Legal Document

460 U.S. 204 103 S.Ct. 1042 75 L.Ed.2d 1 Kevin H. WHITE, etc., et al., Petitionersv.MASSACHUSETTS COUNCIL OF CONSTRUCTION EMPLOYERS, INC., al. No. 81-1003. Argued Nov. 1, 1982. Decided Feb. 28, 1983. Syllabus Petitioner Mayor of Boston, Mass., issued an executive order requiring all construction projects funded in whole or part by city funds that the had authority to administer be performed a work force at least half which are bona fide residents city. The Massachusetts Supreme Judicial Court held unconstitutional under Commerce Clause. Held: Clause does not prevent from giving effect Mayor's order. Pp. 206-215. (a) When state local government enters market as participant, it is subject restraints Hughes v. Alexandria Scrap Corp., 426 794, 96 2488, 49 220; Reeves, Inc. Stake, 447 429, 100 2271, 65 244. In case like instant one, only inquiry whether challenged program constituted direct participation market. 206-208. (b) Insofar expended its own entering into contracts for public projects, was participant and entitled treated such rule Corp. Even if implementation might have significant impact on specialized firms employing out-of-state residents, this relevant participating marketplace when provides construction. Impact figures equation after decided regulating rather than it, former need determined any burden interstate commerce permitted And, even characterized sweeping too broadly, characterization imposes city's activity no help deciding those apply. 209-211. (c) applied with obtained certain federal programs, affirmatively sanctioned pertinent regulations programs. Where restrictions imposed financed directed Congress, then dormant issue presented. 212-213. 384 Mass. 466, 425 N.E.2d 346, reversed remanded. Laurence Tribe, Cambridge, petitioners. Paul J. Kingston, respondents. Justice REHNQUIST delivered opinion Court. 1979 mayor Massachusetts, order1 required funds, administer, should consisting Boston.2 unconstitutional, observing "presents clear obstacle order." 446, 346 (1981). We granted certiorari decide United States Constitution, Art. I, § 8, cl. 3, prevents mayor's 455 919, 102 1273, 71 458 (1982). now conclude reverse. 2 * were first asked 220 (1976), governments restrained they seek commercial transactions "regulators" but "market participants." case, Maryland legislature, attempt encourage recycling abandoned automobiles, offered bounty every Maryland-titled automobile converted scrap processor supplied documentation ownership. An amendment statute more exacting requirements in-state processors, who turn demanded sold junked automobiles scrap. As result, became easier possession sell processors. "The practical substantially same withdrawn altogether availability bounties hulks unlicensed suppliers licensed non-Maryland processors." U.S., 803, n. 13, S.Ct., 2495, 13. upholding face challenge, we said "[n]othing purpose animating prohibits State, absence congressional action, exercising right favor citizens over others." Id., 810, 2498 (footnotes omitted). Because market, acting regulator, concluded "intended require independent justification," id., 809, 2497, statutory bounty. 3 faced question again 244 (1980), confronted South Dakota policy confine sale cement operated plant Dakota. underscored holding saying: 4 basic distinction drawn between participants regulators makes good sense sound law. explains, responds principally taxes regulatory measures impeding free private trade national marketplace. [Citation omitted]. There indication constitutional plan limit ability themselves operate freely market." 436-437, 2277.3 5 Dakota, "as seller cement, unquestionably fits 'market participant' label" "general Scrap." 440, 2279. 6 therefore, stand proposition kind there "a single inquiry: 'program market.' " 436, 7, 2277, 7. reaffirm principle now. 7 City Boston described Reeves because applies where nonproprietary capacity, has commerce, necessary achieve objectives, receives grants. ----, N.E.2d, 354-355. For reasons court found violated substantive Clause.4 Ibid. II 8 Petitioners respondents both, greater lesser extent, us questions presented record case. support court's finding urge much involved nonpublic largely through funds. While terms would appear apply construction, simply nothing before conclusion used these types projects. Respondents, wished raise question, obligated offer some evidence jointly finance fact subjected provisions order; supports conclusion.5 issues us, then, propriety applying wholly address application 9 expressed reservations participation" here, reasoning "the will engage areas employ permanent works crews composed out-of-State residents." 