep. Fred Upton, R-Mich, from 2003 to 2010. Prior to that, he was in charge of marketing and communications for Cornerstone Alliance, a nonprofit economic development group in Southwest Michigan.
House Minority Leader Sam Singh, D-East Lansing, said in a news release that Snyder made "a good choice" in Pscholka.
"I had the privilege of working with Al over the past four years on the House Appropriations Committee, and his leadership made the complicated budget process run smoothly," Singh said. "That leadership will be needed as our state faces monumental challenges, including restoring proper funding to our schools and universities, repairing the damaged Flint water system and ending the humanitarian crisis there, improving infrastructure across our state and ensuring local communities have the funding they need to provide vital services."
The liberal advocacy group Progress Michigan called Pscholka a bad choice for the job because he sponsored Michigan's 2011 emergency manager law. Voters repealed Public Act 4 in 2012 before Pscholka introduced the new, current version.
"Hiring Al Pscholka to such a high-level position despite his past failings is akin to hiring the builder of the Hindenburg to run an airline," said Lonnie Scott, executive director of Progress Michigan, in a written statement.
The state's emergency manager law has come under fire after the Flint and Detroit Public Schools crises exposed flaws that critics say highlight how the law can fail citizens and ultimately hurt the state's credit.
Flint's water contamination crisis began after the city, under oversight of an emergency manager, broke off from the Detroit Water and Sewerage System in 2014 to save money when its contract to receive Detroit-supplied water ended. The city began pulling water from the Flint River and intended to use it until later this year when it will get its water from a new Karegnondi Water Authority pipeline. The Flint River water wasn't properly treated and corroded pipes throughout the system.
The city with state financial help reconnected to Detroit's system last year but it did not solve the city's problems because the delivery system's pipes had been contaminated with lead.
Now two Flint emergency managers – Darnell Earley and Gerald Ambrose – appointed by Snyder have been charged with criminal wrongdoing. Earley was named EM by Snyder in September 2013 and served until January 2015. Ambrose began working for Flint in January 2012 as finance director for three emergency managers and then succeeded Earley as emergency manager from January 2015 to April 2015.
Pscholka, who officially takes on the role as budget director in February, will be working with Roberts until his departure as the budget office prepares to present the governor's budget for fiscal 2017-18, which starts Oct. 1. Roberts will maintain the title and position of budget director until the second week of February when the state releases the governor's recommended budget.
Kurt Weiss, a spokesman for the budget office said that Roberts and Pscholka plan to make building the Rainy Day Fund a priority.
Michigan's rainy day fund balance was nearly depleted in 2011 when Gov. Snyder took office. It has since been built back up to more than $600 million today, with a projected balance at the end of fiscal 2017 of $705 million.
"Having a savings account in state government is a sound and prudent fiscal principle," Weiss said. "A healthy rainy day fund shows taxpayers and rating agencies that the state's fiscal house is in order and provides a reserve for potential one-time funding needs that may occur. Investments in the state's rainy day fund will continue to be a priority." Spending for Flint's recovery, Detroit Public Schools restructuring and transportation cut into the governor's plans last year to put more into the rainy day fund.
Moody's Investors Service, S&P Global Ratings and Fitch Ratings currently rate the state Aa1 and AA-minus and AA respectively. The outlook is stable.
