Correspondence between

Thanks! Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, Ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov ety Think Green! Don't print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that 1s confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you

TI will do the letter.

How do you want to handle this? Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov = Think Green! Don't print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited, If you are not the intended recipient, please contact the 138 xxxEND_PAGE:treasury01_b04_0379_0503_049 sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you

Background information from DEQ on KWA. They also believe that KWA remains the best option, even in light of the most recent offer by DWSD.

Please prepare a response to “Fred the Engineer” to be signed by Roger on behaif of Andy. Will you please let me know today how long it will take to get a response out and then also CC me on the letter once it does go? Thanks.

xxxEND_PAGE:treasury01_b04_0379_0503_031 Received by Flint yesterday evening.

Importance: High Do we have a sense on "when" review will be complete? At last word, Caleb was working up talking points to be used after the review is complete...but hoping ta have a sense of when it all could shake out...

FYI

Fine! version sttached w/a dashboards. Edward 8. Koryzne, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, ist Floor | Lansing, MI 48922 (517) 373-4415 | (617) 373-0633 (fax) Korvenok@ michigan gay wy Think Green! Don't print this e-mail unless you need te. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you xxxEND_PAGE:executiveofficeemails20_b1834_4448_4449_2

Transition of Solid Waste collection to private section has been better than expected, minimal complaints. | assured Ed that Andy is aware of the March deadline for KWA Back story on council tabling the KWA participation last week was about political posturing, Ed believes final vote will be 8/1 or 7/2 FY 12-13 budget on track at the % point Hired 7 officers with the additional public safety millage, but need 5 more. Will not be able to hire them until they run a new police academy about 16 weeks out. Retiree health care changes on hold until federal judge rules, current problem is the employee's costs exceed city’s cap by $150 and they are sending bills. They cannot differentiate between a 45 yr. old retiree receiving $17,000 of healthcare benefits versus a 65 yr. old retiree who is on Medicaid. Not sure of the outcome this will have on the judge’s ruling. Mike Brown talking to Jeff Barnes to make sure second year of state funding for the lockup is still available. 1 mentioned the sanitary sewer issue they are dealing with, 300-400 manholes need to be replaced @ $800 per manhole. Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov = Think Green! Don't print this e-mail uniess you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you 161 xxxEND_PAGE:treasury01_b06_0561_0924_214 Lamphier, Wendy (T reasury)

Thanks, | will share this info with Ed Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, 1st Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@ michigan.gov AS Think Green! Don't print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited, If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destray all copies of the original message and attachments. Thank you

Twill press Brom on #1. There is no conversation of which I am aware regarding a TAB in the near term for Flint. In his state of the city speech, Walling made his position clear that he and the Council could manage this.

FYI - Ed shared a couple of items that | thought you should be aware of: 1. KWA-The County is sending Bids for engineering services to size the pipeline on 3/22/13. Per Ed this is the absolute deadline for making a decision to participate Obviously he would like Treasury to share a decision with him ASAP. He also asked me to share with you that PA 72 does not appear to have a $50k spending limit that PA 4 had and he ts willing to proceed with the Project, independent of Treasury, if you desire. 2. Mayor Walling meeting w/ Governor — The Mayor is meeting with the Governor on 3/8/13 to discuss the TAB. Ed said that If Treasury 1s contemplating moving in this direction please let him know because it impacts the budget he will prepare. They are currently preparing a five-year budget. Appointment of a TAB only requires two year budget and certain charter provisions will increase costs to the City. xxxEND_PAGE:treasury01_b06_0561_0924_199 Edward 8. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, 1st Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@ michigan.gov 5 Think Green! Don't print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law, Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you xxxEND_PAGE:treasury01_b06_0561_0924_200 Stanton, Terry A. (7 reasury)

FYI

Very good news indeed! Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, Ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov = Think Green! Don't print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law, Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you

We've been working on the final touches to our KWA report, which includes our recommendation. However, we learned within the past few days that Tucker Young apparently met with Andy and is exploring another alternative. Do you have any information about that? I asked for some additional edits on the Highland Park plan, which has been evolving along with the KWA report.

Did we ever track down the responses to Andy's KWA questions? What about the Highland Park plan?

