State forgives $20M in Flint water debt

Leonard N. Fleming
The Detroit News

Flint’s outstanding loans for its Drinking Water Revolving Fund totaling more than $20 million have been forgiven to help give financial relief to the troubled city, state officials said Thursday.

State Treasurer Nick Khouri made the announcement that takes effect immediately. The loans, state officials said, were forgiven at the behest of the Michigan Department of Environmental Quality.

“I am pleased to support the forgiveness of these loans as provided under federal law,” Khouri said in a statement. “This action provides financial relief to the city as it continues down its path toward fiscal stability and recovery.”

The loans originated dating back to 1999 through 2003 and were used for upgrades and improvements to the water treatment plant.

The U.S. Environmental Protection Agency in August gave Michigan its approval to forgive $20.7 million in past water infrastructure loans owed by Flint to the state.

A package of legislation approved by Congress in December 2016 included a measure giving states the flexibility to use the federally funded Drinking Water Revolving Loan program to forgive past loans owed to a state. Flint also received tens of millions of dollars to fix its corroded water infrastructure.

Flint Mayor Karen Weaver said the loan forgiveness is “good news” for Flint.

“We appreciate the state’s approval of the DEQ's request to forgive the City's Drinking Water Revolving Fund debt,” Weaver said in a Thursday statement.

“The people and the City of Flint continue to deal with the effects of the water crisis emotionally, physically, and financially. And I am thankful for the state officials who continue to try and help make the city whole as we work to transition from crisis to recovery."

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