“Flow Control” Revisited–The Local Government Can Control Its Citizens' Trash

by Michael D. Diederich, Jr.*

This article is intended to place into context the recent Second Circuit decision, United Haulers Ass'n. v. Oneida-Herkimer Solid Waste Management Authority, 261 F.3d 245 (2d Cir. 2001), cert denied, [122 S.Ct. 815 (Jan. 7, 2002)], where the court held that regulatory "flow control" can permissibly be used by local government to direct solid waste to publicly owned facilities without running afoul of the Commerce Clause to the United States Constitution. This is a precedent of national importance, because it provides a sound legal rationale for municipal control of local citizens' trash--a traditional power which many observers had regarded as lost when, in C&A Carbone, Inc. v. Town of Clarkstown, 511 U.S. 383 (1994), the Supreme Court invalidated flow control to a municipally-preferred local entrepreneur.

1. Background

A battle has been waged in the courts and in Washington as to whether the waste industry or local government should have the right to control municipal solid waste--commonly referred to as garbage or trash. To the waste industry, garbage is seen as a profitable "article of commerce." To municipalities, garbage is a public health problem and noisome pollutant which requires costly and often complex solutions.

One method used by municipalities to manage their garbage has been waste "flow control," whereby solid waste is directed by ordinance to designated facilities, commonly to waste-toenergy incinerators. Broadly speaking, there are several types of flow control:

• municipal collection–a city's garbage trucks collect trash and dispose of it at, for example, its municipal landfill;

• economic–"free" or subsidized disposal services offered by local government (e.g., free household hazardous waste collection/disposal) causes waste to "flow" by force of economics;

• franchise/contractual–waste flows per the conditions of governmental franchise or contract;

• regulatory–where local law directs waste to designated facilities. This species of flow control has been the most common subject of legal challenge.

2. C&A Carbone v. Town of Clarkstown

In Carbone, supra, the United States Supreme Court invalidated a town flow control ordinance, holding that the regulation impermissibly discriminated in favor of the town's preferred local vendor in waste management services. After the town dump closed, the Town of Clarkstown, New York, enacted its ordinance directing all "acceptable waste" (essentially ordinary trash) found within its borders to a town-sponsored waste transfer station owned by a private company.

The Carbone case involved a Town of Clarkstown ordinance which basically required that all ordinary garbage found within the town, even imported garbage, be delivered to a privately run transfer station for ultimate disposal elsewhere. The town guaranteed this transfer station a minimum volume of waste, and thus an assured profit amortizing the cost of the facility which the town could eventually purchase for $1. The town's promise of waste delivery was backed by its flow control ordinance which, in this case, required that the non-recycled waste from plaintiff C&A Carbone's recycling facility be brought to the town-designated facility. Thus, plaintiff C&A Carbone's (non-recycled) garbage, both locally generated and imported, was effectively co-opted by the town by requiring delivery to its preferred vendor. The ordinance forced C&A Carbone to lose control over its stock-in-trade, the local and interstate garbage it was processing, by requiring it to deposit its garbage with the town's higher priced vendor.

In effect, Clarkstown created one point of exit for all garbage generated or coming into the town, with a private toll gate attached. Only the town's preferred vendor could "package" the garbage for export, and to exact any toll it wished. Under its arrangement with its preferred local vendor, Clarkstown was assured the presence of a transfer station to service the town (certainly a legitimate waste management purpose), and would eventually receive title to the facility, all without the political burden of directly levying taxes to pay for this assurance.

The justices in Carbone debated over whether the monopoly which the Town created in favor of the local vendor should be viewed in Commerce Clause terms, and whether the preferred vendor should be viewed as acting as a "quasi-public" agent for the Town. Ultimately, the Court determined that the Town's ordinance impermissibly discriminated against interstate commerce in favor of the local entrepreneur.

a. Carbone's "Local Grab" Benefiting Private Sector Ratio Decidendi

The Supreme Court, in a 6-3 decision, found the town's ordinance unconstitutional as protectionist discrimination. The Court viewed the town's flow control ordinance as imposing a "local grab" (local processing) requirement, a type of favoritism historically found to violate the Constitution's Commerce Clause. See generally, Tribe, AMERICAN CONSTITUTIONAL LAW (2d Ed. 1988 (discussing "local grab" cases) § 6-9.

The legal argument centered around the Constitution's Commerce Clause. Basically, the Commerce Clause has been interpreted to prohibit State or local governmental impediments to trade between States. The issue framed by the parties in Carbone was whether the Clarkstown ordinance, directing all acceptable waste to the preferred private transfer station, imposed an unconstitutional restriction on interstate commerce. The Supreme Court's invalidation of the Town's flow control ordinance made sense. if every community attempted to grab and tax trash already being managed by the interstate solid waste industry, the interstate solid waste marketplace would be impaired and commercial transactions (not to mention public outsourcing) severely disrupted. Cf.,Oregon Waste Systems, Inc. v. Department of Environmental Quality of Oregon, 511 U.S. 93 (1994) (Oregon's surcharge on waste entering the state violated Commerce Clause).