The updated assessment appears fine. Thanks for the additional work. The Flint parallel water line option is not one I understand. It is not clear why construction of a new line paralleling the 72" line from Port Huron would be of interest to DWSD and a benefit, not only to Flint, but also to the metro area users of the DWSD water services. Do we have any confirmation of DWSD’s interest is this approach?

| believe Ed Kurtz stated that the Flint City Council is 100% in favor of the KWA option. —---Original Message-——

Andy is pretty reluctant to have an unelected EM/EFM make the decision on the KWA. Do we have any sense where the council is on this issue? | think he would feel much better if we had a supportive resolution from the Council. Can you please inquire? Sent from my iPad xxxEND_PAGE:treasury01_b06_0561_0924_066 89 (Rev 02-11) STATE OF MICHIGAN RICK'SNYDER DEPARTMENT OF TREASURY ANDY DEON GOVERNOR LANSING STATE TREASURER ANALYSIS TO: Edward Koryzno, Administrator; Office of Fiscal Responsibility FROM: Eric Cline. Unit Operations Specialist SUBJECT: Flint Water System Status Assessment DATE: January 22, 2013 On November 26, 2012, the Department of Treasury commissioned the firm of Tucker, Young, Jackson & Tull, Inc. (TYJT) to analyze options for the City of Flint to either remain a customer of the Detroit Water & Sewer Department (DWSD) or to join the Karegnondi Water Authority (K WA) in Genesee County. The overarching purpose of this study was to provide objective analysis to the State Treasurer and to Flint’s Emergency Financial Manager (EFM) in order to secure potable drinking water for the City for the foreseeable future. The Office of Fiscal Responsibility (OFR) has been the lead office representing Treasury on this project. On December 21, 2012, staff from TYJT met with representatives from the Department of Treasury and the City of Flint to provide a preliminary report on their findings. At this meeting, TYJT outlined $ options that they had analyzed. These options were: 1) 100% water provision by the City of Flint Water Plant from its water source of the Flint River; 2) 100% provision of untreated Lake Huron Water by KWA (which would require treatment by the Flint Water Plant); 3) Effective 100% provision of treated drinking water by DWSD,; 4) Provision of variable amounts of water from DWSD through the existing Potter & Baxter mains (this option called for Flint to treat and blend river water into DWSD water in order to reach their daily needs); and 5) Provision of variable amounts of water from DWSD through the 72” Imlay City main (this option also called for Flint to treat and blend river water into DWSD water in order to reach their daily needs). Each of the blending options looked at Flint purchasing 4, 8, or 12 Million Gallons per Day (MGD) from DWSD and blending the balance in river water to achieve their maximum daily water needs of 18 MGD. The Imlay City option also provided for DWSD to sell the 72” main to the City of Flint, which would then become the operational and maintenance responsibility of Flint.

Andy asked for a little followup on our conversations. Can you guys have someone put together a written response to these questions ASAP? 1) Please show the different projected construction costs provided by TYJT and in the presentation by Flint this week. If different, please indicate why we believe the Flint #s are acceptable projections. 2) Please show the contingency on construction included in both projections. 109 xxxEND_PAGE:treasury01_b06_0561_0924_056 3) What are the protections that Flint has in the case of a) cost overruns on construction, and b) a delay in the construction timeline that forces Flint to use DWSD water longer. Thanks.

Follow Up Flag: Follow up Flag Status: Flagged A document for discussion at this afternoon’s meeting from Ed Kurtz regarding Flint water system options. Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, Ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.goyv = Think Green! Don't print this e-mail unless you need to, CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments, Thank you

Follow Up Flag: Follow up Flag Status: Flagged FYI - Mike Brown called to say that Mayor Walling will be joining Ed Kurtz, Mike Brown and Jerry Ambrose for this afternoon’s meeting. Edward B. Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, Ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov = Think Green! Don't print this e-mail unless you need to CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that ts confidential and protected from disclosure under the law, Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments. Thank you xxxEND_PAGE:treasury01_b06_0561_0924_037 Koryzno, Edward (T reasury)

See Comments below Edward B, Koryzno, Jr. | Administrator - Office of Fiscal Responsibility State of Michigan | 430 W. Allegan Street, ist Floor | Lansing, MI 48922 (517) 373-4415 | (517) 373-0633 (fax) KoryznoE@michigan.gov a Think Green! Don’t print this e-mail unless you need to. CONFIDENTIALITY NOTICE: This e-mail, and any attachments, is for the sole use of the intended recipient(s) and may contain information that is confidential and protected from disclosure under the law. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail, and delete/destroy all copies of the original message and attachments, Thank you