PAUL A. ENGELMAYER, District Judge:
Plaintiffs Riva Janes, Bruce Schwartz, Bette Goldstein, and Hillel Abraham (collectively, "plaintiffs"), on behalf of a class certified for injunctive purposes, bring this action against the Triborough Bridge and Tunnel Authority ("TBTA"); the Metropolitan Transportation Authority ("MTA"); Jay H. Walder, Chairman of the MTA ("Walder"); and James Ferrara, President of the TBTA ("Ferrara") (collectively, "defendants"). Plaintiffs allege that the defendants' differential toll policies, which provide for discounted tolls on the Verrazano Narrows Bridge, the Cross Bay Veterans Memorial Bridge, and the Marine Parkway — Gil Hodges Memorial Bridge that are available only to residents of discrete areas within New York City, are unlawful. Defendants move for summary judgment on plaintiffs' claims. For the reasons that follow, defendants' motion is granted.
The Court begins with a brief overview of the history, purpose, and function of New York City's transit system, which is essential to an understanding of the policies at issue here and plays a substantial role in the Court's legal analysis.
In 1965, the New York State Legislature created the predecessor to today's MTA. Def. 56.1 ¶ 10; Pl. Resp. to Def. 56.1 ¶ 10
Defendants have put before the Court two thorough and articulate reports from well-qualified and able experts, relating to the history, usage, economics and interdependence of the metropolitan area transit
New York City's transit system as it exists today began with the construction of the city's subway system, which opened for the first time on October 27, 1904. Moss Rep. 7. Originally, two companies operated the subway system, under a "dual system" put in place in 1913: the Interborough Rapid Transit Company ("IRT") and the Brooklyn Rapid Transit Company ("BRT").
During the 1920s, this system suffered financially, for a variety of reasons, including the lowering of automobile prices due to mass assembly, a stagnant fare of five cents (and political opposition to raising that fare), and increased fuel costs and wages. Id. at 9, 11. Mayor John F. Hylan therefore envisioned a new subway line owned by the city but which would compete directly with the IRT and BMT and, eventually, would be able to buy out both lines, creating a unified system. Id. at 10. The new system, the Independent ("IND") — known to many as the "people's subway" — opened in 1932. Id. at 10-11. The BMT and IRT, which were neither entitled to subsidies nor able to increase the five-cent fare, responded by cutting salaries, reducing their workforce, and maintaining old equipment rather than purchasing new, in contrast to the IND's "faster, cleaner, modern subways." Id. Ridership on those lines fell significantly. Id. at 11.
Concerned about the system's disrepair, Mayor Fiorello LaGuardia pressed for the unification of the subway system. Id. at 11-12. In 1939, New York City purchased the BMT for $175 million and the IRT for $151 million. Id. at 12. On June 1, 1940, New York City took control of the subways in "the largest railroad merger in U.S. history and the largest financial transaction undertaken by the City of New York at that time." Id.
In response to a drop in ridership in the late 1940s, the New York State Legislature passed legislation reorganizing the subway system and creating the NYC Transit Authority, a semi-independent public corporation run by a board of directors. Id. at 13.
In 1965, New York State created the Metropolitan Commuter Transportation Authority, which soon became the MTA. In 1968, the MTA began overseeing the NYC Transit Authority. Id.; see supra pp. 322-23. From the 1960s through the early 1980s, the subway system suffered an enormous decrease in ridership: By the early 1980s, it had declined to "levels not seen since the 1920s, before the full system was built." Id. at 14. In response, in 1979, the MTA began a rebuilding, rehabilitation,
Today, the New York City mass transit system consists of 24 subway lines and 217 bus routes. Id. at 15. Some 7.4 million people ride the subways and buses each weekday, id.; four of every five rush-hour commuters to New York's central business districts utilize mass transit, id. at 4. The subway today is an integral part of life in New York City.
The Triborough Bridge Authority ("TBA"), chaired by Robert Moses, was created by New York State in 1933 as a public-benefit corporation, originally for the purpose of completing construction of the Triborough Bridge (since renamed the Robert F. Kennedy Bridge). Id. at 25. The TBA was authorized to charge tolls, which were then used to finance construction. Id. The construction of more bridges and tunnels followed, with the goal of "complement[ing] the roads and parkways that [Moses] built, to allow regional traffic to flow well." Id.
In 1940, Moses consolidated the Henry Hudson Parkway Authority, the Marine Parkway Authority, and the New York City Parkway Authority into the TBA to "centralize planning and economy and to fill in gaps in the road and bridge infrastructure." Id. at 26 (citation omitted). In 1946, the New York City Tunnel Authority was also merged into the TBA, creating the TBTA. Id.
New York State's transportation policies began to shift, however, in the 1960s and early 1970s, under the administration of Governor Nelson Rockefeller, moving away "from a highway-focused policy to a broader approach that emphasized maintaining and improving mass transit and intercity rail systems in addition to roads and highways." Id. (citation omitted); see also Molinari v. N.Y. Triborough Bridge and Tunnel Authority, 838 F.Supp. 718, 720 (E.D.N.Y.1993). In 1968, when the MTA began overseeing the New York City Transit Authority, see supra p. 323, the TBTA became an MTA affiliate. The merger, which contemplated "far greater emphasis than ever before on mass transit," signaled that "[t]he age of Moses was over. Begun on April 23, 1924, it had ended on March 1, 1968. After forty four years of power, the power was gone at last." Robert A. Caro, The Power Broker, 1135, 1144 (1974). New York Public Authorities Law § 1264(1) described the new MTA as having as its purpose, "consistent with its status as ex officio board of both the New York [C]ity [T]ransit [A]uthority and the [T]riborough [B]ridge and [T]unnel [A]uthority, to develop and implement a unified mass transportation policy." N.Y. Pub. Auth. L. § 1264(1).
