6.7. SR 07-10-2000 - Laserfiche WebLink

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I. CONSTITUTIONAL ANALYSIS The United States Supreme Court has held that an ordinance which is not primarily an exercise of the power of taxation or a revenue raising measure, and which does not interfere with or burden interstate commerce, is not unconstitutional even though it requires a license or imposes a fee. An ordinance which is an exercise of the police power of the city designed in good faith to protect the public health, welfare, or morals is valid where the purpose of the license, fee, or exaction is to make the exercise of the police power effective by contributing to its administration or financing, and where the ordinance is not discriminatory as against nonresidents or interstate commerce. Brennan v. Titusville, 153 U.S. 289 (1894). Thus, where the object is not to derive revenue~ but to protect the public against imposition, a license fee will be sustained under the general police power. The exercise of such power will not be permitted, however, if it interferes with interstate or foreign commerce. The negative or dormant implication of the Commerce Clause prohibits state regulation that discriminates against or unduly burdens interstate commerce and thereby "imped[es] free private trade in the national marketplace." General Motors Corp. v. Tracy, 519 U.S. 278, 287 (1997); see, e.g., Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573, 578-579 (1986); Reeves, Inc. v. Stake, 447 U.S. 429, 437 (1980); Federal Compress and Warehouse Company v. McLean, 291 U.S. 17 (1934). United States Supreme Court cases thus have indicated that even nondiscriminatory state legislation may be invalid under the dormant Commerce Clause, when, in the words of the so-called Pike undue burden test, "the burden imposed on [interstate] commerce is clearly excessive in relation to the putative local benefits," Pike v. Bruce Church, Inc., 397 U.S. 137, 142 (1970). "Distinguishing between regulations that do place an undue burden on interstate commerce and regulations that do not depends upon delicate judgments." Lopez v. United States, 514 U.S. 549, 580 (1995) (Blackmun, J., dissenting). Nevertheless, it is a general rule of constitutional law that municipal corporations can restrain and regulate huckstering, hawking, peddling, and canvassing within the municipality. Municipal competency in this respect is a phase of municipal police power and accordingly is justified to the extent it bears a reasonable relationship to public health, safety, morals, welfare, and convenience. Furthermore, such municipal competency may be based on the power of a municipality to regulate the use of its streets, at least insofar as use of the streets is involved. Green River v. Fuller Brush Co., 65 F.2d 112, (10th Cir. 1933). Police regulation in this as in other instances can utilize licensing as a method of control. See McQuillin, Municipal Corporations, Chapter 26. Nonresident and itinerant hawkers and peddlers (transient merchants) are in general subject to municipal regulation or prohibition of hawking and peddling. But an anti-itinerant peddling law ~ State and local taxes on interstate activities are to be upheld if four specific criteria are satisfied: (1) the taxed activity must have a substantial nexus with the taxing jurisdiction; (2) the tax must be fairly apportioned; 3) the taxing legislation must not discriminate against interstate commerce; and (4) the amount of the tax must be fairly related to the services provided by the taxing jurisdiction. Complete Auto Tr. v. Brady, 430 U.S. 274, (1977); see, Matter of Orvis Co. v. Tax Appeals Tribunal, 654 N.E.2d 954. These criteria make the older "peddler" and "drummer" cases, which are based on a repudiated analysis, irrelevant. Homier Distrib. Co., Inc. v. City of Albany, 681 N.E.2d 390, 396 (N.Y. Ct. App. 1997). In any event, the Elk River Ordinance is not primarily a taxing instrument; therefore, the applicable analysis of it is as a regulation of the activity in question.