The Supreme Court's New Public-Private Distinction under the Dormant Commerce Clause: Avoiding the Traditional versus Nontraditional Classification Trap

In its 2007 decision United Haulers Association, Inc. v. Oneida-Herkimer Solid Waste Management Authority, the Supreme Court for the first time held the "dormant" Commerce Clause doctrine ("DCCD") allows for a distinction between appropriate laws establishing local government monopolies providing public services such as waste disposal, and inappropriate laws favoring the self-interest of in-state private businesses over out-of-state competition. In addition, the Court emphasized that courts should apply the DCCD more leniently in the area of waste disposal because it is a traditional local government function. In its 2008 decision Department of Revenue of Kentucky v. Davis, the Court reaffirmed United Haulers' distinction between laws preferring government activities serving the public interest and laws favoring local private firms at the expense of other private firms, but clarified to what extent it matters whether a government function is traditional or nontraditional. This article argues there are compelling reasons to treat public entities differently from private entities, but that courts should be wary of focusing on whether a government function is traditional or nontraditional.

Instead, courts should focus on whether a challenged local law fulfills a legitimate public purpose or favors local private firms at the expense of out-of-state firms. In its 2007 decision United Haulers Association, Inc. v. Oneida-Herkimer Solid Waste Management Authority, the Supreme Court for the first time held the DCCD allows for a distinction between appropriate laws establishing local government monopolies providing public services such as waste disposal, and inappropriate laws favoring the self-interest of in-state private businesses over outof- state competition. In addition, the Court emphasized that courts should apply the DCCD more leniently in the area of waste disposal because it is a traditional local government function. In its 2008 decision Department of Revenue of Kentucky v. Davis, the Court reaffirmed United Haulers' distinction between laws preferring government activities serving the public interest and laws favoring local private firms at the expense of other private firms, but clarified to what extent it matters whether a government function is traditional or nontraditional.

This article argues there are compelling reasons to treat public entities differently from private entities, but that courts should be wary of focusing on whether a government function is traditional or nontraditional. Instead, courts should focus on whether a challenged local law fulfills a legitimate public purpose or favors local private firms at the expense of out-of-state firms.