Document: 510 U.S. 332 DEPARTMENT OF REVENUE OREGONv.ACF INDUSTRIES, INC., ET AL. No. 92-74. Supreme Court of United States. Argued November 8, 1993. Decided January 24, 1994. The Railroad Revitalization and Regulatory Reform Act 1976, in relevant part, forbids States to impose (1) higher property tax rates assessment ratios upon "rail transportation property" than "other commercial industrial property," 49 U. S. C. §§ 11503(b)(1)-(3), (2) "another that discriminates against a rail carrier providing transportation," § 11503(b)(4). Oregon exempts from its ad valorem various classes business personal property, but not railroad cars owned by respondent companies. They filed suit the District Court, alleging violates 11503(b)(4) because it certain taxation while taxing full. Both Appeals agreed discriminatory exemptions may be challenged under subsection (b)(4). However, reversed lower court's finding Oregon's complied with provision, holding instead respondents were entitled same exemption enjoyed preferred owners. Held: Section 11503 does limit States' discretion exempt non-railroad generally applicable taxes. Pp. 338-348. (a) Respondents' position carrier" is residual category designed reach any state tax, including taxes, covered subsections (b)(1)-(3) plausible only if (b)(4) read isolation. structure as whole supports view speak exemptions. "[C]ommercial which serves comparison class for measuring discrimination (b)(1)-(3), defined (a)(4) "property, other land used primarily agricultural purposes or timber growing, devoted use subject levy." interplay between this definition central (b)(4)'s interpretation. For example, Congress' exclusion demonstrates intent permit at rate land, notwithstanding (b)(3)'s general prohibition discrimination. To consider such tax" would subvert statutory plan reading prohibit what (b)(3), conjunction (a)(4),was allow. result contravene elementary canon construction statute should interpreted so render one part inoperative. 338-341. (b) phrase "subject levy" further qualifies definition. When elsewhere 11503, means taxed; since identical words different parts are intended have meaning, must carry meaning (a)(4), Sorenson v. Secretary Treasury, 475 851, 860. Thus, class. It illogical conclude Congress, having allowed grant turn around nullify own choice 341-343. (c) Other considerations reinforce foregoing statute. 11503's silence on exemptions—in light explicit ratio —reflects determination leave their place. Principles federalism compel view, pre-empt traditional powers clear manifest purpose Congress. statute's legislative history casts no doubt Nor interpretation lead an anomalous result. Since railroads entities need decided whether did single out property. And within sound weigh benefit preserving some protecting carriers every scheme favors nonrailroad reached here bizarre Congress could it. See Demarest Manspeaker, 498 184, 191. 343-348. 961 F. 2d 813, remanded. KENNEDY, J., delivered opinion REHNQUIST, BLACKMUN, O'CONNOR, SCALIA, SOUTER, THOMAS, GINSBURG, JJ., joined. STEVENS, dissenting opinion, post, p. 348. 1 CERTIORARI TO THE UNITED STATES COURT APPEALS FOR NINTH CIRCUIT. 2 Virginia L. Linder, Solicitor General Oregon, argued cause petitioner. With her briefs Theodore R. Kulongoski, Attorney General, Thomas A. Balmer, Deputy Robert M. Atkinson, Assistant General. 3 Kent Jones amicus curiae urging reversal. him brief Days, Acting Paup, Wallace, Gary Allen, Paul Geier, Dale Andrews, Mark Lindsey, G. Joseph King. 4 Carter Phillips respondents. was James W. McBride.* 5 JUSTICE KENNEDY Court. 6 power local governments taxes interstate has been source recurrent litigation Commerce Clause Due Process Clause. See, e. g., Central Co. Pa. Pennsylvania, 370 607 (1962); Braniff Airways, Inc. Nebraska Bd. Equalization Assessment, 347 590 (1954); Morgan Parham, 16 Wall. 471 (1873). In case before us, federal statute, 1976 (4-R Act). Pub. 94-210, 90 Stat. 31. 7 question presented State violated imposing exempting other, all, We hold without subjecting challenge provision 4-R Act, 306(1)(d), 8 * imposes all real jurisdiction, except granted express exemption. Ore. Rev. 307.030 (1991). Various exempt, machinery equipment; nonfarm inventories; livestock; poultry; bees; furbearing animals; products possession farmers. 307.325, 307.400. Standing also severance when harvested. 321.272. like many States, motor vehicles well, levying them modest annual registration fee. 803.585, 803.420(1). 