Challenging Bedrock Law: “Dillon’s Rule” in Detroit and Beyond

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Detroit’s hardship has garnered much attention: the privatization; the racism; the water shutoffs; the debt; the neglect; the “new form of local government.” As Maureen Taylor of Michigan Welfare Rights Organization makes clear, the profit being made off poverty in Detroit “is beyond horrible.” Michigan’s right-wing governor and state legislature take blame, and rightfully so. But it’s more than a particular regime that brought all these trials to Detroit and 10 other Michigan cities: Flint, Inkster, River Rouge, Hamtramck, Highland Park, Lincoln Park, Benton Harbor, Ecorse, Pontiac and Allen Park. A structure of law that blankets the entire nation is involved.

Detroit and the other city governments have been effectively dissolved. Voting for mayor or city council yields no power. The elected governments are symbolic – toothless. In Detroit, all governing power resides in one man – Kevyn Orr – the state-appointed “emergency manager.” He performs all functions of local government – unilaterally.

And though egregious, Detroit’s dismemberment is but a symptom of a legal doctrine – an idea – that has worked to trivialize the American municipality, for well over a century.

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The legal doctrine was devised in the 1880s by one of the United States’ first corporate lawyers, a legal wizard, John F. Dillon. After sitting on the Iowa State Supreme Court and the Eighth Circuit, Dillon went on to teach at Columbia Law while serving as general solicitor of Union Central Railroad Company. He later left academia to practice law, representing the likes of Union Pacific, Western Union and the famous robber baron Jay Gould.

As suffrage was slowly expanded to the property-less in the 1800s, newly empowered white men began to use local governments to municipalize infrastructure, in direct threat to the propertied. These efforts placed services like water utilities in the hands of the public, rather than wealthy private investors. For Dillon, this was intolerable – so he made it his life’s work to legally bind local communities to the will of their state. As expressed in one of his Iowa opinions: “[The state] breathes into [municipal corporations] the breath of life, without which they cannot exist. As it creates, so it may destroy.” But today, it’s not just white men who bear the brunt of this strategy.

Detroit’s emblematic battle against Dillon’s legacy has turned one of the largest majority black US cities into a corporate playground.

In Dillon’s eyes, municipal power was a direct threat to “free enterprise.” He wanted to insulate “private” matters from intrusion by all levels of government. But he focused on the local, writing that local governments should never enjoy “powers to accomplish purposes [like railroad expansion] which can better be left to private enterprise.” State legislatures, he saw, were less vulnerable to democratic, redistributive outbursts.

The Supreme Court adopted Dillon’s Rule in 1903. This meant communities possessed only those powers that were bestowed upon them by the state. If a city wanted to build a bridge or do anything novel, it had to first get permission from its state legislature. In Detroit, this vision has been taken to the extreme, but it’s not the first time something like this has happened.

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In 1901, Pennsylvania passed the “ripper” law to replace mayors with state-appointed recorders in Pittsburgh and Philadelphia. Like the assault on Detroit, the ripper law was clearly politically motivated, and relied on an ideology and structure of law that believes “no town or city has any rights the legislature is bound to respect,” as one legal scholar wrote in the Harvard Law Review in 1902. Individual citizens have constitutional protections. But, the scholar wrote, “collectively, however, the body of citizens aggregated into a town or city, is beyond the pale of law, and the judiciary is powerless to protect it against whatever the legislature may do.”

The list of examples of state suspension of local democracy is long. Notably, New York City’s charter was rewritten in 1900 by a state-appointed commission to rid the city of pigs and cattle.

Eventually, such initiatives spark a backlash. The decades’ long “home rule” movement was a direct response to these local restrictions. And though this progressive movement did win some local governments control over issues of “local concern,” it decisively failed to shift the fundamental power relation identified by Dillon. Home rule localities can act without the state’s permission in matters of “local concern,” but the state can always redefine “local concern” as it pleases.

A 2004 National Association of Counties study shows that some form of home rule is afforded to localities in 37 states, and, according to the National League of Cities, Dillon’s Rule is also practiced in 47 states. How the two interact depends on the state. In many, cities can adopt home rule to escape Dillon’s Rule while in others, the size of the municipality determines its agency. But regardless, localities with the most local autonomy are still at the mercy of state governments’ definition of “local concern.” Just look at Oregon, a home rule, no Dillon’s Rule state, where the state legislature moved quickly to classify genetically modified organisms as beyond local concern after local governments started proposing prohibitions.