To that end, a system for redistributing surplus TBTA funds was put in place, and exists to this day. New York Public Authorities Law § 1219-a(2)(b), enacted in 1981, requires that $24 million plus 50% of the balance of the TBTA's operating surplus be transferred to the NYCTA, and that the remainder of the operating surplus be transferred to the MTA. See N.Y. Pub. Auth. L. § 1219-a(2)(b); see also Moss Rep. 27; N.Y. Urban League, Inc. v. State of N.Y., 71 F.3d 1031, 1034 (2d Cir. 1995). The TBTA is thus a vital source of revenue helping to fund New York City's mass transit system. That system, in turn, helps "decrease[] traffic congestion on the bridges and tunnels" and "increase[s] accessibility for workers seeking to commute in and through the MTA region... without adding to the traffic on the roads, bridges, and tunnels." Moss Rep. 42-43.
The TBTA bridge and tunnel tolls contribute to a decrease in congestion in more
New York City's transit system differs fundamentally from the systems of other cities, including in the degree to which it consists of a unified, integrated system. "By having responsibility for commuter rail, toll-based bridges and tunnels, buses, and subways, the MTA serves all major modes of travel and transportation within the New York Metropolitan Region, unlike other systems which typically operate only light rail, subways, buses and/or commuter rail systems." Id. at 33. No other transportation agency in the United States controls toll-collecting bridges and tunnels in addition to commuter rail, buses, and subways. Id. As a result, the MTA is able to make "decisions ... with respect to the subways and buses [that] also affect users of the roadways, and vice-versa." Id. The scale of the MTA and its receipt of funds from the TBTA's bridges and tunnels "has enabled the MTA to provide the transportation services that make possible the New York region's unique density and economic productivity." Id. "Without the connectivity provided by MTA bridges, tunnels, subways and commuter rail systems, New York would not be able to maintain its place as the economic engine of the state and a center of global commerce, a position it has held for more than a century." Id. at 47.
Under a system first put in place by the New York State Legislature, and since then adjusted administratively, individuals who are residents of Staten Island, the Rockaways, and Broad Channel receive discounts on the tolls they pay to cross their local bridges. Def. 56.1 ¶¶ 36, 38; Pl. 56.1 ¶¶ 1-2; Herzog Decl. Ex. AA. For residents of Staten Island, this applies to the Verrazano Bridge, which connects Staten Island to Brooklyn and serves as the only artery connecting the borough of Staten Island with the rest of New York City. Moss Rep. 58. For Rockaway and Broad Channel
Staten Island residents who use the E-ZPass system pay $6.36
For residents of the Rockaways and Broad Channel, the toll fares over both the Marine Parkway Bridge and the Cross Bay Bridge are reduced. Def. 56.1 ¶ 36; Herzog Decl. Ex. AA. A Rockaway or Broad Channel resident using E-ZPass pays $1.31 to cross either of those bridges and, in the case of the Cross Bay Bridge, receives a rebate for that entire sum. Herzog Decl. Ex. Z. A non-resident using E-ZPass, by contrast, pays $2. Id.; see also Def. 56.1 ¶ 39. For residents who do not use E-ZPass, a token costs $1.79; for non-residents, a token costs $2.50 or paying cash costs $3.75. Herzog Decl. Ex. Z.
The Resident Discount Programs are summarized in the chart below:
Non-Resident Non-Resident With Resident With Resident With
With E-ZPass Cash (or Tokens) E-ZPass Tokens
Verrazano-Narrows $10.66 $15.00 $6.36 (up to $8.53
Bridge two trips per
Bridge month)/$6.00
(three or more
trips per
month)
Marine $2.00 $2.50 (with token); $1.31 $1.79
Parkway-Gil $3.75 (with cash)
Hodges
Memorial
Bridge
Cross Bay $2.00 $2.50 (with token); $1.31 (rebated $1.79
Veterans $3.75 (with cash) entirely)
Memorial
Bridge
Riva Janes ("Janes") is a resident of New Jersey who, during the relevant period, regularly traveled over the Verrazano Bridge to visit her parents in Brooklyn. Pl. 56.1 ¶ 10; Herzog Decl. Ex. H ("Janes Dep.") 41, 69-70. During these trips, Janes frequently took her parents, who were essentially homebound, shopping for groceries, clothes, and various other items. Pl. 56.1 ¶ 10; Janes Dep. 70-76. On occasion,
Bette Goldstein ("Goldstein") was a resident of New Jersey who commuted to Brooklyn over the Verrazano Bridge for her work as assistant principal and school psychologist at a yeshiva. Pl. 56.1 ¶ 8; Herzog Decl. Ex. I ("Goldstein Dep.") 35-36, 39. On two occasions, Goldstein also traveled from her home in New Jersey to Brooklyn to purchase food at a kosher butcher shop. Pl. 56.1 ¶ 8; Goldstein Dep. 47. She, too, was ineligible for the resident discount over the Verrazano.
Hillel Abraham ("Abraham") regularly commuted over the Verrazano Bridge from his home in Elizabeth, New Jersey to his work at a yeshiva in Brooklyn. Pl. 56.1 ¶ 9; Herzog Decl. Ex. J ("Abraham Dep.") 28, 31-33. In addition, he regularly crossed the Marine Parkway Bridge to pick up his stepson from visits with relatives. Pl. 56.1 ¶ 9; Abraham Dep. 45. As a resident of neither Staten Island nor the Rockaways, he was ineligible for a discount on either bridge.
