FEDERALISM

Question 1

Supremacy Clause

Answer 1

Under the Supremacy Clause, federal laws trump conflicting state and local laws

Express Preemption–If a federal law provides that it is the exclusive authority in a given area, it preempts state and local laws in the area
* However, preemption provisions are narrowly construed

Implied Preemption–If a federal law is silent on preemption, courts will presume a conflicting state law is valid, UNLESS Congress clearly intended to supered. Implied preemption usually occurs in 3 situations:
1) Mutual exclusivity: Federal and state laws are mutually exclusive (i.e. complying with both is impossible)
» States can set stricter requirements if compliance with
both federal and state law is possible

2) State law impedes a federal objective
3) Congress evidences a clear intent to legislate exclusively and/or preempt state law (e.g. immigration & bankruptcy law)

Question 2

Dormant Commerce Clause (Negative Implications of the Commerce Clause)

Answer 2

State and local laws that affect interstate commerce may be unconstitutional if they are unduly burdensome

Analysis–Ask if a state/local law or regulation is discriminatory (i.e. does it discriminate against non-state residents and/or favor local economic interests) and apply either of the following:

• Non-discriminatory state law–Violates DCC if it:
  1) Burdens interstate commerce, AND
  2) The burden exceeds any legitimate local benefits produced by the law
• Discriminatory state law–Violates DCC if it:
  1) Burdens interstate commerce, AND
  2) Is not necessary to achieve an important govt purpose (i.e. no reasonable, less discriminatory alternative exists)
  » Note: discriminatory state/local laws will almost always
  be invalid under this test

EXCEPTIONS: State laws burdening interstate commerce is valid if:
1) Express federal govt approval, OR
2) State is a Market Participant–State and local govts can favor their own citizens in giving subsides, govt hiring, got purchasing, etc.
» E.g. State universities can give tuition discounts to
instate residents

Note: Individuals, Corporations and Aliens can sue under DCC

Question 3

P&I Article IV

Answer 3

No state may deny citizens of other states the privileges and immunities it accords its own citizens
* Protects against denial of fundamental rights to non-state citizens (i.e. it is an anti-discrimination provision)

Analysis–Article IV P&I problems arise if a state law discriminates against non-residents

• Discriminatory state law–Invalid if it:
  1) Relates to civil liberties or commercial activities
  2) Is not necessary to achieve an important govt interest
• I.e., State has no substantial justification for the
  discrimination or less restrictive means are available
  » Examples:
• Valid: In-state residents pay lower fees for public golf
  courses, hunting licenses, camping permits
• Invalid: Income tax on non-residents only; limiting bar
  admission to state residents; different fees for commercial
  fishing licenses

Non-discrimminatory state law–Valid
* Note: Only applies to U.S. citizens!!

14th A P&I–Primarily applies to restrictions on rights to interstate travel, narrowly construed and unlikely to be a correct answer choice

Question 4

State Taxation of Interstate Commerce

Answer 4

States may only tax activities that have a substantial nexus to the state
* A state may not use its tax systems to help in-state businesses or discriminate against interstate commerce

• Taxation of interstate businesses must be fairly apportioned
  » I.e. A state can only tax the portion of the business connected to the state

Question 5

Intergovernmental Immunity

Answer 5

States may not directly tax or regulate fed govt activity
* Incidental taxes are acceptable
» E.g. States can collect income tax on federal employees working with the state or tax private entities doing business with the fed govt.

Question 6

Full Faith & Credit Clause

Answer 6

Courts in one state must give full faith & credit to judgments of courts in another state if:
1) The prior court had jurisdiction over the parties and subject matter

2) Judgment was on the merits
» E.g. Judgment not founded on procedural issues

3) Judgment was final

Question 7

Federalism Quick Recap

Answer 7

A. Preemption
1. Express
2. Implied
a) When state law impedes federal objective
b) When congress has clear intent to preempt state law
B. Dormant commerce clause (DCC): Do not need out-of-stater discrimination.
1. State/local laws are unconstitutional if they place an undue burden on interstate commerce
2. Corporations and aliens can use this
3. If no discrimination: If burden exceeds benefits, strike down law
4. If yes discrimination: Strike down unless it’s necessary to achieve important government purpose
a) Exception: Congress approval or market participant exception (if government owns the business)
C. Art IV privileges and immunities (used if law discriminates against out-of-staters)
1. States can’t deprive citizens of other state the privileges or immunities it gives to its own citizens
2. Corporations and aliens can’t use this
3. If no discrimination: N/a
4. If yes discrimination: Strike down if it affects out-of-staters civil liberties or important econ interests (ability to earn living), unless it’s necessary to achieve an important government purpose

Hint: 14th amendment Privileges and Immunities Clause is always wrong answer on MBE, unless it is about right to travel.

D. State:

1. State tax on interstate commerce:
2. States can’t use tax system to help in-state business
3. State can only tax interstate activities with substantial nexus to state.
4. State tax on interstate commerce must be fairly apportioned.