Correspondence among

Thanks, Natasha L. Henderson, City Administrator 1101 S. Saginaw St. Flint, MI Email: Phone: (810) 237-2057 www.cityofflint.com xxxEND_PAGE:treasury01_b38_6783_6976_075 CITY OF FLINT Dr. Karen W. Weaver January 27, 2016 Mayor Treasurer Nick A. Khouri Michigan Department of Treasury Lansing, Michigan 48922 Re: Water Related Civil Litigation Dear Treasurer Khouri: In our letter of December 10, 2015, we requested the State of Michigan’s financial assistance with the cost of defending the Shears, et al v City of Flint, et al \awsuit. As stated in that letter, if plaintiffs were to be successful in that litigation, the financial impact on the City of Flint (City) would be catastrophic. As you are aware, the City hired the law firm of Miller Canfield to aid in its defense. Since the firm became involved defending this suit, the City has won favorable rulings before Circuit Court Judge Archie Hayman. These rulings included an amendment scaling back the scope of the August 17, 2015, preliminary injunction. Prior to this ruling the City was forecasting financial insolvency as early as this summer. Now, the City is permitted to charge water and sewer rates consistent with the Revenue Bond Act and the biennial budget adopted by former Emergency Manager Gerald Ambrose. Additionally, Judge Hayman has acknowledged that the City is not obligated to repay 15.7 million dollars from its general fund to its water and sewer fund. Put simply, while the costs to retain Miller Canfield have not been insubstantial, it has been money well spent. These rulings are clear victories for the City. They are a key step in ensuring Flint’s overall financial health and stability — both now and in the future. While these triumphs are important, the City has also moved to have the case dismissed. Although Judge Hayman denied the motion, the City believes it has strong grounds for appellate review. That appeal is currently pending before the Michigan Court of Appeals, and the City expectantly awaits a favorable ruling. Despite the successes in Shears, the City must still overcome significant economic challenges. Our City is confronting the most dire water related emergency faced by a municipality in recent memory. This is not hyperbole, Both Governor Snyder and President Obama have declared states of emergency in the City because of the water. What is more, our City’s infrastructure, reputation, and people have been irreparably damaged. As a result of this situation, the City is facing a significant amount of civil litigation. Several lawsuits have already been filed against the City. These include two class action suits. The first, Mays v Snyder, et al was brought in the Eastern District of Michigan; the second, Collins v Snyder, was brought against the City in Genesee County Circuit Court. The City expects to incur significant legal City of Flint 1101 8. Saginaw St. Rim J01 - Flint, Michigan 48502 | wau.cityvofflintcom > (S10) 766-7346 © Far: (810) 766-7218 xxxEND_PAGE:treasury01_b38_6783_6976_076 fees and costs in defending these two suits. Moreover, we believe these suits are only the first wave of suits to be filed. It is very likely that additional plaintiffs will file suits against the City in the future. As is the case with the Shears litigation, if the plaintiffs in any water related lawsuits are successful, the financial impact on the City would be catastrophic. Certainly, the financial progress and accomplishments achieved by emergency managers over the lust four years are at risk. Avoiding this catastrophic result must be a priority. And, given the potential liability posed by these cases all funds expended on competent, qualified legal counsel will be money well spent. We again acknowledge that under Public Act 436, the State does not assume liability for the actions of an emergency manager. However, without State assistance, the City simply cannot cope with the voluminous number of lawsuits it will soon be facing. Our City needs the resources and expertise of proven legal counsel, such as Miller Canfield, Unfortunately, the City cannot afford these costs. Therefore, we are asking the State to provide the necessary funding for outside legal counsel. The City and its residents have sacrificed much to attain fiscal stability and end the financial emergency. Our budget, which is already thin, has been stretched to the breaking point by the water crisis. Again, we need the State’s help. We would ask that you provide us with the financial assistance necessary to deal with all water related litigation both now and in the future. Respectfully submitted, Dr. Karen W. Weaver " Nitasha L. Hendergo: Mayor City Administrator SADBR\Municipal Folders\Water Litigation Treasury Cormespondence\Ltr to N Khouri re Water Sutts | 27 16 docx xxxEND_PAGE:treasury01_b38_6783_6976_077 Pleyte, Beth (Ti reasury)

Hello All: I have attached the signed copies. I will bring the signed copies for distribution in the meeting today. Thanks, Natasha L. Henderson, City Administrator City of Flint, Michigan xxxEND_PAGE:treasury01_b36_6099_6552_098 RESOLUTION NGO.: 1508732, presentep:___/0- /A- 15 ADOPTED: RESOLUTION AUTHORIZING A BUDGET AMENDMENT TO INCREASE THE WATER AND SEWER BUDGET BY $12,000,000.00 AND TO ALLOW FOR EXPENDITURES FROM THOSE FUNDS TO FACILITATE THE SWITCH BACK TO THE DWSD WATER SUPPLY BY THE CITY ADMINISTRATOR: Due to the serious health threat facing the residents of the City of Flint, the Administration has been diligently working toward a feasible and speedy resolution to the City’s water crisis; and Through the commitment of $6 million from the State of Michigan and $4 million from the C.S. Mott Foundation, a total of $10 million in contributions have been pledged to assist the City with the cost of purchasing water from the Detroit Water and Sewerage Department and its successor, the Great Lakes Water Authority, until the City is able to receive water from the Karegnondi Water Authority (KWA). The City Administrator and the Mayor have agreed to the acceptance of these funds. At this time, the KWA reports that construction is on schedule to be completed by June 30, 2016. The City estimates that the total cost to purchase water through DWSD will be $12 million for 9 months. The balance of $2 million not covered by the generous pledges of State and Local resources is the responsibility of the City, A budget amendment is necessary to reflect both an increase in revenues for the receipt of $10 million in assistance and $2 million of budgeted Use of Fund Balance and an increase in expenditures of $12 million for the purchase of DWSD water supply. IT IS RESOLVED that the Finance Department is authorized to process a budget amendment to the appropriate Water and Sewer funds to facilitate the switch back to the Detroit water system as soon as practicable. Specific revenue and expenditure line items will be provided by the Chief