Government Suppliers Consolidating Services, Inc. v. Bayh, Nos. 92-1318

CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)
Writing for the CourtBefore CUMMINGS, EASTERBROOK, and RIPPLE; RIPPLE
Citation975 F.2d 1267
Decision Date17 September 1992
Docket NumberNos. 92-1318,92-1515
Parties, 61 USLW 2181, 23 Envtl. L. Rep. 20,042 GOVERNMENT SUPPLIERS CONSOLIDATING SERVICES, INCORPORATED and Jack Castenova, Incorporated, Plaintiffs-Appellants, Cross-Appellees, v. Honorable Evan BAYH, Governor of the State of Indiana, and Honorable Kathy Prosser, Commissioner of the Indiana Department of Environmental Management, Defendants- Appellees, Cross-Appellants.

Page 1267

975 F.2d 1267
35 ERC 1622, 61 USLW 2181, 23 Envtl.
L. Rep. 20,042
GOVERNMENT SUPPLIERS CONSOLIDATING SERVICES, INCORPORATED
and Jack Castenova, Incorporated,
Plaintiffs-Appellants, Cross-Appellees,
v.
Honorable Evan BAYH, Governor of the State of Indiana, and
Honorable Kathy Prosser, Commissioner of the
Indiana Department of Environmental
Management,
Defendants-
Appellees,
Cross-Appellants.
Nos. 92-1318, 92-1515.
United States Court of Appeals,
Seventh Circuit.
Argued April 27, 1992.
Decided Sept. 17, 1992.

Page 1269

Ronald J. Waicukauski, White & Raub, Indianapolis, Ind., Bruce L. Thall (argued), Abramson Freedman & Thall, Philadelphia, Pa., for plaintiffs-appellants.

Robert S. Spear, Chief Counsel, Office of Atty. Gen., Federal Litigation, Arend J. Abel, John R. Maley, Barnes & Thornburg, David F. Hamilton (argued), Rosemary G. Spalding, Indiana Dept. of Environmental Management, Indianapolis, Ind., for defendants-appellees.

Before CUMMINGS, EASTERBROOK, and RIPPLE, Circuit Judges.

RIPPLE, Circuit Judge.

The plaintiffs, who are brokers of municipal solid waste, arrange for trucks to haul

Page 1270

waste from temporary storage sites in New York, New Jersey, and Pennsylvania to landfills in Indiana. Seeking a declaratory judgment and injunctive relief, they brought suit in the United States District Court for the Southern District of Indiana to challenge the constitutionality, under the Commerce Clause, of Indiana statutes regulating the trucking of municipal waste. The district court upheld all but one of the provisions at issue, and the plaintiffs appeal. The defendants cross-appeal, challenging both the district court's determination that the plaintiffs had presented a controversy ripe for review and its determination as to the one provision struck down. For the reasons set forth in this opinion, we reverse in part and affirm in part.
I
BACKGROUND

A. The Challenged Provisions

The plaintiffs challenge a set of statutory provisions regulating the transport and disposal of municipal waste in Indiana. According to the plaintiffs, the challenged provisions, which were enacted as a package in 1991, are aimed at reducing or eliminating, and will in fact reduce or eliminate, the disposal of out-of-state waste in Indiana.

1. The backhaul ban

Under Indiana Code § 13-7-31-13.1, trucks that are used to haul municipal waste to Indiana landfills or disposal facilities may be used to haul only a limited number of other items. The statute provides that "municipal waste collection and transportation vehicles" 1 may only be used to collect and transport the following:

(1) Municipal waste.

(2) Special waste (as defined in 329 IC 2-2-1 as in effect January 1, 1990).

(3) Hazardous waste regulated under:

(A) IC 13-7-8.5; or

(B) the federal Solid Waste Disposal Act (42 U.S.C. 6901 et seq. as in effect January 1, 1990).

(4) Waste described under IC 13-1-12-9 that results from the combustion of coal.

(5) Material that is being transported to a facility, except an incinerator or a landfill, for reprocessing or reuse.

(6) Wood, concrete, brick, and other construction and demolition materials.

(7) Dirt, sand, gravel, asphalt, salt, and other highway maintenance material.

(8) Coal, gypsum, slag, scrap metal, and other bulk industrial commodities.

(9) Infectious waste (as defined under IC 16-1-9.7-3).