Bruce Schwartz ("Schwartz"), an accountant, is a resident of Flushing, Queens. Pl. 56.1 ¶ 11; Herzog Decl. Ex. K. ("Schwartz Dep.") 17-19. During the relevant period, Schwartz traveled over the Verrazano Bridge, the Cross Bay Bridge, and the Marine Parkway Bridge, for purposes of both business (i.e., to visit clients) and recreation. Schwartz Dep. 20-23, 33-36; Pl. 56.1 ¶ 11. Although a resident of New York City, Schwartz was neither a Staten Island nor a Rockaway resident, and was thus ineligible for a discount on any of the three bridges.
On February 22, 2006, Schwartz and Janes filed the initial Complaint in this case. Dkt. 1. They alleged that the TBTA's toll policies violate the Commerce Clause of the United States Constitution, U.S. Const. art. I, § 8, cl. 3; the Privileges and Immunities Clause,
On March 6, 2006, the case, then assigned to the Hon. Barbara S. Jones, United States District Judge, was referred to the Hon. Henry B. Pitman, United States Magistrate Judge, for general pretrial supervision. See Dkt. 6.
On April 7, 2008, Judge Pitman stayed this case pending the decision of the Second Circuit in Selevan v. New York Thruway Authority, 584 F.3d 82 (2d Cir.2009), discussed infra at pp. 328-32, because there was substantial overlap between the issues presented there and in this case. See Dkt. 24 (order staying case), 28 (order extending stay), 30 (order extending stay).
On October 5, 2011, 2011 WL 10885430, Judge Jones issued an opinion and order granting in part and denying in part plaintiffs' motion for class certification. Dkt. 51. The Court, pursuant to its authority under Fed.R.Civ.P. 23(c)(4), certified what it termed "an injunctive class" under Rule 23(b)(2). This class sought solely declaratory and injunctive relief, based on plaintiffs' federal constitutional claims. The Court then bifurcated the proceedings, pursuant to Fed.R.Civ.P. 42(b), with one phase focused on federal claims, none of which seek monetary relief, and a second phase focused on state-law damages claims. The Court declined, for the time being, to address whether a class could properly be certified for the damages phase of the case.
On October 7, 2011, the case was reassigned to this Court. Dkt. 52. On October 19, 2011, defendants filed a timely motion for reconsideration of the motion for class certification, asking the Court to deny plaintiffs' motion "to the extent that the putative class ... include[d] persons who lack[ed] standing to seek injunctive and declaratory relief." Dkt. 53. Specifically, defendants argued that three categories of individuals included in the class under Judge Jones's opinion should be excluded from the 23(b)(2) class: (1) current residents of Staten Island, the Rockaway Peninsula, and Broad Channel; (2) persons who no longer have a driver's license or who no longer in fact drive; and (3) persons who have not crossed any of the bridges at issue within the two years preceding entry of the certification order.
On January 3, 2012, this Court granted defendants' motion for reconsideration, narrowing the Rule 23(b)(2) class so that the class boundaries were drawn to exclude persons who lacked standing to seek injunctive or declarative relief.
On July 24, 2013, after the close of fact discovery and in keeping with the scheduling order entered by this Court, see Dkt. 85, defendants moved for summary judgment. Dkt. 86, 87 ("Def. Br."). On August 23, 2013, plaintiffs opposed that motion. Dkt. 91 ("Pl. Br."). On September 9, 2013, defendants submitted a reply brief in support of the motion. Dkt. 96 ("Def. Reply Br.").
On September 24, 2013, the Court heard argument on defendants' motion and reserved decision.
To prevail on a motion for summary judgment, the movant must "show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R.Civ.P. 56(a). The movant bears the burden of demonstrating the absence of a question of material fact. In making this determination, the Court must view all facts "in the light most favorable" to the non-moving party. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); see also Holcomb v. Iona Coll., 521 F.3d 130, 132 (2d Cir.2008). To survive a summary judgment motion, the opposing party must establish a genuine issue of fact by "citing to particular parts of materials in the record." Fed. R.Civ.P. 56(c)(1); see also Wright v. Goord, 554 F.3d 255, 266 (2d Cir.2009). "A party may not rely on mere speculation or conjecture as to the true nature of the facts to overcome a motion for summary judgment." Hicks v. Baines, 593 F.3d 159, 166 (2d Cir.2010) (citation omitted). Only disputes over "facts that might affect the outcome of the suit under the governing law" will preclude a grant of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In determining whether there are genuine issues of material fact, the Court is "required to resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought." Johnson v. Killian, 680 F.3d 234, 236 (2d Cir.2012) (citing Terry v. Ashcroft, 336 F.3d 128, 137 (2d Cir.2003)).
The Court has the benefit of unusually apposite circuit precedent to set the framework for, and guide, its analysis here. In a series of decisions arising out of the Northern District of New York lawsuit in Selevan v. New York Thruway Authority, the Second Circuit has recently considered the constitutionality of residency-based toll discounts.
In the Selevan lawsuit, brought in 2006, plaintiffs
Although the district court held that plaintiffs had satisfied the requirements for Article III standing, it held that prudential standing was lacking as to the Commerce Clause claim, because plaintiffs had not demonstrated that "their use of the Grand Island Bridge, and therefore the Grand Island toll policy, [was] more than marginally within the zone of interests protected by the Commerce Clause.... Plaintiffs ... d[id] not identify any in-state commercial interest that is favored, directly or indirectly, by the challenged toll policy at the expense of out-of-state competing interests." Id. at 172. Accordingly, "any alleged burden on interstate commerce [was] merely negligible." Id.
