delivered the opinion of the Court, except as to Part II-D.
“Flow control” ordinances require trash haulers to deliver solid waste to a particular waste processing facility. In C & A Carbone, Inc. v. Clarkstown,
I
Located in central New York, Oneida and Herkimer Counties span over 2,600 square miles and are home to about 306,000 residents. 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.
By the 1980’s, the Counties confronted what they could credibly call a solid waste “‘crisis.’” Brief for Respondents 4. Many local landfills were operating without permits and in violation of state regulations. Sixteen were ordered to close and remediate the surrounding environment,
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.
Responding to these problems, the Counties requested and New York’s Legislature and Governor created the Qneida-Herkimer Solid Waste Management Authority (Authority), a public benefit corporation. See N. Y. Pub. Auth. Law Ann. §2049-aa et seq. (West 1995). The Authority is empowered to collect, process, and dispose of solid waste generated in the Counties. § 2049-ee(4). 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.” §2049-tt(3).
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. 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. To fulfill its part of the bargain, the Authority agreed to purchase and develop facilities for the processing and disposal of solid waste and recyclables generated in the Counties.
The Authority collected “tipping fees” to cover its operating and maintenance costs for these facilities.
As described, the agreement had a flaw: Citizens might opt to have their waste hauled to facilities with lower tipping fees. 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.
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. 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. 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.
The District Court read our decision in Carbone,
On remand and after protracted discovery, a Magistrate Judge and the District Court found that the haulers did not show that the ordinances imposed any cognizable burden on interstate commerce. The Second Circuit affirmed, assuming that the laws exacted some toll on interstate commerce, but finding any possible burden “modest” compared to the “clear and substantial” benefits of the ordinances.
II
A
The Commerce Clause provides that “Congress shall have Power ... [t]o regulate Commerce with foreign Nations, and among the several States.” U. S. Const., Art. I, §8, cl. 3. Although the Constitution does not in terms limit the power of States to regulate commerce, we have long interpreted the Commerce Clause as an implicit restraint on state authority, even in the absence of a conflicting federal statute. See Case of the State Freight Tax,
To determine whether a law violates this so-called “dormant” aspect of the Commerce Clause, we first ask whether it discriminates on its face against interstate commerce. American Trucking Assns., Inc. v. Michigan Pub. Serv. Comm’n,
B
Following the lead of the Sixth Circuit in Daviess County, the haulers argue vigorously that the Counties’ ordinances discriminate against interstate commerce under Carbone. In Carbone, the town of Clarkstown, New York, hired a private contractor to build a waste transfer station. According to the terms of the deal, the contractor would operate the facility for five years, charging an above-market tipping fee of $81 per ton; after five years, the town would buy the facility for one dollar. The town guaranteed that the facility would receive a certain volume of trash per year. To make good on its promise, Clarkstown passed a flow control ordinance requiring that all nonhazardous solid waste within the town be deposited at the transfer facility. See
This Court struck down the ordinance, holding that it discriminated against interstate commerce by “hoarding] solid waste, and the demand to get rid of it, for the benefit of the preferred processing facility.” Id., at 392. The dissent pointed out that all of this Court’s local processing cases involved laws that discriminated in favor of private entities, not public ones. Id., at 411 (opinion of SOUTER, J.). According to the dissent, Clarkstown’s ostensibly private transfer station was “essentially a municipal facility,” id., at 419, and this distinction should have saved Clarkstown’s ordinance because favoring local government is by its nature different from favoring a particular private company. The majority did not comment on the dissent’s public-private distinction.
The parties in this case draw opposite inferences from the majority’s silence. The haulers say it proves that the majority agreed with the dissent’s characterization of the facility, but thought there was no difference under the dormant Commerce Clause between laws favoring private entities and those favoring public ones. The Counties disagree, arguing that the majority studiously avoided the issue because the facility in Carbone was private, and therefore the question whether public facilities may be favored was not properly
We believe the latter interpretation of Carbone is correct. As the Second Circuit explained, “in Carbone the Justices were divided over the fact of whether the favored facility was public or private, rather than on the import of that distinction.”
