1998 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

9-9-1998

Maldonado v. Houstoun

Precedential or Non-Precedential:

Docket 97-1893

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Recommended Citation

"Maldonado v. Houstoun" (1998). 1998 Decisions. Paper 219.

http://digitalcommons.law.villanova.edu/thirdcircuit_1998/219
Filed September 9, 1998 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

No. 97-1893 

EDWIN MALDONADO; MARIA DELORES MALDONADO, 

individually and as next friends of Ana Maldonado, Pablo 

Maldonado, Edwin Maldonado, Rey Maldonado, Yesenia 

Maldonado, and Jose Maldonado, and on behalf of all

others similarly situated; MARIA ORTIZ; MICHAEL ORTIZ, 

individually and as next friends of Julie Ortiz, Michael 

Ortiz, and Angelica Ortiz, and on behalf of all other 

similarly situated; KENSINGTON WELFARE RIGHTS 

UNION; PHILADELPHIA WELFARE RIGHTS 

ORGANIZATION, on behalf of themselves and their 

members; TRAVELER'S AID SOCIETY OF PHILADELPHIA, 

individually and on behalf of its clients 

v. 

FEATHER O. HOUSTOUN, Secretary of the 

PENNSYLVANIA DEPARTMENT OF PUBLIC WELFARE; 

DON JOSE STOVALL, Executive Director of the 

PHILADELPHIA BOARD OF ASSISTANCE, both in their 

official capacities, 

 Appellants 

Appeal from the United States District Court 

For the Eastern District of Pennsylvania 

D.C. No.: 97-cv-04155 

Argued: July 21, 1998 

Before: STAPLETON, ROSENN, Circuit Judges, 

and 

RESTANI, Judge, United States Court of 

International Trade* 

_________________________________________________________________ 

*The Honorable Jane A. Restani, Judge, United States Court of 

International Trade, sitting by designation. 
(Filed September 9, 1998) 

 John G. Knorr, III (Argued) 

 Office of Attorney General of 

 Pennsylvania 

 Department of Justice 

 Strawberry Square 

 15th Floor 

 Harrisburg, PA 17120 

 Counsel for Appellant 

 Susan Frietsche (Argued) 

 Women's Law Project 

 125 South 9th Street 

 Suite 401 

 Philadelphia, PA 19107 

 Counsel for Appellee 

OPINION OF THE COURT 

ROSENN, Circuit Judge. 

This appeal presents a significant constitutional question 

implicating an aspect of Pennsylvania's recent amendment 

to its public assistance benefits legislation. Pennsylvania 

made the change during a recent wave of federal and state 

welfare reform legislation which swept the nation calling for 

a reduction in overall welfare expenditures. Specifically, we 

must decide the constitutionality of S 9(5)(ii) of 

Pennsylvania's Act 35 of 1996. See Pa. Stat. Ann., tit. 62, 

S 432(5)(ii). It mandates that an eligible family arriving in 

Pennsylvania from another state shall, during itsfirst 

twelve months of bona fide residence, receive as cash 

benefits the lesser of: (1) the benefit level available to 

similarly situated Pennsylvania residents of twelve months 

or more, or (2) the benefit level the family would have been 

eligible to receive in their prior state had they not moved to 

Pennsylvania. 

In 1997, several months after the passage of this 

legislation, Maria and Edwin Maldonado and their six 

minor children migrated to Pennsylvania from Puerto Rico. 

They became eligible for public assistance benefits but were 

 2 
informed that the cash benefits allowance available to them 

would be substantially lower than the benefits provided to 

similarly situated long-term Pennsylvania residents.1 

Shortly thereafter, the Maldonados and several 

organizations that represent their interests (collectively, the 

"Maldonados"), instituted a class action against Feather O. 

Houstoun, Pennsylvania's Secretary of Public Welfare, and 

Don Jose Stovall, Executive Director of the Philadelphia 

Board of Assistance, both in their official capacities 

(collectively, the "Commonwealth"), in the United States 

District Court for the Eastern District of Pennsylvania. The 

Maldonados sued pursuant to 42 U.S.C. S 1983, seeking 

declaratory and injunctive relief, claiming that 

Pennsylvania's two-tier welfare scheme violates their 

constitutional rights to travel, to equal protection, and to 

non-discriminatory treatment under the Privileges and 

Immunities Clause. The district court held that the scheme 

did not appear to be supported by a rational basis, and 

thus likely violated the Fourteenth Amendment's Equal 

Protection Clause. Therefore, the court preliminarily 

enjoined enforcement of the two-tier scheme and certified 

the class, with the Maldonados as class representatives. 

The Commonwealth timely appealed the injunction. We

affirm, although our analysis differs. 

I. 

The relevant facts of this case are for the most part 

undisputed. In May 1996, after several attempts to pass 

similar measures failed throughout the early 1990s,

Pennsylvania, as part of the state's broad-scale welfare 

reform, enacted Section 9(5)(ii), governing public assistance 

benefits to eligible families that have resided in 

Pennsylvania for less than one year. Section 9(5)(ii) provides 

that during the first twelve months of residence in

Pennsylvania, an eligible family's cash assistance benefits 

are limited to the lesser of (1) the benefit level that family 

_________________________________________________________________ 

1. Pennsylvanians with a twelve month residence were eligible for cash 

benefits of $836 but the Maldonado family, because of their less than a 

twelve month residence, was eligible for cash benfits of only $304 per 

month, the amount they would have been allowed in Puerto Rico. 

