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untanglingwebs
El Supremo
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Kincaid, Flint residents take water rate lawsuit to federal court
Print Ron Fonger | rfonger1@mlive.com By Ron Fonger | rfonger1@mlive.com
on May 13, 2014 at 6:00 AM, updated May 13, 2014 at 6:05 AM
FLINT, MI -- City Council President Scott Kincaid and two other Flint residents have taken their complaints about water rates to federal court.
A May 4 lawsuit filed in U.S. District Court claims the city charged more than the law allowed when it raised water and sewer rates in 2011.
A similar lawsuit was dismissed in Genesee County Circuit Court last year, a decision that's been appealed as the federal case moves forward.
"I'm not giving up on this. I think it was wrong what the emergency manager did," said Kincaid, who claims former emergency manager Mike Brown improperly raised rates and spent water and sewer funds on general city obligations.
The lawsuit says water rate increases by Brown violated the rights of city residents to have their rates determined in accordance with Flint ordinances, which cap the rate and the frequency of increases.
Kincaid says the city imposed a 47 percent water rate increase on retail customers from Sept. 16, 2011, to July 1, 2012, and raised rates more than once -- contrary to ordinance.
Flint spokesman Jason Lorenz would not comment on the new lawsuit, saying the city doesn't discuss pending litigation.
The federal court will be the third to consider Kincaid's claim that city water rate increases have been illegal.
In addition to cases in Genesee Circuit and U.S. District courts, the state Court of Appeals dismissed the first lawsuit filed by Kincaid in 2012.
The newest lawsuit seeks to reduce water and sewer rates as well as refund Flint water customers for the increased amount they've paid since September 2011.
jacobsmith 50 minutes ago
Water billing was abused in a manner that seems illegal, and I would love the refund.
I am just not sure who is going to provide the money, perhaps the state as the EFM was involved, but Walling was just as culpable.
john 1 hour ago
The best and fastest way to fix Flint's budget problem is to charge people $150 to move out of the city.
GrandBlancGirl 2 hours ago
Another example of misplaced anger and frustration. Trying to prove the argument that the Emergency Manager may have over stepped his authority is not going to advance the City of Flint. Who do they want to be responsible for their expenses related to water and sewer? Don't expect a bailout like the Governor has proposed for that other city that over spent and can't pay its debts! |
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Tue May 13, 2014 9:50 am |
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untanglingwebs
El Supremo
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Tue May 13, 2014 9:54 am |
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untanglingwebs
El Supremo
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New complaint in Flint water rate lawsuit claims service charge violates state law
Print Kristin Longley | klongley1@mlive.com By Kristin Longley | klongley1@mlive.com
on January 06, 2013 at 7:00 AM, updated January 06, 2013 at 7:08 AM
FLINT, MI -- A new complaint in a lawsuit attempting to reverse Flint water rate increases alleges the city's water service charge violates state law.
The lawsuit was filed last year by Flint City Council President Scott Kincaid and three other Flint residents, whose attorney is asking a judge to consider adding the new allegation to the case.
The claim cites a state law that says the retail rate charged to water customers "shall not exceed the actual cost of providing the service."
Attorney Val Washington, who is representing Kincaid, said the city is in violation because it doesn't have on file a chart to determine how it calculates the water service charge that appears on customer bills each month.
"If you're a wholesale customer of Flint you cannot charge your retail customers more than the actual cost of the water," he said, adding that a rate chart is supposed to be kept on file in the clerk's office. "That service charge is a made up number."
The water service and sewer service charges are separate from the usage charges on customer bills.
Washington said he asked the city for the chart, but the city didn't produce one. He said the city did, however, have a chart for how it calculates the sewer service charge.
"My position is that (water service) charge is pulled out of the air," he said.
City Attorney Peter Bade has declined to comment on the ongoing litigation.
Bade said the city has not yet been served with Washington's request to amend the lawsuit to add the new complaint. Once it is, the city will file a response with the court, he said.
Flint water customers have seen a 110-percent increase in their average water and sewer rates since January 2011.
Kincaid's water rate lawsuit was originally filed in May in the Michigan Court of Appeals because it alleged the rate increases violated the Michigan Constitution. The suit deals with the two most recent water rate increases, which went into effect in September 2011 and July 2012.
The lawsuit is seeking to reduce water and sewer rates as well as refund Flint water customers for the increased amount they've paid since September 2011.
The appeals court dismissed a portion of the lawsuit that claimed the rate increases violated the Michigan Constitution, and the Michigan Supreme Court declined to hear an appeal.
