Abrams, Robert H

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Florida Agricultural & Mechanical University College of Law

Florida A&M University College of LawScholarly Commons @ FAMU LawJournal Publications Faculty Works1992Charging a Higher Fee for Disposal of Out-of-StateHazardous Waste: Will the Dormant CommerceClause Become Dormant?Robert H. AbramsFlorida A&M University College of Law, robert.abrams@famu.eduFollow this and additional works at: http://commons.law.famu.edu/faculty-researchPart of the Environmental Law Commons, and the Water Law CommonsThis Article is brought to you for free and open access by the Faculty Works at Scholarly Commons @ FAMU Law. It has been accepted for inclusion inJournal Publications by an authorized administrator of Scholarly Commons @ FAMU Law. For more information, please contactlinda.barrette@famu.edu.Recommended CitationRobert H. Abrams, Charging a Higher Fee for Disposal of Out-of-State Hazardous Waste: Will the Dormant Commerce ClauseBecome Dormant? 1991-92 Preview U.S. Sup. Ct. Cas. 337 (1992)ENVIRONMENTAL LAWCharging a higher fee for disposal ofout-oJ-state hazardous waste:Will the dormant Commerce Clause become dormant?by Robert H. AbramsChemical Waste Management, Inc.v.Guy Hunt, Governor of Alabama(Docket No. 91-471)Argument Date: April 21 ,1992As the environmental and public health risks associatedwith the disposal of hazardous waste have gained notoriety,the NIMBY phenomenon (Not In My Back Yard) hasrestricted severely the number of hazardous-waste disposalfacilities that have been sited nationwide. On another front,the increasingly stringent regulation of existing hazardous-waste disposal facilities has forced many to close at the sametime as other existing facilities are running out of space toreceive additional waste. With the conjunction of thesetrends, the few licensed facilities having significant capacityto receive hazardous waste are serving increasingly largegeographic areas. In this case, Emelle, Alabama, finds itselfhome to the nation's largest such facility and also finds thatthe vast majority of the waste being deposited there is "im-ported" from other states throughout the nation. Beginning in1990, Alabama imposed a mandatory additional tipping fee(i.e. a tax) for the disposal of out-of-state waste, a practicethat the Emelle facility's owner claims is an unconstitutionaldiscrimination against interstate commerce.ISSUEDoes the Alabama statute imposing an additional fee of$72 per ton for the disposal of out-of-state generated hazard-ous waste violate the Commerce Clause of the United StatesConstitution?FACTSFactually, this is a very simple case. Chemical WasteManagement, Inc. (CWM) operates one of the nation'slargest hazardous-waste disposal facilities in Emelle,Alabama. That facility accepts large amounts of hazardouswaste, more than three quarters of a million tons of it in 1989alone. Of that waste, 85 percent to 90 percent originates instates other than Alabama.Robert H. Abrams is professor oflaw at Wayne State Univer-sity School ofLaw, Detroit, M148202; telephone (313) 577-3935.Issue No. 10Beginning in 1987, when the United States EnvironmentalProtection Agency (EPA) granted CWM a permit to operatethe Emelle facility, Alabama, led by Governor Guy Hunt,began a campaign to limit the amount of out-of-state hazard-ous waste that Emelle would accept. In a press release datedAug. 27,1987, the governor was quoted as saying:"I wish to make it absolutely clear that we will take anyand all action available to us to keep out-of-state waste out ofAlabama. We will handle our own problem but we don't wantanybody else's problems."Alabama made several unsuccessful efforts to thwartCWM's operation of the Emelle facility. It challenged EPA'slicensure of the facility and lost. See Alabama ex. rei. Siegel-man v. EPA, 911 F.2d 499 (Ll th Cir. 1990). It tried to blockan EPA cleanup of a Texas contamination site on the groundthat polychlorinated biphenol (PCB) waste was going to bedisposed of at the Emelle facility, and lost. See Alabama v.EPA, 871 F.2d 1548 (lith Cir. 1989).In May, 1989, the Alabama legislature passed a measure,popularly known as the Holley Bill, that effectively barredthe treatment in Alabama of hazardous waste generated else-where if the state of origin had no hazardous waste disposalfacilities of its own or had not entered into an agreement forthe disposal of its waste with the state of Alabama. Thisstatute was invalidated in National Solid Wastes ManagementAssociation v. Alabama Department of EnvironmentalManagement, 910 F.2d 713, as modified at 924 F.2d 1001(llthCir.1990).Undeterred, Alabama passed Alabama Act No. 90326(codified at Ala. Code 2230B 1.1 et seq.), the law at issue inthis case. That statute has three parts: a "Base Fee" of $25.60per ton charged to commercial facilities on all hazardouswaste they accept without