Michigan restricted Flint from switching water in loan deal

The state of Michigan restricted Flint from switching water sources last April unless it got approval from Gov. Rick Snyder's administration under the terms of a $7 million loan needed to help transition the city from state management, according to a document released Wednesday.

By the time the loan agreement was in place, cries about Flint's water quality were growing louder, though it had not yet been discovered that the improperly treated Flint River water was causing lead to leach from aging pipes and put children at risk. Flint's state-appointed emergency manager said at the time that switching back to the water source would cost the city more than $1 million a month and that "water from Detroit is no safer than Flint water." Snyder eventually agreed roughly six months later to help Flint reconnect to a Detroit-area system after doctors reported high levels of lead in kids.

But critics in the Michigan Democratic Party said that the loan document, obtained by the party through a public records request, shows that his administration tied Flint's hands and prevented earlier action. Shortly after, a top Democrat became the first state lawmaker to call for Snyder to resign.

"The Snyder administration effectively put a financial gun to the heads of Flint's families by using the emergency manager law to lock the city into taking water from a poisoned source," party chairman Brandon Dillon said.

House Minority Leader Tim Greimel later added: "Given the actions of negligence and indifference by the governor, and a culture he has created that lacks transparency and accountability, the very serious call for resignation is warranted."

Snyder spokesman Ari Adler said the governor is "fully committed to remaining in office and fixing the problems with the water in Flint and the problems within state government that caused this crisis in the first place." He also criticized Greimel's "politically charged press conference" instead of attending a legislative briefing on Flint with the governor's office.

Snyder previously refused to step down after calls to do so from protesters, liberal groups and presidential candidate Vermont Sen. Bernie Sanders.

The loan deal said Flint could not enter an agreement with its former water supplier without approval from the state treasurer and also prohibited the city from reducing water and sewer rates unless authorized by the state.

In March 2015, the Flint City Council, which was powerless at the time, voted to "do all things necessary" to stop using the Flint River and reconnect to Lake Huron water. But state-appointed emergency manager Jerry Ambrose, who sought the loan from the state, said no, calling it "incomprehensible."

Provisions in such a loan agreement are "included to ensure that a local unit of government remains on solid financial footing and does not slip back into financial emergency," said state Treasurer Nick Khouri, who took the job just days before signing the loan deal. The Democratic Party also called for his resignation or firing Wednesday.

"At no time did the loan agreement with Flint prohibit the city from returning to the Detroit Water System. It required the City only to notify, and receive State approval, before making such a decision," he said in a statement.

A month before the loan, a state official notified Snyder's aides of a surge in Legionnaires' disease potentially linked to Flint's water -- long before the governor, who said he was not made aware of the deadly outbreak, reported the increase to the public. The official also briefly mentioned Legionnaires in a January 2015 email to one of Snyder's spokespeople, according to recently released emails.

Those emails, released by Snyder's office last month, showed he was made aware of Flint's water troubles, including E. coli detections, outraged residents' complaints about the color and smell, high levels of a disinfectant byproduct and a General Motors plant's decision to no longer use the water because it was rusting engine parts.

The governor has said he did not clearly know the full extent of the water's danger until around Oct. 1, when state health officials confirmed elevated blood-lead levels in children.

Snyder said last week, "we didn't connect all the dots that I wish we would have," but added that when his aides checked with environmental and health experts in state agencies about concerns, they continually reaffirmed "there was no problem." Some state environmental regulators have since lost their jobs.

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