550 U.S. 330 (2007)
Located in central New York, Oneida and Herkimer Counties span over 2,600 square miles and are home to about 306,000 residents.1 Traditionally, each city, town, or village within the Counties has been responsible for disposing of its own waste. Many had relied on local landfills, some in a more environmentally responsible fashion than others.2
By the 1980’s, the Counties confronted what they could credibly call a solid waste crisis. Many local landfills were operating without permits and in violation of state regulations. Sixteen were ordered to close and remediate the surrounding environment, costing the public tens of millions of dollars.3 These environmental problems culminated in a federal clean-up action against a landfill in Oneida County; the defendants in that case named over 600 local businesses and several municipalities and school districts as third-party defendants.4
The crisis extended beyond health and safety concerns. The Counties had an uneasy relationship with local waste management companies, enduring price fixing, pervasive overcharging, and the influence of organized crime. Dramatic price hikes were not uncommon: In 1986, for example, a county contractor doubled its waste disposal rate on six weeks’ notice.5
Responding to these problems, the Counties requested and New York’s Legislature and Governor created the Oneida-Herkimer Solid Waste Management Authority, a public benefit corporation. See N. Y. Pub. Auth. Law Ann. §2049–aa et seq. (West 1995).6 The Authority is empowered to collect, process, and dispose of solid waste generated in the Counties. To further the Authority’s governmental and public purposes, the Counties may impose appropriate and reasonable limitations on competition by, for instance, adopting local laws requiring that all solid waste be delivered to a specified solid waste management-resource recovery facility.7
In 1989, the Authority and the Counties entered into a Solid Waste Management Agreement, under which the Authority agreed to manage all solid waste within the Counties.8 Private haulers would remain free to pick up citizens’ trash from the curb, but the Authority would take over the job of processing the trash, sorting it, and sending it off for disposal.9 The Authority collected tipping fees to cover its operating and maintenance costs for these facilities. The tipping fees significantly exceeded those charged for waste removal on the open market, but they allowed the Authority to do more than the average private waste disposer, including recycling of 33 kinds of materials.10 If the Authority’s operating costs and debt service were not recouped through tipping fees and other charges, the agreement provided that the Counties would make up the difference.11
Citizens might opt to have their waste hauled to facilities with lower tipping fees.12 To avoid being stuck with the bill for facilities that citizens voted for but then chose not to use, the Counties enacted flow control ordinances requiring that all solid waste generated within the Counties be delivered to the Authority’s processing sites.13 Private haulers must obtain a permit from the Authority to collect waste in the Counties. Penalties for noncompliance with the ordinances include permit revocation, fines, and imprisonment.14
Petitioners are United Haulers Association, Inc., a trade association made up of solid waste management companies, and six haulers that operated in Oneida and Herkimer Counties when this action was filed.15 In 1995, they sued the Counties and the Authority under 42 U.S.C. §1983, alleging that the flow control laws violate the Commerce Clause by discriminating against interstate commerce.16 They submitted evidence that without the flow control laws and the associated $86 per-ton tipping fees, they could dispose of solid waste at out-of-state facilities for between $37 and $55 per ton, including transportation.17 The District Court ruled in the haulers’ favor. The Second Circuit reversed in 2001 and again affirmed in 2006 after remand. The Supreme Court granted certiorari in 2006.18
Whether the Counties’ flow control ordinances discriminate against interstate commerce under the dormant Commerce Clause?19
To determine whether a law violates the dormant Commerce Clause, the Court first asks whether it discriminates on its face against interstate commerce.20 In this context, discrimination simply means differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter.21 Discriminatory laws motivated by simple economic protectionism are subject to a virtually per se rule of invalidity, which can only be overcome by a showing that the State has no other means to advance a legitimate local purpose.
No. The flow control ordinances benefit a clearly public facility while treating all private companies exactly the same whether in-state or out-of-state.22 This is shown in the established facts that the Authority is a public benefit corporation created by state law and the ordinances require delivery only to Authority sites.23 The ordinances do not hoard solid waste for the benefit of a preferred private processing facility.24
The Counties’ flow control ordinances do not discriminate against interstate commerce for purposes of the dormant Commerce Clause.25
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Justice Scalia joined Parts I and II–A through II–C of the Court’s opinion.26 He reaffirmed his view that the so-called negative Commerce Clause is an unjustified judicial invention not to be expanded beyond its existing domain.27 The historical record provides no grounds for reading the Commerce Clause to be other than what it says.28
He has been willing to enforce a negative self-executing Commerce Clause only against facially discriminatory laws or laws indistinguishable from those previously held unconstitutional.29 The flow-control law at issue benefits a public entity performing a traditional local-government function and treats all private entities precisely the same way.30 Disparate treatment constitutes discrimination only if the objects are similarly situated for the relevant purposes.31
None of the Court’s cases concludes that public and private entities are similarly situated for Commerce Clause purposes.32
Joined by Stevens And Kennedy, Jj.
