Pacific Merchant Shipping Assn. v. Voss

• Decision Date: 29 December 1995
• Docket Number: No. S044869,S044869
• Citation: 12 Cal.4th 503,48 Cal.Rptr.2d 582,907 P.2d 430
• Court: California Supreme Court
• Parties: , 907 P.2d 430, 18 ITRD 2362, 1996 A.M.C. 1212, 64 USLW 2417, 96 Cal. Daily Op. Serv. 62, 96 Daily Journal D.A.R. 69 PACIFIC MERCHANT SHIPPING ASSN., Plaintiff and Respondent, v. Henry VOSS, as Director, etc., et al., Defendants and Appellants.

Page 582

48 Cal.Rptr.2d 582

12 Cal.4th 503, 907 P.2d 430, 18 ITRD 2362, 1996 A.M.C. 1212,

64 USLW 2417, 96 Cal. Daily Op. Serv. 62,

96 Daily Journal D.A.R. 69

PACIFIC MERCHANT SHIPPING ASSN., Plaintiff and Respondent, v. Henry VOSS, as Director, etc., et al., Defendants and Appellants.

No. S044869.

Supreme Court of California.

Dec. 29, 1995.

Daniel E. Lungren, Attorney General, Roderick E. Walston, Chief Assistant Attorney General, Walter Wunderlich, Assistant Attorney General, Charles W. Getz IV and Marc N. Melnick, Deputy Attorneys General, for Defendants and Appellants.

Lillick & Charles, Sher & Blackwell, R. Frederic Fisher, Lawrence N. Minch, David F. Smith, Jeffrey F. Lawrence, San Francisco, Cindy Buys, Washington, DC, Minder & Muro and Thomas G. Minder, Sacramento, for Plaintiff and Respondent.

MOSK, Justice.

In this appeal we consider whether two statutes and a regulation authorizing the California Department of Food and Agriculture to levy an inspection fee on ships carrying agricultural goods into California from foreign countries (Food & Agr.Code, §§ 5352 & 5353, subd. (b); Cal.Code Regs., tit. 3, § 3560, subd. (b)), when no such fee is levied on carriers bringing such goods into California from other states, unjustifiably discriminate on their face against foreign commerce in violation of the negative aspect of the foreign commerce clause of the United States Constitution. (U.S. Const., art. I, § 8, cl. 3.)

We shall conclude, as the trial court ruled, that the cited provisions are facially discriminatory and that the discrimination cannot be justified under the controlling "strictest scrutiny" standard. We therefore reverse the judgment of the Court of Appeal holding the provisions to be nondiscriminatory.

Background

The United States Department of Agriculture (USDA) has long maintained a comprehensive program for inspecting potentially contaminated or otherwise harmful agricultural products brought into the United States from foreign countries. (See, e.g., 7 U.S.C. § 151 et seq. [Plant Quarantine Act of 1912]; 7 U.S.C. § 150ee ["The Secretary [of the USDA] may promulgate such regulations requiring inspections of products and articles of any character whatsoever and means of conveyance ... as a condition of their movement into or through the United States, or interstate, and imposing other conditions upon such movement, as he deems necessary to prevent the dissemination into the United States, or interstate, of plant pests, ..."]; 7 C.F.R. § 330.100 et seq. (1995).) The USDA currently enforces federal quarantines against virtually every country in the world, and these quarantines cover literally thousands of agricultural pests found only outside the United States. (See 7 C.F.R. § 319 (1995).) As part of this comprehensive program, all ships traveling from the specified foreign countries are subject to inspection by federal authorities at their first port of call in the United States. (Id., § 330.105(a) (1995).) As payment for its services, the USDA currently levies a "user fee" of $369.50 per inspection on all owners of nonexempt vessels. (7 C.F.R. §§ 330.107, 354.3(b) (1995).)

In 1990 our Legislature enacted the California Airport and Maritime Plant Quarantine, Inspection, and Plant Protection Act (hereafter the Act) as part of a state-sponsored effort to supplement the USDA's agricultural pest control efforts in California. (Stats.1990, ch. 1612, § 1, p. 7753.) The Legislature adopted the Act as an urgency statute effective September 30, 1990, because in its view "It is necessary to enact programs that are alternatives to the repeated application of pesticides in order to eradicate pests, including the Mediterranean fruit fly in Los Angeles County. This act would enact one such alternative and, in order to protect the people and the environment from the repeated application of pesticides and to protect California's agriculture from pests as soon as possible, it is necessary that this act take effect immediately." (Stats.1990, ch. 1612, § 8, p. 7755.)