The Carbone majority viewed Clarkstown’s flow control ordinance as “just one more instance of local processing requirements that we long have held invalid.” Id., at 391. It then cited six local processing cases, every one of which involved discrimination in favor of private enterprise.
The Carbone majority stated that “[t]he only conceivable distinction” between the laws in the local processing cases and Clarkstown’s flow control ordinance was that Clarkstown’s ordinance favored a single local business, rather than a group of
c
The flow control ordinances in this case benefit a clearly public facility, while treating all private companies exactly the same. Because the question is now squarely presented on the facts of the case before us, we decide that such flow control ordinances do not discriminate against interstate commerce for purposes of the dormant Commerce Clause.
Compelling reasons justify treating these laws differently from laws favoring particular private businesses over their competitors. “Conceptually, of course, any notion of discrimination assumes a comparison of substantially similar entities.” General Motors Corp. v. Tracy,
Given these differences, it does not make sense to regard laws favoring local government and laws favoring private industry with equal skepticism. As our local processing cases demonstrate, when a law favors in-state business over out-of-state competition, rigorous scrutiny is appropriate
The contrary approach of treating public and private entities the same under the dormant Commerce Clause would lead to unprecedented and unbounded interference by the courts with state and local government. The dormant Commerce Clause is not a roving license for federal courts to decide what activities are appropriate for state and local government to undertake, and what activities must be the province of private market competition. In this case, the citizens of Oneida and Herkimer Counties have chosen the government to provide waste management services, with a limited role for the private sector in arranging for transport of waste from the curb to the public facilities. The citizens could have left the entire matter for the private sector, in which case any regulation they undertook could not discriminate against interstate commerce. But it was also open to them to vest responsibility for the matter with their government, and to adopt flow control ordinances to support the government effort. It is not the office of the Commerce Clause to control the decision of the voters on whether government or the private sector should provide waste management services. “The Commerce Clause significantly limits the ability of States and localities to regulate or otherwise burden the flow of interstate commerce, but it does not elevate free trade above all other values.” Maine v. Taylor,
We should be particularly hesitant to interfere with the Counties’ efforts under the guise of the Commerce Clause because “[w]aste disposal is both typically and traditionally a local government function.”
We hold that the Counties’ 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.
D
The Counties’ flow control ordinances are properly analyzed under the test set forth in Pike v. Bruce Church, Inc.,
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. The Second Circuit alluded to, but did not endorse, a “rather abstract harm” that may exist because “the Counties’ flow control ordinances have removed the waste generated in Oneida and Herkimer Counties from the national marketplace for waste processing services.”
At the same time, the ordinances are more than financing tools. They increase recycling in at least two ways, conferring significant health and environmental benefits upon the citizens of the Counties. First, they create enhanced incentives for recycling and proper disposal of other kinds of waste. Solid waste disposal is expensive in OneidaHerkimer, but the Counties accept recyclables and many forms of hazardous waste for free, effectively encouraging their citizens to sort their own trash. Second, by requiring all waste to be deposited at Authority facilities, the Counties have markedly increased their ability to enforce recycling laws. If the haulers could take waste to any disposal site, achieving an equal level of enforcement would be much more costly, if not impossible. For these reasons, any arguable burden the ordinances impose on interstate commerce does not exceed their public benefits.
* * *
The Counties’ ordinances are exercises of the police power in an effort to address waste disposal, a typical and traditional concern of local government. The haulers nevertheless ask us to hold that laws favoring public entities while treating all private businesses the same are subject to an almost per se rule of invalidity, because of asserted discrimination. In the alternative, they maintain that the Counties’ laws cannot survive the more permissive Pike test, because of asserted burdens on commerce. There is a common thread to these arguments: They are invitations to rigorously scrutinize economic legislation passed under the auspices of the police power. There was a time when this Court presumed to make such binding judgments for society, under the guise of interpreting the Due Process Clause. See Lochner v. New York,
The judgments of the United States Court of Appeals for the Second Circuit are affirmed.
