SPRECHER, Circuit Judge.
This is an appeal from the granting of a preliminary injunction enjoining the Attorney General of Indiana from refusing to approve subgrants for financial assistance allocated by the Public Counselor of Indiana, in accordance with Section 205(a) of the Energy Conservation and Production Act of 1976, 42 U.S.C. § 6805(a), establishing state consumer protection offices, solely on the basis that the subgrantees retain lobbyists.
I
Enacted as part of the Energy Conservation and Production Act, Section 205(a) (hereafter referred to as 42 U.S.C. § 6085(a)) was intended to provide financial assistance to state offices of consumer services for the purpose of facilitating the presentation of consumer interests before utility regulatory commissions. 42 U.S.C. § 6801. A state office of consumer services so financed must “assist consumers in the presentation of their positions before utility regulatory commissions” and “advocate, on its own behalf, a position which it determines represents the position most advantageous to consumers.” Section 6805(a).1 Financial grants are now made by the Department of Energy.
An Indiana statute provides that the governor shall appoint a practicing attorney as public counselor to represent the public in utility rate hearings before the state Public Service Commission.2 Ind.Code 8-1—1—4.
In September, 1977, the Public Counselor of Indiana had applied for and received from the Department of Energy (DOE) a $200,000 grant under § 6805(a), which was approved by the Indiana Attorney General as to “form and legality.” Eighty-Four Thousand dollars of this grant was allocated for financial and technical assistance to consumer groups in order to facilitate participation in utility rate proceedings.
On December 21, 1977, the Public Counselor executed a proposed contract with the Citizens Energy Coalition, Inc. (Coalition), an Indiana private, not-for-profit organization, for services to be performed by the Coalition for $5,000 under § 6805(a). An Indiana statute provides that all contracts entered into by state agencies shall be approved as to form and legality by the Attorney General. Ind.Code 4 — 13-2-14.3 On March 29, 1978, the Indiana Attorney General disapproved the proposed contract in part because the Coalition maintained a registered lobbyist and “a conflict may arise under the terms of IC 2-4-3 et seq.” 4
[1161]*1161The district court held that to “disapprove the contract of December 21, 1977 on the grounds that the contract would be in conflict with Ind.Code 2-4-3-7 [prohibiting lobbying for pay by public officials] would be an erroneous disapproval.” 5
• After the Attorney General had disapproved the Coalition contract, the Coalition submitted to the Public Counselor three proposals seeking § 6805(a) financial assistance totaling $46,000. The Indiana Public Interest Research Group (Research Group), also an Indiana private, not-for-profit organization which maintained a registered lobbyist, submitted a proposal for financial assistance in the amount of $9,785 to the Public Counselor.
In the meantime the Public Counselor on April 5, 1978, wrote to the Attorney General with supporting affidavits, requesting reconsideration of the disapproval of the original $5,000 contract. Several days later the Attorney General returned the Public Counselor’s letter with a notation that the- “A.G. will not accept lobbyist or organization on contract.”6
On April 17, 1978, the Public Counselor by letter requested the advice of the Attorney General as to whether or not he could make grants under § 6805(a) to consumer groups who had lobbied in the preceding session of the Indiana General Assembly. No formal or informal written response was ever made to this request.
In letters of May 30 and 31, 1978, the Public Counselor advised the Coalition and the Research Group that he was unable to approve their requests for financial assistance “in view of the ruling of the Indiana Attorney General which prohibits my contracting with any organization or individual registered as a lobbyist during the most recent session of the Indiana General Assembly.”7
The Public Counselor did approve an application for financial assistance in the amount of $24,000 by the Consumer Center of Fort Wayne, Indiana, which organization did not retain a lobbyist.
In June, 1978, DOE directed the publie counselor to refrain from spending or committing any further funds allocated for § 6805(a) financial assistance “until such time as the ‘lobbyist’ issue has been satisfactorily resolved.”
On June 14, 1978, the Coalition and the Research Group filed their complaint in this action against the Attorney General and the Public Counselor. On October 17, 1978, the district court, upon the plaintiffs’ motion, granted the preliminary injunction.
II
In his appeal the Attorney General first argued that the district court did not have subject matter jurisdiction. The district court concluded that it did have jurisdiction, finding that “the constitutional [1162]*1162claims in this action are substantial” and that the action raised the issue of whether public officials acting under color of state law have deprived the plaintiffs of their constitutional rights. In addition the cause arises under an act of Congress. 28 U.S.C. § 1337.