Finally, the district court dismissed the Equal Protection Clause claim, based on the policy's alleged discriminatory treatment of non-residents who sought to exercise their constitutional right to travel.
In an alternative basis for its ruling as to the Equal Protection claim, the district court held that plaintiffs' claim would fail on the merits. It reasoned that the Equal Protection claim was subject to rational basis review, because any burden on plaintiffs' right to interstate travel was "minimal and insufficient to constitute a deprivation," id. at 177, and plaintiffs had not claimed to be members of a suspect class, id. And, the district court held, defendants had identified a legitimate governmental purpose for the program — namely, "the effort to ameliorate the disparate burden that would befall geographically bridge-dependent residents of Grand Island and the secondary effects of this drain on the community"; thus, the policy easily survived rational basis review. Id.
The Selevan plaintiffs appealed, and on October 15, 2009, the Second Circuit affirmed in part, vacated in part, and remanded. Selevan v. N.Y. Thruway Auth. ("Selevan II"), 584 F.3d 82 (2d Cir.2009). It held that the plaintiffs had prudential standing: Their Dormant Commerce Clause claims were within the "zone-of-interests" because they had sufficiently alleged that the toll affected interstate commerce. Id. at 91-92 ("the zone-of-interests requirement ... is not a rigorous one"; "[w]hether the ... toll is actually a burden on interstate commerce is a question left for later proceedings.").
As to the merits of that claim, the Circuit held that, although plaintiffs had indeed failed to allege that the policy discriminated against interstate commerce so as to render it "virtually invalid per se," the district court had been required to consider whether the policy otherwise violated the Commerce Clause. Id. at 95. In particular, plaintiffs had alleged that the burden imposed on interstate commerce created by the toll was excessive in relation to the benefits conferred; the district court was therefore obliged to consider that issue before resolving the Dormant Commerce Clause claim. Id. at 95-96. It was to do so on remand, the Second Circuit stated, by applying the three-factor test articulated in Northwest Airlines, Inc. v. County of Kent, 510 U.S. 355, 114 S.Ct. 855, 127 L.Ed.2d 183 (1994), to determine whether the fee imposed was reasonable. Specifically: (1) was the toll amount based on some fair approximation of the use of the facility; (2) was it excessive in relation to the benefits conferred; and (3) did it discriminate against interstate commerce? Id. at 369, 114 S.Ct. 855. Although the pleadings had not implicated the third factor,
As to the right to travel claim, under the Fourteenth Amendment's Equal Protection and Privileges or Immunities Clauses, the Second Circuit held, the district court had not applied the correct analysis. It had failed to consider the Privileges or Immunities claim, and had misapplied rational basis review. Instead, the Second Circuit held, the proper inquiry was, first, whether the differential policy represented an "invidious distinction[] that penalize[d] the right to travel" and thus merited strict scrutiny, or whether it instead served as "merely a minor restriction on travel that [did] not amount to the denial of a fundamental right." If the latter, the district court was to apply the test formulated in Northwest Airlines.
Following remand, the filing of a second amended complaint, and discovery, defendants moved for summary judgment. Analyzing the Dormant Commerce Clause claim, the district court applied the first two prongs of the Northwest Airlines test, as directed. It held that the toll structure satisfied both prongs, and granted defendants' motion for summary judgment. Selevan v. N.Y. Thruway Auth. ("Selevan III"), No. 06-cv-291 (GLS/DRH), 2011 WL 5974988, at *6 (N.D.N.Y. Nov. 28, 2011).
As to the right to travel claim, under the Fourteenth Amendment's Privileges or Immunities and Equal Protection clauses, the district court held that, even with the addition of two new plaintiffs who commuted to work via the Grand Island Bridge, the toll still constituted no more than a minor restriction on travel. Id. It then considered whether the toll nevertheless penalized the right to travel, and was thus subject to strict scrutiny, or was instead "designed only to make the user of state-provided facilities pay a reasonable fee to help defray the costs of their construction and maintenance." Id. (citation omitted). Finding that the toll represented a reasonable user fee, the district court held that "strict scrutiny [was] inappropriate here, and the permissibility of the ... fee scheme hinges on the application of the Northwest Airlines test." Id. Having already applied that test in analyzing the Dormant Commerce Clause claim and having found that the policy survived it, the district court also granted defendants' motion for summary judgment on the right to travel claim.