Financial Officer. eter M. Bade, City Attorney APPR APPROVED AS TO FINANCE: APPROVED BY THE FLINT CITY COUNCIL: ENTED TO CITY COUNCIL: 10/12/2015 ADOPTED BY CITY COUNCIL: 10/12/2015 xxxEND_PAGE:treasury01_b36_6099_6552_099 ISO08975° RESOLUTION NO.: pREsENTED:___/O~- /A = 15 ADOPTED: RESOLUTION AUTHORIZING THE CITY ADMINISTRATOR TO TAKE NECESSARY ACTION TO CONVERT TO THE DETROIT WATER SYSTEM BY THE CITY ADMINISTRATOR: In order to promote the health, safety and welfare of this community, it is in the best interests of the City of Flint for the Detroit Water and Sewer Department (DWSD) to supply the City with treated water pending completion of the Karegnondi Water Authority; and In order for DWSD to supply the City with water, it will be necessary to utilize pipe owned by the Genesee County Drain Commission (GCDC); and The City, DWSD and GCDC are actively negotiating the terms of the necessary agreements to ensure this transition occurs as soon as possible; and IT IS RESOLVED that the City Administrator is hereby authorized to enter into agreements with DWSD and GCDC for conversion to the Detroit Water System. APPROVED AS TO FORM: fe M. HX APPROVED BY CITY COUNCIL: ESENTED TO CITY COUNCIL: 10/12/2015 ADOPTED BY CITY COUNCIL: 10/12/2015 xxxEND_PAGE:treasury01_b36_6099_6552_100 Dempkowski, Angela (Ti reasury)

Hello Randy, Per our conversation, I have attached the document. Thanks, Natasha L. Henderson, City Administrator City of Flint, Michigan 1101 S. Saginaw St. Flint, MI. 48502 Email: Phone: (810) 237-2057 www.cityofflint.com xxxEND_PAGE:treasury01_b35_5648_6098_052 SUBMISSION NO.:_ CHOP PS LO/S- presenteD: /O° 3-/5 ADOPTED: RESOLUTION TO AUTHORIZE BUDGET AMENDMENTS BY THE CITY ADMINISTRATOR: Whereas, the City of Flint’s budget 1s monitored on an ongoing basis by the Finance Department and City department heads; and Whereas. the Finance Department is recommending certain adjustments; TT 1S RESOLVED. that the FY16 Budget of the City of Flim is hereby amended to reflect the changes in the attached list of budget adjustments to the City’s Water and Sewer Funds dated October 7, 2015; and That the Chief Financial Officer is authorized to do all things necessary to incorporate the attached changes into the Budget and to assign the appropriate account numbers. ‘ale fi MLA 2 Gy es CITY COUNCIL: RECEIVERSHIP TRANSITION ADVISORY BOARD: Joshua Freeman, Council President xxxEND_PAGE:treasury01_b35_5648_6098_053 Department Sewer Fund Revenues: Transfers In Charges for Services Other Revenue Drawings From Fund Balance Appropriations Net Revenues/Appropriations Water Fund Revenues: Charges for Services Drawings From Fund Balance All Other Revenue Appropriations Net Revenues/Appropriations ee CITY OF FLINT 1ST QUARTER BUDGET AMENDMENTS FOR THE FISCAL YEAR ENDING JUNE 30, 2016 Amended FY2016 ist Quarter Budget Adopted Proposed 4/28/2015 Amendments 800,000 (800,000) 30,434,895 (5,941,475) 11,000 - 1,091,873 2,883,373 32,337,768 (3,858,102) 36,943,802 (3,560,824) : 7,287,125 112,000 - 35,990,087 (207,984) 1,065,715 (1,065,715) Proposed Amended Budget 10/7/2015 24,493,420 11,000 3,975,246 28,479,666 28,382,978 7,287,125 112,000 35,782,103 xxxEND_PAGE:treasury01_b35_5648_6098_054 Cline, Richard (Treasury) SAM, U¢5S, Mayor, CA, Fad

Thanks, Natasha L. Henderson, City Administrator City of Flint, Michigan @Samsung Galaxy Note 4 ---------- Forwarded message ----------

Natasha L. Henderson, City Administrator City of Flint, Michigan @Samsung Galaxy Note 4 98 xxxEND_PAGE:treasury01_b25_3630_3729_021 A BORD ITN, i City of Flint Water Quality Update Wednesday August 12” 2015 Leak Detection What: $900,000 Treasury Distressed City Grant for Leak Detection / Pipe Wall Assessment Status: Work commencing The vendor “echologics” has mobilized in the City and is prepping to begin working this week. Next steps: Work performance. GAC Installation What: $1,601,740 contract with LAN to design and install new filter media at the Water Plant Status: Six filters in use Six of the twelve filters are completely installed and are now in use. internal testing has confirmed a significant drop in the TTHM level leaving the plant, levels were trending between 50 — 60 and have dropped to 20. Installation has started on the remaining six filters. All twelve filters will be available for use in advance of our next quarterly testing period which is next week. Next steps: Install last six filters. xxxEND_PAGE:treasury01_b25_3630_3729_022 WPC Incinerator Shutdown What: $1,100,000 Treasury Distressed City Grant for WPC Incinerator Shutdown Status: In construction phase Construction continues, the weather has cooperated and the work is on schedule. Next steps: Continuation of construction work. Water Meter Installation What: $5,000,000 contract to purchase and install up to 18,000 water meters. Status: in progress The vendor has established a good routine and has completed the installation of ~300 meters each week. Next steps: Track the progress and maintain information flow. Howard Croft Public Works Director xxxEND_PAGE:treasury01_b25_3630_3729_023 Koryzno, Edward (T reasury)

Natasha L. Henderson, City Administrator City of Flint, Michigan @Samsung Galaxy Note 4 115 xxxEND_PAGE:treasury01_b29_4586_4669_66 Fria City of Flint Water Quality Update Wednesday July 297 2015 Leak Detection What: $900,000 Treasury Distressed City Grant for Leak Detection / Pipe Wall Assessment Status: Contract signing The vendor Echologics is ready to mobilize and has set the week of August 10" as the time to begin the project. The vendor maintains a window of 10 — 14 weeks following starting in order to complete the full scope of work. Next steps: Mobilization. GAC Installation What: $1,601,740 contract with LAN to design and install new filter media at the Water Plant Status: Installing Six of the tweive filters are completely installed The filters are expected to immediately drop the TTHM level. The timing of putting the filters into use is designed to get the maximum impact at the time of the next testing period which is schedule for the third week of August. Next steps: Introduce water through the six new filters, and begin installation of the next six filters. xxxEND_PAGE:treasury01_b29_4586_4669_67 WPC Incinerator Shutdown What: $1,100,000 Treasury Distressed City Grant for WPC Incinerator Shutdown Status: In construction phase Construction continues, the weather has cooperated and the work is on schedule. Next steps: Completion of concrete work. Water Meter Installation What: $5,000,000 contract to purchase and install up to 18,000 water meters. Status: On schedule Letters have been sent to the public and posted online. The installation of the first 9000 meters started this week. A kickoff meeting of all management personne! involved is set for today to evaluate all aspects and possible issue that could occur. Next steps: Kickoff meeting with all management today. Howard Croft Public Works Director xxxEND_PAGE:treasury01_b29_4586_4669_68 Dempkowski, Angela (Treasury)

