48 F.3d 701 (3rd Cir. 1995), 94-5173, Atlantic Coast Demolition & Recycling, Inc. v. Board of Chosen Freeholders of Atlantic County

Docket Nº:94-5173.
Citation:48 F.3d 701
Party Name:ATLANTIC COAST DEMOLITION & RECYCLING, INC. Appellant, v. BOARD OF CHOSEN FREEHOLDERS OF ATLANTIC COUNTY; Atlantic County Utilities Authority; Board of Chosen Freeholders of Camden County; Pollution Control Financing Authority of Camden County; Scott Weiner, individually and in his capacity as Commissioner of New Jersey Department of Environmental
Case Date:February 16, 1995
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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Page 701

48 F.3d 701 (3rd Cir. 1995)

ATLANTIC COAST DEMOLITION & RECYCLING, INC. Appellant,

v.

BOARD OF CHOSEN FREEHOLDERS OF ATLANTIC COUNTY; Atlantic

County Utilities Authority; Board of Chosen Freeholders of

Camden County; Pollution Control Financing Authority of

Camden County; Scott Weiner, individually and in his

capacity as Commissioner of New Jersey Department of

Environmental Protection and Energy.

No. 94-5173.

United States Court of Appeals, Third Circuit

February 16, 1995

Argued Sept. 13, 1994.

Sur Petition for Rehearing March 28, 1995.

Page 702

[Copyrighted Material Omitted]

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Mark R. Rosen (argued), Jodi Isenberg, Mesirov, Gelman, Jaffe, Cramer & Jamieson, Haddonfield, NJ, for appellant.

James J. Ciancia, Acting Atty. Gen., Andrea M. Silkowitz, Asst. Atty. Gen., Gail M. Lambert (argued), Stefanie A. Brand, Deputy Attys. Gen., Newark, NJ, for appellee Scott Weiner.

William J. Linton, Atlantic County Utilities Authority, Pleasantville, NJ, for appellee Atlantic County Utility Authority.

Frederick J. Schuck, Camden, NJ, for appellee Bd. of Chosen Freeholders of Camden County.

Jonathan L. Williams, J.S. Lee Cohen (argued), Michael S. Caro, DeCotiis, Fitzpatrick & Gluck, Hackensack, NJ, for amici curiae Hudson County Improvement Authority, Passaic County Utilities Authority and Essex County Utilities Authority Mercer County Imp. Authority.

Joseph J. Slachetka, John A. Mercer, Jr., Higgins, Slachetka & Long, Laurel Springs, NJ, for amicus curiae Cape May County Mun. Utilities Authority.

Gail B. Phelps, Asst. Counsel, Bureau of Regulatory Counsel, Harrisburg, PA, for amicus curiae Pennsylvania Dept. of Environmental Resources.

Betty Jo Christian, Paul J. Ondrasik, Jr., William T. Hassler, Steptoe & Johnson, Washington, D.C. (Bruce J. Parker, Alan S. Ashkinaze, Of Counsel), and Michael F. Riccardelli, Ronald S. Bergamini, Riccardelli, Rose & Hoonhoudt, Montclair, NJ, for amici curiae City of Jersey City, Borough of Northvale, C & A Carbone, Inc., National Solid Wastes Management Ass'n, and Waste Management Ass'n of New Jersey.

Before: STAPLETON, ALITO and LEWIS, Circuit Judges.

OPINION OF THE COURT

STAPLETON, Circuit Judge:

This appeal concerns the constitutional validity of New Jersey's solid waste regulatory scheme. Atlantic Coast Demolition and Recycling, Inc. ("Atlantic Coast") sought to enjoin enforcement of New Jersey's waste flow regulations on the ground they violate the dormant Commerce Clause. The district court entered judgment in favor of defendant New Jersey Department of Environmental Protection and Energy ("the Department"), finding that the flow control regulations did not impose an unconstitutional burden on interstate commerce. Atlantic Coast appealed. We will reverse.

Shortly after the district court entered final judgment upholding the flow control regulations, the Supreme Court issued its decision in C & A Carbone, Inc. v. Town of Clarkstown, --- U.S. ----, 114 S.Ct. 1677, 128 L.Ed.2d 399 (1994), in which the Court struck down a local flow control ordinance of the Town of Clarkstown, New York, as violative

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of the dormant Commerce Clause. In light of the Supreme Court's recent teachings, we conclude that the district court erred in holding that the regulations do not discriminate against interstate commerce and in applying the balancing test set forth in Pike v. Bruce Church, Inc., 397 U.S. 137, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970). Because the district court did not consider whether the regulations could pass muster under the stricter dormant Commerce Clause test applicable to discriminatory measures, we will vacate the district court's judgment and remand so that the district court may determine whether the regulations can be upheld despite their discriminatory effect. 1

I.

The facts of this case are generally not in dispute. 2 The necessary factual background concerns New Jersey's waste management system and Atlantic Coast's activities.