Simply put, local government cannot permissibly "grab" for a local business's profit commerce which is properly moving in interstate channels. The Court has a tradition of invalidating such parochialism. See, e.g., Dean Milk Co. v. City of Madison, Wisconsin, 340 U.S. 349 (1951).

b. The Disposal Service, not the Trash, is the "Article of Commerce"

In addition to its local grab constitutional analysis, the other aspect of Carbone of particular significance to the United Haulers decision is its re-characterization of the "article of commerce" as the waste processing service, not the trash itself.

Because both endemic and out-of-state garbage was affected by the Clarkstown ordinance, neither the parties nor the Court in Carbone focused on whether locally-generated municipal waste, as such, is an "article of commerce" subject to constitutional protection. Nevertheless, Justice Kennedy, in his majority opinion, specifically characterized the "article of commerce" involved in Carbone as "not so much the waste itself, but rather the service of processing and disposing of it." 511 U.S. at 393; see also, Diederich, Does Garbage Have Standing?: Democracy, Flow Control and a Principled Constitutional Approach to Municipal Solid Waste Management, 11 Pace Envt'l L. Rev. 157, 198-201, 208-215 (Fall 1993) (hereinafter "Does Garbage Have Standing").

This is an important distinction, for many reasons. If solid waste is itself a commodity, then what is the propriety of governmental policies seeking its elimination, reduction, recycling, and proper disposal? If solid waste is a commodity, are other wastes, such as air and water emissions, also commodities? If wastes are commodities, should we adjust international law? For example, if Canada self-manages all its solid waste locally, is this an act of trade aggression by depriving American or Mexican landfills of those countries trash? Do we favor international "pollution havens" because they most cheaply accommodate the byproducts of human activities? To classify locally-managed garbage as, in itself, an article of commerce has no principled basis in law or logic, and is unlike the situation where waste has already been placed into and is moving within the channels of commerce. Cf., Philadelphia v. New Jersey, 437 U.S. 617 (1978). Common sense dictates that individuals, alone or collectively, should be allowed to reduce and eliminate waste–that waste is not some sacrosanct object. After all, what right does an interstate waste disposal firm have to lay claim to a community's trash, whether sitting in the home, curbside, or in a garbage truck destined to a public waste facility?

There is a widespread perception that waste itself is protected commerce–a perception nurtured by those in the solid waste industry who stand to profit in trash management However, this theory was argued to the Supreme Court in Carbone, citing several lower court rulings holding that trash is an "article of commerce." See, Waste System Corp. v. County of Martin, Minn., 985 F.2d 1381 (8th Cir. 1993); DeVito v. Rhode Island Solid Waste Management Corp., 770 F.Supp. 775, aff'd 947 F.2d 1004 (1st Cir.1991); Waste Recycling Inc. v. Southeast Alabama Solid Waste Disposal Authority, 814 F Supp.1566 (MD.Ala. 1993), aff'd sub nom. Waste Recycling v. SEAL Solid, 29 F.3d 641 (11 th Cir. 1994). The Supreme Court did not adopt this rationale.

The fact that the Supreme Court did not rely on the "waste is commerce" argument, but instead, as discussed above, relied upon traditional "local grab" Commerce Clause jurisprudence, is of immense significance. If the Supreme Court had not employed its traditional, and narrow, local grab analysis in Carbone, but instead used a "waste is commerce" rationale, this may have defeated State and local governments in subsequent Commerce Clause challenges. Instead, as the cases unfolded in the appellate courts, public systems which did not discriminate in favor of locally-preferred business have survived judicial scrutiny.

3. Post-Carbone cases

Nevertheless, in the immediate wake of Carbone, there was wide concern amongst municipal officials that regulatory flow control was unconstitutional. The federal Environmental Protection Agency was asked to prepare, and did prepare, an extensive report on the subject. See, United States Environmental Protection Agency, Report to Congress: Flow Controls and Municipal Solid Waste (Mar.1995) Several "fixes" were proposed in Congress, since Congress is the final arbiter under the Commerce Clause as set forth in Article l, § 8.

Nevertheless, the dire predictions were overblown. Appellate courts found ways to allow the public to manage its trash, such as where "open and competitive" procurement was employed (so as not to discriminate against out-of-state firms). See, e.g., Houlton Citizens' Coalition v. Town of Houlton,175 F.3d 178 (1st Cir.1999); Harvey & Harvey v. County of Chester, 68 F.3d 788 (3d Cir. 1995). Similarly, municipalities could use the so-called "market participant exception" to the Commerce Clause to contract for services. See, SSC Corp. v. Town of Smithtown, 66 F.3d 502 (2d Cir. 1995); USA Recycling v. Town of Babylon, 66 F.3d 1272 (2d Cir.1995).

On the other hand, where New Jersey drew preferential waste management lines at its state border, the Third Circuit regarded this as discrimination and violation of the Commerce Clause. See, Atlantic Coast Demolition and Recycling Inc. v. Board of Chosen Freeholders of Atlantic County, 48 F.3d 701 (3d Cir.1995).