Plaintiffs again appealed. Per curiam, the Second Circuit held, with the district court, that the toll policy was a minor restriction on travel that constituted a reasonable user fee and did not involve "invidious distinctions." Selevan v. N.Y. Thruway Auth. ("Selevan IV"), 711 F.3d 253, 258, 261 (2d Cir.2013). Accordingly, it held, the district court had correctly applied, in lieu of strict scrutiny review, the Northwest Airlines test to evaluate both
Guided by the Second Circuit's analyses in the Selevan decisions, the Court turns first to plaintiffs' right to travel claim. "[F]reedom to travel throughout the United States has long been recognized as a basic right under the Constitution." United States v. Guest, 383 U.S. 745, 758, 86 S.Ct. 1170, 16 L.Ed.2d 239 (1966); see also Attorney Gen. of N.Y. v. Soto-Lopez, 476 U.S. 898, 901-02, 106 S.Ct. 2317, 90 L.Ed.2d 899 (1986); Williams v. Town of Greenburgh, 535 F.3d 71, 75 (2d Cir.2008). Although the Supreme Court has "not felt impelled to locate this right definitively in any particular constitutional provision," Soto-Lopez, 476 U.S. at 902, 106 S.Ct. 2317, it is "variously assigned to the Privileges and Immunities Clause of Article IV, to the Commerce Clause, and to the Privileges [or] Immunities Clause of the Fourteenth Amendment," id., as well as the Equal Protection Clause of the Fourteenth Amendment, see Zobel v. Williams, 457 U.S. 55, 67, 102 S.Ct. 2309, 72 L.Ed.2d 672 (1982) (Brennan, J., concurring). This right encompasses intrastate, as well as interstate, travel. Selevan II, 584 F.3d at 100; Greenburgh, 535 F.3d at 75; King v. New Rochelle Mun. Hous. Auth., 442 F.2d 646, 648-49 (2d Cir.1971). "A state law implicates the right to travel when it actually deters such travel, when impeding travel is its primary objective, or when it uses any classification which serves to penalize the exercise of that right." Soto-Lopez, 476 U.S. at 903, 106 S.Ct. 2317 (citations omitted). And "`[w]hen a local regulation infringes upon a constitutionally-protected right, we apply strict scrutiny, requiring the municipality to show that the regulation is narrowly tailored to serve a compelling governmental interest.'" Selevan II, 584 F.3d at 100 (quoting Town of Southold v. E. Hampton, 477 F.3d 38, 53 (2d Cir.2007)).
Plaintiffs argue that the differential toll structure here presents a "pure case" of burdening "travel qua travel." Pl. Br. 8-9. Citing Selevan II, they argue that it represents a "discriminatory imposition on a fundamental right" and an "invidious distinction[] that penalize[s] the right to travel." Pl. Br.13 (citations omitted).
But plaintiffs misapprehend Selevan II. The Second Circuit did not hold there that the fundamental right to travel is implicated, and strict scrutiny therefore applied, in every instance in which a state regulation somehow affects travel. Instead, the Second Circuit distinguished between circumstances in which states have, for example, conditioned benefits or rights on a durational residency in the state, in which strict scrutiny is required, from state-imposed "minor restrictions on travel." The latter, the Second Circuit stated, "simply do not amount to the denial of a fundamental right" and do not merit strict scrutiny. Selevan II, 584 F.3d at 101 (quoting Town of Southold, 477 F.3d at 54); see also Weisshaus v. Port Auth. of N.Y. & N.J., 497 Fed.Appx. 102, 104 (2d Cir.2012) (summary order) ("[M]inor restrictions on travel simply do not amount to the denial of a fundamental right."); Miller v. Reed, 176 F.3d 1202, 1205 (9th Cir.1999) ("[M]inor burdens impacting interstate travel, such as toll roads, do not constitute a violation of th[e] right [to travel]."). In thus synthesizing the case law, the Second Circuit was in accord with Evansville-Vanderburgh Airport Auth. Dist. v. Delta Airlines,
Plaintiffs here seek to distinguish this line of authority. They emphasize that cases like Evansville-Vanderburgh upholding fees or charges used to fund construction and maintenance as minor restrictions involved fees that applied uniformly to all users. By contrast, they note, the differential toll policy discriminates among users depending on their residence. But the same was so in Selevan. And the Second Circuit there ultimately upheld the decision of the district court on remand that the differential toll there represented a reasonable user fee and a minor restriction to which strict scrutiny review did not apply.
Recognizing this problem presented by Selevan, at argument, plaintiffs identified various ostensible distinctions between this case and Selevan, and offered a demonstrative handout chronicling these distinctions. See Court Exhibit I ("Seven Distinctions Between This Case and Selevan II and [IV]") (Dkt. 101). These, plaintiffs argued, justify applying strict scrutiny here even though it was not applied in Selevan.
Of plaintiffs' distinctions, only one merits extended discussion. Plaintiffs argue that the tolls here are sufficiently larger than in Selevan, whether measured in absolute terms or by the differential between base and discounted fees, so as to make them "invidious" to justify strict scrutiny. Arithmetically, plaintiffs are correct that the tolls are distinguishable. Selevan involved tolls that reached a maximum of 75 cents in each direction; whereas the tolls here reach $15 for a round-trip on the Verrazano Bridge (for non-residents who do not use E-ZPass) and $2.50 each way on the Marine Parkway and Cross-Bay Bridges (same).
But these differences are not of constitutional magnitude. First, measured in percentage rather than absolute terms, the differentials between resident and non-resident tolls here are less than those in Selevan: At the point in time at which they were measured, the resident discount in Selevan resulted in a 66-cent (i.e., 88%) resident discount on a 75-cent toll.
Plaintiffs point to no case, within this Circuit or beyond, in which a differential toll policy has been held an "invidious distinction" so as to require application of strict scrutiny. Instead, in every case of this type, courts have held that a differential toll policy does not violate the right to travel. In Cohen, the district court, noting that the Supreme Court has upheld "bona fide residence requirements" which "further[] the substantial state interest in assuring that services provided for its residents are enjoyed only by residents," upheld toll discounts for residents of Rhode Island, stating that this policy did "not burden or penalize the constitutional right of interstate travel, for any person is free to move to a State and to establish residence there." 775 F.Supp.2d at 451 (citations omitted). Such requirements are distinguished from "durational, fixed date, and fixed point residence requirements, which treat established residents differently based on the time they migrated into the State." Id. (citation omitted). The toll discount for Rhode Island residents, it held, "plainly qualifie[d] as a `bona fide residence requirement' under the Supreme Court's definition," noting that "all members of the Plaintiff class are free to move to Rhode Island and to establish residence there." Id.