Natasha L. Henderson, City Administrator City of Flint, Michigan @Samsung Galaxy Note 4 120 xxxEND_PAGE:treasury01_b29_4586_4669_28 City of Flint Water Quallty Update Wednesday July 23" 2015 Leak Detection What: $900,000 Treasury Distressed City Grant for Leak Detection / Pipe Wall Assessment Status: Contract signing The Contract has been signed internally and sent to the vendor. The vendor maintains a window of 10 — 14 weeks following mobilization to complete the full scope of work. Next steps: Complete the contract signing and schedule mobilization. GAC Installation What: $1,601,740 contract with LAN to design and install new filter media at the Water Plant Status: Installing Six of the twelve filters are completely installed and will go inte use at the beginning of next week. We need to relocate the mid-point chlorination prior to switching the water to running through the filters. The filters are expected to immediately drop the TTHM level. One the water has been redirected through the new GAC, the remaining six filters will begin installed All twelve filters will be available for use in advance of our next quarterly testing period which is the third week in August. Next steps: Introduce water through the six new filters, and begin installation of the next six filters. xxxEND_PAGE:treasury01_b29_4586_4669_29 WPC Incinerator Shutdown What: $1.100.000 Treasury Distressed City Grant for WPC incinerator Shutdown Status: In construction phase Construction continues, the weather has cooperated and the work is on schedule. Next steps: Completion of concrete work. Water Meter Installation What: $5,000,000 contract to purchase and install up to 18,000 water meters Status: On schedule Letters have been sent to the printer for mailing. A list of frequently asked questions is written and being posted to the website. The installation of the first 9000 meters is scheduled to launch within the next week. A kickoff meeting of all management personnel involved is set for this week. Next steps: Hold a kickoff meeting with all management personnel involved prior to launch of installation program. Howard Croft Public Works Director xxxEND_PAGE:treasury01_b29_4586_4669_30 Pleyte, Beth (T reasury)

Hello Randall and Eric, I have an engagement this morning and will not be able to participate in the conference call this morning. Mayor Walling is aware and will update me on the call details. Accordingly, I have attached a water update. Thanks, Natasha Natasha L. Henderson, City Administrator City of Flint, Michigan 1101 S. Saginaw St. Flint, MI. 48502 Email: nhen n i Phone: (810) 237-2057 www. cityofflint.com 141 xxxEND_PAGE:treasury01_b30_4670_4718_37 City of Flint Water Quality Update Wednesday June 10th 2015 Leak Detection What: $900,000 Treasury Distressed City Grant for Leak Detection / Pipe Wall Assessment Status: Expected start date - late June / early July The resolution was approved by the RTAB and the contract is being sent to the vendor. The company ‘Echologics’ is still prepared to sign the contract and mobilize within several! weeks following the contract signing. The company maintains a window of 10 — 14 weeks to complete the full scope of work. Next steps: Get contract signed and determine mobilization timeframe and length of project. WPC Incinerator Shutdown What: $1,100,000 Treasury Distressed City Grant for WPC Incinerator Shutdown Status: In construction phase With good weather, construction continues to move forward. No change in the schedule. The 10 inch ductile iron cake pipes have now been placed and partially buried. This week, they are testing them (see pictures) to verify that they will hold 600 psi. This is double the working pressure of the cake discharge from those pumps. Next steps: Continued construction of underground infrastructure xxxEND_PAGE:treasury01_b30_4670_4718_38 GAC Installation What: $1,601,740 contract with LAN to design and install new filter media at the Water Plant Status: Ahead of schedule Vendor Calgon is still conducting performance testing on water samples that were sent to them. The sampling will verify the specific media that will be used. Testing is expected to be completed within the next week. Once the exact medial is determined, delivery of supplies and installation will be scheduled. Next steps: Vendor tests on Flint water and sand samples continue until results are determined. Water Meter Installation What: $5,000,000 contract with Metron to purchase and install 18,000 water meters Status: On schedule Funding was budgeted ($2,500,000) in FY 15 to replace all 9,000 of the meters that are The City will purchase and replace 3000 over each of the next three years to complete the city wide installation plan. Vendor Metron-Farnier was awarded the contract following an RFP for purchase and installation services, Metron has just recently signed the contract and has targeted July 15, 2015 to begin the installation of 9,000 meters. Next steps: A written installation plan is being developed by the city’s water service center which will have one person designated as the internal manager of the project. Howard Croft Public Works Director xxxEND_PAGE:treasury01_b30_4670_4718_39 Vandegrift, Drew (TREASURY)

Per our conversation, I have attached information about the GAC/Leak Detection status. Also, the next Water Technical Advisory Committee Meeting will be Wednesday May 20th 2:00 pm at City Hall. Thanks, Natasha Natasha L. Henderson, City Administrator City of Flint, Michigan 1101 S. Saginaw St. Flint, MI. 48502 Email: Phone: (810) 237-2057 www. cityofflint.com 161 xxxEND_PAGE:treasury01_b32_5109_5235_083 City of Flint Water Quality Update Tuesday May 13" 2015 Leak Detection What: $900,000 Treasury Distressed City Grant for Leak Detection / Pipe Wall Assessment Status: On schedule An amended RFP for Services was returned and a qualified vendor “Echologics” has been Identified. This company Is based In Georgia with strong financials and capacity to accomplish the work. The bid for services was ~$895,000. (Bid sheet included for raview) The resolution is being routed through Legal and Finance and will make it to the City Administrator this week. The company has confinned that If the contract is signed in the next two weeks that they can mobilize and begin work sometime In June. The company has given a window of 10 ~ 14 weeks to complete the full scope of work. Next steps: Complete the resolution approval process. GAC Installation What: $1,601,740 contract with LAN to design and install new filter media at the Water Plant Status: On schedule LAN has embedded someone in the Treatment Plant as a project manager for 15 — 20 hrs. per week for prep work, testing, and updates. (Most recent update included for review) Weekly updates come with a status report on all aspects of water quality concems and