Ind.Code § 13-7-31-13.1. The practical impact of this law is to require the use of semi-dedicated fleets of trucks to haul garbage to Indiana. As the district court stated, if this provision is enforced, "a significant number of the remaining truckers now willing to haul trash to Indiana will become unwilling because they cannot afford to dedicate their trucks to so limited a range of payloads." No. 91 C 899, Order at 16 (R. 132) (Feb. 5, 1992).

2. Vehicle registration and stickering

Indiana enforces its backhaul ban by requiring that municipal waste collection and transportation vehicles be registered with the Indiana Department of Environmental Management, Ind.Code § 13-7-31-8, and bear identification stickers. Ind.Code § 13-7-31-8.2(d). The Department must issue the registration and identification stickers within thirty days after receipt of the application. Ind.Code § 13-7-

Page 1271

31-8(d). The registration must be renewed every two years, Ind.Code § 13-7-31-8.1(a), and the fee for registration or renewal is $100. 2 Ind.Code § 13-7-31-16.1(a)(1). A person who owns, leases, or operates more than one municipal waste collection and transportation vehicle need obtain only one registration listing all such vehicles. Ind.Code § 13-7-31-8.2(a). A copy of the current registration must be carried by each vehicle at all times. Ind.Code § 13-7-31-8.2(c). All vehicles must bear stickers:

Vehicle identification stickers provided by the department, indicating that the vehicle carries municipal waste, must be affixed adhesively at all times in a prominent location on each side of each registered municipal waste collection and transportation vehicle's cargo compartment or, at the option of the person to whom the registration is issued, on each side of a truck cab of a vehicle.

Ind.Code § 13-7-31-8.2(d). Landfills are not permitted to accept a shipment of municipal waste if the vehicle carrying it does not have a vehicle identification sticker properly affixed. Ind.Code § 13-7-31-14(1).

3. Surety bond and disposal fees 3

Indiana law also provides that "nonresident operators," that is, brokers like the appellants, managers of transfer stations, or transporters of municipal waste, who are not residents of Indiana, must post a surety bond with the Indiana Department of Environmental Management. Ind.Code § 13-7-10.5-15. This provision is intended to "ensure the collection and payment of any civil penalties that the operator may be required to pay in Indiana because of the solid waste transfer activities of the operator." Ind.Code § 13-7-10.5-15(1)(B). The amount of the surety bond and the time for payment are to be determined under rules adopted by the Solid Waste Management Board. Ind.Code § 13-7-10.5-15(1)(A). Such rules have not yet been adopted. In addition, the nonresident operator is "considered to appoint the Secretary of State as the operator's agent for purposes of service of process in connection with any matter involving solid waste transfer activities." Ind.Code § 13-7-10.5-15(2).

Lastly, the appellants challenge Indiana's disposal fees. Indiana Code § 13-9.5-5-1 provides not only for fees that apply uniformly to all waste, regardless of origin, but also for fees that apply only to waste generated outside Indiana. 4 These latter

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fees are to be determined by rules to be adopted by the Solid Waste Management Board, and "shall be set at an amount necessary to offset the costs incurred by the state or a county, municipality, or township that can be attributed to the importation of the solid waste into Indiana and the presence of the solid waste in Indiana." Ind.Code § 13-9.5-5-1(b). Rules have not yet been adopted. 5

B. Facts

We give the facts as found by the district court. Indiana is an economically favorable disposal site for municipal waste from other regions of the United States. Indiana's first attempt to regulate the hauling of waste into Indiana was declared unconstitutional under the Commerce Clause in 1990. See Government Suppliers Consolidating Serv., Inc. v. Bayh, 753 F.Supp. 739 (S.D.Ind.1990). After this ruling, which was not appealed, Indiana enacted new provisions regulating the disposal of municipal waste. Those provisions are the ones at issue in the present case. The primary target of the provisions is a practice known as backhauling or crosshauling.

