8. Transmittal No. 24 is not in conflict with the terms of 12 U.S.C. § 1715z-1. Transmittal No. 24 may be legally implemented retroactively only to the extent that the Department may make refunds to project owners of contributions erroneously made to the reserve fund and provided that such refunds compensate project owners only for basic rentals contributed to the fund.
9. Since there is no genuine dispute as to the material facts and since judgment should be entered for Plaintiffs as a matter of law on the issue of whether the operating subsidy provisions of 12 U.S.C. § 1715z-1 are mandatory, plaintiffs' motion for preliminary injunction should be consolidated with the trial on the merits and plaintiffs should be granted summary judgment. Plaintiffs consequently are entitled to declaratory relief in accordance with these conclusions of law. Plaintiffs are also entitled to a writ of mandamus and a permanent injunction ordering the Secretary, her agents, officers, servants, employees, attorneys and all persons in active concert or participation with her to establish initial operating expense levels for all Section 236 projects nationwide, to determine the increase in the cost of local property taxes and utilities for such projects, to determine whether such increases have been reasonable and comparable to cost increases in the relevant community, and to make and contract to make operating subsidy payments for the benefit of plaintiffs from February 18, 1975, forward and to continue to make such payments periodically as the availability of funds permits. Plaintiffs should be denied permanent injunctive relief enjoining permanent implementation of Transmittal No. 24.
An Order consistent with the foregoing Findings of Fact and Conclusions of Law has been filed this date.
John H. Pratt United States District Judge
Upon consideration of plaintiffs' motion for a preliminary injunction, the memoranda in support of and in opposition to this motion, the oral argument of counsel at a hearing held on May 20, 1976, and the Findings of Fact and Conclusions of Law filed contemporaneously herewith, and it appearing that the defendant is under a legal duty to implement 12 U.S.C. § 1715z-1(f)(3) and (g) and to make and contract to make the additional assistance payments therein provided for, it is this 8th day of June, 1976.
ORDERED, that the hearing on plaintiffs' motion for a preliminary injunction be consolidated with the trial on the merits pursuant to Rule 65(a) of the Federal Rules of Civil Procedure, that plaintiffs be granted summary judgment, and that defendant shall as soon as practically possible:
(1) Determine the initial operating expense level, as defined in 12 U.S.C. § 1715z-1(f)(3), for all housing projects in the United States which are assisted under 12 U.S.C. § 1715z-1;
(2) Determine whether the increase in the cost of utilities and local property taxes for each of these housing projects has been reasonable and comparable to cost increases affecting other rental projects in the relevant community, as required by 12 U.S.C. § 1715z-1(f)(3);
(3) Make and contract to make the additional assistance payments to which plaintiffs are entitled, from February 18, 1975, forward, pursuant to 12 U.S.C. § 1715z-1(f)(3) and (g) and continue to make such payments periodically as the availability of funds permits; and
(4) Make the additional assistance payments provided for in subsection (3) above from the reserve fund established pursuant to Section (g) and to the extent necessary from unobligated contract authority currently available or which shall become available; and it is
FURTHER ORDERED, that plaintiffs' request for permanent injunctive relief enjoining the implementation of Transmittal No. 24 is denied; and it is
FURTHER ORDERED, that plaintiffs are entitled to recover reasonable costs for this suit.
John H. Pratt United States District Judgec
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