 3 
would have received in its prior state of residence, or (2) the 

benefit level available to otherwise similarly situated longterm Pennsylvania residents.2 Because Pennsylvania grants 

larger cash benefits than 40 other states, under this twotier scheme, a typical eligible family moving to Pennsylvania 

would lose anywhere from over 60%, to as little as 2%, of 

their cash benefits for the first twelve months that they 

reside in the state. 

Pennsylvania's legislation received considerable 

reassurance when several months later, in August 1996, 

Congress passed landmark welfare reform legislation known 

as the Personal Responsibility and Work Opportunity

Reconciliation Act of 1996 ("PRWORA"), 42 U.S.C. SS 601, et 

seq. The PRWORA dramatically changed the climate for 

welfare programs in this country and encouraged states to 

adopt restrictive cash benefit programs of the type

contained in Pennsylvania's Act 35 for those relocating from 

another state. Among other things, the PRWORA changed 

the basic funding format for state Temporary Assistance to 

Needy Families ("TANF ")3 plans to awards of block grants, 

expressly terminating the prior program's entitlement 

nature. Especially relevant to this appeal is Section 604(c) 

of the PRWORA, which explicitly authorized two-tier cash 

benefits provisions like that enacted by Pennsylvania. 

Section 604(c) authorized states to treat new residents 

differently than longer-term residents. 

Prior to May 1997, Plaintiff Edwin Maldonado worked as 

a mechanic in Puerto Rico and supported his family with 

his salary plus government-provided nutritional and

medical assistance. In May 1997, Maldonado's job ended. 

_________________________________________________________________ 

2. Section 9(5)(ii), in its entirety, reads as follows: 

 Cash assistance for applicants and recipients of aid to families 

with 

 dependent children who have resided in this Commonwealth for less 

 than twelve months shall not exceed the lesser of the maximum 

 assistance payment that would have been received from the 

 applicant's or recipient's state of prior residence or the maximum 

 assistance payment available to the applicant or recipient in this 

 Commonwealth. 

3. TANF replaced the former federal welfare program popularly known as 

Aid to Families with Dependent Children ("AFDC"). 

 4 
He and his wife both had health problems, and therefore in 

May 1997, they and their six children moved from Puerto 

Rico to Philadelphia, Pennsylvania, where Mr. Maldonado 

was born and spent part of his childhood, to seek better 

health care. 

Shortly after establishing residence in Pennsylvania, the 

Maldonados applied for TANF benefits. The Pennsylvania 

Department of Public Welfare ("DPW") approved their

application and also certified that both Mr. and Mrs. 

Maldonado temporarily were unable to work. Under 

Pennsylvania's revised welfare scheme, the Maldonados 

qualified for monthly cash benefits of $304, the amount 

they would have received in their prior place of residence, 

Puerto Rico, $720 in food stamps and medical benefits paid 

by the state of $1,483.60, plus a one-time grant of $213 to 

defray job-search expenses.4 Had the Maldonados been 

residents of Pennsylvania for at least twelve months, they 

would have been eligible for cash benefits of $836 per 

month instead of the $304 in benefits that they actually 

received, a reduction of almost 64%. 

As a result of the DPW's benefits decision, the 

Maldonados sued the Commonwealth on June 19, 1997, 

seeking a temporary restraining order (TRO) and 

declaratory and injunctive relief. They claimed that 

Pennsylvania's two-tier durational residency structure 

violated their fundamental right to travel, their rights under 

the Equal Protection Clause of the Fourteenth Amendment, 

and their rights under the Privileges and Immunities Clause 

of Article IV and the Fourteenth Amendment. 

After denying the plaintiffs' motion for a TRO, the court 

held a two-day hearing on the application for a preliminary 

injunction. On October 6, 1997, after considering the 

memoranda, transcripts, exhibits, and other evidence 

contained in the sizeable and well-developed record, the 

district court certified the class and preliminarily enjoined 

enforcement of Pennsylvania's two-tier durational residency 

requirement. The court, applying rational basis Equal 

Protection analysis, held the law irrational. It found that 

_________________________________________________________________ 

4. The Maldonados returned the $213 grant as both were certified 

temporarily unable to work. 

 5 
the class members were likely to succeed on the merits of 

their constitutional claim that the class would suffer 

irreparable harm absent the injunction, rejected the 

Commonwealth's fiscal harm arguments, and found that 

the public interest would be best served by granting the 

injunction.5 

The Commonwealth timely appealed. The district court 

placed the action in civil suspense pending resolution of 

this appeal.6 

II. 

On appeal, when considering the district court's grant of 

a preliminary injunction, we review the court's legal 

conclusions de novo, its findings of fact for clear error, and 

its ultimate decision to grant or deny the preliminary 

injunction for an abuse of discretion. See, e.g., Anderson v. 

