Commentary

South Dakota has filed a petition in South Dakota v. Wayfair asking the U.S. Supreme Court to hear a challenge to its law requiring out-of-state retailers to collect sales tax. In Quill Corp. v. North Dakota (1992), the Supreme Court held that states cannot require retailers with no in-state physical presence to collect sales tax. In March 2015, Justice Kennedy wrote a concurring opinion stating that the “legal system should find an appropriate case for this Court to reexamine Quill.” Justice Kennedy criticized Quill in Direct Marketing Association v. Brohl for many of the same reasons the State and Local Legal Center stated in its amicus brief. Specifically, internet sales have risen astronomically since 1992 and states and local governments are unable to collect most taxes due on sales from out-of-state vendors. Following the Kennedy opinion a number of state legislatures passed legislation requiring remote vendors to collect sales tax. South Dakota’s law is the first to be ready for review by the U.S. Supreme Court. In September the South Dakota Supreme Court ruled that the South Dakota law is unconstitutional because it clearly violates Quill and it is up to the U.S. Supreme Court to overrule it. 

At the Supreme Court’s “long conference,” where it decides which petitions—that have been piling up all summer—to accept, the Court agreed to hear two unrelated cases involving car searches. Per the Fourth Amendment police officers generally need a warrant to search a car. However,  the automobile exception allows officers to search a car that is “readily mobile” without a warrant if officers have probable cause to believe they will find contraband or a crime has been committed.  Collins v. Virginia raises the question of whether the automobile exception applies to a car that is parked on private property.

In 2016, the Supreme Court was expected to overrule a nearly 40-year old precedent requiring public sector employees who don’t join the union to pay their “fair share” of collective bargaining costs. Justice Scalia died shortly after the Court heard oral argument in Friedrichs v. California Teachers Association. The Court ultimately issued a 4-4 decision which, practically speaking, kept Abood v. Detroit Board of Education (1977) on the books. With a ninth Justice now on the bench the Supreme Court has agreed to try again to decide whether to overturn Abood in Janus v. American Federation of State, County and Municipal Employees. More than 20 states authorize fair share for public sector employees. In Abood the Supreme Court held that the First Amendment does not prevent “agency shop” arrangements where public employees who do not join the union are still required to pay their “fair share” of union dues for collective-bargaining, contract administration, and grievance-adjustment. The rationale for an agency fee is that the union may not discriminate between members and nonmembers in performing these functions. So, no free-riders are allowed.

A federal district judge in Texas has invalidated Obama overtime regulations which would have made it more likely states and local governments would have had to pay more employees overtime.

Per the Fair Labor Standards Act (FLSA), executive, administrative, and professional "white collar" employees do not have to be paid overtime if they work more than 40 hours a week. Per Department of Labor (DOL) regulations, adopted shortly after the FLSA was adopted in 1938, employees must perform specific duties and earn a certain salary to be exempt from overtime as white collar employees.

On May 23, 2016, DOL issued final rules nearly doubling the previous salary level test for white collar employees from $455 per week, or $23,660 per year, to $913 per week, or $47,476 per year. The rules also automatically updates the salary level every three years for white collar employees.

According to the Judge Mazzant, DOL does not have the authority to adopt a salary test that effectively eliminates the duties test, which is what the final rule does. The text of the final rule explicitly says that those earning less than $913 will be eligible for overtime "irrespective of their job duties and responsibilities." The court likewise concluded that the automatic updating mechanism is unlawful. 

In an unusual move, the Supreme Court accepted a case during its summer recess.  Like most of its docket, this case will affect states and local governments. The Prison Litigation Reform Act (PLRA) states that when an inmate recovers money damages in a confinement conditions case “a portion of the judgment (not to exceed 25 percent)” shall be applied to his or her attorney’s fees award. The question the Supreme Court will decide in Murphy v. Smith is whether “not to exceed 25 percent” means up to 25 percent or exactly 25 percent. A jury awarded inmate Charles Murphy about $300,000 in damages relating to an officer crushing his eye socket and leaving him unconscious in a cell without checking his condition. The trial judge awarded Murphy’s attorney about $100,000 in fees and allocated 10 percent of Murphy’s damages award to attorney’s fees (about $30,000).

Federalism cases raise legal issues big and small, pedestrian and esoteric. The very simple question in Artis v. District of Columbia is what does it mean for a statute of limitations to “toll” under 28 U.S.C 1367(d)? The State and Local Legal Center (SLLC) filed a Supreme Court amicus brief agreeing with the District of Columbia’s interpretation of “toll.” A year after the fact, Stephanie Artis sued the District of Columbia in federal court bringing a number of federal and state law claims related to her termination as a code inspector. It took the federal district court over two and a half years to rule on her claims. It dismissed her sole federal claim as “facially deficient” and no longer had jurisdiction to decide the state law claims. 28 U.S.C 1367(d) states that statutes of limitations for state law claims pending in federal court shall be “tolled” for a period of 30 days after they are dismissed (unless state law provides a longer tolling period). While Artis was waiting for the federal district court to rule, the three-year statutes of limitations on all her state law claims passed. She waited 59 days to re-file her claims in state court after the federal district court dismissed her case. Was her claim timely? The District of Columbia Court of Appeals held no.  

