Background
The city of Royal Oak established a competitive process to award two recreational marijuana retail licenses. The city’s ordinance gave the city manager the authority to “implement and administer” the application process and to rank applicants based on who was “best suited to operate” in the city. The city manager convened an internal workgroup of city officials to help review the 21 applications received.
After the city manager selected two applicants other than the plaintiffs, Exclusive Capital Partners LLC and Quality Roots, Inc., the plaintiffs sued. They argued, among other things, that the selection process violated Michigan’s Open Meetings Act (OMA) because the meetings between the city manager and the workgroup were not held in public. The trial court granted summary disposition to the city, finding no OMA violation.
The Michigan Court of Appeals reversed. It held that while the ordinance appeared to grant final authority to the City Commission (which approved land use permits later in the process), the city manager was the “de facto” decision-maker. The panel concluded this amounted to a delegation of authority from the commission, making the city manager a “public body” subject to the OMA. The city appealed to the Michigan Supreme Court.
The Court’s Holding
The Michigan Supreme Court reversed the Court of Appeals, holding that the city manager was not required to comply with the OMA when conducting the license selection process. The Court found that the city manager did not qualify as a “public body” under either of the two pathways established by OMA case law.
First, an entity is not a “public body” in its own right if it is an individual. Citing its precedent in Herald Co v Bay City, the Court affirmed that the term “public body” in the OMA connotes a collective entity like a board, commission, or council, not a single official. Second, the Court found no delegation of authority from a public body. The Court of Appeals erred by presuming the city commission held the original authority to rank applicants. The ordinance, the Court explained, unambiguously granted that specific power directly to the city manager. The city commission had no role in the ranking; its separate, later duty was to approve special land use permits. Because the city manager was acting alone pursuant to an independent grant of authority from the ordinance, not exercising power delegated from the commission, he was not subject to the OMA.
Key Takeaways
- An individual government official, like a city manager, is not a “public body” under Michigan’s Open Meetings Act (OMA) when acting in an individual executive capacity.
- Authority granted directly to an official by a municipal ordinance is not considered a “delegation” of authority from the city commission for OMA purposes, even if the commission enacted the ordinance.
- A multi-step licensing process can validly assign distinct decision-making roles to different officials or bodies. An official’s ranking process is not subject to the OMA merely because another body, like a city commission, has a separate approval role later on.
Why It Matters
This decision clarifies the scope of Michigan’s Open Meetings Act, reinforcing that it primarily applies to collective governmental bodies and not to individual officials carrying out duties assigned to them by law. It provides a clear roadmap for municipalities on how to structure competitive licensing processes. Cities can assign specific, outcome-determinative ranking functions to individual officials via ordinance without triggering the OMA’s public meeting requirements for that part of the process. This allows for administrative efficiency but reduces public visibility into the initial, dispositive selection phase of such licensing decisions.