354. factually correct,6 building If establishes barrier conditions demands participation. 10 may sweeps creating accomplish stated objectives. 355. activity, relied our decision Hicklin Orbeck, 437 518, 98 2482, 57 397 (1978), saying Hicklin, supra, broadly far wider merely favoring unemployed underemployed 11 considered Alaska employment connected oil gas leases State party "qualified" preference nonresidents. sought justify "Alaska Hire" law ground underlying owned itself. Analyzing Privileges Immunities IV, 2, mere ownership natural resource did circumstances render regulation immune attack clause. summarized view words: 12 "In sum, Act virtually businesses benefit way economic ripple Alaska's develop resources bias their practices State's 531, 2490. 13 though longer press argument, note involving represent sort "attempt effect" enter "to [city's] residents."7 14 also observed percentage affected received Federal sources." indicate approximately $54 million order, $34 represented being Urban Development Action Grants (UDAGs).8 assigns specific dollar amounts UDAGs, parties stipulated Community Block (CDBGs) Economic Administration (EDAGs).9 15 But proves much. grant restriction body. See American Power & Light Co. SEC, 329 90, 67 133, 91 L.Ed. (1946); Gibbons Ogden, Wheat. 23 (1824). unlike legislature authorizing similar expenditures, limited negative implications exercise spending power. action specifically authorized interferes commerce. Southern Pacific Arizona, 325 761, 769, 1515, 1520, 89 1915 (1945). Thus, Congress 16 examination applicable statutes reveals programs intended revitalization, including improved opportunities poor, minorities, unemployed.10 Examination set forth margin indicates sounds harmonious note; each permit type parochial favoritism order.11 III 17 hold violate Constitution.12 supra. above, judgment therefore reversed, remanded proceedings inconsistent opinion. 18 It so ordered. 19 BLACKMUN, whom WHITE joins, concurring dissenting part. 20 I agree presents two issues: (1) validity entirely revenues, (2) revenues pursuant congressionally created 21 Respecting second issue, am agreement Court's Ante, ----. holds, power authorize discrimination against otherwise aspect Prudential Ins. Benjamin, 328 408, 418-427, 66 1142, 1149-1153, 90 1342 (1946).1 22 do agree, however, scrutiny insofar activities undertaken without authorization. rejects arguments advanced "regulation of," "participation in," 210-211. holds latter because, view, "falls well within scope," ante, 211, decisions (1980). With due respect, plainly so. 24 Scrap, subsidy processors located State. scrutiny, purchaser, effect, potential article commerce" "restric[t] State." 808, 2497. thus permits prefer recipients subsidies. 14, 2279, (discussing ). 25 refused consumers until orders customers filled. implicated prefers purchasers state-produced goods. Neither nor went beyond ensuring enjoy 'the long recognized trader manufacturer, engaged business, his discretion he deal.' 438-439, 2278, quoting Colgate Co., 250 300, 307, 39 465, 468, 63 992 (1919). 26 Boston's goes further. attempted choose "parties [it] deal."2 Instead, condition obtaining contract requirement hire 50% specified jobs.3 directly restricts employers nonresidents, thereby curtails nonresidents' access jobs employers. thought established that, Clause, localities cannot impose granting either exclusive right, priority, sector opportunities. H.P. Hood Sons Du Mond, 336 525, 69 657, 93 865 (1949); Pennsylvania West Virginia, 262 553, 43 658, 1117 (1923); cf. (1978) (decided Clause). 27 Such solely them Court, thought, carefully explored been exemption, notwithstanding policy's essentially proprietary nature. 440-447, 2279-2282. line participant" regulator" always bright: "South label comfortably subsidize ("We occasion here inquire warrant proprietary, regulatory, activity"). 28 participation, purposes reference values rise exemption most important historically "Commerce marketplace"; designed 437, 2277 (emphasis added). rests core notions sovereignty, coupled traditional traders determine identities bargaining partners governmental interference. 