The Environmental Protection Agency should have issued an emergency order to address the water crisis in Flint, Michigan, seven months before it eventually decided to take action, according to a report from the agency’s inspector general.

The EPA’s office of inspector general on Thursday said the agency had the authority and “sufficient information” to act far sooner than it did to address vast lead contamination in the city.

“These situations should generate a greater sense of urgency,” said Arthur Elkins, the inspector general, in a statement. “Federal law provides the EPA with emergency authority to intervene when the safety of drinking water is compromised. Employees must be knowledgeable, trained and ready to act when such a public health threat looms.”

Flint’s water became contaminated with lead in April 2014, when a state-appointed emergency manager decided to switch the city’s water source to a local river. The state’s environmental agency failed to require the city to use corrosion control to prevent lead from leaching off water pipes and flowing into households.

By June 2015, the report said, the EPA’s midwest office was aware that Flint had not been using corrosion control inhibitors, and that the city had exceeded the federal threshold for lead to prompt remedial action. That month, an employee produced an interim memo that identified “major public health concerns in the city of Flint”, according to the report.

Instead of issuing an emergency order, the EPA’s midwest office concluded it was legally precluded from taking action because of the state’s activities to address the lead concerns.

That was incorrect, the report said.

“In the absence of EPA intervention in Flint, the state continued to delay taking action to require corrosion control or provide alternative drinking water supplies,” the report said. “Additional data in August and September 2015 demonstrated lead contamination was widespread, and also demonstrated an increase in the blood lead levels of children living in Flint.”

It was not until mid-January that the EPA issued an emergency order, after it “became clear” to the agency’s office of enforcement and compliance that the midwest branch had authority to take action.

The inspector general outlined a series of proposed policy changes in a 16-page report that said the agency “must be better prepared and able to timely intercede in public health emergencies like that which occurred in Flint”.

The EPA said in a statement it “issued an order to the City of Flint and the State of Michigan as soon as it became apparent that the city and state were failing to address the serious problems with the Flint drinking water system”. It added that it would review the report’s other findings and make appropriate updates.

The interim report is part of the EPA’s ongoing investigation into what happened in Flint. The report – called a “management alert” – is aimed at emphasizing the “immediacy of concerns and need for action to appropriate EPA officials”, according to the inspector general’s office.

The inspector general recommended the EPA update its policy guidance to include “relevant examples” of how and when an emergency order has been issued, and give direction about when an emergency action should be taken.

Flint’s mayor, Karen Weaver, said the report is “deeply troubling” and that officials found responsible for the crisis “must be held accountable”.

“In this country we have agencies and policies in place to help ensure the well-being and safety of men, women and children, yet they failed when it comes to the man-made water disaster in Flint,” Weaver said in a statement.

Separately from the report, investigators from the EPA’s office of inspector general are aiding an investigation by the US attorney’s office in Detroit over potential criminal violations in the run-up to Flint’s water crisis.

Michigan’s attorney general, Bill Schuette, is conducting an inquiry of his own, and has charged nine state and local officials for their alleged involvement in the crisis. That investigation also remains ongoing, and additional charges are expected.