Maintaining accurate voter rolls means walking a fine line.

 In Husted v. A. Philip Randolph Institute the Supreme Court will decide whether federal law allows states and local governments to remove people from the voter rolls if the state or local government sends them a confirmation notice after they haven’t voted for two years, they don’t respond to the notice, and then they don’t vote in the next four years.  While Ohio is being sued in this case, twelve other states use a similar process. The State and Local Legal Center (SLLC) filed an amicus brief in this case supporting Ohio.  The National Voter Registration Act (NVRA) says that roll maintenance procedures “shall not result in” people being removed from the polls for failure to vote. The Help America Vote Act modified the NVRA to say that states may remove voters if they don’t respond to a confirmation notice and don’t vote in the next two federal election cycles.

Good news for local governments with "merger" ordinances: you can keep them on the books.

 It has been a number of years since states and local governments have won a property rights case. But in Murr v. Wisconsin the Supreme Court concluded 5-3 that no taking occurred where state law and local ordinances "merged" nonconforming, adjacent lots under common ownership, meaning the property owners could not sell one of the lots by itself. The State and Local Legal Center (SLLC), filed an amicus brief, which the Court cited two times, arguing that these very common provisions are constitutional. 

 The Murrs owned contiguous lots E and F, which together are .98 acres. Lot F contained a cabin and lot E was undeveloped. State law and a St. Croix County merger ordinance prohibit the individual development or sale of adjacent lots under common ownership that are less than one acre total. A grandfather clause allows for the sale and development of separately owned substandard lots purchased before the statute and ordinance went into effect.

     The Murrs sought and were denied a variance to sell Lot E to finance moving the cabin on Lot F. They claimed the ordinance resulted in an unconstitutional uncompensated taking.

On its last opinion day of the term, the Supreme Court announced that it would rule on the constitutionality of the Trump administration’s revised travel ban. In the meantime, to the extent the executive order prevents foreign nationals and refugees “who lack any bona fide relationship with a person or entity in the United States” from entering the United States, it may go into effect until the Supreme Court rules on the merits of this case. The president’s first executive order prevented people from seven predominantly Muslim countries from entering the United States for 90 days, froze decisions on refugee applications for 120 days, and capped total refugee admissions at 50,000 for fiscal year 2017. The Ninth Circuit temporarily struck it down, concluding this executive order was not religion-neutral, and that it likely violated the due process rights of lawful permanent residents, nonimmigrant visa holders, and refugees. The president’s second executive order prevents people from six predominately Muslim countries from entering the United States for 90 days, but only applies to new visa applicants and allows for case-by-case waivers, and contains the same provisions regarding refugees as the original travel ban. The Fourth Circuit concluded the revised travel ban likely violates the Establishment Clause, noting that its “text speaks with vague words of national security but in context drips with religious intolerance, animus and discrimination.” It temporarily prevented the portion of the executive order regarding admission to the United States for 90 days from going into effect. The Ninth Circuit concluded that the revised travel ban likely exceeds the power granted to the President by Congress in the Immigration and Nationality Act. It temporarily prevented all of the provisions mentioned above from going into effect, including those affecting refugees.

In Gill v. Whitford the Supreme Court has agreed to decide whether and when it is possible to bring a claim that partisan gerrymandering is unconstitutional. While the Court has repeatedly struck down district maps that rely on racial gerrymandering, it has never ruled that maps drawn to secure partisan advantage are unconstitutional. In 2004, Justice Anthony M. Kennedy – who may be the deciding vote in Whitford – wrote a concurring opinion indicating that partisan gerrymandering could be unconstitutional. In 2011, Wisconsin legislators redrew state assembly districts to reflect population changes recorded in the 2010 census. Map makers used a model designed to predict the likelihood that various proposed districts would elect a Republican. In the 2015 election, Republican candidates received less than 49% of the statewide vote and won seats in more than 60% of the state’s assembly districts; and, in 2014, 52 percent of the vote yielded 63 seats for Republicans. The challengers propose a standard for determining the influence of partisan gerrymandering in the district-drawing process. Drawn from a 2015 article written by a University of Chicago law professor and a lawyer for the challengers, the standard is based on “wasted votes”–votes in each district cast for a non-winning party’s candidate. By dividing the difference between the sums of each party’s wasted votes by the total number of votes cast, the proposed standard yields an efficiency gap.