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Michigan restricted Flint from switching water in loan deal
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LANSING, Mich. (AP) — The state of Michigan restricted Flint from switching water sources last April without approval from Gov. Rick Snyder's administration under the terms of a $7 million loan needed to help transition the city from state management, according to a document released Wednesday.

By the time the loan agreement was in place, cries about Flint's water quality were growing louder, though it had not yet been discovered that the improperly treated Flint River water had caused lead to leach from aging pipes and put children at risk. Flint's state-appointed emergency manager said at the time that switching back to the water source would cost the city more than $1 million a month and that "water from Detroit is no safer than Flint water."

Snyder eventually agreed roughly six months later to help Flint reconnect to a Detroit-area system after doctors reported high levels of lead in children. But critics in the Michigan Democratic Party said Wednesday that the loan document, obtained by the party through a public records request, shows the Republican's administration tied Flint's hands and prevented earlier action.

"The Snyder administration effectively put a financial gun to the heads of Flint's families by using the emergency manager law to lock the city into taking water from a poisoned source," party chairman Brandon Dillon said.

The loan deal said Flint could not enter an agreement with its former water supplier without approval from the state treasurer and also prohibited the city from reducing water and sewer rates unless authorized by the state.

In March 2015, the Flint City Council, which was powerless at the time, voted to "do all things necessary" to stop using the Flint River and reconnect to Lake Huron water. But state-appointed emergency manager Jerry Ambrose, who sought the loan from the state, said no, calling it "incomprehensible."

Provisions in the loan agreement "were included to ensure the city remain on solid financial footing going forward," state Treasury Department spokesman Terry Stanton said Wednesday.

Snyder spokesman Ari Adler said that under the loan, "nothing was prohibited as this latest round of political rhetoric is suggesting," and such provisions are commonplace because "oversight provisions are used based on the request that is made."

A month before the loan, a state official notified Snyder's aides of a surge in Legionnaires' disease potentially linked to Flint's water — long before the governor, who said he was not made aware of the deadly outbreak, reported the increase to the public. The official also briefly mentioned Legionnaires in a January 2015 email to one of Snyder's spokespeople, according to recently released emails.

Those emails, released by Snyder's office last month, showed he was made aware of Flint's water troubles, including E. coli detections, outraged residents' complaints about the color and smell, high levels of a disinfectant byproduct and a General Motors plant's decision to no longer use the water because it was rusting engine parts.

The governor, who has apologized for the disaster and his administration's mistakes, has said he did not clearly know the full extent of the water's danger until around Oct. 1, when state health officials confirmed elevated blood-lead levels in children.

Snyder said last week, "we didn't connect all the dots that I wish we would have," but added that when his aides checked with environmental and health experts in state agencies about concerns, they continually reaffirmed "there was no problem."