v.
CITY OF FLINT, and Flint City Council, Intervening
The Court entered judgment in this case on October 17, 2017 directing defendant City of Flint to execute a long-term contract providing for a source of water for its water distribution by October 23, 2017. The contract must comply with an Emergency Administrative Order that had been issued several months earlier by the Environmental Protection Agency (EPA). The delay in finalizing such an agreement imperiled the solvency of Flint's water system and its future capacity to deliver safe drinking water to Flint's residents. The City of Flint has now concurred in the judgment's order for relief. Its City Council-an intervening defendant-has filed a motion for relief from that judgment, or to amend the judgment, or to stay the proceedings, because, it says (among other things), it wants more time to gather information and mull this over. Plaintiff Michigan Department of Environmental Quality (MDEQ) argues that much of the information that the City Council presents to support its new arguments comes too late in this litigation, and the urgent need for a long-term contract still exists. With one exception, the Court agrees. And that exception consists of a subject matter jurisdiction argument that is unpersuasive. Therefore, the Court will deny the City Council's motion.
MDEQ discussed in its response to the motion various options for enforcing the judgment. But the Court does not act on its own in that realm. If the judgment remains unsatisfied, the plaintiff must take the initiative to file an appropriate motion for enforcement.
I.
The City Council presents six arguments: (1) there is no subject matter jurisdiction because MDEQ did not satisfy the 60-day notice provision of the Safe Drinking Water Act's citizen suit section; (2)
[*846] Flint's rate of collecting water bills could improve to the point that insolvency of the water fund is not inevitable; (3) there are factual disputes that should have precluded summary judgment; (4) the Court was required to hold an evidentiary hearing before issuing a permanent injunction; (5) forcing Flint's legislative body to sign a contract violates certain state laws; and (6) a stay of the judgment is appropriate because Flint is not in danger of losing its source of drinking water. These arguments purportedly are based on Federal Rules of Civil Procedure 59(e), 60(b)(1), 60(b)(6), and 62(b), and Local Rule 7.1(h). Other than citing those rules in the first paragraph of its motion, the City Council does not discuss the requirements of those rules or mention them again in its brief. Appreciating those rules' requirements, however, is necessary to applying them.
A party seeking relief under Rule 59(e) must show one of four things: "(1) a clear error of law; (2) newly discovered evidence; (3) an intervening change in controlling law; or (4) a need to prevent manifest injustice." Intera Corp. v. Henderson ,
A motion based on Rule 60(b)(1) is "intended to provide relief to a party in only two instances: (1) when the party has made an excusable litigation mistake or an attorney in the litigation has acted without authority; or (2) when the judge has made a substantive mistake of law or fact in the final judgment or order." Cacevic v. City of Hazel Park ,
The Sixth Circuit has held that a court may grant relief under Rule 60(b)(6)" 'only in exceptional and extraordinary circumstances,' which are defined as those 'unusual and extreme situations where principles of equity mandate relief.' " Export-Import Bank of U.S. v. Advanced Polymer Sciences, Inc. ,
[*847] Rule 62(b) allows a court to stay the execution of a judgment in the short term if a post-judgment motion is pending under, among others, Rules 59 or 60. But such a stay must be "[o]n appropriate terms for the opposing party's security." Fed. R. Civ. P. 62(b). "What constitutes 'appropriate terms' is a matter left to the trial court's discretion, but normally the party seeking a stay is required to post a bond sufficient to protect fully the prevailing party's interest in the judgment." Newburgh/Six Mile Ltd. P'ship II v. Adlabs Films USA, Inc. , No. 09-11067,
Finally, under Local Rule 7.1(h), the moving party must show (1) a "palpable defect," (2) that misled the court and the parties, and (3) that correcting the defect will result in a different disposition of the case. E.D. Mich. LR 7.1(h)(3). A "palpable defect" is a defect which is obvious, clear, unmistakable, manifest, or plain. Mich. Dep't of Treasury v. Michalec ,
II.
There is a common denominator among most of these rules: a party that has had a fair chance to present its arguments ought not have a second bite at the apple. Most of the City Council's present arguments could be dispatched under this rubric. However, the contention that the MDEQ failed to abide by the SDWA's citizen suit 60-day notice requirement requires special attention, because if subject matter jurisdiction is implicated, the issue can be raised at any time, even if a party passed on the opportunity earlier in the case.