It is so ordered.
Notes
Tipping fees are disposal charges levied against collectors who drop off waste at a processing facility. They are called “tipping” fees because garbage trucks literally tip their back end to dump out the carried waste. As of 1995, haulers in the Counties had to pay tipping fees of at least $86 per ton, a price that ballooned to as much as $172 per ton if a particular load contained more than 25% recyclables.
Oneida’s flow control ordinance provides in part:
“From the time of placement of solid waste and of recyclables at the roadside or other designated area approved by the County or by the Authority pursuant to contract with the County, or by a person for collection in accordance herewith, such solid waste and recyclables shall be delivered to the appropriate facility, entity or person responsible for disposition designated by the County or by the Authority pursuant to contract with the Authority.” App. to Pet. for Cert. 122a.
The relevant portion of Herkimer’s flow control ordinance is substantially similar:
“After placement of garbage and of recyclable materials at the roadside or other designated area approved by the Legislature by a person for collection in accordance herewith, such garbage and recyclable material shall be delivered to the appropriate facility designated by the Legislature, or by the Authority pursuant to contract with the County.” Id., at 135a.
Each side makes much of the Carbone majority’s various descriptions of the facility. The haulers point out that the Court twice referred to the construction and financing of the transfer station as the town’s project. See
See South-Central Timber Development, Inc. v. Wunnicke,
The dissent asserts that the Court “long ago recognized that the Commerce Clause can be violated by a law that discriminates in favor of a state-owned monopoly.” Post, at 361. The authority it cites — Scott v. Donald,
Vance actually upheld, “South Carolina’s monopoly over liquor distribution!;,] ... rejecting] the argument that this monopoly system was unconstitutionally discriminatory.” Granholm, supra, at 507 (Thomas, J., dissenting) (citing Vance, supra, at 450-452). It was the dissent in Vance that argued that “such a state monopoly system constituted unconstitutional discrimination.” Granholm, supra, at 507 (Thomas, J., dissenting) (citing
Justice Thomas is thus wrong in stating that our approach might suggest “a policy-driven preference for government monopoly over privatization.” Post, at 354 (opinion concurring in judgment). That is instead the preference of the affected locality here. Our opinion simply recognizes that a law favoring a public entity and treating all private entities the same does not discriminate against interstate commerce as does a law favoring local business over all others.
The Counties and their amicus were asked at oral argument if affirmance would lead to the “Qneida-Herkimer Hamburger Stand,” accompanied by a “flow control” law requiring citizens to purchase their burgers only from the state-owned producer. Tr. of Oral Arg. 33-34 (Counties), 45-46, 49-50 (amicus State of New York). We doubt it. “The existence of major in-state interests adversely affected by [a law] is a powerful safeguard against legislative abuse.” Minnesota v. Clover Leaf Creamery Co.,
Concurrence Opinion
concurring in part.
I join Part I and Parts II-A through II-C of the Court’s opinion. I write separately to reaffirm my view that “the so-called ‘negative’ Commerce Clause is an unjustified judicial invention, not to be expanded beyond its existing domain.” General Motors Corp. v. Tracy,
I have been willing to enforce on stare decisis grounds a “negative” self-executing Commerce Clause in two situations: “(1) against a state law that facially discriminates against interstate commerce, and (2) against a state law that is indistinguishable from a type of law previously held unconstitutional by this Court.” West Lynn Creamery, Inc. v. Healy,
I am unable to join Part II-D of the principal opinion, in which the plurality performs so-called “Pike balancing.” Generally speaking, the balancing of various values is left to Congress — which is precisely what the Commerce Clause (the real Commerce Clause) envisions.
Concurrence Opinion
concurring in the judgment.
