Correspondence among

All: I spoke with Mr. Craig at the DEQ and he was working on the current version of the Consent Order when I called. Mr. Craig indicated that the order is intended to temporarily reopen the lime disposal area so the WTP upgrades can go forward. In the future the area would be evaluated for clean-up or capping (or other measures after an environmental assessment occurs). Mr. Craig stated that he hopes to send his comments back to the City’s attorney at Werner, Norcross & Judd either tomorrow or Monday. I requested periodic updates on the status of this project but if anyone wishes any follow-up, please let me know. Eric Cline | Unit Operations Specialist - Office of Fiscal Responsibility State of Michigan | Michigan Department of Treasury 430 W. Allegan Street, 3rd Floor | Lansing, MI 48922 (517) 335-2078 | clinerl @michigan.gov 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_b19_2589_2633_07 CITY OF FLINT OFFICE OF THE EMERGENCY MANAGER Darnell Earley, 1CMA-CM, MPA Emergency Manager ELECTRONIC COMMUNICATION March 7, 2014 Ms. Sue McCormick Detroit Water and Sewer Department Detroit, Michigan RE: DWSD Water Rates Dear Ms. McCormick: Thank you for the correspondence dated February 12, 2014 which provides Flint with the option of continuing to purchase water from DWSD following the termination of the current contract as of April 17, 2014. Following DWSD’s April 17, 2013 notice of termination of the water service contract between the City of Flint and DWSD, the City of Flint has actively pursued using the Flint River as a temporary water source while the KWA pipeline is being constructed. We expect that the Flint Water Treatment Plant will be fully operational and capable of treating Flint River water prior to the date of termination. In that case, there will be no need for Flint to continue purchasing water to serve its residents and businesses after April 17, 2014. We are aware that Genesee County has been in negotiations with DWSD to purchase water from DWSD following the termination of our contract, and we understand that an agreement may be imminent. Should that occur, there would be no further need for the City to discuss with DWSD any continuing purchase of water. Should that not occur, however, we would be interested, if Genesee County were to so request, to purchase water from DWDS for some period of time. In such an event, our demand for water would be only for the amount necessary to provide Genesee County with water. That amount would be approximately half of the amount Flint is currently purchasing from DWSD. City of Flint ¢ 1101 S. Saginaw Street + Flint, Michigan 48502 www.cityofilint.com ¢ (810) 766-7346 « Fax: (810) 766-7218 xxxEND_PAGE:treasury01_b19_2589_2633_08 Ms. Sue McCormick March 7, 2014 Page 2 However, in the very unlikely event that the City of Flint is not able to draw water from the Flint River no later than April 17, 2014, then the City would like the option of continuing to purchase water from DWSD for a period of time, up to the time water is available from KWA. Consequently, I am requesting that you clarify your proposal for the City of Flint to continue purchasing water from DWSD under the following scenarios: e Flint, upon the request of Genesee County, purchases water for sale to Genesee County for up to 3 years, beginning April 17, 2014, in an amount approximately 50% of the volume currently purchased by the City; « Flint purchases water from DWSD in approximately the same volume as currently, for up to 3 years, beginning April 17,2014, with the ability to reduce that volume by up to 50% during that period, upon 30 days notice to DWSD e Flint purchases water from DWSD in approximately the same volume as curtently, for up to 3 years, beginning April 17, 2014, with the ability to reduce that volume by up to 50% during that period, upon 30 days notice to DWSD, and further, to terminate the reduced volume purchase should Genesee County and DWSD reach an agreement whereby Genesee County directly purchases water m DWSD. Thank you and please contact me if you have any questions. I look forward to your response. Sincerely, Darnell Earley, ICMA-CM, MPA. f Emergency Manager City of Flint xxxEND_PAGE:treasury01_b19_2589_2633_09 Koryzno, Edward (T reasury)