437 U.S. 518 (1978)
In 1972 the Alaska Legislature enacted the Local Hire Under State Leases Act, known as Alaska Hire, which directed that all oil and gas leases, easements or right-of-way permits for oil or gas pipeline purposes, unitization agreements, and any renegotiations of those instruments to which the state was a party must require the employment of qualified Alaska residents in preference to nonresidents.1 The Act was administered by issuing resident cards to persons who satisfied the statutory definition of resident, which at the time of suit included a one-year durational residency requirement together with maintenance of a state residence, establishment of voting residency, and an intent to remain permanently.2 Appellants, individuals who sought jobs covered by the Act but could not obtain the required resident cards, filed suit challenging the resident preference and the durational requirement.3
Although the statute had been on the books since 1972, it was not seriously enforced until 1975 when construction of the Trans-Alaska Pipeline reached its peak.4 On March 1, 1976, the Commissioner of Labor issued a cease-and-desist order to all unions supplying pipeline workers directing them to dispatch all qualified Alaska residents before dispatching any nonresidents.5 As a result, the appellants, all but one of whom had previously worked on the pipeline, were prevented from obtaining further pipeline-related employment.6
On April 28, 1976, appellants filed a complaint in the Superior Court in Anchorage seeking declaratory and injunctive relief against enforcement of the Act.7 By agreement of the parties the motion for preliminary injunction was consolidated with the merits, and the case was submitted on affidavits, depositions, and memoranda of law without oral testimony.8 On July 21, 1976, the Superior Court upheld Alaska Hire in full and denied all relief.9
On appeal the Alaska Supreme Court unanimously held the one-year durational residency requirement unconstitutional under both state and federal equal protection guarantees and further held that any durational requirement exceeding thirty days was infirm.10 By a three-to-two vote, however, the court sustained the Act's general preference for Alaska residents.11 Appellants appealed only that portion of the judgment, and the United States Supreme Court noted probable jurisdiction in 1977.12
Five of the appellants swore they were not residents of Alaska.13 They therefore could not satisfy the element of the residency definition that required an individual not to have claimed residency in another state during the period of required residency.14 This preserved a continuing controversy between those appellants and the state officials.15
Whether the case remains a live controversy after the Alaska Supreme Court invalidated the one-year durational residency requirement?16
Yes. Although the Alaska Supreme Court invalidated the one-year durational residency requirement, five of the appellants swore that they are not residents of Alaska.19 They therefore cannot satisfy the element of the residency definition requiring that an individual has not claimed residency in another state during the period of required residency.20 These five appellants, identified in the ESTABLISHED FACTS as Tommy Ray Woodruff, Frederick A. Mathers, Emmett Ray, Betty Cloud, and Joseph G. O’Brien, retain a continuing interest in restraining enforcement of Alaska Hire’s resident preference.21 The ESTABLISHED FACTS further establish that the Commissioner of Labor’s cease-and-desist order prevented the appellants from obtaining pipeline-related work after they had previously worked on the project, preserving their concrete stake in the litigation.22
The procedural history confirms that appellants filed suit in Superior Court seeking declaratory and injunctive relief, the trial court upheld the entire Act, the state supreme court struck only the durational requirement, and the United States Supreme Court noted probable jurisdiction over the resident-preference holding.23 Because the five nonresident appellants still face the Act’s employment discrimination, the controversy remains live and justiciable.24
The case is not moot and presents a live controversy between the five nonresident appellants and the state officials.25
Whether the Alaska Hire Act's requirement that covered employers give preference to qualified Alaska residents violates the Privileges and Immunities Clause of Article IV, Section 2?26
The Privileges and Immunities Clause of Article IV, Section 2 bars a state from discriminating against nonresidents in the pursuit of a common calling.27 The state must demonstrate that nonresidents constitute a peculiar source of the evil the statute aims to remedy and that the discrimination bears a substantial relationship to that particular evil.28
Yes. The Alaska Hire Act mandates that all covered oil and gas leases, pipeline permits, and unitization agreements require employment of qualified Alaska residents in preference to nonresidents, and the Commissioner of Labor enforced this mandate by ordering unions to dispatch all qualified Alaska residents before any nonresidents during Trans-Alaska Pipeline construction. The ESTABLISHED FACTS show that the major cause of Alaska’s high unemployment was the lack of education, job training, and geographic remoteness of resident workers, especially Alaska Natives, rather than any influx of nonresidents.29 No evidence in the record indicates that nonresidents were a peculiar source of the unemployment problem the Act targeted.30
Even if nonresidents could be viewed as contributing to the problem, the Act’s flat preference for every Alaska resident regardless of employment status, education, or training fails the substantial-relationship test.31 The discrimination extends indiscriminately to skilled and unskilled residents alike instead of being tailored to unemployed residents or those enrolled in training programs.32 Applying the Toomer framework to the ESTABLISHED FACTS therefore compels the conclusion that the resident preference violates the Privileges and Immunities Clause.33
The Alaska Hire Act’s requirement that covered employers give preference to qualified Alaska residents violates the Privileges and Immunities Clause of Article IV, Section 2.34
Whether the State's ownership of oil and gas resources justifies the Act's discrimination against nonresidents under the Privileges and Immunities Clause?35
A state’s ownership of a natural resource is a relevant factor in evaluating discrimination against nonresidents under the Privileges and Immunities Clause.36 It is not dispositive.37 The discrimination remains subject to scrutiny and must be justified by the state’s proprietary interest rather than by the mere fact of ownership.38
No. Although Alaska owns the oil and gas underlying the leases and permits covered by the Act, the statute’s reach extends far beyond any direct proprietary interest.39 The ESTABLISHED FACTS establish that the Act applies to all employment resulting from oil and gas leases, pipeline easements, unitization agreements, and renegotiations to which the state is a party, including work performed by suppliers and subcontractors who have no contractual relationship with the state, perform no work on state land, and receive no state payments.40 The Act further encompasses employment at refineries and distribution systems utilizing oil and gas obtained under Alaska leases, activities only remotely connected to the state’s ownership.41
Because the discrimination mandated by the Act sweeps so broadly and reaches employers with attenuated or nonexistent ties to the state’s resources, Alaska’s ownership interest supplies insufficient justification under the Privileges and Immunities Clause.42 The pervasive resident preference therefore cannot be sustained on the basis of state ownership alone.43
The State's ownership of oil and gas resources does not justify the Act's discrimination against nonresidents under the Privileges and Immunities Clause.44