I concur in the judgment. Although I joined C & A Car-bone, Inc. v. Clarkstown,
I
Under the Commerce Clause, “Congress shall have Power ... [t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” U. S. Const., Art. I, §8, cl. 3. The language of the Clause allows Congress not only to regulate interstate commerce but also to prevent state regulation of interstate commerce. State Bd. of Ins. v. Todd Shipyards Corp.,
The Court does not contest this point, and simply begins its analysis by appealing to stare decisis:
“Although the Constitution does not in terms limit the power of States to regulate commerce, we have long interpreted the Commerce Clause as an implicit restraint on state authority, even in the absence of a conflicting federal statute. See Case of the State Freight Tax,15 Wall. 232 , 279 (1873); Cooley v.Board of Wardens of Port of Philadelphia ex rel. Soc. for Relief of Distressed Pilots, 12 How. 299 , 318 (1852).” Ante, at 338.
The Court’s reliance on Cooley v. Board of Wardens of Port of Philadelphia ex rel. Soc. for Relief of Distressed Pilots,
Unfazed, the Court proceeds to analyze whether the ordinances “discriminat[e] on [their] face against interstate commerce.” Ante, at 338. Again, none of the cases the Court cites explains how the absence or presence of discrimination is relevant to deciding whether the ordinances are constitutionally permissible, and at least one case affirmatively admits that the nondiscrimination rule has no basis in the Constitution. Philadelphia v. New Jersey,
The Court’s policy preferences are an unsuitable basis for constitutional doctrine because they shift over time, as demonstrated by the different theories the Court has offered to support the nondiscrimination principle. In the early years of the nondiscrimination rule, the Court struck down a state health law because “the enactment of a similar statute by each one of the States composing the Union would result in the destruction of commerce among the several States.” Minnesota v. Barber,
Many of the above-cited cases (and today’s majority and dissent) rest on the erroneous assumption that the Court must choose between economic protectionism and the free market. But the Constitution vests that fundamentally legislative choice in Congress. To the extent that Congress does not exercise its authority to make that choice, the Constitution does not limit the States’ power to regulate commerce. In the face of congressional silence, the States are free to set the balance between protectionism and the free market. Instead of accepting this constitutional reality, the Court’s negative Commerce Clause jurisprudence gives nine Justices of this Court the power to decide the appropriate balance.
II
As the foregoing demonstrates, despite more than 100 years of negative Commerce Clause doctrine, there is no principled way to decide this case under current law. Notably, the Court cannot and does not consider this case “[i]n light of the language of the Constitution and the historical context.” Alden v. Maine,
Explaining why the ordinances do not discriminate against interstate commerce, the Court states that “government is vested with the responsibility of protecting the health, safety, and welfare of its citizens.” Ante, at 342. According to the Court, a law favoring in-state business requires rigorous scrutiny because the law “is often the product of ‘simple economic protectionism.’” Ante, at 343. A law favoring local government, however, “may be directed
In Carbone, which involved discrimination in favor of private entities, we did not doubt the good faith of the municipality in attempting to deal with waste through a flow-control ordinance.
Ill
Despite its acceptance of negative Commerce Clause jurisprudence, the Court expresses concern about “unprecedented and unbounded interference by the courts with state and local government.” Ante, at 343. It explains:
“The dormant Commerce Clause is not a roving license for federal courts to decide what activities are appropriate for state and local government to undertake, and what activities must be the province of private market competition.
“There is no reason to step in and hand local businesses a victory they could not obtain through the political process.” Ante, at 343, 345.
I agree that the Commerce Clause is not a “roving license” and that the Court should not deliver to businesses victories that they failed to obtain through the political process. I differ with the Court because I believe its powerful rhetoric is completely undermined by the doctrine it applies.
In this regard, the Court’s analogy to Lochner v. New York,
In so doing, the majority revisits familiar territory: Just three years after Lochner, the Court narrowed the right of contract for policy reasons but did not overrule Lochner. Muller v. Oregon,
Because I believe that the power to regulate interstate commerce is a power given to Congress and not the Court, I concur in the judgment of the Court.
with whom Justice Stevens and Justice Kennedy join, dissenting.