  1. New Jersey's Solid Waste Management System

    New Jersey has an extensive statutory and regulatory system governing the management and disposal of solid waste. This highly regulated system grew out of a crisis that began in the 1970s as a result of wide-spread illegal practices in the then private, unregulated waste disposal market and the closing of many landfills due to unsanitary conditions and noncompliance with newly enacted federal regulations. This crisis has been documented in the caselaw of both this court and the New Jersey courts. See, e.g., J. Filiberto Sanitation v. Department of Envtl. Protection, 857 F.2d 913, 918-19 (3d Cir.1988); Trade Waste Management Ass'n, Inc. v. Hughey, 780 F.2d 221, 223 (3d Cir.1985); A.A. Mastrangelo, Inc. v. Commissioner of Department of Envtl. Protection, 90 N.J. 666, 449 A.2d 516, 518-19, 521 (1982); Hackensack Meadowlands Dev. Comm'n v. Municipal Sanitary Landfill Auth., 68 N.J. 451, 348 A.2d 505 (1975), rev'd sub nom. City of Philadelphia v. New Jersey, 437 U.S. 617, 98 S.Ct. 2531, 57 L.Ed.2d 475 (1978); Southern Ocean Landfill, Inc. v. Mayor & Council of the Township of Ocean, 64 N.J. 190, 314 A.2d 65, 66-67 (1974); In re Scioscia, 216 N.J.Super. 644, 524 A.2d 855, 857 (Ct.App.Div.1987). As the Department has observed in a recent update to its Statewide Solid Waste Management Plan:

    By the early 1980s, the department had closed, or was in the process of closing, over 300 unsafe or unregulated landfills that posed serious environmental hazards or had exhausted capacity. However, the department's persistent actions to implement rigorous environmental standards on landfill construction and operations, coupled with a steady influx of millions of tons of waste annually from neighboring states during the 1970s, resulted in a serious shortfall of disposal capacity in the state....

    By the late 1980s, the "solid waste crisis" had become a national issue, and New Jersey, the most densely populated state in the union, was at the forefront of both the problem and the solution. Responding to the need to develop safe, efficient systems, by 1990 the state/county planning process produced 13 new major disposal facilities.... Despite this remarkable progress, however, a number of additional counties were forced by the continuing capacity shortages to make disposal arrangements with out-of-state facilities, and New Jersey, once a net importer of waste, became a net exporter with peak exports of

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    28% of all solid waste generated in the state in 1988. As national attention focused on the environmental concerns associated with solid waste management practices, a number of states moved to restrict the importation of waste. On several occasions, New Jersey waste was banned, without notice, from out-of-state facilities, resulting in serious disruptions of service and unhealthy conditions as waste collected in the streets.

    New Jersey Dep't of Envtl. Protection and Energy, Div. of Solid Waste Management, Solid Waste Management State Plan Update: 1993-2002, Executive Summary 1-2 (Draft Jan. 1993) (App. 511-12) [hereinafter State Plan Update-Executive Summary ].

    New Jersey's existing statutory and regulatory waste management system is the result of attempts to respond to this crisis. 3 The two major statutory provisions of New Jersey's solid waste management system are the Solid Waste Management Act ("SWMA"), N.J.Stat.Ann. Sec. 13:1E-1 to -207 (West 1991 & Supp.1994), and the Solid Waste Utility Control Act ("SWUCA"), N.J.Stat.Ann. Sec. 48:13A-1 to -13 (West Supp.1994). These acts were passed in 1970 to establish a statutory framework to coordinate "all solid waste collection, disposal, and utilization activity" in the state, N.J.Stat.Ann. Sec. 13:1E-2(b)(1) (West 1991), and to regulate the rates at which these services are provided as a means of providing safe, adequate, and proper waste management services, N.J.Stat.Ann. Sec. 48:13A-2 (West Supp.1994).

    The Department is vested with broad regulatory authority, 4 while direct management responsibility is delegated to the twenty-two solid waste management districts that comprise the state, one for each of New Jersey's counties plus the Hackensack Meadowlands District. See N.J.Stat.Ann. Sec. 13:1D-19 (West 1991). Each solid waste district is responsible for developing a ten-year solid waste management plan that must be approved by the Department before it is implemented. Id. Secs. 13:1E-20, 13:1E-24 (West 1991). In each waste district, solid waste disposal is managed either directly by the county government or by municipal authorities created and designated by the district for this purpose. 5 Each district's waste plan must provide for "sufficient [and] suitable" disposal facilities to treat and accommodate all solid waste generated within the waste district; the districts may meet this obligation by contracting with public or private entities or by constructing and operating the waste facilities themselves. Id. Sec. 13:1E-21 to -22 (West 1991); Secs. 40:14B-19 (West 1991), 40:37A-55 (West 1991), 40:37C-5 (West 1991). By the early 1980s the Department had approved solid waste management plans for each of the twenty-two solid waste districts. State Plan Update-Executive Summary, supra, at 1 (App. 511).

    In addition to this system of local district management, the disposal facilities 6 themselves are subject to state regulation by the Department. The private or public entity performing the disposal service must register with and obtain approval from the Department before providing disposal service, N.J.Stat.Ann. Sec. 13:1E-5 (West 1991), and must obtain a certificate of public convenience

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    and necessity from the Board of Regulatory Commissioners, id. Sec. 48:13A-6 (West Supp.1994). To...

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