The district court in Surprenant ruled likewise. It held that the Massachusetts toll program at issue did not inhibit the plaintiff's right to travel "in any meaningful sense." It noted that "[w]hether a burden placed by a State on a nonresident is unreasonable under the Privileges and Immunities Clause, turns on whether the challenged classification strikes at the heart of an interest deemed so fundamental that its derogation would hinder the formation, the purpose, or the development of a single Union of the states. To constitute a penalty compromising the right to travel, a toll differential must have a significant effect on interstate travel." 2010 WL 785306, at *7 (citations omitted); see also Kelen, 2007 WL 1418510, at *4-5. Surprenant, the plaintiff there, was not prevented from using the relevant bridges and tunnels; instead, like the plaintiffs here, she was "simply require[d] ... to pay the same rate as almost all other travelers, including the overwhelming majority of [in-state] residents." Id.
Similarly, here, defendants convincingly demonstrate that more New Yorkers than residents from outside the state pay the non-discounted tolls. See Def. 56.1 ¶ 52, Small Rep. 20-22. To be sure, as defendants concede, this factor alone is not dispositive. See 9/24/13 H'g. Tr. 10; see also Selevan II, 584 F.3d at 92 ("We have never suggested that a state regulation must benefit a large percentage of the state's population in order to violate the dormant Commerce Clause."). But plaintiffs have not shown, by any measure or metric, a significant effect on interstate travel so as to merit application of strict scrutiny or a serious basis to believe that the policy meaningfully implicates out-of-staters' fundamental right to travel. To the contrary,
Seeking to distinguish Selevan on a different ground, plaintiffs note that, unlike the plaintiffs in Selevan, they bring an "equal right to earn a living claim." But that claim is no salvage. Plaintiffs rely on Hicklin v. Orbeck, 437 U.S. 518, 98 S.Ct. 2482, 57 L.Ed.2d 397 (1978), and United Building, 465 U.S. 208, 104 S.Ct. 1020, which examined the Privileges and Immunities Clause in the context of a right to earn a living claim. Under that line of cases, the Court has held that there must be a "substantial reason" for a difference in treatment of in-state versus out-of-state residents, and that nonresidents "must somehow be shown to `constitute a peculiar source of the evil at which the statute is aimed.'" United Building, 465 U.S. at 222, 104 S.Ct. 1020 (quoting Toomer v. Witsell, 334 U.S. 385, 396, 68 S.Ct. 1156, 92 L.Ed. 1460 (1948)). But as the Supreme Court has recently clarified, when it "has struck laws down as violating the privilege of pursuing a common calling," it has done so "only when those laws were enacted for the protectionist purposes of burdening out-of-state citizens"; in other words, where "the clear aim of the statute at issue was to advantage in-state workers and commercial interests at the expense of their out-of-state counterparts." McBurney v. Young, ___ U.S. ___, 133 S.Ct. 1709, 1715, 185 L.Ed.2d 758 (2013).
Here, there is no credible basis for claiming that the differential toll policies at issue arose from the impulse to protect in-state workers and commercial interests over others. The policies on their faces do not distinguish between in-state and out-of-state residents; instead, they benefit only a small subset of in-state residents based on their isolated places of residence. And the residential discount does not apply to businesses, but only to individuals. The differential toll policy thus affects commercial interests only insofar as it lessens the cost of commutes for residents who must cross the bridges to go to work, while not reducing tolls for non-residents who must do the same. Under Selevan, that is insufficient to trigger strict scrutiny. In Selevan IV, in fact, the Second Circuit addressed and rejected a similar argument. The Second Circuit noted that it "[ha]d not indicate[d] that the district court could and should apply strict scrutiny... if the plaintiffs included individuals who traveled the [bridge] in the course of commuting to work," because "the mere addition [to the case] of plaintiffs who pay the commuter rate did not transform a minor restriction on travel into an instance of invidious distinctions." 711 F.3d at 258. As the Supreme Court recently explained in McBurney: "While the [Privileges and Immunities] Clause forbids a state from intentionally giving its own citizens a competitive advantage in business or employment, the Clause does not require that a State tailor its every action to avoid any incidental effect on out-of-state tradesmen." 133 S.Ct. at 1716. This logic, which accords with that in Selevan, dictates rejecting plaintiffs' argument here.
Where a toll policy is deemed not to merit strict scrutiny, it should be analyzed under the Northwest Airlines test to determine whether the toll discriminates against interstate commerce. See Selevan II, 584 F.3d at 102. As noted above, that test is also part of the Commerce Clause analysis. Because, with strict scrutiny held inapplicable, the two inquiries collapse, the Court applies the Northwest Airlines test to the toll policies at issue here in the course of its Dormant Commerce Clause analysis, which follows.