2278. legitimacy claim primarily particular closely resembles impede among parties, attempt, analogous accustomed merchants sector, govern conduct deal. 29 simple unilateral refusals deal encountered relatively pure examples seller's purchaser's choosing partners, "long recognized" enterprise system. notable contrast, relationships. dictate another viewed suspicion context purely relations.4 exercised government, essence regulation. 30 Attempts constrict choices contractual particularly akin conventional regulation, threaten extend transaction interest. A wishing workforce practice nonresidents connection whatever entity imposing condition. firm relies degree compelled positions. purchase goods unrelated business. considerations counsel stable relationships suppliers, across board. "conditions" identical practices. 31 cited "considerations sovereignty" factor counseling restraint "proprietary" activity. sovereign interest freedom interference hiring employees. argued could chosen build covered itself and, restraint, hired done residents.5 never suggested special determining hire, setting employment, extends dictating employment. my managing relations employees fully safeguarded chooses, immunity attaches situation. observation tying concerns sovereignty merchant's customary deal, consistent view. attempts arrogate unto "independent discretion" others please, exercises must generally Varat, "Citizenship" Interstate Equality, 48 U.Chi.L.Rev. 487, 560-564 32 This approach safeguards benefits supported providers purchases marketplace, state-created subsidy, using tremendous treasury flow or, what worse, discriminate if, example, state-owned resell customers. Cf. 444, 17, 2281, ("Nor cut off altogether, bar resale purchasers"). Similarly, receiving bounty, processed in-state. conditions, intrude upon historic concern "measures marketplace." 2277. 33 intend suggest necessarily variations case; evidently, acknowledges "restrictions reach immediate transacts business" pose profound Reeves. upholds understanding exception 208-209. many contractors different crew project undertake, arguably limited, says, "discrete, identifiable class major participant." 7.6 unique industry—and projects—must underlie related justification "[e]veryone is, substantial informal sense, 'working city.' 34 persuaded, comparatively constitute regulation." "sense" "work city" "informal," lack substance altogether. them, fire negotiate representative about pay wages. subcontractors regulated pay, with, short, entities impedes "free marketplace," reason scrutiny. impermissible 35 recognizes, constitutes "parochial favoritism" jobs. 213. "protectionist measure" per se invalidity cases. See, e.g., Philadelphia New Jersey, 617, 624, 2531, 2535, 475 (1978).7 36 That burdens living outside extent other save rule. First, derives encouraging communities institute measures. Mass.Gen.Laws Ann. ch. 149, (West 1982).8 clearly expense States. carrying out mandate, creature Commonwealth, tainted Commonwealth's larger discriminatory scheme. 37 Second, significant, improper Dean Milk Madison, 340 349, 295, 95 (1951), absent statute. Milk, Wis., ordinance "plainly discriminate[d] commerce," "Wisconsin milk Madison area [was] proscription moving commerce." 354, 4, 298, 4. "erect[ed] protecting industry competition 298. invalid "reasonable nondiscriminatory alternatives, adequate conserve legitimate interests, [were] available." 38 disposal reasonable alternatives central goal—the alleviation unemployment residents. can create training establish aggressive referral aimed promoting implicating concerns. undertake itself, Moreover, ill-suited eliminating just undertrained. 527-528, 2488. Finally, since indicated unjustified unless reason, apart origin, treat differently articles individuals engaging originating 626-627, 2537. No shown 40 violative affirm judgment. To respectfully dissent. provides: "On which, accordance otherwise, expends administers, signatory contract, worker hours craft-by-craft basis shall performed, documents herewith, follows: a. residents; b. 25% minorities; c. 10% women." Only residency challenged. 1980, $482 million, 11%, spent applied. Of amount, (UDAGs). noted limitation Clause: "Restraint counseled role 'as guardian trustee people,' Heim McCall, 239 175, 191, 78, 83, 60 206 (1915), Atkin Kansas, 191 207, 222-223, 124, 127, 148 (1903), be, often are, burdened participants. Evenhandedness suggests proprietors, similarly share existing freedoms constraints, inherent limits Clause." 