improvements. LAN has been in contact with the DEQ and expects to have final design plans submitted for discussion by the end of this week. A contractor and supplier have been contacted by LAN and are awaiting approval of the final design specifications. Next steps: Obtain design approval by the DEQ. xxxEND_PAGE:treasury01_b32_5109_5235_084 Financially Distressed Cities, Villages, and Townships Grant Agreement City of Flint Grant # 210005-15 APPENDIX A ~ APPROVED BUDGET AMOUNTS Water Main Leak Detection Survey and Condition Assessment Below Is the approved budget for your grant project. Please note, we have assigned budget categories to each of your original budget line Items. Use these categories when submitting your reimbursement requests. Budget Category Budget Description pippplication Aware Budget Infrastructure - Repalr_| Project Planning $90,000.00 $90,000.00 Infrastructure - Repair | Mobilization of Crew to Site $27,000,00 $27,000.00 Infrastructure - Repair_| Leak Detection < 160" | 378,000.00, 000.00 iol id Diameter Infrastructure - Repair | Leak Detection > 16” Diameter Infrastructure - Repair _| Pipe Condition Assessment $135,000.00 $135,000.00 Comments Le i a a a Budget Total $900,000.00 | _$900,000.00[ SSCS” ‘Reimbursement requests must include copies of invoices and cancelled checks (or equivalent) supporting the costs. Prior to the release of funds, the grantee will provide to Treasury an updated work plan / timeline, related to the line items for which grant funding was recelved. The work plan / timeline should include estimated completion dates and a description of the deliverable for each step. Between the Start Dafe and the End Date specified on page 1, water and sewer rates may not be Teduced, xxxEND_PAGE:treasury01_b32_5109_5235_085 Part Il: Cost Proposal 7. Pricing Pricing for this project is presented in below. All quantities are estimated based on information provided by Flint. It is estimated that site work will take 10-14 weeks to complete for 2 Echologics’ Field Specialists. $3,500 Mobilization ePulse™ condition assessmenl and EchoWave™ leak detection, for transrnission main pipe. {214” diameter} First mile rate ePulse™ candition assessment and EchoWave™ leak detection, for transmission main pipe, [216" diameter} Up to 35 additional miles Small diameter leak detection listening survey with acoustic correlation (<16” diameter} Up to 300 miles Non-Revenue Water Study Emergency Mobilization Fee* Re-booking Fee* $5,000 Standby Fee* 2,200 | Per Day Estimated Project Total $895,850 “If Echologics’ staff are unable to work due to any cause within the reasonable control of Client, a standby rate of $2,200 per day will be billed Echologics invoices monthly for completed work. Field tests and analysis will be considered 80% complete upon the conclusion of the field tests, and 100% complete upon the submission of the draft repart Each payment is due within 30 days. Payment terms are subject to approval by the Echologics Credit Department. All prices are tn USD, and do not include applicable taxes. Pricing is based on the standard terms and conditions provided in this proposal, and ts valid for 120 days CONFIDENTIAL Proposal # 42215089 37 xxxEND_PAGE:treasury01_b32_5109_5235_086 CITY OF FLINT WATER QUALITY STATUS REPORT May 7, 2015 We are still working with the Water Treatment Plant staff to establish set criteria for raw and treated waler data for your use, Most information is already in place but few are still in the works. Question marks will be eliminated when data are available. I. Issues of Concern A. THM level tn Dort is 100 B. Reservoirs are intended to be used minimally prior to sampling; however, emergency type events (Large water main break or a major fire) may require the use of water from those reservoirs which could contain potentially high THM levels THM levels needs to be analyzed weekly to understand trend changes in the levels before reuse. C. Bids for Phase 1 of the 24” water main replacement have not been received yet and therefore, the work will not be completed prior to the August THM sampling period. Some of this work will be needed to help ensure low THM levels in August. D. Cleaning of all reservoirs is needed and proper water circulation, within the reservoirs, i recepimentied to help eliminate old age and warm water from developing high THM levels E. Water age in system is possibly being adversely affected by pump statron(s) operations and flow back to WTP/Elevated tank. To be evaluated further with water model F. The City needs to proceed with the design and developing plans for transfer pump station to Dort reservoir. G. Lime sludge removal from Bray Road needs to be planned soon to meet the agreed to limits discussed with the MDEQ. None has been removed to date. Il. Raw Water A. TOC = ~10.8 mg/l, note internal values are showing higher than DEQ tab results B. Temp = 15.6°C (60° F) on 5/6/15 C. THM = 22? Ill. Treated Water A. TOC = 3.7 (65% removal) B. THM = ~40 C. Distribution THM 1. Sample Sites 1, 5, 6 — near 80 IV. WTP Operations A. 17.3 MGD on 5/6/15 B. Un-softened stream currently around 1 MGD C. items to be postponed until after May THM testing 1. East clarifier repair 2. Cleaning of plate settlers 3. Clean/repair slakers D. RFP for polymer pumps to clarifiers is out - work to commence when awarded with intent to be operational well in advance of the August THM sampling E. Security improvements at the main gate are ongoing F. One pump at Cedar St. PS is operational and SCADA control is possible by laptop until communication issues are addressed. Vv. LAN A, Contract amendment is being signed. Liability language and scope for the construction work will need to be incorporated as an amendment to the contract. B. Hydraulic Water Model 1. Rob B provided additional information with help from billing. 2. LAN is working on model update which 1s to be completed approximately 1 month after all existing water system information Is received iQ Nn: Lockwood, Andrews & Newnam, | nc. BLED A DALY COMPANY xxxEND_PAGE:treasury01_b32_5109_5235_087 C. GAC Media 1. Design ts underway: basis of design is being developed 2. Plan is to set up meeting with MDEQ, likely second or third week of May VI. Distribution A. Chlorine residuals are currently holding well B. Flushing will begin week of May 11" Vil. Preparation for Upcoming THM Sampling . A strategy meeting was held on 5/5/15 w/ Rob B, WTP staff & LAN All Reservoirs will be taken off line prior to sampling Recommend flushing for sample sites 1 (McDonalds), 4 (Taco Bell), 5 (Univ. Market), and 6 (Salem Housing) with 5 being the most critical. . Staff will increase ferric dosage prior to sampling Eliminate the softening bypass stream completely if possible Decrease Cl, feed (already implemented) "7g OB> Tracking Data Primary TTHM Sample Indicators Flint River | Flint River | Chlorine TTHM Average Leaving System Water Temp WTP TTHM 5/06/15 15.6 4.1 40 4f2B/5 : q 4.5 2? 