Davila, 125 F.3d 148, 159 (3d Cir. 1997); New Jersey Hosp. 

Ass'n v. Waldman, 73 F.3d 509, 512 (3d Cir. 1995). 

Because this appeal presents solely legal questions

pertaining to the constitutionality of Section 9(5)(ii) of 

Pennsylvania's welfare act, our review is plenary. 

Ordinarily, limited review is appropriate at the preliminary 

injunction stage of a constitutional challenge to a state 

statute, but since the issue is legal and the facts are well 

established, we "need not abstain from addressing the 

constitutional issue." Thornburgh v. American College of 

Obst. and Gyn., 476 U.S. 747, 756 (1986). 

A. 

The Commonwealth succinctly frames the appellate issue 

in these words: "Whether Pennsylvania violates the 

_________________________________________________________________ 

5. On October 30, 1997, the court granted in part and denied in part the 

Maldonados' motion to amend their complaint to include two additional 

families as plaintiffs and class representatives, allowing one family--the 

Ortizes--to join and denying the other. 

6. The district court had jurisdiction over this civil rights action 

pursuant to 28 U.S.C. SS 1331 and 1343. This Court has jurisdiction 

over the district court's grant of a preliminary injunction pursuant to 28 

U.S.C. S 1292(a)(1). 

 6 
Constitution by providing that, for one year after their 

arrival in Pennsylvania, applicants for certain welfare 

benefits may receive only the amount they would have 

received in their state of prior residence." Thus, we are 

called upon only to determine the constitutionality of the 

state statute; the federal statute, PRWORA, is not before us. 

From a procedural perspective, the district court decided 

the case on the Maldonados' motion for a preliminary 

injunction. A district court should grant a preliminary 

injunction only if (1) the plaintiff is likely to succeed on the 

merits; (2) denial will result in irreparable harm to the 

plaintiff; (3) granting the injunction will not result in 

irreparable harm to the defendant; and (4) granting the 

injunction is in the public interest. See Merchant & Evans, 

Inc. v. Roosevelt Bldg. Prods. Co., Inc., 963 F.2d 628, 632- 

33 (3d Cir. 1992). After weighing these factors, and 

although the district court found that all four weighed in 

the Maldonados' favor, it relied almost exclusively on the 

first, the likelihood of success on the merits. Thus, if the 

court incorrectly determined that the Maldonados were 

likely to succeed on the legal merits of their claim, it erred 

in granting the injunction. Because the Commonwealth 

limits its appeal to the merits issue, we need only address 

the propriety of the district court's legal conclusions. 

B. 

Under the Equal Protection clause, no state shall "deny 

to any person within its jurisdiction the equal protection of 

the laws." U.S. Const. amend. XIV, S1. Pennsylvania's twotier act warrants equal protection analysis because it 

classifies bona fide residents of the state into two groups 

when determining welfare benefits. In determining the 

extent of cash welfare benefits, Pennsylvania created two 

classes of indigent residents indistinguishable from each 

other except that one is composed of residents who have 

resided in the state a year or more, and the other of 

residents who have resided in the state less than a year. 

Even though a state has created a classification, not all 

classifications are per se unconstitutional or automatically 

subject to heightened judicial scrutiny. If Pennsylvania's 

durational residency classification " `neither burdens a 

 7 
fundamental right nor targets a suspect class, we will 

uphold [it] so long as it bears a rational relation to some 

legitimate end.' " See Vacco v. Quill, 117 S. Ct. 2293, 2297 

(1997) (quoting Romer v. Evans, 517 U.S. 620, 631 (1996)); 

see also San Antonio Indep. School Dist. v. Rodriguez, 411 

U.S. 1, 17 (1973). However, if the two-tier scheme is drawn 

on suspect lines or does sufficiently burden a fundamental 

right, it is subject to strict scrutiny and will pass 

constitutional muster only if it is narrowly tailored to serve 

a compelling state interest. See, e.g., Dunn v. Blumstein, 

405 U.S. 330, 335 (1972); Shapiro v. Thompson, 394 U.S. 

618, 634 (1969). 

The Commonwealth argues that the district court 

correctly held that Pennsylvania's two-tier durational 

residence requirement does not penalize the plaintiffs' 

fundamental right to travel or their right to equal

protection, and thus is not subject to strict scrutiny. 

Instead, it argues that the court erred in holding that the 

scheme was unconstitutional under rational basis review 

when it found that it was not related to a legitimate 

governmental interest. The Commonwealth contends that 

the statute is rationally related to furthering the

Commonwealth's legitimate interest in fostering the selfsufficiency and work ethic of its citizens, including its 

newest citizens. By leaving recent interstate migrants with 

the same benefit level as they were in their former place of 

residence, the statute encourages them to seek work, rather 

than increased benefits. The Maldonados, not surprisingly, 

argue that although the court was correct in holding that 

the statute did not pass rational basis review, that the twotier scheme penalizes the plaintiffs' fundamental right to 

travel, and thus should be subject to strict scrutiny. 

Neither party claims that the scheme classifies on suspect 

lines. 

C. 