A. 60-day Notice Provision
The SDWA's citizen suit provision contains this caution:
No civil action may be commenced-
(1) under subsection (a)(1) of this section respecting violation of a requirement prescribed by or under this subchapter-
(A) prior to sixty days after the plaintiff has given notice of such violation (i) to the Administrator, (ii) to any alleged violator of such requirement and (iii) to the State in which the violation occurs....
[*848] 42 U.S.C.A. § 300j-8(b)(1)(A). Citing Hallstrom v. Tillamook County ,
In Hallstrom , the Supreme Court considered the notice requirement in the citizen suit section of the Resource Conservation and Recovery Act (RCRA), found at
In Board of Trustees of Painesville Twp. v. City of Painesville, Ohio ,
The eighteen-year-old Painesville dictum has been called into question. More recently, the Sixth Circuit has warned that attacks on the merits should not be confounded with jurisdictional challenges, admonishing courts to be more exacting when addressing challenges that are phrased as an attack on jurisdiction. Primax Recoveries, Inc. v. Gunter,
The Kwai Fun Wong Court explained that absent a clear statement from Congress, procedural rules are nonjurisdictional, and accordingly do not "deprive a court of authority to hear a case."
Similarly, section 300j-8(b) does not speak in jurisdictional terms and is housed in a provision separate from section 300j-8(a), which confers upon federal courts jurisdiction over these citizen suits. Section 300j-8(b) does not include any clear statement from Congress that would limit the Court's authority to hear this case. It simply prescribes a condition precedent to filing a suit, which, absent jurisdictional language, probably is subject to forfeiture. Kwai Fun Wong cuts against the Sixth Circuit's jurisdiction-based statements in Painesville and supports the proposition that notice requirements fall under the label of "quintessential claim-processing rules," which "seek to promote the orderly progress of litigation," speaking "only to a claim's timeliness, not to a court's power."
In asserting that the Court lacks jurisdiction, the City Council also relies on Judge O'Meara's opinion in McMillian v. Snyder , No. 16-10796,
The weight of authority favors the view that the 60-day notice requirement in section 300j-8(b) is a claim processing rule that imposes a procedural requirement. To be sure, it is a requirement that a district court may not disregard. Hallstrom ,
Moreover, section 300j-8(b) only obligates "the plaintiff" to give "notice of such violation" "to the [EPA] Administrator," the "alleged violator," and "the State." The City Council argues that the September 2016 letter to Flint from the EPA does not satisfy that requirement because it did not come from the plaintiff. But according to the MDEQ, its own administrator also sent Flint a letter in September 2016 that echoed the EPA's concerns. That letter, coupled with the many expressions of concern about the potential failure "to make changes in operations" so that its "waterworks system [would be] operated as to...adequately protect the public health,"
The City Council's challenge to the Court's subject matter jurisdiction must fail.
B. Projected Water Fund Insolvency
Based on the declaration of William Scott Kincaid, the City Council constructs a scenario in which the impending insolvency of Flint's water fund would not be inevitable. According to Mr. Kincaid, the root of the problem is the mistrust engendered among Flint's residents by the catastrophic failure of the water system under the guidance of the state-appointed emergency manager. He explains that before April 2014, the collection rate was 90%. But after the City switched its water source to the Flint River, drinking water quality plummeted and many residents quit using the water and paying their bills. In addition, Mr. Kincaid points out that the City unlawfully raised water rates, a position ultimately sustained by the Michigan Court of Appeals. He says that if things are made right-that is, water rates are reduced and trust is restored-collection rates will rise and the insolvency of the water fund is not inevitable.
