Over the past several years and more recently since the events of September 11, 2001 issues surrounding waste movement across borders have become increasingly important. For the Canadian waste management industry, movement across provincial borders and the international border with the United States is obviously the most significant issue. However, the movement of waste between U.S. states also has the potential to have impact on the movement of Canadian waste.
Two recent court cases south of the border may provide some indication of trends in North American waste movements that eventually could have an effect north of the border.
Flow control laws allow state, county and other local governments to direct solid waste generated within their own jurisdictions to certain facilities. While such laws were prevalent in the U.S. for years, a series of Federal Court decisions (culminating with a 1994 U.S. Supreme Court decision) rendered these laws invalid.
Flow control was used as a mechanism to support the waste management industry as well as to ensure that the facilities and infrastructure to deal with waste could be financed over a long-term period. However, critics of flow control took the position that these laws interfered with free market activity. In the end, private industry was successful in challenging flow control legislation at the U.S. Supreme Court in the case known as Carbone v. Town of Clarkstown.
The issue that the Supreme Court dealt with in that case was whether or not the flow control violated terms of the U.S. Constitution. Specifically, the question was whether the flow control offended the “dormant” commerce clause that bars states and other local jurisdictions from placing undue burdens on inter-state commerce. The Supreme Court in Carbone found that flow controls did offend the commerce clause and as such were illegal.
Exceptions to the rule
While the U.S. Supreme Court was clear in Carbone that flow controls could not be imposed by state or local governments it was equally clear that other portions of the commerce clause of the U.S. Constitution allow the U.S. Congress to “shield” state and local governments from the commerce clause. As a result, if Congress were to pass legislation authorizing state or local governments to implement flow control legislation, the legislation would be permitted and the impediments described in the Carbone case would be overcome.
There has been increased activity in Congress to consider the possibility of flow control for waste generated in particular jurisdictions and, more importantly for Canadian waste exporters to the U.S., the possibility of allowing states to regulate the import of waste from outside their own borders. Because these regulatory tools are being considered federally, any move to relax the waste flow restrictions on state and local governments in the U.S. must be taken seriously by the Canadian industry.
There have been two recent instances in which the U.S. Supreme Court has declined to hear challenges to a local solid waste district’s flow control policies.
The first case, United Haulers Association v. The Oneida-Herkimer Solid Waste Management Authority involved a flow control requirement that haulers take waste generated within the jurisdiction to the transfer station operated by the Solid Waste Authority before disposal. At that transfer station the waste is examined to ensure that federal and state environmental laws regarding the separation of recyclables are complied with. As a result “effective” tipping fees can be increased through fees to pass waste through the transfer station.
While the Supreme Court has upheld the flow control policies in the United Haulers case, the Court has referred the matter to a lower court to confirm whether or not the ordinances could have an adverse effect on inter-state commerce. If the Court finds that it did, it is possible that the result could be reversed. That said, the finding by the Supreme Court that flow controls are allowed so long as they do not interfere with inter-state commerce, will stand.
The second case that the Supreme Court declined to hear was a lawsuit of private hauler Maharg Inc. against the Van Wert Solid Waste Management District in Ohio. The Van Wert district required that all solid waste facilities pay $5.30 per ton for waste accepted within the district. Under the regulations, Maharg was prohibited from delivering waste collected within the county to a landfill across the state line in Indiana that agreed to pay the fee to the county. In appeals court the district held that Van Wert had the power to impose a fee on the out-of-state landfill.
By refusing to hear the appeals of these cases, the U.S. Supreme Court has effectively reduced the scope of the Carbone case and assumptions that have endured since 1994 have been turned on their head to some degree. While some uncertainties still exist with respect to the nuances of the impact of the Supreme Court cases, the general trend of the decisions permit increasing restrictions on flow of waste.
While the ability to impose flow controls for waste generated within a particular U.S. jurisdiction does not have a direct impact on waste movement from Canada, the fact that the legal framework within the U.S. is changing in favour of increased restrictions may give some indication that future legislative or regulatory action may follow this trend.
Written by Adam Chamberlain, LL.B. of Power Budd, the Canadian affiliate of Cameron McKenna, an international law and consulting firm. Mr. Chamberlain is based in Toronto, Ontario.