regard to its origin, a $72.00 perton "Additional Fee" charged only for accepting wasteoriginating out-of-state, and a provision restricting the totalamount of waste that any facility accepting over 100,000 tonsper year could accept to an amount equal to the amountaccepted during a statutorily defined benchmark period (the"Cap"). When challenged by CWM, an Alabama circuit courtinvalidated the Additional Fee and generally upheld both theBase Fee and the Cap. The Alabama Supreme Court, in Huntv. Chemical Waste Management, Inc., No. 1901043 (Ala.S.Ct. July 11, 1991), affirmed the rulings in favor ofthe BaseFee and the Cap and reversed the invalidation of the Addi-tional Fee provision. Certiorari was subsequently granted bythe United States Supreme Court, limited to the issue of theconstitutionality of the Additional Fee.337BACKGROUND AND SIGNIFICANCEThe treatment and disposal of hazardous waste is a majorindustry in this country. Annually more than 240 million tonsof hazardous waste are generated by approximately 80,000different generators. The largest proportion of this total iscomprised of waste corrosives and acids produced by thechemical industry, although the petroleum refining, metalfinishing, electronics, health services, printing, manufactur-ing, and transportation industries also produce substantialamounts of hazardous waste annually. Since 1976, and espe-cially since 1984, subtitle C of the Resource Conservation andRecovery Act (RCRA) has provided stringent regulation oftreatment, storage, and disposal facilities (TSDFs).RCRA's subtitle C TSDF regulation is quite exacting.The most basic command of that legislation is that allmaterials fitting the statute's definition of hazardous wastemust be disposed of at a licensed TSDF. Pursuant to RCRA,EPA has promulgated detailed regulations prescribing mini-mum operating standards for the management of hazardouswaste at the approximately 4,700 facilities nationwide thathold TSDF licenses. These regulations address areas such assite characteristics, inspection, testing, method of treatingincompatible types of waste, groundwater monitoring, in-surance requirements, recordkeeping and reporting obliga-tions, facility closure and post-closure requirements,contingency planning, and much, much, more. The regula-tions are sufficiently burdensome and compliance with themis sufficiently expensive that many of the smaller firms cur-rently operating TSDFs are closing down their operations.Importantly, not all of the TSDFs are approved to receiveall of the various types of hazardous materials. For example,the Emelle, Alabama, facility that is the focus of this litigationis one of two facilities located east of the Mississippi Riverapproved to accept PCBs. Similarly, owing to its advanceddesign and subsurface geology, the Emelle facility is amongthe few disposal sites in the entire nation that is licensed toaccept non-pretreated hazardous waste. This is particularlynoteworthy because in 1984 amendments to RCRA, Con-gress sought to phase out almost all land disposal of hazard-ous waste, preferring treatment. Until sufficient treatmentcapacity is developed, however, a very few sites, includingEmelle, are licensed to accept untreated waste.As suggested by the facts of this case, large quantities ofhazardous waste currently move in interstate commerce ontheir way to TSDFs. Avoiding burdensome and dis-criminatory taxes is a key element in maintaining competi-tiveness in that market. Moreover, keeping facilities likeEmelle viable as a repository for even distant waste may haveimportant national safety benefits. Emelle is the largestfacility in the country, having a usable area that covers 2,700acres. CWM estimates that the facility could continue tooperate for another century at present, or even increased, ratesof disposal. These sorts of volumes are of national sig-nificance. Perhaps more critically, among the reasons Emellewas able to obtain its licensure is the presence of a uniquegeologic feature, the Selma Chalk formation. Although there338is conflicting testimony in the case regarding permeabilityrates due to fractures that may be present, intact portions ofthe formation would, according to EPA, prevent leachatefrom reaching the aquifer below for upwards of 330 years.CWM estimates place the period before any leachate reachesthe aquifer at 10,000 years.When the national importance of the hazardous-wastedisposal problem is taken into account, this becomes a veryvital case on at least three levels. First, this case will deter-mine whether states can charge grossly disproportionate feesfor the disposal of out-of-state hazardous waste at licensedfacilities located within their borders. As such, this case willcontribute significantly to defining the degree to which statescan put the force of their legislative authority behind theNIMBY sentiments of their residents