Lancashire is to take the Government to court over its decision to scrap a £6m a year grant to help fund waste recycling.
County Hall chiefs have taken legal advice after being given the news just before Christmas that the cash handout was ending.
And the authority believes it has a good case in a judicial review to force Whitehall to reverse its shock decision.
“Our lawyers have sought counsel opinion and they are saying we are entitled to this money,” declared Lancashire County Council’s deputy leader David Borrow.
“So we are taking the Government to court over it. This could take a year before it is settled, but we are pursuing it.”
The Department for Environment, Food and Rural Affairs (Defra) has been giving LCC a waste infrastructure grant of £5.99m a year to help with the cost of two huge recycling centres at Farington near Preston and Thornton near Blackpool.
The plants each cost £125m to build and between them they treat 90 per cent of the county’s waste.
The county council took over the ownership and running of the plants last August in partnership with Blackpool Council.
But on December 16 Defra announced it had terminated the grant from last July, forcing LCC to dip into its reserves to stump up the missing cash until the matter can be settled in court.
A report to councillors this week said: “The council considers that it has very strong grounds to contest this decision and will now challenge Defra’s decision by way of a judicial review.
“Although the council is confident of its case, these resources must be considered to be at risk and there is an amount set aside from the reserves to provide this cover for 2015/16.”
Coun Borrow told members of the LCC executive scrutiny committee that the authority’s recycling policy was saving the county around £20m a year.
The two plants became the country’s first fully-enclosed waste treatment facilities when they were built in 2010, diverting 75 per cent of the waste they handle away from landfill.
Thornton, on the site of the former ICI Hillhouse works, was the first to become operational, with Farington, built on the old Leyland Trucks test track, following three months later.
The Farington operation, which created more than 200 jobs, treats waste from Preston, South Ribble, Chorley, Ribble Valley, Lancaster and West Lancashire handling more than 300,000 tonnes of material every year. Thornton deals with waste from Blackpool, Wyre and Fylde.