The remaining counts were refiled in Genesee County Circuit Court.
A hearing on the case is scheduled for Jan. 14 before Genesee Circuit Court Judge Richard Yuille.
Flint's former emergency manager, Michael Brown, has said the water rate hikes were necessary to keep up with rate increases passed on from Detroit, as well as to cover the growing costs of an aging system that serves a much smaller population than it did in the past. |
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Tue May 13, 2014 9:56 am |
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untanglingwebs
El Supremo
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Lawsuit could force city into bankruptcy and put pensions at risk, Flint emergency manager says
Print Gary Ridley | gridley@mlive.com By Gary Ridley | gridley@mlive.com
on January 24, 2014 at 6:00 PM, updated January 24, 2014 at 6:12 PM
FLINT, MI -- Flint Emergency Manager Darnell Earley said a lawsuit filed by retirees could force the city into bankruptcy and put pensions and health benefits at risk of cuts.
The claim is part of an op-ed Earley sent The Flint Journal following a Jan. 3 decision by the U.S. Sixth Circuit Court of Appeals reinstating an injunction that prohibits the city from modifying health care for city retirees until a federal lawsuit is decided.
Six retirees and the Flint-based United Retired Governmental Employees association filed a lawsuit against the city following a decision in April 2012 by then-emergency manager Michael Brown that would make retirees pay more out of pocket for health coverage.
"If the federal district court's decision is not reversed, it is almost certain that Flint will soon be unable to provide even the most basic level of city services," Earley wrote in the op-ed.
An attorney for the retirees could not be reached for comment.
Earley said reinstating historic health care levels for retirees would cost the city an additional $5 million annually and force the city's unfunded liability for retiree health care to increase to as much as $900,000,000.
"We have done everything possible to avoid becoming insolvent," Earley wrote. "Resolving insolvency could include a potential filing for bankruptcy ..."
A bankruptcy proceeding could severely reduce or eliminate health care coverage for retirees and lead to possible pension cuts, Earley said.
Earley said Friday the op-ed should not be interpreted that a bankruptcy filing is inevitable or that he is pressuring retirees to drop their lawsuit against the city.
"We want the public to understand the severity of this issue," Earley said.
Flint City Council President Scott Kincaid said it's too early for the city to consider filing for bankruptcy.
Kincaid said bankruptcy has always been an option, but it's something the city has been trying to avoid.
"I think that the amount that it's going to cost the city is something we have to look at and figure out how we are going to fix in the long run," Kincaid said.
Kincaid said the city should begin to look at how bankruptcy can be avoided, before the trial on the lawsuit begins.
"Once the trial is done, I think that (bankruptcy) would be the option that is considered." Kincaid said. "I think right now it's premature to file for Chapter 9 Federal Bankruptcy."
Earley said the city has taken multiple steps to fix its financial situation, including raising property taxes and utility rates as well as reducing employee compensation.
"All options have to be considered," Earley said.
Staff writer Amanda Emery contributed to this report.
Gary Ridley can be reached at 810-280-9516. You can also follow him on Twitter @GaryRidley or on Facebook. |
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Tue May 13, 2014 10:01 am |
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untanglingwebs
El Supremo
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The Emergency manager Law grants the EM and EFM positions immunity fro lawsuits. So how will the citizen be repaid, especially those who have left Flint.
Which is worst-Flint's water woes or Flint's pension woes? |
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Tue May 13, 2014 10:05 am |
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J HUNTINGWORTH TUNE
F L I N T O I D
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Webs,isn't the EFM law under the State of Michigan ? Would this grant immunity from a Federal lawsuit ? As to what constitutes a larger problem,water rates or pension liability ,,,I don't think there is any comparison.The city is both legally and morally bound by its contract to the retirees.Any attempt to reduce or mitigate this liability and there will be a problem.
I understand the EFM contacted retirees regarding their suit,doing so directly via a letter..while these retirees were represented by an attourney.I wonder if the EFM obtained legal advice prior to doing so,or did he consider himself immune ? |
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Wed May 14, 2014 6:30 am |
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untanglingwebs
El Supremo
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The state may want us into bankruptcy under the guise of reorganization.
Yes the courts have ruled the Emergency Managers cannot change the retirees agreements. However that may not be the case under bankruptcy. Detroit retirees had to make concessions.
Kurtz reaffirmed his indemnification before he allocated federal money to two organizations the City was blocked by HUD guidelines and the Home Rule . from entering into a contract with. This action created the loss in millions of block grant dollars, but no one blamed him. |
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Wed May 14, 2014 1:08 pm |
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