The City Council seems to think that Mr. Kincaid's speculation undermines the finding that the injury identified by the MDEQ is imminent. It does not, for several reasons. First, there is no evidence that a rise in collection rates, coupled with a restoration of water rates-which Mr. Kincaid would calculate as a reduction of about 36%-would cause a marked increase in water revenue. It might even result in a reduction in revenue. But it is hard to say, because the statements in the declaration are quite general and not focused on concrete financial analysis. Second, there is no evidence that accomplishing those goals could take place in the near future, or at any time before the water fund runs out of money. Third, the collection rates are not Flint's only problem. As outlined in the summary judgment opinion, Flint also is on the hook now for monthly bond payments to the Karegnondi Water Authority (KWA), and there is a need to spend for infrastructure improvement to ensure the safety of the water delivery system. An increase in the rate of collecting water bills that charge a third less for the service is, one might say, but a drop in the bucket.
The reasoning behind Mr. Kincaid's declaration also is cause for concern. The facts laid out by the MDEQ portend dire consequences [*851] for Flint residents if its government does not act-and soon-to address their long-term water needs. Mr. Kincaid proposes a solution that has no apparent basis in actual city finances. He asserts that he has been a member of the City Council for over thirty years and has been "directly involved in the finances of Flint." He does not profess any special knowledge or expertise in accounting or finance. And his analysis fails to focus on the several interrelated factors that impact the solvency of the Flint water fund. The Court does not deem it prudent to rely on that declaration to find "newly discovered evidence" (Rule 59(e)), or "a substantive mistake of...fact" ( Rule 60(b)(1) ), or "exceptional and extraordinary circumstances" ( Rule 60(b)(6) ), or a "palpable defect" in its prior reasoning (LR 7.1(h)(3)).
C. Factual Disputes
The City Council has cataloged a list of potential issues that it has characterized as "factual disputes," which, it believes, ought to prevent summary judgment. None of these were raised in response to the MDEQ's motion for summary judgment in briefing or oral argument. The City Council now argues that it "was not asked for, and did not provide, a stipulation or waiver concerning facts." But that argument intimates a fundamental misunderstanding of the summary judgment process.
Under Federal Rule of Civil Procedure 56, the party bringing the summary judgment motion has the initial burden of informing the court of the basis for its motion and identifying portions of the record that demonstrate the absence of a genuine dispute over material facts. Mt. Lebanon Pers. Care Home, Inc. v. Hoover Universal, Inc. ,
The City Council never offered any factual material-or even raised an argument-that questioned the MDEQ's established assertions. Even now, the list of potential facts that might be in dispute is entirely undocumented.
But, City Council argues, there was not much time for discovery and the Court moved quickly through the procedures. Rule 56 has an answer for that: City Council could have attempted to "show[ ] by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition" to summary judgment. Fed. R. Civ. P. 56(d). No such affidavit or declaration was submitted. The City Council chose instead to base its opposition to MDEQ's summary judgment motion on legal arguments focusing mostly on justiciability issues. Relief, therefore, is foreclosed. Unan v. Lyon ,
[*852] (quoting Plott v. Gen. Motors Corp. ,
The Seventh Circuit confronted a similar circumstance in Publishers Resource, Inc. v. Walker-Davis Publications, Inc. ,
Motions for reconsideration serve a limited function: to correct manifest errors of law or fact or to present newly discovered evidence. Such motions cannot in any case be employed as a vehicle to introduce new evidence that could have been adduced during pendency of the summary judgment motion. The non-movant has an affirmative duty to come forward to meet a properly supported motion for summary judgment....Nor should a motion for reconsideration serve as the occasion to tender new legal theories for the first time.
So it is here. The City Council's opposition to summary judgment comes too little, too late. There is no basis to grant relief on this ground under any of the rules the City Council cited.
D. Need for Evidentiary Hearing before Permanent Injunction Issuance
Relying on United States v. Owens ,
In Owens , the district court issued a preliminary injunction after a hearing, but later converted it to a permanent injunction without notifying the parties or conducting a trial.
There was no motion for a preliminary injunction in this case. The MDEQ sought a judgment as a matter of law under Rule 56. The procedure criticized in Owens was different than that at work here. And, as the Owens court acknowledged, "when there is no dispute of material fact alleged, then it may be appropriate for a court to decide a case without an evidentiary hearing."