In Michigan – once a beacon for local control – the state claimed authority to appoint emergency financial managers with powers to reform city finances and contracts in 1988. And as time passed, the state continued to rescind local control during times of financial crisis. The expansions occurred a few times, culminating in 2013’s Local Financial Stability and Choice Act, which not only overturned a statewide citizen initiative that abolished emergency management, but converted emergency financial managers to simply “emergency managers” like Kevyn Orr, with power over all functions of government.

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A lawsuit brought by a coalition of Michigan citizens, elected officials, and members of civil and religious governing boards challenges to overturn this law. Suspending local governments, they argue, violates a slew of constitutional protections and rights, including the right to vote, due process, equal protection, freedom of speech, and Americans’ right to a “republican form of government.”

As of 2009, six out of seven majority black communities in Michigan with the low fiscal “score” of seven had been taken over by financial managers. None of the 12 majority white communities with the same score received managers. This blatant racial application of the law exposes it for what it is, prejudiced, and has opened the door for the equal protection complaint – the only grievance recently deceased Federal District Judge George Steeh allowed to move forward in the case.

In a preliminary decision on the constitutionality of Michigan’s emergency manager law, Judge Steeh explicitly evoked Dillon’s Rule (citing a 1907 Supreme Court decision that leaned on the rule) to show that Americans today have no protected right to petition local governments. He agreed with Michigan Attorney General Bill Schuette’s argument that the emergency manager law “is consistent with the recognition that local governments are not sovereign entities but instead derive their authority from the State,” and that the US Constitution’s guarantee clause, which guarantees citizens a republican form of government, “does not extend to local units of government.”

The trend toward states taking power back from local governments during financial emergencies is underway in 15 other states, though to varying degrees. In some states, the state can unilaterally intervene during a financial crisis, while in others, it has to wait for municipal consent. Under such threat, “missing payroll or a bond payment could potentially be a calamitous event for a municipality.”

Dillon’s Rule is rarely brought into these proceedings, but as attorney John Philo, of Sugar Law Center, representing the Michigan citizen groups, told Truthout, Dillon’s Rule is a “cloud that’s over everything.” And attorney Julie Hurwitz, also representing the aggrieved citizens, told Truthout, “I think we are confronted with the fact that local communities are often narrowly seen only as creatures of the state, all over the country.”

But it is not just emergencies that bring Dillon’s Rule to the fore.

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When state legislatures redefine “local concern” to remove wage regulation from the sphere of local government, or when cities are perpetually denied the power to raise the minimum wage, Dillon’s logic is applied. When cities lack authority to legalize gay marriage, Dillon is there. And when cities in Virginia or Mississippi await state approval to do pretty much anything, like regulate trash pickups, Dillon is the reason.

This is because Dillon’s logic, even if rarely mentioned, has been internalized by our legal system. To confront it is to engage in a war over sovereignty between states and local governments. Which level of government came first? Did local governments create states with specific powers? Or do states create and define local governments?

Picking up where the home rule movement left off is an expanding movement that aims to offer some answers. Though clearly recognizing that there are necessary checks on local governments (like the well-established notion that they can’t degrade anti-discrimination laws) and that local governments should only be able to improve upon state and federal law, the movement unabashedly aims to redefine sovereignty, placing it in the hands of local governments and removing it from state legislatures that are more easily influenced by corporate cash and further removed from the electorate.

One organization involved is the Community Environmental Legal Defense Fund, which has worked with just short of 200 municipalities (not including Detroit) in the United States to pass laws that assert a right to local self-governance to improve upon state protections for health, safety and welfare. To enjoy sovereignty, citizens elevate the right to local self-government above corporate legal privileges, which are frequentlyused to strike down local lawmaking across the country.

The fight is legal and political. The right-wing takeover of Michigan’s state government, says Julie Hurwitz, makes the fight for democracy “much more of a political struggle than a legal one.” Having the law on your side is not enough. However, the opposite is even worse. Americans do not enjoy the elementary right to local self-government, and though this may be opaque to many, in Michigan, it’s clear as day.