Opinion ID: 2347729
Heading Depth: 1
Heading Rank: 3

Heading: the new jersey buy american statute and the commerce clause

Text: The United States Constitution empowers Congress [t]o regulate Commerce with foreign Nations and among the several States   . U.S. Const., Art. I, § 8, cl. 3. Although literally the clause authorizes only Congress to act, it is well settled that, at least in the absence of a finding that Congress has preempted the field, there exists a residuum of power in the states to enact legislation affecting commerce. Cooley v. Board of Wardens, 53 U.S. (12 How. ) 299, 13 L.Ed. 996 (1852); Southern Pacific Co. v. Arizona, 325 U.S. 761, 65 S.Ct. 1515, 89 L.Ed. 1915 (1945); Pike v. Bruce Church, Inc., 397 U.S. 137, 90 S.Ct. 844, 25 L.Ed. 2d 174 (1970). Since we have found that GATT is inapplicable to the governmental purchases for construction of the water treatment plant and that no other treaty or federal legislation preempts the subject matter, our inquiry must be addressed to whether the Commerce Clause prevents New Jersey from favoring domestic materials in its public works purchases and contracts. The underlying concept of the Commerce Clause is the regulation of commerce. Gibbons v. Ogden, 22 U.S. (9 Wheat. ) 1, 6 L.Ed. 23 (1824). Constitutionally commerce has been interpreted to cover every type of movement of persons and things, tangible and intangible. E.g., United States v. South-Eastern Underwriters Ass'n, 322 U.S. 533, 64 S.Ct. 1162, 88 L.Ed. 1440 (1944). Controversies involving the implicit proscription against state interference have centered about state attempts to establish, directly or indirectly, economic barriers to forestall free trade among the states and prevent foreign competition. H.P. Hood & Sons v. DuMond, 336 U.S. 525, 69 S.Ct. 657, 93 L.Ed. 865 (1949). United States Supreme Court cases explicating the unexercised commerce power have traditionally involved state regulation of activity in the private sector. See, e.g., id.; Hale v. Bimco Trading, Inc., 306 U.S. 375, 59 S.Ct. 526, 83 L.Ed. 771 (1939); Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 55 S.Ct. 497, 79 L.Ed. 1032 (1934). Review of such state legislation calls for a balancing of the local public interest against the extent of the burden, and consideration of the availability of less onerous alternatives. Pike v. Bruce Church, Inc., supra ; A. & P. Tea Co. v. Cottrell; 424 U.S. 366, 96 S.Ct. 923, 47 L.Ed. 2d 55 (1976). It was not until Hughes v. Alexandria Scrap Corp., 426 U.S. 794, 96 S.Ct. 2488, 49 L.Ed. 2d 220 (1976), that the Supreme Court discussed the legal impact of the state's entry into the marketplace as a purchaser of goods, rather than as a regulator of the commercial activities of others. [8] In that case the State of Maryland instituted a program to encourage elimination of abandoned automobiles by paying a subsidy to licensed processors to destroy such vehicles. However, because of an amendment to the Maryland statute non-resident processors had to meet substantially more onerous requirements with respect to the title of the vehicles so that Maryland processors were given a substantial advantage in obtaining the business. An out-of-state processor challenged the amendment as violative of the Commerce Clause. Mr. Justice Powell, writing for the majority, reasoned that commerce created when the state enters the market on its own behalf is not to be equated with a state's interference with the natural functioning of the interstate market through burdensome regulation. Id. at 805-806, 96 S.Ct. at 2495-2496, 49 L.Ed. 2d at 228-229. He stated that: [U]ntil today the Court has not been asked to hold that the entry by the State itself into the market as a purchaser, in effect, of a potential article of interstate commerce creates a burden upon that commerce if the State restricts its trade to its own citizens or businesses within the State. [ Id. at 808; 96 S.Ct. at 2497, 49 L.Ed. 2d at 231]