The constitutional right to travel is not contained in the 

text of the Constitution, and a majority of the Supreme 

Court of the United States has never agreed upon its 

textual source. Analytically, the Court has recognized that 

the historical foundation upon which this Republic was 

 8 
structured was that we are all citizens of the United States, 

one people, and, as such, we "must have the right to pass 

and repass through every part of [the country] without 

interruption, as freely as in our own States." See The 

Passenger Cases, 48 U.S. (7 How.) 283 (1849). This right to 

pass freely from one state to another was one of the 

attractive features that persuaded the colonists to unite 

into a nation. The Supreme Court repeatedly and 

consistently has recognized a fundamental right to 

interstate travel, see e.g., United States v. Guest, 383 U.S. 

745 (1966); Crandall v. Nevada, 73 U.S. (6 Wall.) 35 (1867); 

The Passenger Cases, 48 U.S. 283, and that inextricably 

implicated therein is the right to migrate to and settle in 

another state. See, e.g., Jones v. Helms, 452 U.S. 412, 417- 

19 (1981); Memorial Hosp. v. Maricopa County, 415 U.S. 

250 (1974); Dunn v. Blumstein, 405 U.S. 330, 338; Shapiro, 

394 U.S. 618. 

Regrettably, however, the law with respect to the 

constitutional implications of the right to travel is unsettled 

and in need of clarification. The Court has at times 

subjected durational residence laws that impinge on the 

right to travel to strict scrutiny, see Maricopa County, 415 

U.S. 250; Dunn v. Blumstein, 405 U.S. 330; Shapiro, 394 

U.S. 618, and at other times to what appears to be some 

form of a heightened rational basis test.7 Furthermore, 

although never formally recognized by the Court, we have 

previously noted that Shapiro and its progeny arguably 

were analyzed, at least in part, as if the classifications at 

issue were somewhat suspect, in that they "penalized a 

_________________________________________________________________ 

7. See Attorney General of New York v. Soto-Lopez, 476 U.S. 898 (1986); 

Hooper v. Bernalillo County Assessor, 472 U.S. 612 (1985); Zobel v. 

Williams, 457 U.S. 55 (1982); see also Coburn v. Agustin, 627 F. Supp. 

983, 988-94 (D. Kan. 1985) (discussing the Supreme Court's use of 

"heightened rational basis scrutiny"); Alvarez v. Chavez, 886 P.2d 461, 

466-67 (N.M. Ct. App. 1994) (same); Laurence H. Tribe, American 

Constitutional Law, S 16-3 (2d ed. 1988) (discussing the "new, more 

penetrating character" of the rational basis test, which he lables 

"covertly 

heightened scrutiny"); Gayle Lynn Pettinga, Note, Rational Basis with 

Bite: Intermediate Scrutiny by Any Other Name, 62 Ind. L.J. 779, 787-92 

(1987) (discussing "rational basis with bite in the right-to-travel 

context"). 

 9 
group of people on the basis of their having exercised a 

constitutionally protected right to travel." See Lutz v. City of 

York, Pennsylvania, 899 F.2d 255, 265 (3d Cir. 1990); see 

also Thomas R. McCoy, Recent Equal Protection Decisions-- 

Fundamental Right to Travel or "Newcomers" as a Suspect 

Class?, 28 Vand. L. Rev. 987 (1975); Todd Zubler, The Right 

to Migrate and Welfare Reform: Time for Shapiro v. 

Thompson to Take a Hike, 31 Val. U. L. Rev. 893, 904-05 

(1997). 

In the seminal right to travel case of Shapiro, 394 U.S. 

618, the Court subjected to strict scrutiny several state 

laws that created one-year durational residence 

requirements as a prerequisite to eligibility for any welfare 

benefits. In construing a strikingly similar Pennsylvania 

statute, the Court in Shapiro expressly held that "any 

classification which serves to penalize the exercise of th[e] 

right [to travel], unless shown to be necessary to promote a 

compelling governmental interest, is unconstitutional." Id. 

at 634. The Shapiro Court reasoned that the one-year 

residence requirement imposed on recent migrants as a 

condition of welfare eligibility, which resulted in a complete 

denial of benefits for those persons residing in the state for 

less than one year, was unconstitutional, because it 

discriminated based solely on length of residency in the 

state and thus unconstitutionally burdened the plaintiffs' 

fundamental right to interstate travel and migration. 

Five years later, in Maricopa County, the Court, applying 

Shapiro, similarly subjected to strict scrutiny an Arizona 

law that required one-year residency in a county as a 

prerequisite to receiving free nonemergency hospital or 

medical care. 415 U.S. 250. The Maricopa County Court 

acknowledged that "any durational residence requirement 

impinges to some extent on the right to travel" and thus not 

all durational residency requirements are per se 

unconstitutional. Maricopa County, 415 U.S. at 256. The 

Court further stressed, however, that "the right of interstate 

travel must be seen as insuring new residents the same 

right to vital government benefits and privileges in the 

States to which they migrate as are enjoyed by other 

residents." Id. at 261. Thus, because it found that "medical 

care is as much `a basic necessity of life' to an indigent as 

 10 
[the] welfare assistance" at issue in Shapiro, and that the 

classification penalized those persons who had"exercised 

their constitutional right of interstate migration,[the 

statute] must be justified by a compelling state interest." Id. 

at 258-59 (citation omitted). The Court then struck down 

the law, finding that the Arizona statute created"an 

`invidious classification' that impinges on the right of 

interstate travel by denying newcomers `basic necessities of 

life,' " and was not supported by compelling justifications or 

narrowly drawn. 415 U.S. at 269. 