E. Injunction and State Laws
The City Council also argues to the extent the Court's judgment forces the City to approve a contract against its will, the judgment violates the Flint City [*853] Charter and state law contract principles. But as the Court noted in its order, it is within the power of the federal courts to order performance by a local government in excess of limits set by state statute. Missouri v. Jenkins ,
Under Jenkins , when a federal court determines that a local municipality's actions violate a federal statute that is based on provisions of the United States Constitution (in this case defendant municipalities violated the Federal Clean Water Act,33 U.S.C. §§ 1251 et seq., enacted by Congress empowered by provisions in the Constitution), the court may order a local government unit with taxing authority to levy taxes adequate to satisfy the municipality's debt obligations incurred in complying with federal law, even if the taxes exceed state constitutional and statutory limitations. In other words, Jenkins permits a federal court to enjoin operation of state statutes and constitutional provisions prohibiting a local government unit from levying taxes at a rate above limits set by state law without majority electorate approval.
In that case, the court was enforcing the Clean Water Act and found authority in the Constitution's general welfare clause as well as the Commerce Clause to do so. As the court aptly noted, "No more important single problem faces this country today than the problem of "good water." Water is our greatest single natural resource."
Here, the plaintiff has demonstrated, and the Court has found, that Flint's need for a long-term agreement for a source of safe drinking water is dire. Ordering compliance with the SWDA does not disregard principles of equity or comity.
F. Stay of Judgment
Lastly, the City Council asks the Court to stay its judgment, presumably to allow it to retain an expert to evaluate alternatives to the erstwhile deal that the Flint administration negotiated last April. City Council does not develop its argument, but it appears that the basis of this request is that it has shown that Flint is not at risk of losing access to the 72-inch pipeline owned by the Genesee County Drain Commission or its current source of drinking water.
There is no basis to conclude that the need for immediate action has diminished. In fact, as time slips away, Flint's opportunities for an economical long-term water supply contract are running out. As the Flint administration has outlined in its opposition to this motion, the City Council's inaction has resulted in losing a favorable contract with the Great Lakes Water Authority (GLWA) that would have provided credits-including retroactive credits-against the KWA bond debt, relieved Flint of that obligation, provided Flint with a long-term source of safe water at predictable rates, established a fund for those unable to pay their water bills, and freed cash for infrastructure repair and improvement. That deal is off the table, and it is unclear whether all or part of it can be revived.
The City Council's water consultant wants 75 days to complete his task. During that time, the window will close on the opportunity to refinance the KWA bond debt. Meanwhile, Flint will pay short-term (that is, premium) rates for its water and a hefty sum to KWA each month.
[*854] And the source of Flint's water during that period is not secure. The City Council voted to extend its current contract with GLWA for two more years, after it expires at the end of this month. That certainly is no long-term contract, and there is no evidence that the proposal was communicated to GLWA, or that GLWA would be disposed to accept it. One might wonder if GLWA, which is under an obligation to treat all of its municipal water customers with equal favor, could even accept such a proposal; or why, as the administration points out, GLWA would allow City Council to "string it along while it attempts to secure another water source."
The City Council has fallen far short of proposing "appropriate terms for the opposing party's security." Fed. R. Civ. P. 62(b). In fact, its actions (and inactions) since the judgment was entered-such as they are-likely has made Flint's situation worse. The administration suggests that the delay caused by the stay City Council seeks would be the last brick on the road to Flint's bankruptcy. The evidence indicates that its assessment may be accurate.
III.
The City of Flint's brief includes press accounts of City Council members decrying the Court's intervention, complaining about the "gun [held] to [their] head," "forced into signing a contract." The Court's judgment, however, ordered the City of Flint to do what its citizens elected their representatives to do: govern by acting in the interest of the common good. That has not happened over the past year, and now time-which is of the essence-is in short supply.
MDEQ and the City of Flint have asked the Court to authorize the mayor to sign the Master Agreement negotiated last spring. But that deal in no longer available, since the signature escrow agreement expired on September 30 this year due to the City Council's inaction. In all events, the City Council has not offered any good reasons for reconsidering, altering, amending, withdrawing, or staying this Court's judgment. The parties may move to enforce it as they see fit.
Accordingly, it is ORDERED that the intervening defendant's emergency motion for reconsideration, to alter or amend judgment, for relief from judgment, and for stay of proceedings [dkt. # 40] is DENIED .