when it comes to thedisposal of out-of-state hazardous waste. Politically, the les-son of this case will not go unnoticed-what is good intrastatepolitics for Governor Hunt in Alabama ("... we don't wantanybody else's problems ...") will be good intrastate politicsin every other state that finds itself "importing" large quan-tities of out-of-state hazardous waste.Second, on an economic level, this case could play havocwith the financial incentives operating in the hazardous-wasteindustry. Imagine momentarily that the fee-charging state,rather than seeking to block imports of hazardous waste,merely seeks to tax those imports to relieve its own citizensof alternative taxes. (Being cynical, the state can have it bothways, i.e., play to the NIMBY fervor while still filling thestate's coffers.) By charging disproportionate fees to out-of-state disposers in a market where the supply of hazardous-waste disposal capacity is severely limited due to governmentregulation, the state can skim a major portion of the economicrent that would otherwise be captured by the facility operator.Better still, the state gathers this revenue for itself whilefreeing its own in-state hazardous-waste generators from thefinancial effects of the tax. Note also that the amounts in-volved are non-trivial. Here, for example, if the increased feeat Emelle does not reduce the amount of interstate businessdone (due to the absence of less-expensive alternativefacilities) the state will capture an annual Additional Fee of$56 million.Finally, on a legal level, as highlighted in the argumentsof the parties that appear below, a decision upholding thedifferential fee would mark a significant change in dormantCommerce Clause jurisprudence. (The operation of the com-merce clause in this setting is referred to as "dormant" be-cause the power of the federal government acts as a limit onstate power without affirmative congressional legislative ac-tion.) As recently as 1978 the United States Supreme Courtin Philadelphia v. New Jersey, 437 U.S. 617, had little dif-ficulty in striking down a statute that burdened the un-restrained interstate movement of solid waste. Suchdiscriminatory laws, the Court noted, were subject to a virtual"per se rule of invalidity." There has been a slight change inthe legal landscape since 1978, largely due to the interveningcase of Maine v. Taylor, 477 U.S. 131 (1986), which upheldPREVIEWMaine's ban on the importation of baitfish. Even so, Mainev. Taylor is sufficiently distinguishable from both Philadel-phia and the present case that to follow it here would an-nounce a far more lenient attitude toward state-imposedburdens on interstate commerce than had been displayed inprior cases.ARGUMENTSFor Chemical Waste Management, Inc. (Counsel ofRecord,AndrewJ. Pincus; Mayer, Brown & Platt, 2000 PennsylvaniaAve., NW, Washington, DC 20006; telephone (202) 778-0628):1. The facially discriminatory $72 per ton Additional Feeviolates the Commerce Clause.2. Facially discriminatory laws have repeatedly been sub-jected to a virtually per se rule of invalidity.3. The Additional Fee cannot survive the strict scrutinyprescribed by Philadelphia v.New Jersey in that (1) thereis no meaningful distinction between in-state and out-of-state hazardous waste and (2) there are less interstatediscriminatory means available to Alabama that wouldaccomplish its legitimate health, safety, and environmen-tal interests.4. The legislation in this case is avowedly protectionist.Issue No. 10For Guy Hunt, Governor ofAlabama (Counsel ofRecord,Bert S. Nettles; Spain, Gillon, Grooms, Blan & Nettles, 21172nd Avenue N., Birmingham, AL 35203; telephone (205)328-4100):1. Alabama's facially discriminatory Additional Fee is jus-tified by legitimate state concerns regarding the largevolume of hazardous waste being imported into Alabama.2. Philadelphia v.New Jersey is not controlling because thatcase, involving mere municipal solid waste, did notpresent the real and substantial health, safety, and en-vironmental risks present in this case.3. The Additional Fee is a valid exercise of the state's policepower under Maine v. Taylor and older cases involvingquarantine of intrinsically harmful materials.4. The Additional Fee serves a legitimate police power in-terest that cannot be served adequately by any less bur-densome alternative.5. The public interest in the safe management of hazardouswaste would be better served by recognizing, rather thanlimiting, the ability of the states to control the interstatemovement of hazardous waste.339

Charging a Higher Fee for Disposal of Out-of-State Hazardous Waste: Will the Dormant Commerce Clause Become Dormant?

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Charging a Higher Fee for Disposal of Out-of-State Hazardous Waste: Will the Dormant Commerce Clause Become Dormant?

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