In C & A Carbone, Inc. v. Clarkstown,
I
This Court has “interpreted the Commerce Clause to invalidate local laws that impose commercial barriers or discriminate against an article of commerce by reason of its origin or destination out of State.” Id., at 390. As the Court acknowledges, a law “ ‘ “discriminat[es]” ’ ” in this context if it mandates “‘differential treatment of in-state and out-of-state economic interests’ ” in a way “ ‘that benefits the former and burdens the latter.’ ” Ante, at 338 (quoting Oregon Waste Systems, Inc. v. Department of Environmental Quality of Ore.,
“Solid waste, even if it has no value, is an article of commerce.” Fort Gratiot Sanitary Landfill, Inc. v. Michigan Dept, of Natural Resources,
In Carbone, this Court invalidated a local ordinance requiring all nonhazardous solid waste in Clarkstown, New York, to be deposited at a specific local transfer facility. The Court concluded that the ordinance discriminated against interstate commerce because it “hoard[ed] solid waste, and the demand to get rid of it, for the benefit of the preferred processing facility.” Id., at 392.
The Court explained that the flow-control ordinance did serve a purpose that a nonprotectionist regulation would not: “It ensures that the town-sponsored facility will be profitable, so that the local contractor
The Court also held that “Clarkstown has any number of nondiscriminatory alternatives for addressing the health and environmental problems alleged to justify the ordinance”— including “uniform safety regulations” that could be enacted to “ensure that competitors... do not underprice the market by cutting corners on environmental safety.” Ibid. Thus, the Court invalidated the ordinance because any legitimate local interests served by the ordinance could be accomplished through nondiscriminatory means. See id., at 392-393.
This case cannot be meaningfully distinguished from Car-bone. As the Court itself acknowledges, “[t]he only salient difference” between the cases is that the ordinance invalidated in Carbone discriminated in favor of a privately owned facility, whereas the laws at issue here discriminate in favor of “facilities owned and operated by a state-created public benefit corporation.” Ante, at 334. The Court relies on the distinction between public and private ownership to uphold the flow-control laws, even though a straightforward application of Carbone would lead to the opposite result. See ante, at 342-344. The public-private distinction drawn by the Court is both illusory and without precedent.
II
The fact that the flow-control laws at issue discriminate in favor of a government-owned enterprise does not meaningfully distinguish this case from Carbone. The preferred facility in Carbone was, to be sure, nominally owned by a private contractor who had built the facility on the town’s behalf, but it would be misleading to describe the facility as private. In exchange for the contractor’s promise to build the facility for the town free of charge and then to sell it to the town five years later for $1, the town guaranteed that, during the first five years of the facility’s existence, the contractor would receive “a minimum waste flow of 120,000 tons per year” and that the contractor could charge an above-market tipping fee.
This Court observed that “[t]he object of this arrangement was to amortize the cost of the transfer station: The town would finance its new facility with the income generated by the tipping fees.” Ibid, (emphasis added). “In other words,” the Court explained, “the flow control ordinance [wa]s a financing measure,” id., at 393, for what everyone— including the Court — regarded as the town’s new transfer station.
The only real difference between the facility at issue in Carbone and its counterpart in this case is that title to the former had not yet formally passed to the municipality. The Court exalts form over substance in adopting a test that turns on this technical distinction, particularly since, barring any obstacle presented
For this very reason, it is not surprising that in Carbone the Court did not dispute the dissent’s observation that the preferred facility was for all practical purposes owned by the municipality. See id., at 419 (opinion of Souter, J.) (“Clarkstown’s transfer station is essentially a municipal facility”); id., at 416 (describing the nominal “proprietor” of the transfer station as “essentially an agent of the municipal government”). To the contrary, the Court repeatedly referred to the transfer station in terms suggesting that the transfer station did in fact belong to the town. See id., at 387 (explaining that “[t]he town would finance its new facility with the income generated by the tipping fees” (emphasis added)); id., at 393 (observing that the challenged flow-control ordinance was designed to “ensur[e] that the town-sponsored facility will be profitable”); id., at 394 (concluding that, “having elected to use the open market to earn revenues for its project, the town may not employ discriminatory regulation to give that project an advantage over rival businesses from out of State” (emphasis added)).