Plaintiffs argue that the differential toll policies at issue violate the Dormant Commerce Clause, see U.S. Const. art. I, § 8, cl. 3. The Dormant Commerce Clause is a "doctrine inferred from the Commerce Clause" that "`restrict[s] permissible state regulation.'" Entergy Nuclear Vermont Yankee, LLC v. Shumlin, 733 F.3d 393, 429 (2d Cir.2013) (quoting Hughes v. Oklahoma, 441 U.S. 322, 326, 99 S.Ct. 1727, 60 L.Ed.2d 250 (1979)). The Dormant Commerce Clause is animated by the "principle that one state in its dealings with another may not place itself in a position of economic isolation." H.P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 538, 69 S.Ct. 657, 93 L.Ed. 865 (1949); see also McBurney, 133 S.Ct. at 1719-20 ("[The Dormant Commerce Clause] is driven by a concern about economic protectionism — that is, regulatory measures designed to benefit in-state economic interests by burdening out-of-state competitors." (citation omitted)). Accordingly, the Dormant Commerce Clause "`prohibits state taxation or regulation that discriminates against or unduly burdens interstate commerce and thereby impedes free private trade in the national marketplace.'" Selevan II, 584 F.3d at 90 (quoting Gen. Motors Corp. v. Tracy, 519 U.S. 278, 287, 117 S.Ct. 811, 136 L.Ed.2d 761 (1997)). There is, however, "a residuum of power in the state to make laws governing matters of local concern which nevertheless in some measure affect interstate commerce or even, to some extent, regulate it." Thus, "the Commerce Clause does not ... invalidate all State restrictions on commerce." Selevan II, 584 F.3d at 90 (citations omitted). A regulation
Specifically, under the three-factor Northwest Airlines test, the Court "asks whether the fee `(1) is based on some fair approximation of use of the facilities, (2) is not excessive in relation to the benefits conferred, and (3) does not discriminate against interstate commerce.'" Selevan IV, 711 F.3d at 259 (quoting Northwest Airlines, 510 U.S. at 369, 114 S.Ct. 855); see also Selevan II, 584 F.3d at 96, 98. Although listed as the third factor, whether the policy discriminates against interstate commerce is the threshold inquiry; if a policy fails that prong, it is "virtually invalid per se." Selevan II, 584 F.3d at 94. Accordingly, the Court addresses that factor first.
The Supreme Court has "interpreted the Commerce Clause to invalidate local laws that impose commercial barriers or discriminate against an article of commerce by reason of its origin or destination out of State." C & A Carbone, Inc. v. Town of Clarkstown, N.Y., 511 U.S. 383, 390, 114 S.Ct. 1677, 128 L.Ed.2d 399 (1994); see also Selevan II, 584 F.3d at 95. The party challenging the validity of a state statute or regulation bears the burden of showing that it discriminates against, or places some burden on, interstate commerce. Hughes v. Oklahoma, 441 U.S. 322, 336, 99 S.Ct. 1727, 60 L.Ed.2d 250 (1979). Discrimination against interstate commerce occurs where "an[] in-state commercial interest ... is favored, directly or indirectly, by the challenged statutes at the expense of out-of-state competitors." Grand River Enters. Six Nations, Ltd. v. Pryor, 425 F.3d 158, 169 (2d Cir.2005). "The `common thread' among those cases in which the Court has found a dormant Commerce Clause violation is that `the State interfered with the natural functioning of the interstate market either through prohibition or through burdensome regulation.'" McBurney, 133 S.Ct. at 1720 (quoting Hughes v. Alexandria Scrap Corp., 426 U.S. 794, 806, 96 S.Ct. 2488, 49 L.Ed.2d 220 (1976)).
The toll policies at issue here, however, do not either prohibit or significantly restrict access to the New York marketplace or regulate that marketplace in a burdensome fashion. And plaintiffs fail to adduce evidence of an in-state commercial interest that is favored over an out-of-state one. To be sure, some plaintiffs here require use of the bridges to commute to work from out-of-state, and pay the non-discounted rate. But, as Selevan teaches, that fact is insufficient to show disadvantage to an out-of-state interest. See supra p. 335-36 (quoting Selevan IV, 711 F.3d at 258); see also Selevan IV, 711 F.3d at 261 n. 8. Further, as to the plaintiffs who commute from out of state, the evidence adduced in discovery demonstrated convincingly that they have not been seriously affected by the tolls in place. See Def. 56.1 ¶ 42 ("Of the four named plaintiffs, three have not changed their use of the Verrazano-Narrows, Cross Bay, or Marine Parkway bridges at all in light of the tolls, and the fourth has used an alternate route on occasion."); see also October 5, 2011 Memorandum & Order (Dkt. 51) 4-5; Janes Dep. 44; Goldstein Dep. 35-48;
On the summary judgment record, every indication is therefore that the tolls here do not interfere with the natural functioning of the interstate market. "The critical consideration is the overall effect of the [regulation] on both local and interstate activity." Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth., 476 U.S. 573, 579, 106 S.Ct. 2080, 90 L.Ed.2d 552 (1986); see also Am. Booksellers Found. v. Dean, 342 F.3d 96, 102 (2d Cir.2003). Relevant to the inquiry as to discrimination against interstate commerce, more New Yorkers pay the undiscounted toll rates than do residents from outside the state. See Small Rep. 20-22. And the policies benefit only a small number of New York residents: As of February 15, 2013, there were 164,001 Staten Island Resident E-Z Pass Accounts and 39,459 Staten Island Resident Sticker Accounts for the purchase of discounted tokens and carpool tickets; and as to the Rockaway Resident Discount Program, there were only 19,375 Rockaway Resident E-Z Pass Accounts and 1,851 Rockaway Resident Sticker Accounts for the purchase of discounted resident tokens. See Terry Decl. ¶ 2. Id. To be sure, that in-state residents are disadvantaged by the policies along with outsiders does not foreclose a finding of discrimination against interstate commerce. See, e.g., C & A Carbone, 511 U.S. at 391, 114 S.Ct. 1677; Dean Milk Co. v. Madison, 340 U.S. 349, 354 n. 4, 71 S.Ct. 295, 95 L.Ed. 329 (1951); Selevan II, 584 F.3d at 92; see also supra pp. 334-35. But it supplies a valuable gauge of the policies' overall effect, and strongly undermines any claim that they are driven by "economic protectionism." See Nichols Media Grp., LLC v. Town of Babylon, 365 F.Supp.2d 295, 314-15 (E.D.N.Y.2005); cf. C & A Carbone, 511 U.S. at 404, 114 S.Ct. 1677 (O'Connor, J., concurring) ("[T]he fact that interests within the regulating jurisdiction are equally affected by the challenged enactment counsels against a finding of discrimination.... The existence of substantial in-state interests harmed by a regulation is a powerful safeguard against legislative discrimination." (citation omitted)).