4. Permissibility of Public Self-Management of Local Trash

Notwithstanding that some means were available for local government to take a modicum of control over local trash, none of the above cases addressed whether a local community has the fundamental democratic right to publicly self manage its own trash. Legislative solutions were sought. In the New York State legislature there was a proposal, drafted by the author, to allow municipalities to "take title" to their own trash, to allow proper trash self-management. Basically, the concept was that the people own their own trash, and can collectively allow their own government to manage it (notwithstanding the desires of outside waste vendors).

In Washington, D.C., far less attractive solutions were proposed. In reality, the "solutions" being proposed in Congress would be a "cure" which would cause the patient's demise, by permitting some existing flow control, but eventually eliminate this local community right forever. Moreover, at the same time "waste transport" legislation was proposed which would impede the flow of waste legitimately placed into commerce by municipalities needing such solution. Both these proposed Congressional "solutions" were contrary to the spirit and intent of the Commerce Clause, both would promote waste management "balkanization," and both remain undesirable legislative possibilities.

Thus, through the post-Carbone years, there remained no answer to the fundamental question of whether the public could democratically self manage its own garbage. This question was finally answered, thoughtfully and positively, in the Second Circuit's United Haulers decision.

5. Importance of United Haulers case

In United Haulers, the Second Circuit accepted the arguments of the amicus N.Y S. Association of Solid Waste Management in holding that flow control to a public entity is not impermissible discrimination under the Commerce Clause. The Court saw the debate between the justices in Carbone about whether or not the preferred local vendor was "quasi-public" or "private" as an indication that this was a distinction of constitutional dimension. The Second Circuit did not stop there, but rather went on to explain how the Supreme Court's local grab analysis caused the inescapable conclusion that  government preferring its own public facilities does not constitute discrimination against interstate commerce, because it is not discrimination in favor of local business.

If the public were not permitted to self manage the traditionally local function of waste management (a form of sanitation), one might ask whether other traditional local activities of government–police or fire protection–might be subject to Commerce Clause challenge by a potential private service provider.

While the Second Circuit felt constrained, as a matter of legal formality based upon the procedural posture of the case, to remand United Haulers to the district court, it appears that victory for the public's waste management system is virtually assured. The district court must undertake a "Pike balancing test," to determine whether the comprehensive waste management system of Oneida and Herkimer counties creates an undue burden on interstate commerce. However, "Pike balancing" generally means municipal win, and here the Second Circuit made expressly clear its view that the traditional power of local government to manage its own citizen's waste must be considered.

The principle challenge now is to overcome eight years of indoctrination that "flow control is unconstitutional." Public waste officials should be educated with United Haulers, and informed that public self-management of trash is not perilous. Rather, especially when combined with fair, open, competitive and geographically nondiscriminatory out-sourcing of service providers, municipal flow control can be a viable means of managing the public's waste.

6. Concluding Thoughts

Local democratic rule over waste should not be a revolutionary idea. Local government can manage crime, fire and education without Commerce Clause scrutiny. Garbage, a form of pollution, should be viewed no differently. It is a traditional local activity for purposes of the Tenth Amendment and of federalism. Moreover, Congress has stated its policy regarding garbage management, in Subtitle D of the federal Resource Conservation and Recovery Act ("RCRA"), where it expressly states that "the collection and disposal of solid wastes should continue to be primarily the function of state, regional and local agencies." See, RCRA § 1002(a)(4); 42 U.S.C. § 6901(a)(4).

United Haulers is a crucial precedent of national, and perhaps international, importance. Depriving local government of the ability to control its own citizens' wastes could have had farreaching consequences. If garbage were held to be a protected "article of commerce" even before its movement into the interstate waste stream, then local government would have lost a means to control sanitation. Localities would be forced to rely on free market economics, which can result in garbage flowing to "pollution havens"–the cheapest available waste repositories (where long term costs and environmental consequences are not considered). The profitable segments of the waste disposal and recycling business would flow to the waste industry, while the less profitable segments (the wastes posing the greatest public health dangers) would be left for municipalities to manage at taxpayer expense.

By permitting local government to self-manage its own citizens' trash, by allowing solid waste to be directed to public facilities, the Second Circuit in United Haulers has created a sound precedent for municipal solid waste management, fully consistent with the dictates of federal environmental law and the Constitution.

*Mr. Diederich's law practice includes environmental law. He wrote Rockland County's amicus curiae brief for the County of Rockland in the Carbone case. He submitted, for the N.Y.S. Association for Solid Waste Management (NYSAWSM), an amicus curiae brief in the Smithtown case. He submitted amicus curiae briefs and presented oral argument in theUnited Haulers case, which persuaded the Court.

Repr. from 16(5) Municipal Lawyer (Sept./Oct.2002), published bi-monthly by the Edwin G. Michaelian Municipal Law Resource Center, Inc. of Pace University and the Municipal Law Section of the New York State Bar Association.


Pace University

One Martine Avenue

White Plains, New York 10606



Concerned Citizens of Cattaraugus County home page

Municipal liability for privately-caused pollution