5/21/14 18.2 10.3 | 5.3 56 11/21/14 5.4 7.3 I 47 33 [ 50 | 2014 2015 No. Address Sample Location 5/21/14 8/21/14 11/21/14 1/27/15 2/18/15 5/6/15 May Max Last Internal Internal Possible 1 3719 Davison McDonalds 2 8225. Dart BP Gas Sta. 3 3302S. Dort Liquor Palace 4 3606Corunna =‘ Taco Bell 5 2501Flushing Univ. Market 6 3216MLK Salem Housing 7 = $018Clio Rite Aid 8 6204N Saginaw N. Flint Auto WTP Tap 56 86 33 16 8 40 Dort Res 153 2? 2? 100 CS Res 163 35 23 2? 64 WS Res 134 44 60 2? ?? kwood, qarews: &Newnam,inc. ALE A RULES A DALY COMPANY COMPANY [an : xxxEND_PAGE:treasury01_b32_5109_5235_088 250 200 150 —e—Sitel — Sites 3 —<— Site 6 —- »Leaving WTP 100 50 [s} - ~ — = 41d S/d 6/1/14 W/f14 B/N fifi lO/L/1a 11/1/14 17/1/14 1/15 2/1/15 B/S 4fif1s 5f1/1S 6/1/45 Date xxxEND_PAGE:treasury01_b32_5109_5235_089 3500 (Rev 01-11) STATE OF MICHIGAN RICK SNYDER DEPARTMENT OF TREASURY NICK A. KHOURI GOVERNOR STATE TREASURER DATE: May 15, 2015 TO: Rick Snyder, Governor FROM: Wayne Workman, Deputy State Treasurer SUBJECT: Status of Financially Stressed Local Governments EMERGENCY MANAGER Lincoln Park Emergency Manager: Brad Coulter Appointed: July 3, 2014 Anticipated Exit: January 2016 Recent Developments - After conducting preliminary interviews for the City Administrator position, a request was made by the Emergency Manager to identify additional qualified candidates. - A fire union collective bargaining agreement was approved on February 6, 2015. Changes to overtime and paid leave will yield an estimated cost savings of $500K annually. - Voters rejected the Firefighters and Police Officers Retirement Act proposal that was on the May ballot by a margin of 47% to 53%. Had it been approved it would have raised an additional 6 mils, or $3M annually to fund fire and police pension and healthcare costs. - EM Coulter has modified retiree collective bargaining agreements to reduce healthcare benefits. These changes will be implemented on July 1, 2015 and will reduce retiree healthcare costs from $4.1M to $600K annually. - FY 14 ended with a General Fund accumulated deficit of $736K, out of a total budget of $21M. This is a significant increase from the FY 13 accumulated deficit of $89K. Salient increases were in Public Safety - $1.1M, Public Works - $700K, and Culture and Recreation - $600K. Significant Actions/Issues - On February 3, 2015, the city was awarded $143.5K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to enhance public safety through updated technology. Issues to Resolve before EM Exit - Police collective bargaining agreements must be finalized. - Increase and stabilize pension and other post-employment benefits (OPEB) funding levels. www michigan govitreasury xxxEND_PAGE:treasury01_b32_5109_5235_090 Page 2 FINANCIAL REVIEW COMMISSION (FRC) Detroit FRC Created: November 12, 2014 FRC Members: Nick Khouri, Bill Martin, Brenda Jones, Darrell Burks, John Roberts, Lorron James, Mike Duggan, Stacy Fox, Tony Saunders Recent Developments - The city submitted its Four-Year Financial and Operating Plan (Plan) to the FRC in March 2015 for review. Upon its review and determination that the Plan was based on sound assumptions and met all of the requirements under statute, the FRC approved the Plan on April 20, 2015. The city’s Plan encompassed the second year (FY16) of Emergency Manager Orr’s two-year budget and used this as its base year with no changes, plus three years (FY17, FY18, and FY19). - The city’s CFO John Hill hosted a “mini” revenue estimating conference on May 14, 2015, to review revenue estimates approved in February 2015 at the statutorily required Revenue Estimating Conference. After reviewing the city’s revenue trends for income tax, state revenue sharing, wagering taxes, property taxes, utility users tax and all other general fund revenues, among other major fund accounts, and discussing economic trends since February, the city elected to maintain revenue estimates agreed upon at the February 2015 Revenue Estimating Conference. - In addition to the recent hire of Ron Rose for the position of Executive Director for the Office of the FRC, Treasury has hired Steven Watson, who is currently with the State of New Jersey Office of Budget and Management, to fill the Administrative Manager position. Mr. Watson is expected to start on May 26, 2015. Treasury does not expect to hire any additional staff beyond an executive administrative assistant. - The most intense work that the FRC will perform going forward is measuring the effectiveness of restructuring initiatives in light of the large annual pension obligations the city will incur beginning in 2024. - The next FRC meeting is scheduled for May 18, 2015, and the Commission will be asked to approve various contracts and leases related to the Detroit Water and Sewerage Department transaction. RECEIVERSHIP TRANSITION ADVISORY BOARD (RTAB) Allen Park RTAB Appointed: September 26, 2014 RTAB Members: Suzanne Schafer, Joyce Parker, Fredrick Frank, Karen Barann Recent Developments ~ The RTAB approved City Council’s appointment of the city’s Finance Director as Interim City Administrator, effective March 12, 2015. A professional search firm has been hired to help find City Administrator candidates. Treasury will be participating with City Council in the selection process. - The city was expecting to issue a bond tender offer beginning in March but was delayed due to the uncertainty around the City Administrator position. Completion of the bond tender process is now projected to be June 2015. - In April, the RTAB approved the creation of an Interim Deputy City Administrator position to assist in overseeing city operations until the bond tender and City Hall projects are xxxEND_PAGE:treasury01_b32_5109_5235_091 Page 3 completed. Mark Kibby, former City Manager of the City of Woodhaven, was appointed to this position. The Michigan Municipal League and Plante Moran were retained by the city to conduct salary and classification studies of all department head and key manager positions within the city. The city has not established a timeline for this project at this time. The city remains without a Director of Public Services after the leading candidate for the position rejected the city’s offer of employment. A department foreman is serving as interim while the city evaluates how to fill this position. Significant Actions/Issues Litigation was filed by retirees challenging the EM’s authority to reduce other post- employment benefit (OPEB) liabilities. A motion for summary disposition is pending. No date has been set to hear this motion. City Hall will be relocating to a temporary facility in May 2015. The present facility is in poor condition and beyond repair. Benton Harbor RTAB Appointed: March 10, 2014 RTAB Members: Larry Steckelberg, Bret Witkowski, Marvin Raglon, Sharon Hunt Recent Developments The city’s Finance Director has accepted