Since Shapiro and Maricopa County, a majority of the 

Court has never subjected a durational residency 

requirement to strict scrutiny. Instead, the Court 

sometimes employs some form of rational basis review, and, 

occasionally, analyzes such laws without even implicating 

the fundamental right to travel. See, e.g., Attorney General 

of New York v. Soto-Lopez, 476 U.S. 898 (1986) (four of the 

justices applied strict scrutiny in an opinion which did not 

command a majority); Hooper v. Bernalillo County Assessor, 

472 U.S. 612 (1985); Zobel v. Williams, 457 U.S. 55 (1982). 

This tendency, however, does not establish that rational 

basis is now the appropriate test when evaluating 

durational residency requirements as applied to welfare 

benefits. The Court in those cases merely employed its 

version of rational basis analysis because the challenged 

laws could not even survive rational basis review. Thus, the 

Court found it unnecessary to subject the laws to 

heightened scrutiny. See, e.g., Soto-Lopez, 476 U.S. at 904 

(explaining that because the "contested classifications [in 

Zobel and Hooper] did not survive even rational basis, [the 

Court] had no occasion to inquire whether enhanced 

scrutiny was appropriate"). The holdings of Shapiro and 

Maricopa County subjecting durational residency 

requirements that impinge on the right to travel to strict 

scrutiny, however, have never been overturned and thus 

are binding precedent to which we adhere in deciding this 

factually and legally similar case. 

In deciding whether a durational residency requirement 

sufficiently impinges upon the right to travel or migrate to 

trigger strict scrutiny, the Court looks to see whether the 

challenged law's "primary objective" is to impede interstate 

 11 
travel; whether it "penalize[s] the exercise of that right;" or 

whether it "actually deters such travel." Soto-Lopez, 476 

U.S. at 903 (plurality opinion) (internal quotations and 

citations omitted); see also Shapiro, 394 U.S. at 628-34. 

Here, relying on the legislature's express intent "to promote 

the self-sufficiency of all the people of the Commonwealth," 

Pa. Stat. Ann., tit. 62, S 401(a), the district court, in a very 

thoroughly drafted opinion, agreed with the Commonwealth 

that the statute's primary objective was not to deter 

interstate travel and migration. The court also found that 

the plaintiffs offered no conclusive evidence that the 

durational residency requirement actually deters the right. 

Even accepting the district court's conclusions of law that 

travel deterrence was not the statute's primary objective 

and the court's finding that the plaintiffs' failure to 

establish that the duration requirement actually deterred, 

we are still left with the formidable task of determining 

whether having exercised the Constitutional right to travel, 

the plaintiffs were penalized because of the duration of 

their residence. 

The district court ultimately employed rational basis 

review because it found that the Maldonados could not 

"demonstrate that Section 9(5)(ii)'s durational residence 

requirement results in a `penalty' on the right to interstate 

migration." The court distinguished this case from Shapiro 

on the ground that scheme at issue in Shapiro resulted in 

a total deprivation of welfare benefits needed to obtain 

"life's basic necessities," whereas here the Pennsylvania 

statute amounted only to a reduction in cash benefits. The 

law did not deny the Maldonados other welfare benefits. 

The court compared the Maldonados' position before and 

after exercising the right, and found it significant that the 

Maldonados continued to be eligible for TANF benefits at 

the same level they would have received in Puerto Rico 

(plus food stamps, medical benefits, and other assistance). 

Accordingly, the court concluded that 

 the lower benefits do not make new residents any 

 worse off because [they] receive exactly what they were 

 receiving or would have received in their state of prior 

 residence. Thus, the `penalty' that plaintiffs allege is 

 imposed on them for exercising their right to migrate 

 12 
 interstate is not a `penalty' in the traditional sense of 

 the word--a lost benefit that the person would have 

 received had he not exercised some constitutional 

 right. Indeed, the plaintiffs here have lost no benefit 

 that they would have received had they not exercised 

 their right to migrate. . . . Thus, . . . [this court] finds 

 that Section 9(5)(ii)'s multi-tier durational residency 

 does not act as a penalty on plaintiffs' right to 

 interstate migration. 

Maldonado v. Houstoun, 177 F.R.D. 311, 331-32 (E.D. Pa. 

1997). 

