SUPREME COURT:

Ruling curbs port's crackdown on truck emissions

The Supreme Court today shot down key provisions in the Port of Los Angeles' program for cleaning up air pollution.

In a unanimous opinion, the justices said the port cannot require trucks to display placards and submit off-street parking plans as part of its 2007 Clean Truck Program. The court held that such provisions were pre-empted by a 1994 law that deregulated the trucking industry.

But the court declined to rule on whether Supreme Court precedent prohibits maintenance and financial capacity requirements, noting that it is unclear whether and how the port will enforce penalties against truckers who violate those mandates. Justices sent those issues back to lower court for further proceedings.

The Port of Los Angeles, the nation's largest port, launched its Clean Truck Program as part of a coordinated effort to address some of the nation's worst air pollution.

Truckers quickly challenged the program, and at issue in American Trucking Associations Inc. v. Los Angeles is whether a "concession agreement" that the port requires truckers to sign before granting access is pre-empted by the 1994 Federal Aviation Administration Authorization Act, or FAAAA.

Justice Elena Kagan wrote today that the tariff provision carries significant penalties.

"A violation of that tariff provision is a violation of criminal law," Kagan wrote. "And it is punishable by a fine or a prison sentence of up to six months. So the contract here functions as part and parcel of a governmental program wielding coercive power over private parties, backed by the threat of criminal punishment. That counts as action 'having the force and effect of law' if anything does."

Located 20 miles south of downtown Los Angeles in what physicians have dubbed the "diesel death zone," the port is perfectly suited to trap diesel particulates because warm inland air blankets cooler sea air near the ground. The nearby Palos Verdes hills also bottle the pollution close to the port, an area that is predominantly inhabited by low-income and minority residents.

The Clean Truck Program has been heralded by public health advocates as a success. It has phased out about 1,500 dirty diesel trucks and replaced them with cleaner-burning trucks made after 2007. By most estimates, it has cut truck emissions by at least 50 percent (Greenwire, April 11).

At the heart of the program is the concession agreement. Based on a successful program at Los Angeles International Airport, the agreement included provisions such as an off-street parking plan, maintenance requirement and placard display. It also mandated that all drivers be part of a large trucking company -- as opposed to independent owner-operators.

Truckers have relentlessly challenged the program in court. In September 2011, the San Francisco-based 9th U.S. Circuit Court of Appeals upheld many of those provisions but struck down the owner-operator requirement (E&ENews PM, Sept. 26, 2011).

In additional to their pre-emption arguments, the truckers also claimed that the Supreme Court's ruling in Castle v. Hayes Freight Lines prohibited the program. The 1954 ruling held that Illinois could not bar federally licensed motor carriers from its highways for prior violations of state safety regulations. Consequently, the truckers argued, the port may not deny access for violating provisions of the Clean Truck Program.

Kagan wrote that it is unclear whether the port's financial and maintenance requirements will violate that precedent because it has yet to enforce them.

The port had argued that it is a private enterprise and the truck program was an environmental stewardship initiative similar to those taken by other major businesses. The port -- along with groups including the Natural Resources Defense Council -- claimed that it was a "market participant" and therefore allowed to restrict access to its facilities.

But Kagan shot down that argument.

"We can assume the Port acted to enhance goodwill and improve the odds of achieving its business plan -- just as a private company might," she wrote. "But the Port's intentions are not what matters."

Reactions

The case has been closely watched by other ports and transportation hubs such as airports that may also consider concession agreements to crack down on environmental issues.

Justin Pidot of the Sturm College of Law at the University of Denver, however, noted that the opinion appears focused on the circumstances surrounding the port's truck program. Consequently, he doesn't believe the ruling will have broad consequences.

"The opinion probably won't have major reverberations outside of Los Angeles," Pidot said. "The opinion could have resolved a big question in environmental law -- whether the Clean Air Act pre-empts state and local government programs to directly purchase clean cars and trucks and otherwise use their power as market participants to promote green vehicles. But the court's analysis doesn't bear on that question because the Clean Air Act's pre-emption provision is worded very differently than that in the FAAAA."

Phillip Sanfield, a spokesman for the port, said it is still digesting the ruling but noted the importance of the concession agreements.

"An important component of the Clean Truck Program has been our concession agreements with trucking companies that call at the Port of Los Angeles," he said. "We are reviewing the Supreme Court ruling in order to determine how it affects our current ability to provide a clean, safe and secure trucking system consistent with the court's guidance."

Justice Clarence Thomas concurred with the ruling and wrote that Congress may have run afoul of the Constitution's Commerce Clause with the FAAAA.

"Congress made no findings indicating that offsite parking -- conduct that falls within the scope of the States' traditional police powers -- substantially affects interstate commerce," Thomas wrote. "And I doubt that it could."

Click here for the opinion.