ELR Citation: ELR 20744
No(s). 77-71100 (E.D. Mich. Dec 23, 1991)

The court enjoins the U.S. Environmental Protection Agency (EPA) and the Michigan Department of Natural Resources (MDNR) from transferring deobligated grant funds under Title II of the Federal Water Pollution Control Act (FWPCA) to Michigan's water pollution control revolving fund, until the city of Detroit's pending administrative appeals of adverse funding decisions receive final agency action. Detroit had appeals pending of denials of Title II grant increases to cover additional costs that arose during construction of sewage treatment plants, when Michigan decided to transfer deobligated Title II funds into its revolving loan account under Title VI of the FWPCA, which allows states to issue low or no-interest loans to qualifying construction projects. The court holds that it has jurisdiction to invoke its equitable powers to maintain the status quo pending resolution of Detroit's appeals. The court holds that Detroit has demonstrated that it is entitled to a preliminary injunction. The court finds that Detroit will be irreparably harmed by the transfer of funds since any success during the appeal process will be meaningless if no money will be available to fund approved grant increases. The court further finds that the injunction will not cause substantial harm to others since the funds can be transferred to the revolving loan fund after resolution of Detroit's appeals. Finally, the court finds that the public interest will be served by a full, fair, and meaningful administrative appeal process, and that Detroit is likely to succeed on the merits since Michigan has never suggested that the additional costs for which Detroit seeks funding are nonallowable.

Counsel for Plaintiff
Fred R. Disheroon
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Counsel for Defendant
Stephen F. Schuesler, Ass't Attorney General
Attorney General's Office, Environmental Protection Division
Law Bldg., Lansing MI 48913
(517) 373-1110

Counsel for Communities Severed by DWSD Treatment Plant
James A. Smith
Bodman, Longley & Dahling
100 Renaissance Ctr., 34th Fl., Detroit MI 48243
(313) 259-7777