Although the Supreme Court has never made clear the

"amount of impact required to give rise to the compellingstate-interest test," Maricopa County, 415 U.S. at 256-57, 

we are persuaded that the district court's "penalty" analysis 

in this case misconstrued the import of the relevant case 

law and used an improper comparison. Thus it erroneously 

concluded that Pennsylvania's two-tier welfare scheme does 

not amount to a penalty. First, similar to the Pennsylvania 

scheme under review here, two of the three state laws that 

the Court struck down in Shapiro offered "partial assistance 

. . . to some new residents and full assistance . . . to other 

new residents." See Shapiro, 394 U.S. at 695; see also 

Zobel, 457 U.S. at 60-66 (holding unconstitutional state 

distribution of benefits to citizens on a sliding scale based 

on how long they have lived in the state); Erwin 

Chemerinsky, Constitutional Law: Principles and Policies, 

S10.7, at 703-04 (1997) ("The Supreme Court . . . has ruled 

that laws that do not totally deny benefits, but provide less 

to new arrivals are unconstitutional."). Thus, that

Pennsylvania's scheme does not amount to a complete

denial of cash benefits and that it provides recent

immigrants with some amount of welfare benefits other 

than cash assistance is not dispositive. 

Second, and more importantly, as demonstrated by 

Shapiro, Maricopa County, and every equal protection case, 

the appropriate comparison is between those persons

subject to the classification and those persons who are 

similarly situated but for the classification. Here, whether 

Pennsylvania's two-tier scheme amounts to a penalty must 

be determined by comparing new residents of Pennsylvania 

 13 
and other similarly situated longer-term Pennsylvania 

residents, and not by comparing new residents of 

Pennsylvania and those of their former state. Once the 

Maldonados established bona fide residency in 

Pennsylvania, a comparison of residents of Puerto Rico with 

long-term Pennsylvania residents for equal protection 

purposes is neither sound nor logical; it is not a 

comparison between analogues. Residents of Puerto Rico 

have no claim to Pennsylvania welfare benefits or to equal 

protection under Pennsylvania's welfare laws until they 

move from Puerto Rico and establish a bona fide residence 

in Pennsylvania. Only once those persons reside in 

Pennsylvania is the classification applicable to them. 

Although the level of scrutiny to which durational 

residence requirements are subject may not be applied 

similarly in all contexts, that the appropriate comparison is 

between short- and longer-term Pennsylvania residents is 

well-established by the foregoing body of Supreme Court 

precedent. Moreover, our conclusion that the appropriate 

penalty analysis must compare shorter-term with longerterm Pennsylvania residents has been reached by 

numerous other federal and state courts that have 

considered this precise, or substantially similar, issue.8 

_________________________________________________________________ 

8. See Roe v. Anderson, 966 F. Supp. 977, 984-85 (E.D. Cal. 1997), 

aff 'd, 134 F.3d 1400, 1404-05 (9th Cir. 1998), petition for cert. filed, 

(U.S. July 9,1998) (No. 98-97); Green v. Anderson, 811 F. Supp. 516, 

521 (E.D. Cal. 1993), aff'd, 26 F.3d 95 (9th Cir. 1994), judgment vacated 

as unripe, 513 U.S. 557 (1995) (per curiam); Westenfelder v. Ferguson, 

998 F. Supp. 146, 154 (D.R.I. 1998); Mitchell v. Steffen, 504 N.W.2d 198, 

201-02 (Minn. 1993); Sanchez v. Department of Human Services, ___ 

A.2d ___, A-466-97T1F, 1998 WL 391584, at *5 (N.J. Super. Ct. App. 

Div. July 8, 1998); Brown v. Wing, 649 N.Y.S.2d 988, 995 (N.Y. Sup. Ct. 

1996), aff 'd, 241 A.D.2d 956 (1997); see also Aumick v. Bane, 612 

N.Y.S.2d 766 (N.Y. Sup. Ct. 1994); Robert C. Farrell, Classifications That 

Disadvantage Newcomers and the Problem of Equality, 28 U. Rich. L. 

Rev. 547, 609 (1994) (arguing that the "relevant comparison . . . [is] 

between newcomers and the established residents of the new state"); cf. 

Hicks v. Peters, ___ F. Supp. ___, No. 98C3247, 1998 WL 424176 (N.D. 

Ill. July 17, 1998) (declining to reach the issue of whether the Illinois 

durational residence statute imposes a penalty because it failed rational 

basis review). But cf. Jones v. Milwaukee County, 485 N.W.2d 21 (Wisc. 

1992) (finding that a 60 day durational residency requirement for general 

relief benefits is "substantially less onerous than the one year waiting 

period of Shapiro, . . . does not operate to penalize an individual's 

right 

to travel," and passes rational basis review). 

 14 
From a constitutional standpoint, it is of no consequence 

that the Maldonados receive the same benefits that they 

would have received in Puerto Rico. Pennsylvania's two-tier 

welfare scheme penalizes the Maldonados for having 

exercised their right to travel by treating them significantly 

less favorably than other similarly situated longer-term 

Pennsylvania residents solely because they exercised that 

right more recently. 

It is well-established "that a State may not impose a 

penalty upon those who exercise a right guaranteed by the 

Constitution." Harman v. Forssenius, 380 U.S. 528, 540 

(1965); accord Dunn v. Blumstein, 405 U.S. at 341. This, 

however, is exactly what Pennsylvania's two-tier durational 

residence scheme does. The $532 monthly reduction in the 

Maldonados' Pennsylvania benefits, based solely on their 

newly arrived status amounts to a 64% reduction in cash 

benefits and plainly penalizes them for having exercised 

their right to migrate into the state. 

