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Supreme Court Decision Alters Solid Waste Flow Control Jurisprudence

Beveridge & Diamond, P.C., May 2, 2007

The U.S. Supreme Court has upheld the right of local governments to direct the flow of solid waste to publicly owned waste facilities without running afoul of the Commerce Clause. The case, United Haulers Association, Inc. v. Oneida-Herkimer Solid Waste Management Authority (Case No. 05-1345, released April 30, 2007), has been closely followed by public and private parties involved in solid waste management.

Prior to United Haulers, the Court’s doctrinal decision in the area of flow control had been C&A Carbone, Inc. v. Clarkstown, 511 U.S. 383 (1994).  In that case, a New York municipality hired a private contractor to build a waste transfer facility and enacted a flow control ordinance requiring that all solid waste generated within the town be directed to the transfer facility.  The Carbone Court struck down the ordinance on the basis that solid waste was a commodity in commerce and that the Commerce Clause in the U.S. Constitution invalidates laws that discriminate against such commerce on the basis of its origin or its destination out-of-state.  U.S. Const. , Art. 1, § 8, cl. 3.  The Court found that flow control laws “deprive competitors, including out-of-state firms, of access to a local market.” Carbone, at 386.  

In United Haulers, the Court evaluated flow control ordinances enacted by the Counties of Oneida and Herkimer in New York State.  Both county ordinances required that all solid waste generated within county boundaries be directed to processing facilities controlled by a public solid waste authority that had been created by the New York Legislature at the request of the counties.  Failure to direct solid waste to these facilities was punishable by fine and imprisonment.

The Oneida and Herkimer flow control ordinances were challenged by a trade association comprised of private solid waste haulers, and by six hauling companies, on the basis that the ordinances violated the Commerce Clause by discriminating against interstate commerce.  The petitioners submitted evidence that the flow control laws increased the cost of waste transport and disposal from between $37 - $55 per ton without flow control to $86 per ton with flow control.   

A majority of the Supreme Court found in United Haulers that the challenged ordinances, unlike the ordinances at issue in Carbone, conferred a benefit on a public facility rather than a private one, and that the ordinances treated all private companies the same.  These distinctions were critical for the majority, who noted that government is vested with responsibility to protect the health, safety and welfare of its citizens and that laws favoring local government should therefore be evaluated for Commerce Clause deficiencies differently than laws favoring private industry.  The majority opinion noted that local government plays a vital role in the collection and disposal of solid waste, that the State of New York had adopted a policy of displacing competition with regulation or monopoly control, and that “nothing in the Commerce Clause vests the responsibility for that policy judgment with the Federal Judiciary.”  United Haulers, at 12-13.  Consequently, the Court held that “flow control ordinances, which treat in-state private business interests exactly the same as out-of-state ones, do not ‘discriminate against interstate commerce’ for purposes of the dormant Commerce Clause.” Id., at 13. 

A plurality of justices who supported the majority decision also called for the use of the so-called Pike test to analyze the county ordinances for impermissible commerce clause impacts. These justices, citing to Pike v. Bruce Church, Inc. , 397 U.S. 137, 142 (1970), indicated that they would uphold a nondiscriminatory statute like the county ordinances “unless the burden imposed on interstate commerce is clearly excessive in relation to the putative local benefits.” United Haulers., at 14, citing Pike, at 142.  The plurality noted that the District Court below could not detect any disparate impact on out-of-state as opposed to in-state businesses. Instead, these justices reasoned, the counties had adopted an expensive waste disposal system that accepted recyclables and hazardous waste for free in order to promote separation of these materials, and that the system they had devised enhanced their ability to enforce recycling laws. These provided public benefits that the justices viewed as overriding any burden that had been placed on interstate commerce.  United Haulers, at 15.  

The United Haulers decision will have significant impacts on the solid waste industry in those parts of the country where local government desires to become deeply involved in implementing solid waste policy.  Specifically, the case clarifies that local governments may use monopoly controls over solid waste facilities as a tool to achieve solid waste management policy goals.

For more information about the United Haulers decision, please contact Stephen Richmond at srichmond@bdlaw.com.

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