News Feature | December 1, 2020

With Flint Settlement Eclipsing $640 Million, Michigan Details Plan To Pay

Peter Chawaga - editor

By Peter Chawaga


In the wake of a shockingly pervasive lead contamination saga for the drinking water of Flint, MI, the state agreed to pay $600 million to compensate consumers. Now, it appears that cost is rising as a court case progresses, and Michigan will have to be creative in how it comes up with the funds to settle it.

“A landmark settlement in the Flint water crisis came a step closer to reality … when attorneys in the class-action lawsuit presented the agreement to a federal court with an additional $41.2 million,” according to a recent report from The Detroit News. “The $641.25 million settlement, if approved by the court, would largely go to victims of the water crisis that emerged after Flint residents learned their drinking water had been contaminated with lead after a source switch to river water in 2014.”

Flint residents would be eligible for some of the compensation if they received a water bill or had to pay a bill from the local utility in a given timeframe, ingested or came into contact with local drinking water for at least 21 out of 30 days of an “Exposure Period,” or were exposed to water from the treatment plant and subsequently diagnosed with Legionnaires’ disease in a given timeframe.

“The lawsuit consolidates hundreds of individual cases taken out against defendants in recent years,” per The Detroit News. “The settlement, described as a ‘hybrid structure’ in the court filing to account for children, adults and property owners and businesses, proposed that nearly 80% of the settlement go to children who were under the age of 7 when they were exposed. Potentially thousands of children were exposed to toxic levels of lead.”

According to settlement documents, Michigan is forming a settlement entity that seeks to borrow $600 million from the Michigan Strategic Fund in order to make those potential payments. A state senator has said that legislation to allow for that loan could be introduced and acted upon by the end of 2020.

“The Michigan Legislature will need to agree to the plan for the state bonding and to amend the Michigan Strategic Fund Act to allow for the borrowing,” explained MLive. “The Michigan Strategic Fund was created in 1984 and has broad authority to promote economic development and create jobs in the state.”

After such a public failing to keep its consumers safe, it appears that Michigan will soon take a significant step toward rectifying one of the world’s most prominent drinking water crises. But the details around how exactly it begins to do so are still to be determined.

To read more about the laws that govern drinking water operations, visit Water Online’s Regulations And Legislation Solutions Center.