Dove v. CHATTANOOGA AREA REGIONAL TRANSP. AUTHORITY

• Decision Date: 21 July 1981
• Docket Number: No. CIV-1-80-249.,CIV-1-80-249.
• Citation: 539 F. Supp. 36
• Parties: Vernon W. DOVE, and other plaintiffs similarly situated v. CHATTANOOGA AREA REGIONAL TRANSPORTATION AUTHORITY.
• Court: U.S. District Court — Eastern District of Tennessee

539 F. Supp. 36

Vernon W. DOVE, and other plaintiffs similarly situated v. CHATTANOOGA AREA REGIONAL TRANSPORTATION AUTHORITY.

No. CIV-1-80-249.

United States District Court, E. D. Tennessee, S. D.

July 21, 1981.

S. Del Fuston, Chattanooga, Tenn., for plaintiffs.

George M. Derryberry, Chattanooga, Tenn., for defendant CARTA.

John B. Phillips, Jr., Stophel, Caldwell & Heggie, Chattanooga, Tenn., and William T. Coleman, Jr., Robert S. Draper, and Donald T. Bliss, O'Melveny & Myers, Washington, D. C., for American Public Transit Ass'n, amicus curiae.

MEMORANDUM

FRANK W. WILSON, Chief Judge.

This is an action for declaratory relief, back pay and damages brought pursuant to the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. (the "Act"). At issue in this litigation is whether the operation of the Chattanooga Regional Area Transit Authority ("CARTA"), a metropolitan transit system created, owned and operated by the City of Chattanooga, Tennessee, is an "integral governmental function" within the scope of the Supreme Court's decision in National League of Cities v. Usery, 426 U.S. 833, 96 S.Ct. 2465, 49 L.Ed.2d 245 (1976). Jurisdiction is invoked pursuant to 29 U.S.C. § 216(b) and is not disputed. The case is presently before the Court upon the following motions: (1) the motion for summary judgment, filed by CARTA (Court File # 5); (2) the motion to intervene as amicus curiae, filed by the American Public Transit Association (Court File # 9); (3) CARTA's motion for consideration of the amicus brief (Court File # 10); and (4) the motion to file a responsive brief, filed by the American Public Transit Association (Court File # 17).

In support of its motion to intervene as amicus curiae, the American Public Transit Association ("APTA") states as grounds therefor that it is the national representative of entities operating local public mass transit systems; that it is the national repository for information and research about local public mass transit systems, and, as such, it is uniquely situated to provide useful information about the operation of such systems; and, that it has an important interest, on behalf of its members, in the question of whether the overtime compensation requirements of the Act should be applied to local public mass transit systems. The defendant CARTA has moved the Court to consider APTA's amicus brief and supporting affidavits. The Court being of the opinion that the APTA has sufficient interest to be entitled to enter an amicus appearance, the motion to intervene as amicus curiae (Court File # 9) and CARTA's motion for consideration of the amicus brief (Court File # 10) will be granted. APTA's motion for leave to file a response to a letter to the Court, written by counsel for the plaintiffs, is granted.¹

Numerous affidavits and exhibits have been filed in support of, and in opposition to, the motion for summary judgment. The following relevant facts appear undisputed. CARTA is a metropolitan transit authority created in 1971 by the City of Chattanooga, Tennessee, pursuant to Chapter 515, 1970 Public Acts, as amended by Chapter 160, 1971 Public Acts of the State of Tennessee. It is governed by a Board of Directors, which consists of one representative from each municipality that participates in the operation of the system, except Chattanooga, which appoints a number of directors equal to the total of all participating municipalities plus one. The Authority operates a public transportation system throughout its service area, which includes Chattanooga and other municipalities in Hamilton County, Tennessee, and Lookout Mountain, Georgia. By means of federal capital grants and local government funds, CARTA acquired all private bus lines in its service area by the end of 1973. Prior to that time, mass transportation in the area was provided by means of privately-owed and operated carriers. CARTA currently operates 69 buses over 24 routes and a fixed rail service between Chattanooga and Lookout Mountain, Tennessee. In fiscal year 1980, CARTA carried approximately 4.6 million riders. Affidavit of Alfred E. Smith, CARTA Board Chairman, Court File # 6.

CARTA generally derives 80% of its capital expenditure funds through federal grants from the Urban Mass Transportation Administration ("UMTA"). Another 10% is obtained by grants from the Tennessee Department of Transportation, and 10% is derived from the local governments served by CARTA. Operating expenses are acquired by means of fares, UMTA operating grants, and state and local government operating grants. The fiscal year 1981 operating budget has an operating expense of $5,645,600, of which fares provide only $2,631,700.

