Allison, Attached is the periodic update on distressed local governments, Please pass on to the Governor as appropriate.
This will be the basis for our Local Government briefing March 30. Please call with any questions. Wayne
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3600 (Rev 01-11)
STATE OF MICHIGAN
RICK SNYDER DEPARTMENT OF TREASURY R. KEVIN CLINTON
GOVERNOR STATE TREASURER
DATE: March 23, 2015
TO: Rick Snyder, Governor
FROM: R. Kevin Clinton, Treasurer
SUBJECT: Status of Financially Stressed Local Governments
EMERGENCY MANAGER
Flint
Emergency Manager: Gerald Ambrose
Appointed: January 13, 2015
Anticipated Exit: April 2015
Recent Developments
The city was awarded $2M through the Financially Distressed Cities, Villages, and
Townships Grant Program. These funds will be used to enhance the city’s water system
through improved waste management, leak detection, and pipe assessments.
An EM Order is being prepared that will restructure its SRF loans. This would free up
approximately $2.2M allowing the city to further improve its water system.
The City of Flint had informed residents that it is in violation of the Clean Water Standards
Act, after unsafe levels of trihalomethanes (TTHM, a disinfectant by-product) were found
in the water. Recent testing by the Michigan Department of Environmental Quality
(MDEQ) Testing Lab showed that the total TTHM levels for the month of February are
well within the Environmental Protection Agency (EPA) guidelines for safe water.
However, because EPA regulations require that the four month average for all testing sites
be within certain guidelines, the city is still considered to be non-compliant by the MDEQ.
Monthly testing will be ongoing, and is being conducted by several parties.
The city hired Veolia to provide an analysis of the water system, including recommended
improvements, and associated costs. Recommendations included water plant
improvements, distribution system improvements, new policies and procedures, and better
communication with customers. On March 19, 2015, the report was presented to the Flint
Water Advisory Committee, but the presentation broke down due to citizen unrest. An
International City/County Management Association (ICMA) comprehensive public safety
study has been completed, and was presented to the City Council on January 22, 2015.
Several recommendations for both police and fire are currently being reviewed. Of the 16
major recommendations for public safety, the following four are most crucial:
www michigan govitreasury
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o Establish more aggressive protocols for responding to service demands from the
public.
o Equip a minimum of one marked patrol car with an automated external defibrillator
(AED) and an automatic license plate reader, and equip every car with e-ticket
readers and printers.
o Develop a robust in-service training program.
o Establish and publish a clear multi-year strategic plan that includes specific
performance goals and objectives for all units.
Significant Actions/Issues
The General Fund accumulated deficit for FY 2014 was $9M. In FY 2013, the General
Fund had an accumulated deficit of $12.9M. Noted reductions included $5.6M from Parks
& Recreation, 2.6M from Community Development, 1.8M from Public Safety, and $1.7