9 Respondents, called "Carlines" litigation, eight companies lease shippers. considered "tangible law, 307.030, taxation. Carlines brought 306(1)(d) seeking declaratory injunctive relief assessment, levy, collection State's cars. 10 enacted "restore financial stability railway system States." 101(a), 33. drafting legislation, aware "`are easy prey assessors' they `nonvoting, often nonresident, targets taxation,' who cannot easily remove themselves locality." Western Air Lines, Board D., 480 123, 131 (1987) (quoting Rep. 91-630, (1969)). 306 now codified addresses concern prohibiting (and subdivisions) enacting schemes discriminate railroads. Burlington Northern Oklahoma Tax Comm'n, 481 454, 457 (1987). 11 provisions contained (b), states: 12 "The following acts unreasonably burden commerce, State, subdivision authority acting do them: 13 "(1) assess value true market assessed jurisdiction 14 "(2) levy collect made clause subsection. 15 "(3) exceeds jurisdiction. "(4) another . ." 17 straightforward: These forbid imposition property." scope (b)(4), clear. 18 (b)(1)-(3). attribute fact subjects nonexempt "to equal ratable proportion." Rather, Carlines' contention carrier," violation 19 after reviewing stipulated record, held On facts presented, however, court determined provision. observed that, cases, those more 50% had found Trailer Train Leuenberger, 885 415 (CA8 1988), cert. denied, 490 1066 (1989); Bair, 766 1222 1985). Because (according calculations) exempted 31.4% taxation, judgment State. 20 reversed. 813 (CA9 1992). accordance Circuit precedent, see ACF Industries, Arizona, 714 93, 94 1983), acknowledged Like accepted explained "`prevent form whatsoever.'" 2d, 820 (emphasis original) (citing Ogilvie N. 657 204, 210 (CA8), 454 1086 (1981)). 21 Rejecting Court's apparent less proscribed "most natural reading" dictates "any given taxpayers railroads" forbidden, possible room "a de minimis level exemption[s]." 822 original). calculation most generous 25% far exceeding exception. ground, concluded Id., 823. Holding "were total owners enjoyed," enjoined Ibid. 22 certiorari, 508 905 (1993), reverse. II 23 Before passing validity 11503(b)(4), addressed preliminary question: Whether even ground exempt. question. 24 parties contend plain prohibits answer favor. word "another" "different precedes it." address follows term mean tax." concludes simple reason all. 25 Carlines, Appeals, take view. understand disfavoring property—exemptions effect admit fall outside Brief Respondents 16-17—are ambit Accord, 415, 417-418 Department Revenue Fla. Co., 830 1567, 1573 (CA11 1987). If exclude contend, drafted tax," phrased did. 17. 26 readings defensible isolation, cf. S., 461 (language (b)(1) "plainly declares [its] purpose"), we look determine meaning. yield answer, adverse tax. exposing invalidation 27 Subsections noted, 11503(b)(1)-(3). "Commercial unlawful provisions, 11503(a)(4). 28 "commercial excludes "land purposes." particular One still maintain, suppose, thus forbidden That interpretation, "elementary inoperative." Mountain Telephone & Telegraph Pueblo Santa Ana, 472 237, 249 (1985) (internal quotation marks omitted). 29 qualified further, limiting define phrase, face bear two interpretations: taxed property; taxable broader consisting mass enjoys current 30 first criticism, 135 (White, concurring),* believe way language 11503. 11503(c) confers district courts enforce terms 11503(b) despite bar otherwise imposed Injunction 1341. Subsection (c)(1) grants (under circumstances pertinent here) 31 "an (Emphasis added.) 32 context concerns differential "property "taxed Given "normal rule construction" "`"identical act meaning,"'" 860 (1986) Helvering Stockholms Enskilda Bank, 293 84, 87 (1934) (in quoting Atlantic Cleaners Dyers, 286 427, 433 (1932))), where 33 All bears us. taxed, Exempt then, measured provisions. 34 As pay heed placed beyond So viewed isolation (see supra, 339), untenable whole. Gade National Solid Wastes Management Assn., 505 88, 99 (1992); Sav. Assn. Tex. Timbers Inwood Forest Associates, Ltd., 484 365, 371 (1988) ("A seem ambiguous clarified remainder permissible meanings produces substantive compatible rest law"). exemptions, abstract matter, variant Davis Michigan Dept. 489 803 (1989). warrants conclusion 35 our prohibited uncertain terms, set forth precise standards judicial scrutiny practices, 11503(c)(1)-(2). By contrast, degree particularity "impos[ing] is, best, vague point. carriers, provide standard distinguish valid invalid schemes. 