CARTA employs 83 operators, as well as maintenance and clerical personnel. The plaintiffs, CARTA employees, filed this action alleging that the defendant has not paid them wages for hours over 40 hours per week at a rate of time and one-half of the plaintiffs' regular hourly rate. The plaintiffs allege that, as a result, CARTA has violated the Fair Labor Standards Act (FLSA), specifically 29 U.S.C. § 207(a). CARTA has answered the complaint and raises, by this motion, its defense that the provisions of the FLSA as applied to CARTA are an unconstitutional exercise of Congress' power under the Commerce Clause of the United States Constitution. U.S.Const., Art. I, Sec. 8, cl. 3.

The American Public Transit Association has filed the affidavit of Herbert J. Scheuer, its executive director of administration, in support of CARTA's motion for summary judgment (Court File # 8). According to Mr. Scheuer, the APTA collects and analyzes data concerning the mass transit industry in the United States. That data shows that, from the years 1967 to 1978: (1) the total number of transit vehicles owned by publicly-owned transit systems grew from 48% to 87% of the total owned by the industry as a whole; (2) the total number of vehicle miles traveled by publicly-owned transit systems grew from 51% to 90% of the industry total; and, (3) the total number of linked-passenger trips by publicly-owned transit systems grew from 62% to 91% of the industry total.

In opposition to the motion for summary judgment, the plaintiffs have filed the affidavit of Alexander Cohn, the Assistant General Counsel of the Amalgamated Transit Union, AFL-CIO (Court File # 16). According to Mr. Cohn, the data collected by the Amalgamated Transit Union indicates that the overwhelming majority of urban mass transit employees receive time and a half pay for hours worked over 40 hours per week "by contract". The conclusion that Mr. Cohn draws from this information is that the overtime pay requirements of the FLSA has a very slight impact upon the United States mass transit industry as a whole.

In 1974, the FLSA was amended to extend its wage and hour provisions to virtually all state and local governmental employees. See 29 U.S.C. § 203(d), (s)(5) and (6), and (x). In National League of Cities v. Usery, 426 U.S. 833, 96 S.Ct. 2465, 49 L.Ed.2d 245 (1976), the Supreme Court, in a plurality decision, held the 1974 wage and hour provisions of the FLSA unconstitutional as they applied to state and local governments. The Court found that the wage and hour provisions were within the scope of the powers of the Congress under the commerce clause, but found that the Tenth Amendment operated as a limitation upon Congress' power to regulate commerce insofar as that regulation involved "functions essential to the separate and independent existence" of local governments. 426 U.S. at 845, 96 S.Ct. at 2471, 49 L.Ed.2d at 254. The Court expressly overruled Maryland v. Wirtz, 392 U.S. 183, 88 S.Ct. 2017, 20 L.Ed.2d 1020 (1968), which had upheld the application of the FLSA to employees of state schools, hospitals, and other public institutions.

In National League of Cities the Supreme Court was not particularly clear in defining those functions of state and local governments that were exempt from Congressional power under the commerce clause. The Court held the 1974 amendments could not be constitutionally applied to state and local governments because their application would:

"significantly alter or displace the States' abilities to structure employer-employee relationships in such areas as fire prevention, police protection, sanitation, public health and parks and recreation. These activities are typical of those performed by state and local governments in discharging their dual functions of administering the public law and furnishing public services.16"

426 U.S. at 851, 96 S.Ct. at 2474, 49 L.Ed.2d at 257. The Court stated, at note 16, that the list of examples it had given in the text was not exhaustive "of the numerous line and support activities which are well within the area of traditional operations of state and local governments." Id. The Court did note that the operation of a railroad engaged in "common carriage by rail in interstate commerce", as was found in United States v. California, 297 U.S. 175, 56 S.Ct. 421, 80 L.Ed. 567 (1936), was not an integral function of state government and thus not protected by the Tenth Amendment from Congress' power under the commerce clause.

As noted above, National League of Cities was a plurality decision, and the deciding vote for the majority was cast by Mr. Justice Blackmun. In his separate opinion, Justice Blackmun suggested that the opinion adhered to by the remaining Justices in the majority adopted a "balancing approach," in which the integral and traditional functions of state and local governments would not be immune from Congress' commerce clause powers when the federal interest in the subject matter under regulation is "demonstrably greater." 426 U.S. at 856, 96 S.Ct. at 2476, 49 L.Ed.2d at 260.

The Supreme Court had occasion recently to explain further its holding in National League of Cities in the case of Hodel v. Virginia Surface Mining and Reclamation Ass'n., 452 U.S. 264, 101 S.Ct. 2352, 69 L.Ed.2d 1 (1981). In...