a position as Finance Director in the City of Flint. Her last date of employment is June 5, 2015. The city’s Deputy Finance Director, multiple public safety officers, and two public works department employees have resigned due to other employment opportunities. On April 6, 2015, the City Commission passed resolutions adopting a procurement policy, investment policy, and a credit card policy. Significant Actions/Issues Ecorse On February 3, 2015, the city was awarded $910K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to enhance the water system through water main replacements and fire hydrant repairs, and to complete a property reappraisal which will provide updated and accurate assessing records. Additionally, the city will provide community enhancement through blight management and sidewalk replacement. FY 14 audited General Fund revenues exceed expenditures by $1M, out of a total budget of $6.1M. RTAB Appointed: May 1, 2013 RTAB Members: Edward Koryzno, Robert Bovitz, Joyce Parker Recent Developments On May 12, 2015, the RTAB approved a narrowly balanced FY 16 budget, though significant deficits are projected in future fiscal years, The City Administrator has requested a new City Controller (third in six months) however; the RTAB rejected this appointment at the May meeting. The RTAB has recommended that the State Treasurer amend the final EM order to provide RTAB oversight for all hiring and terminations. xxxEND_PAGE:treasury01_b32_5109_5235_092 Page 4 Flint Significant Actions/Issues On February 3, 2015, the city was awarded $350K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to enhance public safety through improved street lighting. The City Council cancelled the contracted City Administrator search with the Michigan Municipal League (MML) and appointed Wayne O’Neal as full-time City Administrator. On February 10, 2015, the RTAB approved the city’s resolution appointing Mr. O’Neal. The RTAB’s Annual Evaluation for the Governor was not favorable, citing a lack of local financial literacy, political infighting, and an inability to develop a balanced multi-year budget. For these reasons, the removal of RTAB oversight cannot be recommended at this time. The city continues to have trouble attracting qualified candidates, and filling higher level administrative positions. The city signed a contract with UHY to provide part-time financial services until a permanent solution can be found. Municipal Employee's Retiree System (MERS) pension contributions are anticipated to increase from $1.8M in FY 15 to $2.4M in FY 16 because of accelerated funding for closed plans. The city has been unable to balance its five-year budget. Previous budgets project deficit spending in FY 16, and exhaustion of all resources in FY 17. To avoid this eventuality, significant expense reductions will be necessary in upcoming fiscal years. RTAB Appointed: April 29, 2015 RTAB Members: Frederick Headen, Brian Larkin, David McGhee, Beverly Walker-Griffea, Robert McMahan Recent Developments A clerical error by the Flint City Clerk’s Office gave candidates the wrong cutoff deadline to file nominating petitions, April 28 instead of April 21. Consequently, in the Mayor’s race, Mayor Dayne Walling, Councilman Wantwaz Davis, and Dr. Karen Weaver will all be left off the August Primary ballot and will have to run as write-in candidates in November. Councilman Eric Mays did not submit the required number of signatures and will likewise be left off the ballot for Mayor and will also have to run as a write-in candidate. Councilman Herbert Winfrey will be on the ballot and is unopposed for the Sixth Ward seat on the City Council. There were four candidates who filed petitions for the Third Ward City Council seat. Legislators will be asked to provide a statutory fix to allow names on the ballot. If this isn’t successful, all will be forced to run as write-in candidates in the General Election. Jodi Lundquist has accepted the employment offer as CFO. Her start date is to be determined subject to RTAB approval. On April 29, 2015 the city exited emergency manager status and an RTAB was appointed. The first RTAB meeting will be held on June 10, 2015. On April 29, 2015, the Emergency Loan Financial Assistance Board approved a $7M Emergency Loan that will eliminate the city’s remaining deficit when combined with the FY surplus of $20M. EM Gerry Ambrose issued an EM Order on March 19, 2015 that restructured the State Revolving Fund loans and provides approximately $2.2M, allowing the city to invest in capital improvements to the water system. xxxEND_PAGE:treasury01_b32_5109_5235_093 Page 5 EM Gerry Ambrose implemented new Budget Purchasing Ordinances and a Fund Balance Policy during April 2015. The Executive Director of the State Tax Commission notified the city that it must maintain adequate assessment records in compliance with state statute, State Tax Commission rules, and implement any corrective actions necessary. In addition, the city shall implement a full appraisal within a time frame agreed with the State Tax Commission. The City of Flint continues to inform residents that it is in violation of the Clean Water Standards Act, after unsafe levels of trinalomethanes (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 March 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 remains 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. The city is installing a $1.5M granulated active-charcoal filter to improve water quality. This filter installation will be completed in mid-July. In April, EM Gerry Ambrose issued two EM Orders that adopted a two-year budget for FY 17 and FY 18 and outlined the relationship between the Administrator, Mayor, and City Council. On April 13, 2015, EM Order 4 was issued that restored the pay of the Mayor and City Council members. The City Council approved a memorandum of understanding that will consolidate the 67" District Court with the 68th District Court in January 2016. The city has estimated that the consolidation will save the city $8M over a ten year period. The Michigan Municipal League is recruiting qualified candidates to fill the open Human Relations Director, Finance Director, and City Treasurer positions. Voters elected John Cherry, Charles Metcalf, Barry Williams, Cleora Magee, Jim Richardson, Brian Larkin, Victoria McKenze, Marsha Wesley, and Heidi Phaneuf to serve on the Charter Commission. Significant Actions/Issues On February 3, 2015, 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. Pre-planning for implementation of these activities is underway. If the city loses a lawsuit over retiree healthcare, the EM’s two-year budget does not assume this additional $5M to $6M annual expense, which will grow at a rate equal to the general rise in healthcare costs. Hamtramck RTAB Appointed: December 18, 2014 RTAB Members: Deborah Roberts, Mark Stema, Cathy Square, Karen Young Recent Developments