Sandlands C&D LLC v. Horry

• Decision Date: 03 December 2013
• Docket Number: No. 13–1134.,13–1134.
• Citation: 737 F.3d 45
• Parties: SANDLANDS C & D LLC; Express Disposal Service LLC, Plaintiffs–Appellants, v. HORRY, COUNTY OF, a Political Subdivision of the State of South Carolina acting by and through its duly elected County Council; Horry County Solid Waste Authority Inc., Defendants–Appellees. Delaware County Solid Waste Authority; Ecomaine; City And County of Honolulu; International Municipal Lawyers Association; Lancaster County Solid Waste Management Authority; Marion County, Oregon; Montgomery County, Ohio; National Association of Counties; Solid Waste Association Of North America; Solid Waste Authority of Central Ohio; Solid Waste Disposal Authority of The City of Huntsville; South Carolina Association of Counties; Solid Waste Authority of Palm Beach County; Pine Belt Regional Solid Waste Management Authority; Spokane Regional Solid Waste System; Wasatch Integrated Waste Management District; York County Solid Waste And Refuse Authority, Amici Supporting Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

737 F.3d 45

SANDLANDS C & D LLC; Express Disposal Service LLC, Plaintiffs–Appellants,

v. HORRY, COUNTY OF, a Political Subdivision of the State of South Carolina acting by and through its duly elected County Council; Horry County Solid Waste Authority Inc., Defendants–Appellees.Delaware County Solid Waste Authority; Ecomaine; City And County of Honolulu; International Municipal Lawyers Association; Lancaster County Solid Waste Management Authority; Marion County, Oregon; Montgomery County, Ohio; National Association of Counties; Solid Waste Association Of North America; Solid Waste Authority of Central Ohio; Solid Waste Disposal Authority of The City of Huntsville; South Carolina Association of Counties; Solid Waste Authority of Palm Beach County; Pine Belt Regional Solid Waste Management Authority; Spokane Regional Solid Waste System; Wasatch Integrated Waste Management District; York County Solid Waste And Refuse Authority, Amici Supporting Appellees.

No. 13–1134.

United States Court of Appeals, Fourth Circuit.

Argued: Oct. 31, 2013.

Decided: Dec. 3, 2013.

ARGUED:Vincent Austin Sheheen, Savage, Royall & Sheheen, LLP, Camden, South Carolina, for Appellants. Michael Warner Battle, Battle & Vaught, PA, Conway, South Carolina, for Appellees. ON BRIEF:Thomas S. Mullikin, Mullikin Law Firm, LLC, Camden, South Carolina, for Appellants. Emma Ruth Brittain, Thomas & Brittain, P.A., Myrtle Beach, South Carolina; Stan Barnett, Smith, Bundy, Bybee & Barnett, Mt. Pleasant, South Carolina, for Appellees. Scott M. DuBoff, Jeffrey C. Young, Garvey Schubert Barer, Washington, D.C., for Amici Curiae. Michael F.X. Gillin, Media, Pennsylvania, for Amicus Curiae Delaware County Solid Waste Authority. Nicholas Nadzo, Mark Bower, Jensen Baird Gardner & Henry, Portland, Maine, for Amicus Curiae ecomaine. Dana Viola, Deputy Corporation Counsel, Department Of Corporation Counsel, City and County of Honolulu, Honolulu, Hawaii, for Amicus Curiae City and County of Honolulu. Alex Henderson, Hartman Underhill & Brubaker, Lancaster, Pennsylvania, for Amicus Curiae Lancaster County Solid Waste Management Authority. Scott Norris, Assistant Legal Counsel, Marion County, Oregon, for Amicus Curiae Marion County, Oregon. Mathias H. Heck, Jr., Montgomery County, Ohio Prosecuting Attorney, Dayton, Ohio, for Amicus Curiae Montgomery County, Ohio. Michael Belarmino, Associate General Counsel, National Association of Counties, Washington, D.C., for Amicus Curiae National Association of Counties. Moran M. Pope, III, Pope & Pope, P.A., Hattiesburg, Mississippi, for Amicus Curiae Pine Belt Regional Solid Waste Management Authority. Barry Shanoff, Rockville, Maryland, for Amicus Curiae Solid Waste Association of North America. Michael C. Mentel, Chief Legal Officer, Solid Waste Authority of Central Ohio, Grove City, Ohio, for Amicus Curiae Solid Waste Authority of Central Ohio. M. Clifton Scott Jr., Senior Staff Attorney, South Carolina Association of Counties, Columbia, South Carolina, for Amicus Curiae South Carolina Association of Counties. Elizabeth Schoedel, Assistant City Attorney, City of Spokane, Spokane, Washington, for Amicus Curiae Spokane Regional Solid Waste System. Charles H. Younger, Huntsville, Alabama, for Amicus Curiae Solid Waste Disposal Authority of the City of Huntsville, Alabama.

Before WILKINSON, DUNCAN, and DIAZ, Circuit Judges.

Affirmed by published opinion. Judge Duncan wrote the opinion, in which Judge Wilkinson and Judge Diaz joined.

DUNCAN, Circuit Judge:

Appellants Sandlands C & D, LLC (“Sandlands”) and Express Disposal Service, LLC (“EDS”) contest the validity of Horry County's Flow Control Ordinance, which prohibits disposal of waste generated in Horry County at any site other than a designated publicly owned landfill. The district court granted summary judgment in favor of Horry County, and appellants challenge its determination that the Ordinance violates neither the Commerce Clause nor the Equal Protection Clause. For the reasons that follow, we affirm.