In regard to the Attorney General’s argument that the Eleventh Amendment bars the action, the Supreme Court again reaffirmed in Quern v. Jordan, - U.S. -, 99 S.Ct. 1139, 1143, 59 L.Ed.2d 358, 364 (1979) that “under the landmark decision in Ex Parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908), a federal court, consistent with the Eleventh Amendment, may enjoin state officials to conform their future conduct to the requirements of federal law . . ..” The plaintiffs also have standing.
Next the Attorney General contended that the district court should have abstained but it declined to do so. “Abstention is . appropriate where there have been presented difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case then at bar.” Colorado River Water Conservation District v. United States, 424 U.S. 800, 814, 96 S.Ct. 1236, 1244, 47 L.Ed.2d 483 (1976).
The state statute here involved is simple and uncomplicated. Ind.Code 2-4-3-7 prohibits public officials from lobbying. The district court expressly found that “the Public Counselor would not directly or indirectly receive compensation for lobbying by virtue of the DOE grant program.” The court further found that the “plaintiffs are neither public officials nor employees within the meaning of the statute.” The court also concluded:
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SPRECHER, Circuit Judge.
This is an appeal from the granting of a preliminary injunction enjoining the Attorney General of Indiana from refusing to approve subgrants for financial assistance allocated by the Public Counselor of Indiana, in accordance with Section 205(a) of the Energy Conservation and Production Act of 1976, 42 U.S.C. § 6805(a), establishing state consumer protection offices, solely on the basis that the subgrantees retain lobbyists.
I
Enacted as part of the Energy Conservation and Production Act, Section 205(a) (hereafter referred to as 42 U.S.C. § 6085(a)) was intended to provide financial assistance to state offices of consumer services for the purpose of facilitating the presentation of consumer interests before utility regulatory commissions. 42 U.S.C. § 6801. A state office of consumer services so financed must “assist consumers in the presentation of their positions before utility regulatory commissions” and “advocate, on its own behalf, a position which it determines represents the position most advantageous to consumers.” Section 6805(a).1 Financial grants are now made by the Department of Energy.
An Indiana statute provides that the governor shall appoint a practicing attorney as public counselor to represent the public in utility rate hearings before the state Public Service Commission.2 Ind.Code 8-1—1—4.
In September, 1977, the Public Counselor of Indiana had applied for and received from the Department of Energy (DOE) a $200,000 grant under § 6805(a), which was approved by the Indiana Attorney General as to “form and legality.” Eighty-Four Thousand dollars of this grant was allocated for financial and technical assistance to consumer groups in order to facilitate participation in utility rate proceedings.
On December 21, 1977, the Public Counselor executed a proposed contract with the Citizens Energy Coalition, Inc. (Coalition), an Indiana private, not-for-profit organization, for services to be performed by the Coalition for $5,000 under § 6805(a). An Indiana statute provides that all contracts entered into by state agencies shall be approved as to form and legality by the Attorney General. Ind.Code 4 — 13-2-14.3 On March 29, 1978, the Indiana Attorney General disapproved the proposed contract in part because the Coalition maintained a registered lobbyist and “a conflict may arise under the terms of IC 2-4-3 et seq.” 4
[1161]*1161The district court held that to “disapprove the contract of December 21, 1977 on the grounds that the contract would be in conflict with Ind.Code 2-4-3-7 [prohibiting lobbying for pay by public officials] would be an erroneous disapproval.” 5
• After the Attorney General had disapproved the Coalition contract, the Coalition submitted to the Public Counselor three proposals seeking § 6805(a) financial assistance totaling $46,000. The Indiana Public Interest Research Group (Research Group), also an Indiana private, not-for-profit organization which maintained a registered lobbyist, submitted a proposal for financial assistance in the amount of $9,785 to the Public Counselor.
In the meantime the Public Counselor on April 5, 1978, wrote to the Attorney General with supporting affidavits, requesting reconsideration of the disapproval of the original $5,000 contract. Several days later the Attorney General returned the Public Counselor’s letter with a notation that the- “A.G. will not accept lobbyist or organization on contract.”6
On April 17, 1978, the Public Counselor by letter requested the advice of the Attorney General as to whether or not he could make grants under § 6805(a) to consumer groups who had lobbied in the preceding session of the Indiana General Assembly. No formal or informal written response was ever made to this request.
In letters of May 30 and 31, 1978, the Public Counselor advised the Coalition and the Research Group that he was unable to approve their requests for financial assistance “in view of the ruling of the Indiana Attorney General which prohibits my contracting with any organization or individual registered as a lobbyist during the most recent session of the Indiana General Assembly.”7
The Public Counselor did approve an application for financial assistance in the amount of $24,000 by the Consumer Center of Fort Wayne, Indiana, which organization did not retain a lobbyist.