Truckers who haul municipal waste from the eastern United States to the Midwest normally are engaging in backhauling or crosshauling. The truckers haul goods from the Midwest to New York, New Jersey, or Pennsylvania; these trips (known as fronthauls) are a trucker's main source of income. Instead of returning to the Midwest with empty trucks, they haul back trash for disposal in midwestern landfills. Trash collected in eastern cities is stored temporarily in transfer and recycling stations. At these stations, the waste is compacted and bound into large bundles. Brokers (like the appellants) identify truckers looking for backhauls of trash and arrange a pick-up for them from a transfer station and also arrange for disposal of the trash in a landfill in Indiana (or another midwestern state). Flatbed trailers, box-type semi trailers, and open-top dump trailers are used to carry the trash to Indiana. An individual trucker may haul waste to Indiana only once in several years or may haul waste regularly. The brokers do not have long-term contracts with truckers; arrangements for transport of each load of waste are made on an ad hoc, one-time basis.

Many customers of trucking companies refuse to load their goods onto any vehicle that has hauled municipal waste. As the appellants candidly conceded before the district court, trucking companies would prefer that their other customers remain unaware that their trailers have hauled municipal waste. Order at 32. Evidence at trial showed that even commercial entities that are not involved in food products do not want their products transported in trucks that previously hauled trash. These shippers were concerned about potential adverse effects on product reputation. Order at 27. Shippers, apparently thinking that if a truck is very clean it must have been recently washed after hauling garbage, have rejected trucks because they are too clean. As the district court noted,

Page 1273

"this illustrates that shippers are more concerned with reputation than with the actual health risks." Order at 27 n. 10. One trucker testified in the district court that he would not voluntarily tell a shipper that a trailer had previously hauled trash because of the stigma attached to crosshauling. Order at 32....

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    ...constitutional questions that bear on the rights of interested parties. See, e.g., Gov. Suppliers Consolidating Servs., Inc. v. Bayh, 975 F.2d 1267 (7th Cir.1992) (deciding Commerce Clause challenge to state regulation). Here, having determined that the Statutory Exemptions apply, and havin......
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  • NUCOR Corp. v. Aceros Y Maquilas de Occidente, S.A. de C.V., No. 93-1712
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 24 Junio 1994
    ...of which would be essentially unaffected by further factual development." Government Suppliers Consolidating Servs. v. Bayh, 975 F.2d 1267, 1275 (7th Cir.1992), cert. denied, --- U.S. ----, 113 S.Ct. 977, 122 L.Ed.2d 131 (1993) (quoting Peick v. Pension Benefit Guar. Corp., 724 F.2d 12......
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59 cases
  • Empress Casino Joliet Corp.. v. Blagojevich, Nos. 09–3975
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 2 Marzo 2011
    ...(7th Cir.1996) (fees for permits for use of certain streets by heavy trucks); Government Suppliers Consolidating Services, Inc. v. Bayh, 975 F.2d 1267, 1271 n. 2 (7th Cir.1992) (registration fees for waste-collection vehicles), and Trailer Marine Transport Corp. v. Rivera Vazquez, 977 F.2d ......
  • Griffith v. Fed. Nat'l Mortg. Ass'n, Civil Action No. 2:12–02083.
    • United States
    • United States District Courts. 4th Circuit. Southern District of West Virginia
    • 9 Junio 2014
    ...constitutional questions that bear on the rights of interested parties. See, e.g., Gov. Suppliers Consolidating Servs., Inc. v. Bayh, 975 F.2d 1267 (7th Cir.1992) (deciding Commerce Clause challenge to state regulation). Here, having determined that the Statutory Exemptions apply, and havin......
  • Empress Casino Joliet Corp.. v. Balmoral Racing Club Inc., No. 09–3975.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 8 Julio 2011
    ...(7th Cir.1996) (fees for permits for use of certain streets by heavy trucks); Government Suppliers Consolidating Services, Inc. v. Bayh, 975 F.2d 1267, 1271 n. 2 (7th Cir.1992) (registration fees for waste collection vehicles), and Trailer Marine Transport Corp. v. Rivera Vazquez, supra, 97......
  • NUCOR Corp. v. Aceros Y Maquilas de Occidente, S.A. de C.V., No. 93-1712
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 24 Junio 1994
    ...of which would be essentially unaffected by further factual development." Government Suppliers Consolidating Servs. v. Bayh, 975 F.2d 1267, 1275 (7th Cir.1992), cert. denied, --- U.S. ----, 113 S.Ct. 977, 122 L.Ed.2d 131 (1993) (quoting Peick v. Pension Benefit Guar. Corp., 724 F.2d 12......
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