This point is further reinforced by the holdings in Zobel, 

Hooper, and Soto-Lopez, where the Court held 

unconstitutional state benefit schemes that were unique to 

the states involved and which did not even exist in the 

plaintiffs' prior state of residence. See, e.g., Soto-Lopez, U.S. 

476 at 907, 911-12 ("Once [out-of-staters] establish bona 

fide residence in a State, they become the State's `own' and 

may not be discriminated against solely on the basis of [the 

date of] their arrival in the State. . . . For as long as [the 

State] chooses to offer [a benefit to its residents,] the 

Constitution requires that it do so without regard to [time 

of] residence.") (citations and internal quotations omitted); 

Hooper, 472 U.S. at 623 ("The State may not favor 

established residents over new residents based on the view 

that the State may take care of `its own,' if such is defined 

by prior residence."). Thus, from a constitutional viewpoint, 

the level of benefits available to the claimants in the state 

of their prior residence is irrelevant. What the Court found 

significant, however, was the difference in benefits provided 

to the claimants in the state of their new residence based 

solely on residential duration. Here too, newer residents, 

such as the Maldonados, plainly are "penalized" for having 

exercised their right to travel and migrate. 

 15 
Thus, because Pennsylvania's durational residency 

requirement discriminates against newly arrived residents 

and penalizes their fundamental right to travel and migrate, 

we hold that Pennsylvania's welfare durational requirement 

is subject to strict scrutiny. Accordingly, to pass

constitutional muster, the Commonwealth must show that 

the residential requirement is necessary to promote a 

compelling state interest and is narrowly drawn to meet 

that end. Partly because the Commonwealth argues that 

the law should be reviewed under rational basis analysis, it 

has not presented anything even remotely resembling a 

compelling interest which would justify the law or shown 

that it is narrowly tailored to meet its asserted ends. 

First, one of the purposes of the statute articulated by 

the Commonwealth in the district court is to prevent 

Pennsylvania from becoming a "welfare magnet." The 

district court found this purpose clearly unconstitutional 

under Shapiro and its progeny. We agree, and it does not 

warrant additional discussion. See, e.g., Shapiro, 394 U.S. 

at 629. Second, the Commonwealth's argument that the 

purpose of the durational residency requirement,"and 

indeed of Pennsylvania's entire assistance program, is to 

encourage work and self-sufficiency over dependency," is 

unconvincing. Although unquestionably the encouragement 

of self-sufficiency and work is a laudable and legitimate 

state goal, the Commonwealth has not demonstrated that 

this is a compelling interest or that a two-tier scheme is 

necessary to achieve that end. Even assuming arguendo 

that the interest is compelling, the scheme clearly is not 

narrowly drawn to achieve that goal and arguably, as the 

district court found and as applied by the Supreme Court, 

is not even rationally related to that purpose. 

For instance, the Commonwealth has not demonstrated

why newly arrived residents are more in need of 

"encouragement" to join the work force than longer-term 

residents. If encouraging work truly were the goal, and 

reduced benefits during a waiting period accomplished this 

goal, all residents should be subject to a waiting period, not 

just new residents. See Shapiro, 394 U.S. at 637 ("A state 

purpose to encourage employment provides no rational 

basis for imposing a one-year waiting-period restriction on 

 16 
new residents only."). Furthermore, the scheme does not 

encourage all new residents but only "encourages" those 

new residents who arrive from states that provide lower 

benefits than Pennsylvania. Moreover, and significantly, 

immigrants from abroad receive no encouragement for

under Pennsylvania law they are eligible for the same 

benefits as long-term residents. Additionally, the scheme's 

irrationality is demonstrated by its application to persons 

who migrated to Pennsylvania while employed, but due to 

no fault of their own, such as layoffs or plant closings, 

became unemployed within their first twelve months in the 

state. The law's irrationality is further highlighted as the 

scheme applies even to those certified by the 

Commonwealth as being temporarily or permanently 

physically disabled or otherwise incapable of working, such 

as the Maldonados. There simply is no rational reason, let 

alone a compelling reason, to assume that only new 

residents from states that offer lesser benefits than 

Pennsylvania need "encouragement" to seek work and selfsufficiency. 

Amici curiae's proffered reason, that the scheme is

justified by differing expectation and reliance interests--i.e., 

newcomers can more easily adjust to cuts in welfare

benefits through their choice of communities and lifestyles 

than longer-term residents who expect to have, and rely on, 

the safety net of higher benefits--is not sufficiently 

compelling. Even if we assume that many newer residents 

can more easily adjust their lifestyles to reduced benefits 

than those with longstanding ties to a particular area, an 

assumption that is highly speculative, the Commonwealth 

again has not demonstrated a compelling interest that 

justifies what may amount to a greater than 60% reduction 

in an indigent family's cash benefits required to purchase 

many of life's necessities. 

