South Carolina’s lawsuit calling for million-dollar fines and plutonium removal should be dismissed because the state is wrongly interpreting the laws governing a long-delayed nuclear fuel project, the U.S. Energy Department said in court documents.

In its first official response to the state’s lawsuit, the federal government also argued Monday that any potential fines for project delays should be handled in a different court system, not federal district court.

In February, South Carolina accused the federal government of acting unconstitutionally in failing to complete the mixed-oxide facility by Jan. 1, 2016. The lawsuit seeks daily fines of $1 million and plutonium removal.

The project at the Savannah River Site along the South Carolina-Georgia border is billions of dollars over budget. It was intended to turn weapons-grade plutonium into commercial nuclear reactor fuel to help the United States fulfill an agreement with Russia to dispose of at least 34 metric tons apiece of weapons-grade plutonium. That’s an amount government officials say is enough for about 17,000 nuclear warheads.

Since the plant isn’t operating, by law the federal government was supposed to remove 1 metric ton of plutonium from South Carolina by this year or pay $1 million a day for “economic and impact assistance,” up to $100 million yearly, until either the facility meets production goals or the plutonium is taken out of state for storage or disposal elsewhere.

In its response, the federal government argued that Congress made it clear that removal deadlines might not be met and that’s why the fine provision was included. In other words, Energy Department lawyers argue, the agency has the choice between processing or removing the materials or paying fines to the state.

“Removal and payment were meant to be mutually exclusive alternatives, with the financial payment serving as a backstop in the event that neither production nor removal was achieved,” according to the filing.

And those fines, the department argues, must legally be dealt with in the U.S. Court of Federal Claims, which according to its website “is authorized to hear primarily money claims founded upon the Constitution, federal statutes, executive regulations, or contracts.”

Attorneys for South Carolina declined to comment. In a statement provided to The Associated Press, a spokeswoman for Nikki Haley reiterated the governor’s stance that the government must uphold its deal with the state.

“South Carolina will not be a dumping ground for nuclear waste,” said spokeswoman Chaney Adams. “We deserve better than the years of broken promises we’ve seen from the federal government, and we won’t back down on what is an important economic development and quality of life issue for the people of our state.”