Transportation Executive Summary: When is a Toll a Tax, Round V
This website has reported many times on the pending saga of Rhode Island’s attempt to toll commercial motor vehicles (in the eyes of some) or tax commercial motor vehicles (in the views of others). Link to "When is a Toll a Tax, Round IV."
The United States Court of Appeals for the First Circuit has stepped back into the fray. In the case of American Trucking Associations, Inc. et al. v. Rhode Island Turnpike and Bridge Authority et al., the First Circuit is examined the RhodeWorks Act, a Rhode Island statute that imposed tolls exclusively on tractor-trailers for the use of its bridges on the national highway system. The plaintiff’s in this case argued in the District Court that the tolls violated the Dormant Commerce Clause (“DCC”) by discriminating against interstate commerce. The District Court agreed with the plaintiffs, and permanently enjoined Rhode Island from collecting the tolls. The Defendant’s appeal led us here. 125 F.4th 27 (1st. Cir. 2024).
The first argument advanced was that RhodeWork discriminated against interstate commerce by allowing a small truck exemption. This exemption meant that single-unit trucks (smaller trucks) did not have to pay the tolls, which the plaintiff argued allegedly favored in-state small trucks over out-of-state tractor trailers. The appellate court rejected this claim and concluded that RhodeWorks tolling exemption for smaller trucks did not significantly impact interstate commerce and found no evidence of a substantial competitive advantage for in-state trucks. Additionally, the Court emphasized that discrimination under the DCC only applies when there is competition between “substantially similar entities” in the same market. The appellate court found no evidence that out-of-state tractor trailers and in-state smaller trucks compete in the same market, and so the small truck exemption survived the discrimination claim.
The second argument was that the tolling “caps” in RhodeWorks provided a competitive advantage to in-state trucks, since in-state and out-of-state tractor trailers competed in the same markets. Evidence was presented that in-state tractor trailers disproportionately benefited from the caps as they received more toll reductions than the out of state trucks. Therefore, the appellate court ruled that the tolling caps created a discriminatory impact against interstate commerce and were unconstitutional.
The third issue reviewed by the appellate court was the district court’s conclusion that RhodeWorks small-truck exemption violated the fair-approximation test. Under the fair approximation test, the court focused on whether RhodeWorks imposed fees on trucks that reflected a fair approximation of the use of the facilities for whose benefit they are imposed. With the understanding that the tolls are intended to fix the damage caused by vehicles using the bridges, the defendant’s submitted evidence to the court showing that tractor-trailers cause over 70% of the damage caused to bridges. The court found that the defendant’s reliance on studies estimating that truck-related bridge damage was not “wholly unreasonable” and agreed that the RhodeWorks tolling system fairly approximated the use and damage caused by the larger trucks and their exemption for smaller trucks was justified.
The last issue the court decided was whether the unconstitutional caps could be severed from the rest of the statute imposing the tolls. As severability is governed by state law, the court found that the RhodeWorks caps could be severed without undermining legislative intent. The purpose behind the statute was to generate revenue to fix the highways, and it included a severability clause to ensure that the statute could remain effective even if parts were found unconstitutional. The court dismissed the plaintiff’s argument that the caps were crucial for the statute’s passage, as they found no evidence that the legislature would abandon the entire statute if the caps were removed.
In the end, the court affirmed the district court’s ruling, in part, by (1) finding the caps within the tolls to be unconstitutional and (2) finding that the unlawful caps were severable from the rest of the statute, and reversed in part, finding that the small truck exemption was not discriminatory.
for more information
Contact John F. Fatino for more information about trucking and transportation regulatory matters at 515-288-6041. Taylor J. Mikel, Associate Attorney, assisted in the preparation of these materials.