I.

A.

Horry County occupies the northernmost coastal section of South Carolina. Because of its sixty-mile coastline, large geographic size, seasonal population changes, and high water table, landfill waste disposal has been “expensive and difficult.” See Horry Co., S.C., Ordinance 60–90, § 1 (Dec. 21, 1990). Consequently, in 1990 the County Council established the Horry County Solid Waste Authority, Inc. (“SWA”), a nonprofit corporation, to manage the county's solid waste. Id. § 1.4. Although the SWA is a separate legal entity, Horry County maintains power over it in multiple ways: approving its budget, large capital expenditures, and real estate transactions; appointing its board of directors; wielding approval authority over all bylaw amendments; and requiring that the Horry County Treasurer hold all its funds and issue its checks. Furthermore, the IRS categorizes the SWA as a “governmental unit” or “affiliate of a governmental unit.” On appeal, it is undisputed that the SWA is a public entity.

The SWA owns and operates two landfills (one for municipal solid waste and one for construction and demolition (“C & D”) waste) and a recycling facility in Horry County. In addition, the SWA sponsors educational programs on recycling and runs a green power facility that harnesses the methane gas emitted by landfills to generate electricity. The SWA charges haulers and others who use its landfills “tipping fees” based on the tonnage of trash deposited. These fees, which are standard in the waste-disposal industry, provide revenue to fund SWA operations. Haulers who recycle a specified percentage of the waste they collect pay a reduced tipping fee through an application-based recycling incentive program.

On March 17, 2009, the Horry County Council enacted Ordinance 02–09 (“Flow Control Ordinance” or “Ordinance”) to create a county-wide plan for solid waste disposal. Horry Co., S.C., Ordinance 02–09 (Apr. 7, 2009). The final version of the Flow Control Ordinance, as amended on April 7, 2009, provides:

The County hereby designates the disposal facilities operated by the SWA and/or public owned facilities designated by the SWA for the acceptance or disposal of acceptable waste. The dumping or depositing by any person at any place other than at the designated facilities of any acceptable waste generated within the County is prohibited.

Id. § 2.1.1. By requiring that all acceptable waste be disposed of at SWA or other designated public landfills, the Ordinance aims to conserve resources, prevent pollution, and protect the public health, safety, and well-being. Id. § 1.1. It also ensures the SWA a revenue stream from the tipping fees haulers must pay to deliver waste.

To effect its objectives, the Ordinance sets out a detailed regulatory and enforcement framework. It defines the term “acceptable waste” as “ordinary household, municipal, institutional, commercial and industrial solid waste” excluding recyclables as well as hazardous waste, sewage, agricultural waste, biomedical waste, and certain types of nuclear waste. Id. §§ 1.2.1, 1.2.14 (defining acceptable and unacceptable waste); §§ 6.1.2, 7.1.2, 8.1.5 (excluding recyclables). It also sets out rules and licensing requirements for waste haulers. Id. §§ 9–10.

The Flow Control Ordinance has been largely successful in ensuring that waste generated in Horry County is deposited at an approved landfill within the county. According to the South Carolina Solid Waste Management Annual Reports from 2009, 2010, and 2011, an SWA facility processed 689,708 out of 691,552 tons, or over 99% of the waste generated in the county during those years. J.A. 196–205.¹

The remaining 1,844 tons of waste were taken to four landfills outside of the county: the Georgetown County Landfill, the Berkeley County W & S Landfill, the Oakridge Landfill, and the Richland Landfill. Horry County and Georgetown County have an intergovernmental waste-sharing agreement, predating the enactment of the Flow Control Ordinance, under which waste collected near the counties' shared border may be taken to the other county's government-operated landfills. According to the SWA, much of the waste taken to the other landfills was not “acceptable waste” under the Flow Control Ordinance—in other words, it was waste, such as the hazardous material asbestos, that the SWA landfills cannot process. Horry County also acknowledged that some waste may have been removed from the county without the SWA's knowledge or consent.

B.

The enactment of the Flow Control Ordinance altered the local economy of waste management. For example, Sandlands, which operates a private landfill for C & D waste in neighboring Marion County, South Carolina, saw a significant decrease in its business. Because the Sandlands landfill is located only two miles from the Horry County border, a significant portion of the waste deposited there used to originate in Horry County. The Ordinance now prohibits haulers from bringing Horry County waste to the Sandlands landfill in order to take advantage of its lower tipping fees. Sandlands has since struggled financially because of its inability to replace the revenue stream lost as a result of the Ordinance.

EDS operates a waste hauling service in southeastern North Carolina and northeastern South Carolina. Prior to the passage of the Flow Control Ordinance, EDS transported waste from Horry County to the Sandlands landfill and received certain benefits as a result, such as increased hours of access and special, lower tipping fees. EDS has been issued at least seventeen citations for violating the Flow Control Ordinance.

As an alternate business strategy, Sandlands attempted to open a facility to process recovered materials ² at its Marion County site, where it would have sorted general C & D debris into recyclable materials and landfill-ready waste. When Sandlands requested permission from Horry County to remove mixed C & D debris for this purpose, a...