State board approves up to $2.3 million in Flint legal contracts for Snyder, Agen

Beth LeBlanc
The Detroit News

A state board on Tuesday approved up to $2.3 million in contracts for the defense of former state officials being prosecuted in connection with the Flint water crisis. 

The contracts approved by the state administrative board include an up to $1.45 million contract with Warner, Norcross & Judd for the defense of Republican former Gov. Rick Snyder and an up to $835,000 contract with Dickinson Wright for the defense of Jarod Agen, a former communications director and chief of staff for Snyder.

Warner, Norcross and Judd declined comment through spokeswoman Mary Ann Sabo, who noted the firm "does not discuss the fee arrangements it has with clients."

Dickinson Wright did not immediately respond to an email seeking comment. 

Former Gov. Rick Snyder walks past the media after his video arraignment on charges related to the Flint water crisis on Thursday, Jan. 14, 2021 outside the Genesee County Jail in downtown Flint.  Snyder pleaded not guilty to misdemeanor charges of willful neglect of duty in Flint.

The state also has entered into contracts for former Department of Health and Human Services Director Nick Lyon, former chief medical executive Eden Wells and former DHHS employee Nancy Peeler for their legal defense in the Flint water prosecutions.

The amount of the contracts for Lyon, Wells and Peeler was not immediately clear.

The state-financed defense costs for Snyder, Agen and others have a been a subject of controversy under the initial investigation of Republican Attorney General Bill Schuette and under Democratic Attorney General Dana Nessel amid rising defense and prosecution costs and frustration from residents paying for both sides of the litigation. 

Through April 2019, the total expenditures related to Flint legal costs to law firms came in at $25 million, said Bobby Leddy, a spokesman for Gov. Gretchen Whitmer.

"Soon after taking office, the Whitmer Administration realized it had inherited dozens of legal defense contracts responsible for millions of dollars in spending that lacked meaningful cost controls and a uniform system of contract management," Leddy said. 

Whitmer's office capped state employee defense costs in January at much lower rates than had been used previously during the Schuette investigation in an attempt to curb spending on the case. Whitmer's January policy would have capped hourly fees at $225 an hour and imposed a budget ceiling of $175,000 for all legal services prior to and during trial. 

But lawyers pushed back against the cap, calling it too restrictive, and Whitmer raised it in August. She put the pre-trial cost ceiling at $27,500 and eliminated the trial cost ceiling, instead requiring that a maximum amount be agreed upon in a contract. Increases to the pre-trial and trial cost ceilings can be renegotiated if costs exceed what was initially agreed upon. 

The up to $2.3 million in contracts approved Tuesday are limited to the fiscal year running from Friday through Sept. 30, 2022.

The new contract model will apply to all legal contracts for state defendants going forward, not just Flint defendants, Leddy said. 

"...The administration developed a single contract that includes standard terms and cost control measures, and designed a single system to manage the contracts and ensure departmental decisions, like paying invoices, are informed by expert review," Leddy said. 

In January, Nessel's office filed 41 charges against nine state and city officials, including Snyder, over allegations tied to the lead-contaminated water crisis that resulted after Flint switched its water source on April 25, 2014. A one-judge grand jury in Genesee County that operated in secret signed off on the Flint charges.

Snyder, who left office at the end of 2018 after two four-year terms, is facing two counts of willful neglect of duty while Agen is facing a single felony charge of perjury

eleblanc@detroitnews.com