36 Had condition permitting restrict confident spoken clarity precision. Property important aspect policy. common time drafted, now, 1960, number Mo. 150.040 (1949) (exempting unmanufactured articles consigned sale commission merchants); J. 54:4-3.20 (1937) stored public warehouse); Vt. Ann., Tit. 32, 3802 (1959) tools implements possessed mechanics farmers, highway-building equipment); Jacobs, Exemption Tangible Personalty, Exemptions 141, 146 (1939) (by 1938, permitted "temporary newly located constructed plants, equipment plants"). 1960's, about pollution control facilities. McNulty, Incentives Fight Pollution, 56 B. 747, 748, n. (Aug. 1970). 1971, well enactment majority inventories, raw materials textile manufacturing, manufacturing allied equipment, tools. Education Commission Assessment Exemptions: Need Reform, Table C-1 (Mar. 10, 1973). prevalence subject—in discrimination—reflects 37 support, compel, sets limits government, recognized sovereignty. Tully Griffin, Inc., 429 68, 73 (1976); Peniston, 5, determining breadth impinges pre-empts powers, hesitant extend evident scope. Cipollone Liggett Group, 504, 533 (1992) ("We not, absent unambiguous evidence, infer pre-emption clearly mandated language") (Blackmun, concurring); id., 523 (opinion Stevens, J.); Reynolds Tobacco Durham County, 479 130, 140 (1986). will interpret "the Congress." Rice Fe Elevator Corp., 331 218, 230 (1947). above, neither nor meets regard 38 history—to extent relevance inquiry—affords comfort. excerpts record cited nothing carriers. 94-595, 166 (1976) (describing Senate bill, Conference adopted, results treatment contract carrier"). point instance suggesting fact, available evidence suggests opposite us believe. 120 Cong. Rec. 38734 (1974) (providing assurances prevent granting encourage development) (remarks Reps. Staggers, Adams, Kuykendall). 39 draw attention 15-year representatives industry expressed adopt characterized lieu gross receipts taxes; mentioned. Hearings Subcommittee Surface Transportation Committee Legislation Relating Rail Passenger Service, 94th Cong., 1st Sess., pt. pp. 1837, 1883 (1975). sum, argument respect foundation. 40 final leads maintain nonsensical altogether. result, argued, mild form, permits extreme. think implausible. 41 begin with, railroads— either alone isolated targeted group— Cf. Superior, 932 1185 (CA7 1991) (occupation operators "iron ore concentrates docks," practical effect, applied docks carrier). arise, might incorrect say "exempted" nontaxed singled treatment. Hellerstein Hellerstein, Local Taxation 973 (5th ed. 1988) (the "exemption" rather exclusions persons, transactions ... logically base"). manner, decide nature. 42 addition, though unwise "so `could intended'" 191 (1991) Griffin Oceanic Contractors, 458 564, 575 (1982)). About half investment air water devices. CCH Guide 691-692 (1992). practice beneficial purposes. La. Const., Art. VII, 21(F) (10-year "new establishment [any] addition existing establishment"); 285.597 (exemption "enterprise zone"); Va. Code Ann. 58.1-3661 (permitting county, city, town "solar energy facilities devices" "recycling facilities, devices"). hand, other. 43 expresses resolution application. therefore reverse remand proceedings consistent opinion. 44 ordered. Notes: Briefs ofamici reversal Iowa Bonnie Campbell, Daw; Washington et al. Christine O. Gregoire, Washington, Attorneys respective follows: Grant Woods Daniel E. Lungren California, Butterworth Florida, Larry EchoHawk Idaho, Chris Gorman Kentucky, Hubert H. Humphrey III Minnesota, Mike Moore Mississippi, Jeremiah (Jay) Nixon Missouri, P. Mazurek Montana, Don Stenberg Nebraska, Tom Udall New Mexico, Abrams York, Michael Easley North Carolina, Heidi Heitkamp Dakota, Lee Fisher Ohio, Susan Loving Oklahoma, T. Travis Medlock South Charles Burson Tennessee, Jan Graham Utah, Jeffrey Amestoy Vermont, Stephen D. Rosenthal Virginia, Doyle Wisconsin, Meyer Wyoming; Legislatures Richard Ruda Taranto. Malm Andrews Railway Progress Institute amici affirmance. California Lungren, Timothy Laddish, Finn, Supervising Murphy Marguerite Stricklin, General; Association American Railroads Betty Jo Christian, Walsh, Jerald Howe, Jr., Blanchette, Kenneth Kolson; Interstate Carriers Jay Martin, Peter Davis, John Carne. raised antidiscrimination Airport Airway Improvement 1982 (AAIA), App. 1513(d)(1)(A)-(C), analogous appeal AAIA. Hughes 372 106 (1985). rested ruling AAIA, 1513(d)(2)(D)—which, parallel 11503(a)(4), limited levy"—included 110. 