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After Flint, Michigan toughened lead rules. Now water utilities are suing.

LANSING — Michigan last June adopted the nation’s strictest rule for lead in drinking water, including requiring utilities to replace all of the state’s roughly 500,000 lead service pipes within 20 years.

Public health advocates applauded then-Gov. Rick Snyder’s move as an important step toward protecting Michigan’s drinking water after his administration’s actions and inactions triggered Flint’s lead exposure crisis.

But seven months later, the fate of the regulation is anything but certain.

Detroit-area water providers are trying to thwart the rule in the Michigan Court of Claims. Filed in mid-December, their lawsuit calls new requirements under the rule “arbitrary,” too costly and ineffective for addressing Michigan’s most serious lead threats.

Opinion: It’s not just trust that’s lost in Flint, some water remains unsafe

The plaintiffs include the Detroit Water and Sewerage Department, Oakland County Water Resources Commissioner Jim Nash, the Great Lakes Water Authority and the City of Livonia. The coalition provides water to more than half of Michigan’s population.

Public health advocates are outraged.

Cyndi Roper, a Michigan policy advocate for the Natural Resources Defense Council, called the lawsuit “a full-bore attack on the health of thousands of children in Michigan who are at risk of lead poisoning.”

“It is disheartening that these utilities and elected officials are using their resources to fight this rule rather than trying to make their water cleaner,” she told Bridge Magazine.

Dr. Mona Hanna-Attisha, a Flint pediatrician who helped expose Flint’s lead crisis, said in a statement the lawsuit “sets up the potential of many Flints to come.”

Related: Flint residents welcome Nestlé donations. But its ads? Not so much.
Related: In Flint, trust is lost. And bottled water supplies are running low.

The Detroit-area officials say they take their public health duties seriously, but the new rule is unworkable — for water utilities and their ratepayers — and it might even be unconstitutional, they argue.

“There are legalistic problems in the rule, and there are practical problems — we hope we can work them out,” Chuck Hersey, a consultant working for Oakland County, told Bridge.  

“I just can't say this strongly enough: We want to change our lead lines,” he added.

Gov. Gretchen Whitmer has inherited the challenge. Her new administration has yet to respond in court to the lawsuit, and the state Department of Environmental Quality declined to comment on the lawsuit.

Here’s a closer look a dispute with high stakes for public health and for Michigan ratepayers.

First, a reminder: Why is lead dangerous?

Lead is a neurotoxin that damages development of the brain and nervous system — particularly in young children. Experts list lead paint and dust in pre-1970s homes as among the most common causes of childhood lead poisoning. But drinking water can make up as much as 20 percent of someone’s total exposure to lead, according to the U.S. Environmental Protection Agency.

What happened in Flint?

The city, led by one in a series of state emergency managers appointed by Snyder, switched drinking water sources to the Flint River in 2014. The DEQ approved the change but didn’t require any treatment to control corrosion of aging water mains. Highly corrosive river water then rusted the mains, causing lead to leach into drinking water. DEQ regulators first ignored the problem, then tried to discredit whistleblowers.

The episode led to still ongoing civil lawsuits and 15 criminal charges. It also laid bare what experts — including some inside the EPA — describe as serious problems with the federal “Lead and Copper Rule,” designed to limit lead and copper in drinking water.

Among the complaints: Ambiguity in the rule allowed Michigan regulators to use flawed water testing methods that artificially lowered the results of lead testing in the water, allowing officials to game the system. Additionally, the federal lead “action level” — the threshold of how much is acceptable in water — is 15 parts per billion, even though experts say no amount of lead exposure is safe.

How did Snyder change the rule?

Michigan’s standards previously mirrored those from Washington. Snyder made Michigan’s regulations stricter than those of any other state.

Under Snyder’s revision, water suppliers must meticulously inventory lead pipelines, and replace all of them within the next 20 years, though the state could approve alternative replacement plans.

That includes inspecting and, if necessary, replacing privately owned portions of water lines and pipelines that may have only lead “goosenecks” — short fittings that connect water mains to galvanized service lines.

The proposal also tightened water sampling requirements and reduced the action level for lead in water from 15 to 12 parts per billion beginning in 2025.

Who pays for replacements? And how much?

The water providers must pay for the service line replacements, whether on public or private property. The water providers see that as a major problem. Unless the state offers more sizeable grants, that money could only come from ratepayers.

How much money? The Detroit-area utilities say the cost could reach $2.5 billion statewide over 20 years. They reached that number by multiplying the estimated 500,000 lead lines in the state by $5,000 — a figure the state has used as an average cost of a lead line replacement. 

Some opponents of the lawsuit argue that price tag cited by the utilities is inflated, and say utilities could dramatically cut down on costs by finding efficiencies in their work over time.

The $2.5 billion figure assumes no improvements in excavations over a two-decade span. As Bridge has reported, a group of University of Michigan researchers developed an algorithm to more easily pinpoint lead pipelines that they estimate could shave 10 percent off the cost of pipeline replacement projects.

Even so, pipeline replacements would almost certainly cost hundreds of millions of dollars across Michigan — money utilities say they don’t have.

Detroit faces particularly vast challenges. The city estimates it has more than 125,000 lead service lines and decades worth of maintenance backlogs. Raising water rates would be a major problem in a city that shuts off water to thousands of people each year who can’t pay.

Detroit officials say replacing all the city’s lead lines could cost up to $500 million. If accurate, the costs would average more than $1,900 per household over the 20 years.

Why would the rule change be unconstitutional?

Water providers contend that using public money to replace pipelines on private property — as the rule requires — would violate the Headlee Amendment.

That 1978 amendment to Michigan’s constitution bars governments from hiking taxes without voter approval, and the State Supreme Court has ruled — in a 1998 case called Bolt vs. City of Lansing — that basing utility rates on anything besides consumption is a tax.

That means water providers could face a lawsuit just for following the Lead and Copper rule, said Hersey, the consultant for Oakland County.

“If we comply with the rule as it’s written, communities would be violating the Constitution,” he said. “If we comply with the Constitution, we violate the rule.”

Others see the rule as constitutional. In public comments last year, the Natural Resources Defense Council, a nonprofit environmental advocacy group, said water providers would not be levying an unconstitutional tax if they incorporated replacement costs “into the system’s total revenue needs, to be recovered through charges paid by all customers based on their water usage.”  

Haven’t some cities replaced all of their lead pipelines?

Lansing did. The city pulled the last of the city’s 12,000 lead lines from the ground in December of 2016, capping a 12-year, $44.5 million project that ratepayers largely financed.

But unlike most Michigan cities, Lansing owned the entirety of service lines, including those on private property. That meant the city steered clear of constitutional questions and avoided other hassles.

Elsewhere, utilities must get the permission of residents — some of whom can be tough to track down —  to replace private-side lines. That can prove time consuming and costly.

What’s next?

The DEQ has until Feb. 4 to respond in court.

“We’re hopeful that the new administration and the leaders will understand that this isn’t crying wolf — that we’ve got some real issues to work out here,” Hersey said.

Critics of the lawsuit say water providers and state officials should come together on a funding solution — but outside of court.

“Surely the communities that have filed suit could use the next 20 years to figure out how to keep lead out of their water,” Ridgway White, president and CEO of the Flint-based Charles Stewart Mott Foundation, wrote last month in a Detroit Free Press opinion piece.

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