Today the Court dismisses those statements as “at best inconclusive.” Ante, at 340, n. 3. The Court, however, fails to offer any explanation as to what other meaning could possibly attach to Carbone’s repeated references to Clarkstown’s transfer station as a municipal facility. It also ignores the fact that the ordinance itself, which was included in its entirety in an appendix to the Court’s opinion, repeatedly referred to the station as “the Town of Clarkstown solid waste facility.”
I see no ambiguities in those statements, much less any reason to dismiss them as “at best inconclusive”; they reflect a clear understanding that the station was, for all purposes relevant to the dormant Commerce Clause, a municipal facility.
Ill
In any event, we have never treated discriminatory legislation with greater deference simply because the entity favored by that legislation was a government-owned enterprise. In suggesting otherwise, the Court relies unduly on Carbone’s passing observation that “‘offending local laws hoard a local resource — be it meat, shrimp, or milk — for the benefit of local businesses.’” Ante, at 341 (emphasis in original). Carbone’s use of the word “businesses,” the Court insists, somehow reveals that Carbone was not “extending” our dormant Commerce Clause jurisprudence “to cover discrimination in favor of local government.” Ante, at 341.
But no “extension]” was required. The Court has long subjected discriminatory
A
This Court long ago recognized that the Commerce Clause can be violated by a law that discriminates in favor of a state-owned monopoly. In the 1890’s, South Carolina enacted laws giving a state agency the exclusive right to operate facilities selling alcoholic beverages within that State, and these laws were challenged under the Commerce Clause in Scott v. Donald,
Thus, were it not for the Twenty-first Amendment, laws creating state-owned liquor monopolies — which many States maintain today — would be deemed discriminatory under the dormant Commerce Clause. See Granholm v. Heald,
B
Nor has this Court ever suggested that discriminatory legislation favoring a state-owned enterprise is entitled to favorable treatment. To be sure, state-owned entities are accorded special status under the market-participant doctrine. But that doctrine is not applicable here.
Under the market-participant doctrine, a State is permitted to exercise “‘independent discretion as to parties with whom [it]
Respondents are doing exactly what the market-participant doctrine says they cannot: While acting as market participants by operating a fee-for-service business enterprise in an area in which there is an established interstate market, respondents are also regulating that market in a discriminatory manner and claiming that their special governmental status somehow insulates them from a dormant Commerce Clause challenge. See ibid.
Respondents insist that the market-participant doctrine has no application here because they are not asserting a defense under the market-participant doctrine, Brief for Respondents 24-25, but that argument misses the point. Regardless of whether respondents can assert a defense under the market-participant doctrine, this Court’s cases make clear that States cannot discriminate against interstate commerce unless they are acting solely as market participants. Today, however, the Court suggests, contrary to its prior holdings, that States can discriminate in favor of in-state interests while acting both as a market participant and as a market regulator.
IV
Despite precedent condemning discrimination in favor of government-owned enterprises, the Court attempts to develop a logical justification for the rule it creates today. That justification rests on three principal assertions. First, the Court insists that it simply “does not make sense to regard laws favoring local government and laws favoring private industry with equal skepticism,” because the latter are “often the product of ‘simple economic protectionism,’ ” ante, at 343 (quoting Wyoming v. Oklahoma,
A
I see no basis for the Court’s assumption that discrimination in favor of an in-state facility owned by the government is likely to serve “legitimate goals unrelated to protectionism.” Discrimination in favor of an in-state government facility serves “‘local economic interests,’” Carbone,
Experience in other countries, where state ownership is more common than it is in this country, teaches that governments often discriminate in favor of state-owned businesses (by shielding them from international competition) precisely for the purpose of protecting those who derive economic benefits from those businesses, including their employees.
