State Regulation of Commerce (Update 2)

Author:Mark Tushnet

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The Supreme Court has continued to decide cases involving challenges to state regulations of commerce at a rate of one or two each year. A few cases involve statutes that are clearly designed to promote local commerce at the expense of out-of-state commerce. A larger portion, however, seem to critics of the Court's work to involve statutes aimed at achieving socially beneficial goals without any design to harm out-of-state commerce. The decisions have increasingly focused on the presence of geographical terminology (local versus out-of-state) used to distinguish activities that are regulated from those that are not, even when it seems unlikely that the government used the terminology merely to disadvantage out-of-state commerce. There have been no significant majority opinions applying the BALANCING TEST in which the burdens on INTERSTATE COMMERCE are balanced against the benefits conferred by

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the statute, although some separate opinions have applied the test.

C & A Carbone, Inc. v. Clarkstown (1994) invalidated an ordinance directing that all solid WASTE generated within the town be delivered to a privately owned local recycling plant, rather than shipped out of the town or out of the state. The town planned to take over the plant after the private operator recouped the construction costs, and it adopted the flow-control ordinance to ensure that the recycling plant would be financially viable until the town took over the plant. The Court held that the ordinance discriminated against out-of-state plants that stood ready to accept solid waste from Clarkstown. Justice DAVID H. SOUTER, writing for three dissenters, argued that the ordinance was clearly not protectionist in any traditional sense.

The Court confronted an issue that had lurked in earlier cases when it invalidated a subsidy to Massachusetts milk producers in West Lynn Creamery, Inc. v. Healy (1994). Subsidies can serve the same protectionist purposes as discriminatory regulations: Instead of raising the prices out-of-state producers must charge to offset the cost of complying with a discriminatory regulation, a subsidy permits local producers to reduce their charges. The subsidy in Healy was paid to local milk producers from a fund created by a tax imposed on all milk sales in the state. Every producer, local and out-of-state, paid the tax, but only local producers received the subsidy. The Court rejected the argument that the statute...

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