Cost of Flint Water Settlement to Taxpayers Balloons to $1.05 Billion

The $600 million Flint Water Settlement announced by Michigan Governor Gretchen Whitmer in August, 2020 has officially ballooned to $1.05 billion in total cost to taxpayers under legislation signed into law by the governor. 

On December 30, 2020, Governor Whitmer signed Senate Bills 1251 and 1252 into law to create a schedule under which taxpayers will spend $35,000,000 per year over the next 30 years to pay for lawsuits against the State of Michigan for its role in Flint’s decision to switch its water source from the Detroit Water System to the Flint River in 2014.

Nowhere in the governor’s press release is there any mention of the $1,050,000,000 cost of the settlement to taxpayers or how much personal injury lawyers will take from the money dedicated for victims. 

The chart shown here, officially named Exhibit 9, is found in legal documents filed by the State of Michigan in November with the federal judge overseeing the Flint Water litigation. Senate Bills 1251 and 1252 give the Michigan Strategic Fund the authority to borrow and issue bonds and notes to fund the Flint water settlement and to create a Flint Settlement Trust Fund. The annual debt on those bonds is $35 million.

How much is that? It’s twice as much as the state plans to spend this year on its tourism promotion campaign called Pure Michigan. It’s three times as much as Gov. Whitmer and the legislature agreed to spend in the current fiscal year for the Healthy Moms, Healthy Babies program.

A spokesman for Attorney General Dana Nessel says the Flint Water Settlement is the most expensive legal settlement in Michigan history. That’s actually putting it mildly. According to the Senate Fiscal Agency, the $600 million payout in the Flint Water Settlement — not including the $450 million in interest that will be paid over the next 30 years — is virtually the same as all the money, $617 million, that the State of Michigan has paid out in court judgements and settlements for every lawsuit against it OVER THE LAST 10 FISCAL YEARS COMBINED.