Shain v. Veneman

278 F. Supp. 2d 1006, 2003 U.S. Dist. LEXIS 14558, 2003 WL 21998612
CourtDistrict Court, S.D. Iowa
DecidedAugust 19, 2003
Docket4:02-cv-40645
StatusPublished

This text of 278 F. Supp. 2d 1006 (Shain v. Veneman) is published on Counsel Stack Legal Research, covering District Court, S.D. Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shain v. Veneman, 278 F. Supp. 2d 1006, 2003 U.S. Dist. LEXIS 14558, 2003 WL 21998612 (S.D. Iowa 2003).

Opinion

ORDER ON DEFENDANTS’ MOTION TO DISMISS

GRITZNER, District Judge.

Before the Court is Defendants’ Motion to Dismiss or in the Alternative for Summary Judgment (Clerk’s No. 3). The Court first addresses the motion to dismiss. Having considered the motion, Plaintiffs’ resistance, a corresponding reply, documents related to amicus curiae briefs, and statements at oral argument, the Court grants Defendants’ Motion to Dismiss. Accordingly, the Defendants’ alternative motion for summary judgment is denied as moot.

I. PROCEDURE

This case arises out of the construction of two sewage lagoon ponds near the City of Kinross, Iowa, which Plaintiffs allege were improperly funded and improvidently located in a 100-year flood plain. Plaintiff Shain first initiated this lawsuit on December 24, 2002, against Ann Veneman, Secretary of Agriculture, and others working in their capacity as employees of the United States Department of Agriculture (“USDA”), all of whom the Court collectively refers to as “the Government”.

After an extension of time in which to move or respond to the original Complaint, the Government moved the Court to dismiss the case, or alternatively to grant summary judgment. The essential basis for the motion was the Government’s assertion that Plaintiff Shain lacked the necessary standing to bring this suit.

Shain requested and did receive an extension until April 23, 2003, in which to resist the Government’s motion. On April 25, 2003, two days past the extended dead *1008 line, and despite the directive in Fed. R.Civ.P. 15(a) to seek leave of court before amending a pleading after a responsive pleading has been filed, Plaintiff Shain filed an Amended Complaint without leave of Court, adding James Sheetz as a Plaintiff and also inserting a new paragraph to seek review of administrative action pursuant to the Administrative Procedure Act, 5 U.S.C. § 706(2)(A). 1

The Government subsequently amended its initial motion, maintaining Plaintiffs lacked standing to sue, and also argued Plaintiffs could not seek judicial review of agency action since they had not exhausted all administrative remedies. Plaintiffs have filed a resistance to this, citing Darby v. Cisneros, 509 U.S. 137, 113 S.Ct. 2539, 125 L.Ed.2d 113 (1993), and arguing the exhaustion of administrative remedies is not required since Plaintiffs are not program participants of any USDA programs. Plaintiffs reassert their contention that they have standing in this case.

Oral argument on the Government’s amended motion was set and then rescheduled for July 29, 2003. A few days before the hearing, the City of Kinross and the Rural Utilities Services Systems (“RUSS”) filed a motion seeking leave to file an amicus curiae brief in support of the Government. After the July 29, 2003, oral arguments, the Court left the record open to allow Plaintiffs the ability to respond to the amicus brief filed by Kinross and RUSS. 2 Plaintiffs did respond, arguing that under the Administrative Procedure Act and under Dep’t of the Army v. Blue Fox, Inc., 525 U.S. 255, 119 S.Ct. 687, 142 L.Ed.2d 718 (1999), they are entitled to the full array of equitable remedies. Kinross and RUSS, as well as the Government, have each replied to Plaintiffs’ response.

II. MATERIAL FACTS

In August of 1997, Kinross was contacted by the Iowa Department of Natural Resources (“DNR”) about complaints the DNR received regarding discharge of waste-water into a creek near Kinross related to a Kinross resident’s individual septic tank. Kinross was not given a citation but did begin analyzing the possibility of creating a community sewer system. Originally, funding for this community system was sought through community block grants via the USDA, where the Wapello Rural Water Association would be the owner/operator; however, this arrangement proved unsuccessful.

In 2000, Kinross began working with RUSS, an intergovernmental agency, to secure the necessary funding to create a sewer system. 3 RUSS obtained funding through the Iowa Department of Economic Development and the USDA. Eventually, RUSS received a loan not to exceed $128,000 and a grant not to exceed $367,500 for the sewer lagoon project. An additional grant of $89,000 from a Community Development Block Grant (“CDBG”) *1009 was also provided to help fund the sewer lagoon project.

Two sewage retention ponds were built on land adjacent to the City of Kinross. During oral argument, the parties stipulated that construction of both sewage lagoons was complete and the lagoons were operational. The Court notes that the main impact this case has had on the project thus far relates to the USDA not fully disbursing the loan for the project. While this case has been pending, Kinross obtained private funding to address the expenses related to the sewer lagoon project.

Under 7 U.S.C. § 1926(a)(1), Ann Vene-man, as Secretary of the USDA, and those acting under her delegated authority, are authorized to make grants for the financing of projects addressing the collection, treatment, or disposal of waste in rural areas. Pursuant to 42 U.S.C. § 4002, states or local communities, as a condition of future federal financial assistance, must participate in the National Flood Insurance Plan (“NFIP”) 4 administered by the Federal Emergency Management Agency (“FEMA”). Under 42 U.S.C. § 4106, a federal officer or agency shall not approve financial assistance for acquisition or construction purposes which will be used in any area identified as having special flood hazards unless the community participates in the NFIP. In this case, Plaintiffs allege that by authorizing and approving a loan for the sewage lagoons, the Government violated section 4106. Plaintiffs contend the lagoons were built in a 100-year flood plain, and since Kinross does not participate in the NFIP, Kinross was and is ineligible to receive federal financial assistance to construct the sewage lagoons in question. See 42 U.S.C. § 4002 and 42 U.S.C. § 4106.

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Bluebook (online)
278 F. Supp. 2d 1006, 2003 U.S. Dist. LEXIS 14558, 2003 WL 21998612, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shain-v-veneman-iasd-2003.