Economy

Michigan City Tells Residents To Pay Up Or They’ll Shut Off Water — Again

CREDIT: AP Photo/Paul Sancya

Flint residents receiving free bottled water in February 2015

Months after a county judge ordered Flint, Michigan to cease shutting off water pipes and revise customers’ bills, the city is once again sending out letters warning customers to pay or go dry.

The city sent out more than 1,800 shutoff notices since last week, representing about 60 percent of all customers billed in September. While city ordinances call for a 10-day grace period between a shutoff warning and the city actually closing a pipe, Flint is giving residents until December 1 to make payments.

Flint law requires utility rate hikes to be implemented gradually over a one-year period, but city leaders imposed a 35 percent hike all at once in the summer of 2011. Citizens sued, ultimately persuading a judge this past summer to order Flint to revoke that illegally-rapid hike and revise customers’ bills accordingly. The city had been issuing water shutoff notices to past-due customers for weeks at that point, a policy also suspended by the judge’s order. The new notices stem from a new billing system based on rates prior to the summer of 2011, but those old outstanding balances loom should Flint win its appeal.

Prior to an August court ruling, the city had 13,000 clients on the verge of losing their water access. Flint hopes to ultimately enforce those past-due bills, but will be unable to do so unless it succeeds in appealing the judge’s finding that the charges were illegitimate. For now those old account balances are suspended, public information officer Jason Lorenz told ThinkProgress.

Once shutoffs begin in December, the city will try to ensure water lines are reconnected promptly after someone makes a payment, Lorenz said. “We want to ensure it’s no more of a hardship than it needs to be,” he said, adding that low-income residents may qualify for a partial waiver of their bill through a charitable partnership called Keep the Water Flowing.

How did Flint get into this mess?

For decades, Flint relied on nearby Detroit for its water. Both cities sprawled outward over the boom decades for the auto and manufacturing industries, and each now grapples with crumbling public service infrastructure that’s too vast to be sustainable now that the cities have lost more than half their combined population. Buying service through the Detroit Water and Sewerage Department (DWSD) allowed Flint to idle its own water purification systems along the Flint River, but left city residents and businesses beholden to the DWSD’s decisionmaking about prices. As a result of Detroit’s bankruptcy process, water rates in Flint jumped about 25 percent in January 2011, and then by a further 35 percent in August of that year for a total calendar-year hike of more than 60 percent.

A serious fiscal crisis prompted Gov. Rick Snyder (R) to turn Flint over to an emergency manager just after Election Day 2011. Flint remained in a state of emergency until April of this year, when a state panel announced that a series of managers had restored budget balance in Flint, mostly by forcing hundreds of millions of dollars in benefits concessions from public employees.

Getting out from under Detroit’s thumb on water was one of the biggest moves Flint could make to shore up its long-term finances at the time Snyder took the town over. Flint ended its contract with the DWSD to join other area governments in building a new system called the Karegnondi Water Authority (KWA). The KWA will eventually pump water from Lake Huron — the same source Detroit uses — directly to Flint. Detroit warned Flint at the time that the KWA pipeline would end up costing $100 million more than projected, but the project is currently on track to come in under budget. Flint residents can expect to begin receiving KWA water in 2016, potentially at significantly cheaper rates than those incurred through the DWSD deal — though Lorenz warned that residents should not expect an immediate dip in their bills.

While Flint was waiting for the pipeline to get built, another Snyder emergency manager over in Detroit terminated the deal to pump water to Flint in the interim, forcing the smaller city to start pumping its own water from the Flint River. That water was poisonous. A corrosive agent in it caused lead to leech from pipes into drinking water, among other public health disasters related to Flint River water. Worse, emails released thanks to an American Civil Liberties Union lawsuit indicate that state officials knew about the problems with the river water for months before owning up to it publicly and reverting to the DWSD for the remaining months until the new pipeline opens. Michigan will eventually spend close to $11 million to address the health crisis, partly undermining the core financial logic of the emergency manager takeover.

Flint’s water shutoffs are poorly timed for area politicians

For Detroit, Flint’s ongoing struggles offer another damper on a happy anniversary. The city formally emerged from bankruptcy a year ago after a state takeover forced severe concessions from retirees and bondholders alike. The swift resolution of that bankruptcy has prompted hope for a similarly rapid rebound in economic opportunity and quality of life for city residents.

There are some green shoots, according to the Detroit Free Press. Buses run on time for the first time in decades, emergency response times are significantly shorter, property tax collections are rising, and 7,000 of the city’s huge crop of abandoned and blighted homes have been torn down.

With everything balanced so delicately coming out of years of emergency management, thousands facing the loss of their drinking water, and months to go before the KWA lines open, even a place whose problems look simple compared to Detroit’s is learning that it’s still got a long way to go before it’s out of the woods.