The Police Chief resigned on March 11, 2015. Lieutenant Ann Moise was appointed Acting Police Chief. xxxEND_PAGE:treasury01_b32_5109_5235_094 Page 6 Per the 2014 audit, the General Fund’s accumulated fund balance is $2.8M out of a total budget of $16.2M. Significant Actions/Issues On February 3, 2015, the city was awarded $622K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to complete a property reappraisal which will provide updated and accurate assessing records, upgrade City Hall security, and enhance public safety through improved street lighting. A complaint was filed in the federal court by Hamtramck retirees over changes to healthcare benefits in October 2014. The potential exposure to the city is currently unknown. The annual pension liability is anticipated to increase from $3.5M in FY 15 to $4.3M in FY 19. This increase is a result of closing certain pension plans and the Michigan Employee’s Retirement System (MERS) policy of accelerating the required contribution for closed plans. These increases were included in EM Square’s two-year budget. The Segal Group has been hired to provide the city with recommendations on funding its pension obligations. Pontiac RTAB Appointed: August 19, 2013 RTAB Members: Edward Koryzno, Louis Schimmel, Keith Sawdon, Robert Burgess Recent Developments On April 22, 2015, the RTAB postponed consideration of an amendment to the city’s retirement ordinance that would have granted early retirement status to 69 former employees. This ordinance amendment was adopted by the City Council at its April 9, 2015 meeting with no prior announcement or analysis of the issue. No actuarial study was conducted for this change, but the best available estimates indicated the impact to the city’s pension system could be approximately $9M-$13M per year. The Mayor, City Administrator, and Finance Director are opposed to this amendment. On April 29, 2015, the City Administrator informed Treasury that the City Council is considering adopting an amendment to the city’s retirement ordinance that would permit the pension system to absorb $659,000 in COLA overpayments that were made to city retirees. Such an action is permissible under new rules adopted by the Internal Revenue Service. The City Council may consider this ordinance amendment at a future Council meeting. The RTAB postponed action on this issue until City Council takes action. Treasury is monitoring this situation. Significant Actions/Issues On February 3, 2015, the city was awarded $125K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used for community enhancement through blight management. The City Charter proposal was rejected by voters by a 45% to 55% margin. In April 2014, the Final Emergency Manager Order was amended to create a Deputy Mayor position. A suitable candidate was not found through a Michigan Municipal League (MML) search. TJA Staffing and Associates has been hired to recruit a Deputy Mayor as part of the transition back to Home Rule. Per the audit, the General Fund’s accumulated fund balance for FY 14 is approximately $5M out of a total budget of $27M. xxxEND_PAGE:treasury01_b32_5109_5235_095 Page 7 Oakland County Circuit Court Judge Michael Warren dismissed the city’s condemnation lawsuit involving the Phoenix Center because the city failed to include compensation for the lien placed on the property. The city is preparing an appeal of the decision to the U.S. Sixth Circuit Court of Appeals. The City of Pontiac Retired Employees Association v. City of Pontiac lawsuit in the United States District Court was reassigned from Judge Lawrence P. Zatkoff to Judge Avern Cohn. The lawsuit challenges former EM Schimmel’s elimination of retiree healthcare and replacement with an annual stipend. The General Employees Retirement System (GERS) Pension Fund is significantly overfunded and the parties are exploring options to use the overfunded portion to fund retiree healthcare. On March 17, 2015, the Michigan Court of Appeals reversed and remanded for trial a previous lower court dismissal of a 2013 lawsuit which challenged the EM ordered nonpayment of $3.9M into a VEBA trust for the fiscal year ending 2012. This appellate order is not a judgment against the city; rather it allows the previously dismissed lawsuit to proceed. The actual liability of the city will be determined either by a future settlement or by a final determination of the Oakland County Circuit Court. CONSENT AGREEMENT Inkster Date Executed: February 20, 2012 Consent Agreement Consultant: Mark Stuhldreher Recent Developments On May 14, 2015, the City Council agreed to settle the Dent lawsuit regarding police misconduct for $1.37M. The cost of the settlement will be placed on the tax roll by a judgement levy. On April 20, 2015, Wayne County Prosecutor Kym Worthy announced charges of assault and mistreatment of a prisoner (Richard Dent) against William Melendez, former Inkster police officer. In the wake of a violent interaction between Inkster police and a suspect, Inkster Police Chief Vicki Yost announced her resignation on April 22, 2015. The city hired a search firm to recruit qualified candidates to fill the Police Chief position, which is expected to be filled by the end of June. On April 20, 2015, the city adopted a working capital reserve policy for the Water and Sewer Fund which will provide funds for emergency situations. Significant Actions/Issues On February 3, 2015, the city was awarded $855K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to complete a property reappraisal to provide updated and accurate assessing records, enhance the water system through fire hydrant repairs, and enhancing public safety through the creation of a multi-jurisdictional narcotics team, police officer training, deployment of an additional police officer, providing a backup power source, and updating technology. The FY 14 General Fund accumulated deficit per the most recent audit is $767K out of a total budget of $11M. xxxEND_PAGE:treasury01_b32_5109_5235_096 Page 8 River Rouge Date Executed: December 15, 2009 Consent Agreement Consultant: N/A (P.A. 72) Recent Developments A fire union collective bargaining agreement (CBA) was approved on March 10, 2015, resulting in a reduction in health care costs. Significant Actions/Issues On February 3, 2015, the city was awarded $592K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to enhance public safety through improved street lighting, along with infrastructure replacements to City Hall. General fund revenues exceeded expenditures by $885K in FY 14 and the accumulated fund balance was $1.9M. A reduction in healthcare benefits for active employees and retirees was implemented on November 1, 2014. The city estimates an annual savings of $400K, which includes savings expected under the approved fire union CBA. Royal Oak Township Effective Date: April 21, 2014 Consent Agreement Consultant: Robert Burgess Recent