Justice Alito dissented.33 He argued that this Court has never suggested that discriminatory legislation favoring a state-owned enterprise is entitled to favorable treatment.34 To be sure, state-owned entities are accorded special status under the market-participant doctrine, but that doctrine is not applicable here.35
Respondents are acting as market participants by operating a fee-for-service business while also regulating the market in a discriminatory manner.36 The flow control laws discriminate against interstate commerce and are subject to strict scrutiny which they fail because any legitimate goals could be achieved through nondiscriminatory means such as uniform safety regulations or general tax subsidies.37
Whether C & A Carbone, Inc. v. Clarkstown controls this case or decided the question whether laws favoring public facilities may be treated differently from laws favoring private facilities under the dormant Commerce Clause?38
Carbone involved a flow control ordinance requiring that all nonhazardous solid waste within a town be deposited at a transfer facility run by a private contractor under an agreement with the town.39 The Carbone majority viewed the ordinance as just one more instance of local processing requirements that the Court long has held invalid citing six local processing cases every one of which involved discrimination in favor of private enterprise.
No. Carbone cannot be regarded as having decided the public-private question because the transfer station in that case was private.40 The question whether public facilities may be favored was not properly before the Court.41 This is shown in the established facts that the Authority here is a public benefit corporation.42
Carbone does not control this case and did not decide the question whether laws favoring public facilities may be treated differently from laws favoring private facilities under the dormant Commerce Clause.43
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Justice Thomas concurred in the judgment.44 He stated that he no longer believes Carbone was correctly decided because the negative Commerce Clause has no basis in the Constitution and has proved unworkable in practice.45 The language of the Commerce Clause allows Congress to regulate interstate commerce and to prevent state regulation of it.46
Expanding on the powers explicitly conferred on Congress, this Court has interpreted the Clause as a tool for courts to strike down state laws that it believes inhibit interstate commerce.47 But there is no basis in the Constitution for that interpretation.48 Application of the negative Commerce Clause turns solely on policy considerations, not on the Constitution.49
Because this Court has no policy role in regulating interstate commerce, he would discard the Court’s negative Commerce Clause jurisprudence.50
Whether laws favoring local government facilities are subject to the same level of scrutiny as laws favoring particular private businesses under the dormant Commerce Clause?51
Compelling reasons justify treating laws favoring local government differently from laws favoring particular private businesses over their competitors because any notion of discrimination assumes a comparison of substantially similar entities whereas government is vested with the responsibility of protecting the health safety and welfare of its citizens and these important responsibilities set state and local government apart from a typical private business.
No. Laws favoring local government may be directed toward any number of legitimate goals unrelated to protectionism.52 The ordinances here enable the Counties to pursue particular policies with respect to waste handling and treatment while allocating the costs on citizens and businesses according to the volume of waste they generate as detailed in the established facts.53
Laws favoring local government facilities are not subject to the same level of scrutiny as laws favoring particular private businesses under the dormant Commerce Clause.54
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Joined by Stevens And Kennedy, Jj.
Justice Alito dissented and maintained that discrimination in favor of an in-state government facility serves local economic interests inuring to the benefit of local residents who are employed at the facility and local businesses that supply the facility with goods and services.55 It is therefore surprising to read that state discrimination in favor of a state-owned business is not likely to be motivated by economic protectionism.56 Experience in other countries teaches that governments often discriminate in favor of state-owned businesses precisely for the purpose of protecting those who derive economic benefits from those businesses.57
Discrimination in favor of an in-state government facility serves local economic interests.58 The Court’s assumption that such discrimination is unlikely to be the product of economic protectionism cannot be accepted.59
Whether the flow control ordinances impose an incidental burden on interstate commerce that is clearly excessive in relation to the putative local benefits under the Pike test?60
Under the Pike test the Court will uphold a nondiscriminatory statute unless the burden imposed on interstate commerce is clearly excessive in relation to the putative local benefits.61 The ordinances give the Counties a convenient and effective way to finance their integrated package of waste-disposal services and increase recycling conferring significant health and environmental benefits upon the citizens of the Counties.
No. After years of discovery both the Magistrate Judge and the District Court could not detect any disparate impact on out-of-state as opposed to in-state businesses.62 Any arguable burden does not exceed the public benefits of the ordinances as the ordinances create enhanced incentives for recycling and proper disposal of other kinds of waste and markedly increase the Counties ability to enforce recycling laws as shown in the established facts.63
The flow control ordinances do not impose an incidental burden on interstate commerce that is clearly excessive in relation to the putative local benefits under the Pike test.64