By the same token, discrimination in favor of an in-state, privately owned facility may serve legitimate ends, such as the promotion of public health and safety. For example, a State might enact legislation discriminating in favor of produce or livestock grown within the State, reasoning that the State’s inspectors can more easily monitor the use of pesticides, fertilizers, and feed on farms within the State’s borders. Such legislation would almost certainly be unconstitutional, notwithstanding its potential to promote public health and safety. See Philadelphia v. New Jersey,
The fallacy in the Court’s approach can be illustrated by comparing a law that discriminates in favor of an in-state facility, owned by a corporation whose shares are publicly held, and a law discriminating in favor of an otherwise identical facility that is owned by the State or municipality. Those who are favored and disfavored by these two laws are essentially the same with one major exception: The law favoring the corporate facility presumably benefits the corporation’s shareholders, most of whom are probably not local residents, whereas the law favoring the government-owned facility presumably benefits the people of the enacting State or municipality. I cannot understand why only the former law, and not the latter, should be regarded as a tool of economic protectionism. Nor do I think it is realistic or consistent with our precedents to condemn some discriminatory laws as protectionist while upholding other, equally discriminatory laws as lawful measures designed to serve legitimate local interests unrelated to protectionism.
For these reasons, I cannot accept the proposition that laws discriminating in favor of state-owned enterprises are so unlikely to be the product of economic protectionism that they should be exempt
Proper analysis under the dormant Commerce Clause involves more than an inquiry into whether the challenged Act is in some sense “directed toward ... legitimate goals unrelated to protectionism”; equally important are the means by which those goals are realized. If the chosen means take the form of a statute that discriminates against interstate commerce — “ ‘either on its face or in practical effect’ ” — then “the burden falls on [the enacting government] to demonstrate both that the statute ‘serves a legitimate local purpose,’ and that this purpose could not be served as well by available nondiseriminatory means.” Taylor,
Thus, if the legislative means are themselves discriminatory, then regardless of how legitimate and nonprotectionist the underlying legislative goals may be, the legislation is subject to strict scrutiny. Similarly, the fact that a discriminatory law “may [in some sense] be directed toward any number of legitimate goals unrelated to protectionism” does not make the law nondiseriminatory. The existence of such goals is relevant, not to whether the law is discriminatory, but to whether the law can be allowed to stand even though it discriminates against interstate commerce. And even then, the existence of legitimate goals is not enough; discriminatory legislation can be upheld only where such goals cannot adequately be achieved through nondiseriminatory means. See, e. g., Philadelphia, supra, at 626-627 (“[T]he evil of protectionism can reside in legislative means as well as legislative ends,” such that “whatever [the State’s] purpose, it may not be accomplished by discriminating against articles of commerce coming from outside the State unless there is some reason, apart from their origin, to treat them differently”); Hunt v. Washington State Apple Advertising Comm’n,
Dean Milk Co. v. Madison,
The Court did not inquire whether the real purpose of the ordinance was to benefit public health and safety or to protect local economic interests; nor did the Court make any effort to determine whether or to what extent the ordinance may have succeeded in promoting health and safety. In fact, the Court apparently assumed that the ordinance could fairly be characterized as “a health measure.” Id., at 354.
The overarching concern expressed by the Court was that the ordinance, if left intact, “would invite a multiplication of preferential trade areas destructive of the very purpose of the Commerce Clause.” Id., at 356. “Under the circumstances here presented,” the Court concluded, “the regulation must yield to the principle that ‘one state in its dealings with another may not place itself in a position of economic isolation.’ ” Ibid, (quoting Baldwin v. G. A. F. Seelig, Inc.,
The same reasoning dooms the laws challenged here. Like the ordinance in Dean Milk, these laws discriminate against interstate commerce (generally favoring local interests over nonlocal interests), but are defended on the ground that they serve legitimate goals unrelated to protectionism (e.g., health, safety, and protection of the environment). And while I do not question that the laws at issue in this case serve legitimate goals, the laws offend the dormant Commerce Clause because those goals could be attained effectively through nondiscriminatory means. Indeed, no less than in Carbone, those goals could be achieved through “uniform [health and] safety regulations enacted without the object to discriminate” that “would ensure that competitors [to the municipal program] do not underprice the market, by cutting corners on environmental safety.”