Developments Treasury has been informed that the Township Supervisor is regularly approving overtime for employees. Overtime is not included in the 2015 budget, and the Consent Agreement requires State Treasurer approval prior to any overtime expenditures. This is another example of the township’s inability to comply with the terms of the Consent Agreement. Treasury is working with Robert Burgess on a response to this development. On April 7, 2015, Oakland County notified the township that they rejected the proposed ballot language for 4% mils for general operations because the township’s proposed language did not conform to guidelines. The township adopted newly proposed ballot language on April 23, 2015. This language has been resubmitted to Oakland County. An Order was issued by Mr. Burgess on May 9, 2015 to contract for financial consulting services with the Rehmann Group that will assist the township in preparing records for its annual audit and budget amendments. Significant Actions/Issues On February 3, 2015, the township was awarded $274K through the Financially Distressed Cities, Villages, and Townships Grant Program. These funds will be used to enhance public safety through improved street lighting and increased police services. 195 street lights would be converted to LEDs; it is anticipated that work will be completed by August 2015. The Michigan State Police (MSP) continues to provide police services to the township. The Department of Treasury and the MSP continue to work towards an alternative to MSP services. A proposal from the City of Hazel Park is not financially feasible due to expense and the city’s unwillingness to amend the proposal to better accommodate the township’s ability to pay. Mr. Burgess has met with the City of Detroit to determine if the city is interested in submitting a proposal to provide police services to the township. xxxEND_PAGE:treasury01_b32_5109_5235_097 Page 9 The State Treasurer approved the township’s 2015 budget on December 16, 2014, with the requirement that the township work with Treasury to implement additional budget amendments to improve its overall effectiveness. No additional actions have occurred to implement these additional budget amendments and Mr. Burgess is questioning the ability of the township’s newly hired financial analyst to provide service to the township. The township has paid its aging accounts payable that was in excess of $200K. Mr. Burgess has requested the Township Board adopt budget amendments to the 2015 budget totaling $220K to accommodate these unanticipated expenditures. The Township Board has refused to adopt the requested amendments. Treasury is working with the CAC Burgess on a response to this issue. NEUTRAL EVALUATION Highland Park Financial Review Team Appointed: December 2, 2013 Financial Emergency Declared: January 30, 2014 PA 436 Option Selected: Neutral Evaluation Recent Developments Treasury staff is continuing to monitor the city’s progress or lack thereof, in complying with the terms of the Loan Agreement dated September 23, 2014. There are concerns about their ability to successfully restructure their finances and they have failed to implement the health insurance benefit cost reductions as planned in FY 15. In addition, failure to reach an agreement with DWSD resulted in a $20M judgement levy against the city. Finally, there have been problems in implementing the regular billing of water and sewer service to its customers and the calculation and collection of past due amounts owed to the city. since regular billing ceased in mid-2012. On April 24, 2015, the Detroit Water and Sewerage Department (DWSD) was granted a judgment levy to collect $20M for sewer service that is currently owed to DWSD. The DWSD Director has threatened to terminate water and sewer services if the city doesn’t pay its arrearage and current charges. A Wayne County Circuit Judge issued a temporary restraining order on April 29, 2015 blocking DWSD’s efforts to cut off water service to the City of Highland Park. In addition, the judge also set aside the $20M judgment against the City of Highland Park for failure to pay DWSD for water and sewer services. The judge has set a conference hearing on this matter for June 4, 2015. Significant Actions/Issues On February 3, 2015, 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 meter replacement, leak detection, and system repairs. Huron Consulting was retained to prepare a request for proposal to solicit firms to operate and maintain the city’s water and sewer systems, as required by the city’s Plan of Adjustment. The city received one proposal from Wade Trim by the submission deadline of May 4, 2015. This proposal is under review by the City and Treasury. The city’s liabilities total $117.6M. Some of the major components are: $55.3M debt, including $20.7M owed to the DWSD, $17.7M pension bonds, and $26.1M unfunded other post-employment benefits (OPEB) liabilities. xxxEND_PAGE:treasury01_b32_5109_5235_098 Page 10 - Summary of the Plan of Adjustment for the City of Highland Park was adopted on August 28, 2014: o The city must make major reductions to retiree healthcare benefit costs. o In August 2015, an emergency loan of $12M plus restructuring of $4.8M existing loans will be requested by the city to refund $2.7M in Fiscal Stabilization Bonds, $5.2M in Financial Recovery Bonds, and $3.7M in State Revolving Fund Bonds. The status of this request will be reviewed in the context of benchmarks the city committed to in their last emergency loan in September 2014. OTHER COMMUNITIES Wayne County Recent Developments - The Recovery Plan has been released to the public and Treasury has begun an analysis of the plan. Significant Actions/Issues - Cash reserves reached its lowest point in February 2014 with pooled cash falling to approximately $22M. The August 2014 cash balance was approximately $150M. This number includes proceeds from a short-term borrowing of $75M. - The County’s annual structural general fund deficit is approximately $50M prior to any of the proposed remedial actions. - The preliminary results of the county’s actuarial report indicate a drop in other post- employment benefits (OPEB) liability of approximately $409M. This reduction is a result of the county choosing less expensive plans and implementing cost sharing measures. The Plan participants are now paying a larger share of the cost. This does not include any saving opportunities resulting from a proposed change to retiree healthcare. - The county is working to resolve a disagreement with the Mental Health Authority over services provided to jail inmates. The county currently pays for this service but believes it falls under the purview of the Authority. - The county has not yet proposed a long-term solution to its jail problems. xxxEND_PAGE:treasury01_b32_5109_5235_099 Reel yews gas Cline, Richard (Treasury) ATH Analyst, CA, Mayer SAY ees