Furthermore, the legislative scheme is not narrowly

tailored to meet this purpose, as it does not take into 

account the myriad of differences in individual personal 

and financial situations. For example, most people who own 

homes, those who have fixed residential lease obligations, 

or those who have countless other longer-term financial 

obligations can less easily adjust to reduced benefits 

 17 
compared to those persons without similar obligations. The 

Commonwealth could use means, need-based, or other 

testing to determine if a particular applicant actually can 

adjust to reduced welfare benefits. Under any of numerous 

scenarios, it is likely that an eleven-month resident of 

Pennsylvania who unexpectedly finds herself in need of 

welfare benefits will find it just as difficult to survive on 

reduced benefits as will a twelve-month resident. Amici 

curiae have presented no compelling reason to assume that 

all newer residents, and only newer residents, are more 

able to easily adjust to and survive on reduced welfare 

benefits, nor have they demonstrated that the scheme is 

narrowly tailored to affect only those able to adjust to and 

survive on reduced welfare benefits. Thus, it is obvious that 

the Commonwealth (and Amici) has failed to demonstrate 

that its twelve-month durational residency requirement is 

necessary to promote a compelling state interest, or that 

the legislation is narrowly drawn to meet its stated 

objections. 

We agree with the district court that there is no 

constitutional right to welfare benefits, Dandridge v. 

Williams, 98 U.S. 471, 485 (1970), and none is claimed. We 

are also aware of a state's legitimate interest in preserving 

public funds. When, however, a state makes welfare 

benefits available for its indigent, Shapiro and Maricopa 

County make it clear that the preservation of the public fisc 

may not be achieved by an invidious distinction between 

classes of its citizens. 

We are mindful, however, as explained by the district 

court, that the opinions in several Supreme Court cases 

decided since Shapiro and Maricopa County may call into 

question the vitality of strict scrutiny review of laws that 

burden the fundamental right to interstate travel and 

migration. Nevertheless, the Supreme Court has 

periodically admonished lower federal courts, and has 

recently "reaffirm[ed] its rule that `if a precedent of th[e 

Supreme] Court has direct application in a case, yet 

appears to rest on reasons rejected in some other line of 

decisions, the Court of Appeals should follow the case 

which directly controls, leaving to th[e Supreme] Court the 

prerogative of overruling its own decisions.' " See Agostini v. 

 18 
Felton, 117 S. Ct. 1997, 2017 (1997) (quoting Rodriguez de 

Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 

484 (1989)). Because Shapiro and Maricopa County have 

never been overruled by the Court, we follow the Court's 

directive and conclude that they dictate the result of this 

case.9 We note, however, that our opinion is in no way 

meant to pass judgment on the wisdom or desirability of 

the Pennsylvania legislature's attempt at welfare reform. 

III. 

In conclusion, we affirm the district court's order that the 

Maldonados have shown that they were likely to succeed in 

proving that Commonwealth's twelve-month durational

residence requirement is unconstitutional. Thus, the court's 

grant of a preliminary injunction was not an abuse of 

discretion. We conclude, however, that the court 

erroneously subjected the law to rational basis analysis 

instead of the requisite strict scrutiny. The Commonwealth 

has not demonstrated that the scheme is necessary to 

promote a compelling state interest, or that it is narrowly 

_________________________________________________________________ 

9. On appeal, the Maldonados once again argue that Section 9(5)(ii) 

violates the Privileges and Immunities Clauses of Article IV and the 

Fourteenth Amendment. As shown by the almost complete lack of 

citation to authority in their brief, this argument is almost completely 

without merit. But see Zobel, 457 U.S. at 71-81 (O'Connor, J. 

concurring) (finding the right to travel rooted in the Privileges and 

Immunities Clause). The Supreme Court has consistently interpreted 

Article IV, S2--the Privileges and Immunities Clause--to be a limit on the 

ability of a state to discriminate against out-of-state residents. The 

Clause, "in effect, prevents a State from discriminating against citizens 

of other States in favor of its own." Hague v. Committee for Indus. Org., 

307 U.S. 496, 511 (1939). As a necessary prerequisite for the Privileges 

and Immunities Clause to apply, it must be shown that a state 

discriminated against a citizen of another state. See, e.g, United Bldg. & 

Constr. Trades Council v. Mayor and Council of Camden, 465 U.S. 208, 

218 (1984); Zobel, 457 U.S. at 59 n.5. Here, by contrast, the 

Pennsylvania statute is applicable only to bonafide Pennsylvania-state 

residents and does not discriminate against nonresidents in any way. 

The only way to fall under the challenged scheme is to first become a 

resident of the Commonwealth of Pennsylvania. Accordingly, the 

Privileges and Immunities Clause has no application to the issues 

presented by this appeal. 

 19 
tailored to accomplish its stated goal. Accordingly, we hold 

that Pennsylvania's two-tier durational residency 

requirement for welfare benefits is unconstitutional as it is 

based solely on a citizen's length of residing in the state; 

the scheme impermissibly penalizes citizens who have 

exercised their fundamental right to travel and migrate 

interstate, and thus violates the Equal Protection Clause of 

the Fourteenth Amendment. 

A True Copy: 

Teste: 

 Clerk of the United States Court of Appeals 

 for the Third Circuit 

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