1513(d)(1)(A)-(C) include reasoned AAIA affirmed, grounds unrelated 129-134. Justice White concurred, his "ground Dakota sustained improvident." 135; Northwest Airlines, 358 515, 517 (N. 1984). 45 dissenting. 46 Act), 54, amended, (subsection (b)(4)), railroads.1 my fell comparable implicate prohibition. errs arrangements 47 bars "discriminates" surprising Courts applies revenue measures similar others.2 While case) differed precisely how wholesale unlawfully gives rise liability, none taken today claim predicated cognizable 48 explains, ante, 343, contain specific omission, course, us: "discriminates A disfavored variety ways. absence specifically addressing significant deductions, credits, methods collecting protesting penalties. Surely law substantial deduction readily discriminatory. affected deductions. Indeed, make 346. Rather devised accord specified familiar (differential assessments) then included block routes end. minor deviations assessments, allow put manifestly disproportionate burdens text convince me means, 50 (1989), residents (4 111) reference I disagreed issue fairly protected class, surely exemption, expressly prohibited, support unconstitutionally Bacchus Imports, Ltd. Dias, 468 263, 273 (1984); Armco Hardesty, 467 638, 642-646 (1984). why totally ignored "discrimination" kind enterprise. 51 puts great stock difference strict assessments open-ended speaks tersely "discriminat[ion]." best embrace exempted. accept position, reasons, earlier redundant "nullify" limitations Ante, 343. disagree. 52 ban patent historically forms order find ratios, compare inquiry complicated indeed required divine "rates" "assessments" governing surprising, disparate 53 depend governs neighbors. Reading require creates disharmony unless assumes test per se rules differentials assumption unwarranted. 54 (like construed Davis) "discrimination," concept policies guidance. protects little voice policy decisions whose situation makes likely unfavorable treatment.3 give concerns, broadly. sensible discrimination—focusing being treated substantially favorably similarly situated persons—would employ falling afoul 55 suggests, allows disparity supported legitimate property.4 small minority resident warrant occurred. 819-823 (STEVENS, dissenting). merely discrimination, conferring right taxpayer, established paid materially greater property.5 But saved enterprise (e. carriers) recognizes, protect enterprises traditionally disproportionately heavy burdens. This area always circumscribed, prominently itself. plainly requires readjust "discriminat[e]." agree "compels" inapplicable arrangements. 345. 57 Federalism heavily favor if, 344-345, apply choose eliminating across board. explained, required. flexibility bans onerous choices overstated.6 Moreover, meaningfully railroads—as example funds spent environmental cleanup—would "discriminatory" useful businesses 1185, 1187 (invalidating "imposed activity engage"). 58 appears hedge flatly operate disproportionately. intimates must, escape "generally applicable," 335, 340, bona fide "exemption." 346-347. convinced applicable, disposition case. narrowness correspondingly evenhanded nature railroads, goes merit, cognizable. provides basis 100 percent allowing of, percent. 59 recognize application sometimes involve problems line drawing, raise special difficulties. But, grapple opportunity resolve parties' disputes review 60 Accordingly, respectfully dissent. originally enacted, 54. Pursuant recodification 1978, version against" carrier. provided 1978 "may making change laws replaced." 92 1466. Ninth Circuit's decision case, 818-820 (1992), seeDepartment 1987) (provision "discrimination guises" "requires consideration there treatment") (citation internal omitted); Oglivie 209-210 (CA8) (history "its whatsoever," property), (1981). Only contrary conclusion, Richmond, Corporation 260, 262, 336 896, 897 (1985), today—that three subsections, never attacked Railroads' high fixed immobile assets able restrain threatening pull up stakes leave. SeeBurlington 1186 1991). might, defend showing equivalent erred remedy refund theentire railroad. collected average cases certainly suggest undue incursions into fiscal See,e. 416 (violation over 75 1222, 1223-1224 1985) (tax coupled 95 statute).

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