Federal System: DCC, State Taxation, Preemption

Question 1

True or false: Federal powers run concurrent with state powers

Answer 1

True, but if there’s a conflict b/t state and federal powers, federal wins

Question 2

What powers are exclusive to the federal system?

Answer 2

power over foreign relations, power to coin money

Question 3

True or false: state and federal governments are immune from direct taxation and regulation?

Answer 3

False,

Federal gov is immune from direct state regulation or taxation, BUT states are not immune from direct federal regulation. AND states can tax federal gov indirect (ex: taxing federal employees on their income)

Question 4

States cannot ____ state officers from federal liability for violating federal constitutional rights

Answer 4

Conscribe - constrict/limit

EXCEPT for the anti-commandeering principle

Question 5

Explain the Privileges and Immunities Clause (PIC) and what it forbids

Answer 5

Forbids serious discrimination against out of state individuals, absent substantial justification

Does not protect out of state corporations

Serious discrimination = employment

Question 6

Under PIC, can there be a legal requirement of residency for employment for private employers?

Answer 6

No. BUT public employment can require residency.

Question 7

What are examples of private employment requirements that DO NOT require residence (and don’t violate PIC)?

Answer 7

Admission to the Bar, occupational licenses

Question 8

What are examples of public employment requirements that DO depend on residency

Answer 8

A city hiring only residents or requiring a certain % of city residents on city construction projects

Question 9

How is “non serious discrimination” defined?

Answer 9

States can discriminate with regard to recreational activities

Ex: hunting licenses and state park access

Question 10

What does the Dormant Commerce Clause do?

Answer 10

Protects out of state businesses and individuals absent federal regulation

Question 11

In the absence of federal regulation, state regulation of commerce on its face is valid if…?

Answer 11

Facially discriminatory law = strict scrutiny

1) No discrimination against out of state interests
2) Interstate commerce not unduly burdened
3) Not wholly extraterritorial activity

Question 12

What are examples of out of state interests that the DCC protects against?

Answer 12

Ex: forbidding out of state products sold within the state, taxing out of state products at a higher rate, requiring manufacturing of products only be done in state, or limiting landfills to in state garbage only

Question 13

What is the balancing test used for facially neutral discriminatory laws under DCC??

Answer 13

OK to discriminate against out of state individuals or corporations IF:

Local interest > Burden

Question 14

What are the exceptions to the rule against no discrimination against out of state interests?

Answer 14

1) State as a market participant
2) Subsidies
3) Federal approval

Question 15

True or false: If Congress authorizes or consents to state regulation of commerce, the DCC will protect discrimination against out of state interests

Answer 15

False. Congressional authorization or consent of state regulation of commerce trumps the DCC. DCC is only triggered when Congress hasn’t acted.

Question 16

How is an undue burden to interstate commerce defined/tested on a facially neutral law?

Answer 16

So outrageously costly relative to the benefits of the regulation.

Costs v. benefits balancing test

Question 17

True or false: A state may regulate conduct occurring wholly beyond its borders

Answer 17

False

Question 18

Can states tax interstate commerce?

Answer 18

No, unless:
1) Congress consents AND
2) not unduly burdensome

Question 19

When is non-discriminatory taxation OK?

Answer 19

Two requirements:
1) Substantial nexus b/t taxing and property/activity
2) fair appointment of liability b/t the states taxed

Question 20

When are commodities that move over state lines taxed? When are they not taxed?

Answer 20

Full taxes to every state when stopped on tax day for a business purpose

No taxes when merely in transit

Question 21

When is taxation for instrumentalities moving goods across state lines OK?

Answer 21

1) Fair appointment of tax liability w/substantial nexus to the instrumentality
2) Each state in which instrumentality is used can tax the value of that instrumentality

Question 22

True or false: Federal law preempts inconsistent state law

Answer 22

True. When the law is inconsistent b/t state and fed

Note that state law is not preempted b/c it addresses the same subject matter as a federal statute.

Question 23

Define field preemption. Is it common?

Answer 23

When Congress determines there should be no state law of any sort in a particular field. Any state law in that area is inconsistent = preempted

Rare.

Question 24

What does the full faith and credit clause demand of states?

Answer 24

States must give full faith and credit to judgments rendered by other state’s courts if:

1) Rendering court had jurisdiction
2) To render final judgments on the merits