The Act added sections 5350-5353 to the Food and Agricultural Code, ¹ which direct the California Department of Food and Agriculture (the Department) to "establish a program for the inspection of conveyances entering California through airport and maritime facilities to prevent the introduction into, or the spread within, this state of pests." (§ 5350, subd. (a).) The Act specifically requires that the Department maintain plant quarantine inspection stations at California's airports and marine terminals (id., subd. (b)) and establish a program for disseminating information regarding the state's agricultural pest control and quarantine requirements at such points of entry (id., subd. (c)). However, the Act does not expressly require the Department to establish and operate its own state-run inspection sites at airports and marine terminals, but instead broadly authorizes the Department to "contract with federal and state agencies ... to assist [it] in carrying out the purposes of [the Act]." (§ 5353, subd. (g).)

On June 24, 1991, the Department entered into a reimbursable cooperative agreement (RCA) with the USDA. The RCA provided that the Department would pay the USDA to intensify its existing regulatory efforts by hiring additional federal agents to inspect ships and airplanes carrying agricultural goods into California from outside the United States. As a result of the RCA, the USDA was able to hire seven additional marine inspectors and forty-four additional airport inspectors. The RCA expressly provided however, that it was to have no effect on the nature of the federal inspections; rather, it was intended only to make it possible for the USDA to increase its staff and perform more inspections. This arrangement with the USDA is the sole means by which the Department has implemented its duty to provide airport and marine inspections under section 5350, subdivision (a); the Department has never established a state-run commercial inspection program at airports or marine terminals. The original RCA expired on September 30, 1991, but was renewed through September 30, 1992, with minor revisions. There is no indication in the record whether the RCA was renewed thereafter.

For many years the Department has also inspected agricultural goods entering California by truck from other states. (See §§ 5341 & 5341.5.) ² Rather than contracting with a federal agency for this service, however, the Department itself maintains 16 state-run inspection sites on California's borders, staffed by some 126 state inspectors. Unless there are extraordinary circumstances, these inspectors enforce only California's agricultural quarantines; they do not regularly enforce federal quarantines or inspect commerce originating in foreign countries because the Department assumes that federal authorities inspected these goods when they first entered the United States and there is no reason to perform a second inspection.

The focus of this case is not on the legitimacy of California's overall agricultural inspection program or the propriety of the particular means that the Department has chosen to implement its regulatory obligations. Rather, we are here concerned with only one narrow issue: whether the mechanism that the Legislature has created to fund the Department's implementation of its statutory obligation under section 5350, subdivision (b), to provide for the inspection of ships carrying agricultural goods into California from foreign countries passes muster under the federal Constitution. We turn to that funding mechanism.

Section 5352 of the Act requires the Department to derive the funding needed to satisfy its obligations by "levy[ing] a fee on commercial marine carriers, based on the schedule established pursuant to Section 5353, for the use of marine terminal facilities for plant and animal pest inspection, quarantine, and eradication." ³ Section 5352 also requires the Department to "identify and establish a list of countries which [it] has reason to believe are potential sources of exotic plant and animal pests." Section 5353, subdivision (b), then provides that "Each commercial marine carrier engaged in foreign commerce which carries animals or plants or other materials which are, or are likely to be, infected or infested with any pest shall pay a fee of two hundred dollars ($200) to the [Department] upon the initial arrival in this state of the carrier on a voyage which originated outside the United States from a country identified and listed by the [Department] ..., or which made an intermediate stop on that voyage in a country identified and listed by the [Department]...." ⁴

The Act further authorizes the Department "by regulation, [to] increase or decrease any of the charges or fees prescribed in [section 5353, subdivision (b) ] upon determining that the revenue received is inadequate or in excess of the amount needed to conduct an effective inspection program. The maximum adjusted charge or fee shall not exceed [$600]." (§ 5353, subd. (f).) The Department initially adopted a regulation setting the marine inspection fee at $200 effective April 1, 1991; it later amended the regulation by reducing the fee to $100 effective January 1, 1995. (Cal.Code Regs., tit. 3, § 3560, subd. (b).)

The Department gave the following explanation for the 1995 fee reduction in the informative digest section of the public notice of amendment: "Since this inspection program was established in 1991, the Department has contracted with the United States Department of Agriculture (USDA) to perform the authorized inspections. The Secretary [of the Department] has determined that an effective inspection program can now be conducted with revenues from the lower service charge and user fee rates because the USDA is starting to provide inspections of international carriers at an adequate level. The USDA is now committed to supporting federal inspectors who...