Preemption Watch

May 24, 2005

IN THIS ISSUE:

Hawaii’s gas station rent control law upheld

New York’s Union Neutrality Law

Local oversight of solid waste facilities

Local government agriculture laws (North Carolina and others)

Local minimum wage ordinances (Wisconsin)

Local option sales taxes (Minnesota)

FEDERAL

Regulation of Private Property

In a unanimous decision, the U.S. Supreme Court said it was correcting a mistake made in 1980 (Agins v. Tiburon) when it ruled that government regulation of private property “effects a taking if such regulation does not substantially advance legitimate state interests.” The justices said they have never struck down a state law because it did not advance a legitimate state interest. Writing for the Court, Justice O’Connor said the “substantially advance” test “would empower – and might often require – courts to substitute their predictive judgments for those of elected legislatures and expert agencies”.

The issue in Lingle v. Chevron U.S.A. was Hawaii’s regulation that limits the number of gas stations oil companies can own and the rent they can charge. Chevron argued that the state law amounted to a taking because it did not substantially advance the state’s interest in keeping down the state’s gas prices, which are the highest in the nation. The Court rejected this argument, but sent the case back to the lower courts to determine whether the law meets more stringent takings standards.

More information:

Duke University Law School – Supreme Court Online – Lingle v. Chevron U.S.A.

Unions

A federal judge invalidated a New York state law that requires employer neutrality in the face of union organizing. U.S. District Court Judge Neal P. McCurn said the state law is superceded by the National Labor Relations Act.

The "Union Neutrality Law," Judge McCurn wrote, creates an uneven playing field "by, in essence, allowing unions to actively participate in union organizing campaigns, while at the same time significantly curtailing the ability of employers to voice their opposition to unions."

Last year a federal court overturned a similar California state law.

More information:

Health Care Association of New York State et al v. Pataki (PDF)

Interstate Commerce in Trash

The New Jersey Meadowlands Commission, along with Senators John Corzine and Frank Lautenberg, has appealed to the federal Surface Transportation Board to put an end to open garbage pits along rail lines.

A loophole in the 1995 Interstate Commerce Commission Termination Act allows solid waste transfer businesses to be regulated as rail facilities, not solid waste facilities, thus evading state and local oversight. The Meadowlands Commission is seeking to subject solid waste transfer stations to local and state solid waste, health, and worker protection laws.

More information:

New Jersey Meadowlands Commission

STATE

Agriculture and Forestry

The North Carolina legislature introduced four bills aimed at preempting local authority in the areas of agriculture and forestry. Senate Bill 681 would prohibit municipalities from adopting or continuing any regulation of forestry or agricultural activities on land zoned as forestland or farmland. This includes requiring notices or permits, or imposing any kind of fee. House Bill 671 and Senate Bill 631 would prohibit local rules that apply to “any plant or pest”. Senate Bill 843 would prohibit local governments from regulating fertilizer.

More information:

North Carolina League of Municipalities

In 2005, 11 state legislatures have passed bills in at least one house that prohibit local government regulation of plants and/or seeds, and at least three more are considering such bills. Companies promoting agricultural biotechnology are sponsoring the bills in order to preempt local ordinances that prevent cultivation of genetically modified crops. In 2004, Mendocino County, California passed the first such law of its kind, and several other California counties have followed their lead.

More information:

Environmental Commons

Minimum Wage

The Wisconsin minimum wage drama continues. As reported in last month’s Preemption Watch, Madison, Milwaukee and La Crosse tired of waiting for the governor and state legislature to agree on a minimum wage increase and enacted their own ordinances. Now, Governor Jim Doyle (a Democrat) says if Republicans allow his administrative rule to increase the statewide minimum wage to take effect, he will sign their bill to ban local minimum wage ordinances. Under this agreement, the statewide minimum wage would be $6.50. Madison’s minimum wage ordinance raises the minimum wage to $7.75 by 2007, and provides for inflation adjustments in subsequent years.

More information:

Wisconsin Women’s Council

Local Option Sales Tax

Key committees in the Minnesota legislature have approved bills that would allow Hennepin County to impose a .15 cent sales tax to finance a new, major league baseball stadium without subjecting the tax to a countywide referendum. State law requires a referendum, but the Hennepin County board would be authorized to choose whether or not to have a referendum on the proposed stadium tax.

Minnesota has prohibited local governments from enacting new or increased local sales taxes without state approval since 1971 (Minn. Statute 477A.016). Tax collections were centralized at the state level, and the state took primary responsibility for school and local government costs (Local Government Aid). The reforms, called the “Minnesota Miracle”, sought to minimize disparities among communities and ensure that everyone would receive adequate public services at similar property tax rates.

Only 12 of Minnesota’s 853 cities and one county (Cook) have local general sales taxes, almost all of which were approved in referendums. Three notable exceptions – in Duluth, Minneapolis, and St. Paul – were introduced before the enactment of a 1997 law that requires voter approval (MN Statute 297A.99). Another dozen or so cities have local taxes on entertainment, lodging, and vehicle sales. Most of these were introduced before 1997, and some were introduced before 1971.

The legislature has been reluctant to approve other requests for local option sales taxes. This year, the Republican-controlled House tax committee took up only one of 20 cities’ requests for new or extended local option sales taxes (Rochester). They did not consider a request from St. Cloud, where city residents have twice voted to pay a higher sales tax for a new or expanded city library, airport upgrades and transportation projects. After the first referendum, state legislators approved a St. Cloud sales tax, but only for one year and only to pay for the airport. St. Cloud voters approved a second referendum to extend the tax and use it for the library and transportation.

Lawmakers representing these cities have said they will vote for the Hennepin County stadium proposal only if their local sales taxes are also approved.