B
The Court next suggests that deference to legislation discriminating in favor of a municipal landfill is especially appropriate considering that “ ‘[w]aste disposal is both typically and traditionally a local government function.’” Ante, at 344 (quoting
First, this Court has previously recognized that any standard “that turns on a judicial appraisal of whether a particular governmental function is ‘integral’ or ‘traditional’” is “unsound in principle and unworkable in practice.” Garcia v. San Antonio Metropolitan Transit Authority,
Second, although many municipalities in this country have long assumed responsibility for disposing of local garbage, see Carbone, supra, at 419-420, and n. 10 (Souter, J., dissenting), most of the garbage produced in this country is still managed by the private sector. See Brief for National Solid Wastes Management Association et al. as Amici Curiae 22 (“Today, nearly two-thirds of solid waste received at landfills is received at private sector landfills”); R. W. Beck, Inc., et al., Size of the United States Solid Waste Industry, p. ES-3 (Apr. 2001) (study sponsored by the Environmental Research and Education Foundation) (noting that in 1999, 69.2% of the solid waste produced in the United States was managed by privately owned businesses). In that respect, the Court is simply mistaken in concluding that waste disposal is “typically” a local government function.
Moreover, especially considering the Court’s recognition that “ ‘any notion of discrimination assumes a comparison of substantially similar entities,’ ” ante, at 342 (quoting General Motors Corp. v. Tracy,
C
Equally unpersuasive is the Court’s suggestion that the flow-control laws do not discriminate against interstate commerce because they “treat in-state private business interests exactly the same as out-of-state ones.” Ante, at 345. Again, the critical issue is whether the challenged legislation discriminates against interstate commerce. If it does, then regardless of whether those harmed by it reside entirely outside the State in question, the law is subject to strict scrutiny. Indeed, this Court has long recognized that “‘a burden imposed by a State upon interstate commerce is not to be sustained simply because the statute imposing it applies alike to the people of all the States, including the people of the State enacting such statute.’ ” Brimmer v. Rebman,
The dormant Commerce Clause has long been understood to prohibit the kind of discriminatory legislation upheld by the Court in this case. I would therefore reverse the decision of the Court of Appeals.
This justification for the negative Commerce Clause is itself unsupported by the Constitution. See Tyler Pipe Industries, Inc. v. Washington State Dept, of Revenue,
No previous case addresses the question whether the negative Commerce Clause applies to favoritism of a government entity. I agree with the Court that C & A Carbone, Inc. v. Clarkstown,
The dissent argues that such a preference is unwarranted. Post, at 365-366 (opinion of Auto, J.) (“I cannot accept the proposition that laws discriminating in favor of state-owned enterprises are so unlikely to be the product of economic protectionism that they should be exempt from the usual dormant Commerce Clause standards”).
See Granholm v. Heald,
See, e.g., Owen, Sun, & Zheng, Antitrust in China: The Problem of Incentive Compatibility, 1 J. of Competition L. & Econ. 123, 131-133 (2005); Qin, WTO Regulation of Subsidies to State-Owned Enterprises (SOEs)— A Critical Appraisal of the China Accession Protocol, 7 J. of Int’l Econ. L. 863, 869-876 (Dec. 2004).
It therefore seems strange that the Commerce Clause, which has historically been understood to protect free trade and prohibit States from “plac[ing] [themselves] in a position of economic isolation,” Baldwin v. G. A F. Seelig, Inc.,
A law granting monopoly rights to a single, local business clearly would not be immune from a dormant Commerce Clause challenge simply because it excluded both in-state and out-of-state competitors from the local market. See C & A Carbone, Inc. v. Clarkstown,