Were Flint water crisis funds mismanaged?

FLINT, Mich - How much money has Flint received so far to clean up its water?

Sen. Jim Ananich, (D) Flint: "$560-600 million."

Rep. Sheldon Neeley, (D) Flint: "Half a billion dollars is a lot of money.”

That’s taxpayer money money meant to pay for things like children's health, nurses and economic development.

According to Flint’s Chief Financial Officer, Hughey Newsome, about $167 million of state funding has been set aside for the city for pipe replacement and other water related issues.

Spending by Flint Mayor Karen Weaver's administration on replacing the pipes is now being called into question.

In a letter to the Governor and Attorney General, Flint City Councilwoman Kate Fields alleges there has been mismanagement of those funds.

She claims the city administration violated purchasing ordinances when the city paid a national engineering firm, a-e-com using money from the water fund.

The water fund is money paid by residents’ water bills.

Fields says the city charter says that money can’t be used to pay contractors.

Kate Fields, Flint City Council: "This money was paid even though the resolution that hired AECOM said they would be specifically paid out of federal WIIN grants and state grants. So there was no authority to pay them out of the water fund.”

But Flint’s chief financial officer Hughley Newsome disagrees.

He says the arrangement wasn't ideal but that he was within his authority to do it.

Newsome says " it was completely legal and approved by council.”

Some council members feel the city is wasting money by the method contractors are using to look for lead pipes.

When the pipe replacement program started, contractors used so-called "hydrovac" a method that uses high-pressure water to make a small hole in the ground to look for underground pipes.

That system was abandoned last summer.

Mayor Weaver who said digging the holes in a traditional way is safer.

Karen Weaver, Flint Mayor, "We are going to make sure we're addressing this issue. Not put dollars over the people. Not going to rush. Do things correctly. When we say ‘it's okay to drink’ we're going to make sure it's okay to drink".

Hydrovac costs about $300 per home.

Digging them up the more traditional way costs up to $5,000 per home.

So far, the state won't pay for the difference.

Kate Fields, Flint City Council: "How is the state going to reimburse for that $6 million? We don't have that kind of money. The state won't reimburse for anything other than the hydrovac.”

Newsome says the difference is closer to $5 million, but that it's being negotiated with the state department of environmental quality.

Newsome, says "That $5 million is in limbo. We expect that money will be freed up in a month or so.”

Joel: “The state will pay?”

Newsome "Yes".

The disagreement caused Flint City Council member Kate Fields to send this letter to the governor and attorney general asking for a meeting about what she calls financial and public mismanagement.

The attorney general's spokeswoman says they're received the letter and are reviewing it.

Fields says"To be fiscally responsible you don't incur a debt when there may be no way to pay for that debt. To me that's mismanagement.”

State lawmakers say there are several audits underway to see how the money was spent.

Sen. Jim Ananich, (D) Flint: "There's no playbook for this kind of stuff. Mistakes are going to be made.”

Rep. Sheldon Neeley, (D) Flint: "They're just allegations. I'm going to reserve judgement.”

Councilwoman Fields says there may be not enough money to fund the current pipe replacement program: "They want us to approve new contracts. I don't know how much is left in the kitty.”

Newsome says "There are discussions over whether we'll need more money.”

Any additional money would need to be approved by the governor and state legislature.

However, a spokeswoman for the governor says there will be no more additional funds for Flint water other than what's been previously approved.

Sen. Jim Ananich, (D) Flint: "state funds are not going to be unlimited. I've heard people use a disgusting term: Flint fatigue".