In June, 1978, DOE directed the publie counselor to refrain from spending or committing any further funds allocated for § 6805(a) financial assistance “until such time as the ‘lobbyist’ issue has been satisfactorily resolved.”
On June 14, 1978, the Coalition and the Research Group filed their complaint in this action against the Attorney General and the Public Counselor. On October 17, 1978, the district court, upon the plaintiffs’ motion, granted the preliminary injunction.
II
In his appeal the Attorney General first argued that the district court did not have subject matter jurisdiction. The district court concluded that it did have jurisdiction, finding that “the constitutional [1162]*1162claims in this action are substantial” and that the action raised the issue of whether public officials acting under color of state law have deprived the plaintiffs of their constitutional rights. In addition the cause arises under an act of Congress. 28 U.S.C. § 1337.
In regard to the Attorney General’s argument that the Eleventh Amendment bars the action, the Supreme Court again reaffirmed in Quern v. Jordan, - U.S. -, 99 S.Ct. 1139, 1143, 59 L.Ed.2d 358, 364 (1979) that “under the landmark decision in Ex Parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908), a federal court, consistent with the Eleventh Amendment, may enjoin state officials to conform their future conduct to the requirements of federal law . . ..” The plaintiffs also have standing.
Next the Attorney General contended that the district court should have abstained but it declined to do so. “Abstention is . appropriate where there have been presented difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case then at bar.” Colorado River Water Conservation District v. United States, 424 U.S. 800, 814, 96 S.Ct. 1236, 1244, 47 L.Ed.2d 483 (1976).
The state statute here involved is simple and uncomplicated. Ind.Code 2-4-3-7 prohibits public officials from lobbying. The district court expressly found that “the Public Counselor would not directly or indirectly receive compensation for lobbying by virtue of the DOE grant program.” The court further found that the “plaintiffs are neither public officials nor employees within the meaning of the statute.” The court also concluded:
If an application for financial assistance or a subgrant pursuant to 42 U.S.C. § 6805 were allotted to [the plaintiffs], said parties would not become public officials or employees within the meaning of Ind.Code 2-4-3-7.
The district court properly exercised its discretion in declining to abstain. As the Supreme Court noted in Colorado River, supra at 815 n. 21, 96 S.Ct. at 1245, “the presence of a federal basis for jurisdiction [as opposed to diversity jurisdiction] may raise the level of justification needed for abstention.” The Attorney General has not shown any sound justification which would make abstention appropriate.
Finally the Attorney General has argued that the preliminary injunction jeopardizes his right to exercise discretion in approving contracts. The district court found and concluded as to this argument and we agree:
5. The Attorney General exercises a quasi-judicial professional discretion when approving contracts pursuant to Ind.Code 4-13-2-14. However, in determining whether to approve or disapprove state contracts, the Attorney General may only consider the legality and form of the proposed contract. The Attorney General has a mandatory duty to approve all contracts which are lawful as to form and content. The Attorney General has no discretion to reject a contract which is lawful as to form and content; he is not a party to the contract.
* ' * * * * * *
10. A valid state law such as Ind.Code 2-4 — 3—7 cannot be applied in a way to thwart the exercise of a right guaranteed by the Constitution and laws enacted by Congress. See NAACP v. Thompson, 357 F.2d 831, 833 (5th Cir.), cert. denied, 385 U.S. 820, 87 S.Ct. 45, 17 L.Ed.2d 58 (1966).
Ill
The discretion of the district court in granting a preliminary injunction is measured by (1) whether the plaintiffs have no adequate remedy at law and will be irreparably harmed if the injunction did not issue; (2) whether the threatened injury to the plaintiffs outweighs the threatened harm the injunction may inflict on the defendants; (3) whether the plaintiffs have at least a reasonable likelihood of success on the merits; and (4) whether the granting of the preliminary injunction will not disserve [1163]*1163the public interest. Fox Valley Harvestore, Inc. v. A. O. Smith Harvestore Products, Inc., 545 F.2d 1096, 1097 (7th Cir. 1976).
The district court expressly found all of these factors to exist and to weigh particularly heavily in favor of the plaintiffs. For example, the court found that federal funding for Indiana consumer groups has been paralyzed by the Attorney General’s refusal to approve subgrants to organizations retaining lobbyists and that the entire state program envisaged by § 6805(a) may be in jeopardy and subject to imminent destruction. The Attorney General has not addressed these factors in his appeal. Consequently we cannot say that the district court abused its discretion.
The preliminary injunction order is affirmed.