2278 Respondents made several challenges none us. resident preferences contained laws. None submitted below agreed statement facts. approximate value both public, 1980 $482,886,000; amount 54,421,040 'funded contract' Executive Order, terms, applicable. $54,421,040 $34,000,000 Grants." Agreed Statement Facts, A42. readily "significant impact" "small number plaintiff regular comprised These perform specialty work. . ." A41 Although workers employed discouraged bidding work, A-37, reveal Furthermore, data show increased publicly accompanied decline Appendix E. BLACKMUN's part, post, argues regulates BLACKMUN government's 529-531, 2489-2490, (1978). find unnecessary define precision, except say think stop boundary formal privity contract. covers discrete, participant. Everyone "working city." Wherever lie, falls scope Not UDAG HUD publications $28,600,000 UDAGs money costing total $397,000,000. Project Approval List, Region Department Housing Development, (Boston, 9, 1982). know money, overall 7% costs on. administered 1977, 42 U.S.C. 5318 (Supp. IV 1980). governing CFR Part 570, Subpart G CDBGs 1974, 5301 seq. (1976 Supp. 1980), implementing 570 EDAGs Public Works 1965, 3131 305 asserted Transportation. Facts DOT A45. fact, stipulate come CDBGs, EDAGs. A43-A44. Without contrary conclusion, involved. Ramsey UMW, 401 302, 312, 664, 64 (1971); Tyrrell District Columbia, 243 4-6, 361, 362, 61 557 (1917). 1980) (UDAGs); (CDBGs); (1976) (EDAGs). issuing carry program, requires certify alleviate distress helping unemployed. 570.458(c) further provide "comply Section 1968, amended, 135." 570.458(c)(14)(ix)(D) greatest feasible arising planning assisted given lower income persons residing project. 135.1(a)(2)(i) (1982) CDBG recipient section lower-income awarded eligible business in, by, project." 570.307(m) EDAG "[t]he maximum labor development facility grants loans. Accordingly, contractor subcontractor undertaking reasonably on-site qualified regularly reside designated located, centers, center adjacent nearby redevelopment district. 305.54(a) ask offends Citizens States." addressing said: inhabitants city, 'negative' felt difficult violation privileges immunities clause adversely affects Commonwealth well." disposition resolve issue. been, great briefed remand passing merits. General Talking Pictures Western Electric 304 177-178, 58 849, 850-851, 82 1273 (1938). pass possible Const., authorize, affirmative legislation, present L. Constitutional Law 6-31, 403, 214-215, 12, Had almost certainly permissible McCarthy Civil Service Comm'n, 424 645, 1154, 47 366 Scrap. course, applicability exemption. implicate 100% contractor's Compare (1919) (unquestioned unilaterally refuse retailers adhere retail price schedule), 439, Parke, Davis 362 29, 45-46, 80 503, 512-513, 505 (1960) (trader violates Sherman inducing wholesalers Arnold, Schwinn 388 365, 382, 87 1856, 1867, 1249 (1967) ("[o]nce manufacturer parted title risk, dominion product, effort thereafter restrict territory product transferred" Act), Continental T.V., GTE Sylvania Inc., 433 36, 49, 97 2549, 2557, 53 568 (1977) (overruling part; nonprice vertical unlawful, judged individually "rule reason" "should prohibited unreasonable competition"). Conditioning willingness derivative suspect isolate competitors. Lorain Journal States, 342 143, 154-155, 72 181, 186-187, 162 (1951). Here, mayor, competing anticompetitive goal whenever unit subsidies constituents. 8(e) National Labor Relations Act, expressly organizations cease refrain handling, using, selling, transporting dealing products employer, doing person," declared void. 158(e). On hand, permitting unions primary employer staple policy, refusing lawful reason. sure, industry, collective agreements exempted "hot cargo" clauses. Ibid.; see Woelke Romero Framing, NLRB, --- 2071, 2077, 398 chosen, peculiar history nature 2078, exclude detract point: world difference Indeed, appears rely argument. S.Rep. 187, 86th Cong., 1st Sess., (1959) ("The occasional relationship [the construction] markedly manufacturing enterprise. individual employee typically continuously. Jobs frequently short duration, depending various stages construction"). noteworthy, "contractors crews." App. Pet. Cert. A41. reject suggestion cognizable 209-210, 6. result unemployed; projects; increase. A37. states one satisfy "statutory obligation give public[ly] [Massachusetts] G.L. 26." A19. refers provided: "Each county, town district works, contracting subcontracting [in hiring] veterans district." Mass.Gen. Laws Ann., struck down 352-353 appealed ruling.

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