Finally, the benign purpose underlying the challenged policies is apparent. The policies are self-evidently motivated by a desire to reduce the burden suffered by geographically isolated New York residents, who have little or no practical access to mass transit. See Ring Dep. 48-50; Klafter Decl. Ex. M (legislative materials); Monteleone Decl. Ex. DD. Plaintiffs do not dispute that such was the intention underlying the policy. They instead dispute that instituting differential toll policies, even for such purposes, is constitutionally permissible, dubbing it, "aid[ing the] home team." Pl. Br. 24; see also 9/24/13 H'g Tr. 49; Ct. Ex. I ¶ 5. But the Supreme Court teaches that, in this area, benign purposes are germane. "The crucial inquiry ... must be directed to determining whether [the policy] is basically a
Plaintiffs rely on cases holding statutes or regulations to violate the Dormant Commerce Clause. See, e.g., C & A Carbone, 511 U.S. at 390-95, 114 S.Ct. 1677; Oregon Waste Systems, Inc. v. Dep't of Environmental Quality of State of Oregon, 511 U.S. 93, 99-100, 114 S.Ct. 1345, 128 L.Ed.2d 13 (1994); Bacchus Imports, Ltd. v. Dias, 468 U.S. 263, 270-73, 104 S.Ct. 3049, 82 L.Ed.2d 200 (1984). But these cases are very far afield. Here, there is no local business, industry, or monopoly that the toll discounts could credibly be viewed as designed to promote or protect — or as even having the unintended effect of bolstering. The discounts instead bespeak an attempt by New York State to alleviate unique geographic burdens affecting a small subset of the community. That is a legitimate and non-discriminatory governmental purpose.
C & A Carbone, which both parties address, supplies a revealing contrast. Plaintiffs there challenged as a violation of the Dormant Commerce Clause an ordinance adopted by the town of Clarkstown, New York, which required all solid waste to be processed at a designated transfer station before leaving the municipality. 511 U.S. at 386, 114 S.Ct. 1677. As the town admitted, the purpose of the requirement was to offset the cost of the construction and maintenance of the transfer station itself. See id. at 386, 394, 114 S.Ct. 1677. The Supreme Court held that the Clarkstown ordinance discriminated against interstate commerce, because it "deprived [out-of-staters] of access to local demand for their services" and "squelche[d] competition in the waste-processing service ..., leaving no room for investment from outside." Id. at 392, 114 S.Ct. 1677.
The toll policy here is altogether different. It does not protect or elevate a local business, let alone do so at the expense of out-of-staters. It does not limit out-of-staters' access to any instate market. That commuters from out of state may have to pay more than select geographically challenged in-state residents to travel to work does not disfavor out-of-state interests. Indeed, it is far from clear why such a policy would benefit an in-state business. If anything, a toll policy that lowers tolls for outbound, but not incoming, commuters might tend to harm local businesses competing for talented employees and customers.
The differential toll policies thus clear the threshold inquiry presented by the third prong of the Northwest Airlines test. The Court therefore turns to the first and second prongs, which address the reasonableness of these policies.
This first prong of the Northwest Airlines test inquires whether the fee imposed is based on some fair approximation of use of the facilities. It does not require a "perfect fit"; "it simply requires reasonableness." Selevan II, 584 F.3d at 98.
Defendants have amassed an impressive record demonstrating that the tolls for using the Verrazano, Marine Parkway, and Cross Bay bridges are based upon a fair approximation of the use of those facilities. The toll discounts are provided to residents of remote geographical areas who must use these bridges frequently, for
Small Rep. 17-18.
Disputing that the tolls reflect a fair approximation of use, plaintiffs note that the TBTA is unaware of any analysis undertaken at the time the current toll policies were adopted to justify setting the specific amount of the discounts. They also argue that nonresidents are charged unduly more than residents for use of these bridges. Pl. Br. 19. But the requirement of a "fair approximation" seeks reasonableness and broad proportionality. It does not require precise tailoring, or a pre-enactment administrative record, for toll amounts to be justified. And the tolls at issue here are not confiscatory. As the statistics related by defendants' experts reflect, they fairly approximate usage patterns on the bridges.
Plaintiffs also take issue with the proposition that "those who use the bridge more ... [should] pay less," id. But these policy views aside, under the Dormant Commerce Clause, it is reasonable, and consistent with the requirement of a fair approximation of usage, to enact a differential toll policy where doing so creates "incentives for individuals and families to live in areas that are underserved by mass transit and are in locations that are at the edge of the rest of the city," Moss Rep. 59, and alleviates the burdens on frequent users, Small Rep. 17. Plaintiffs have not demonstrated that, as a matter of logic or fact, adopting a differential toll policy for these purposes is unreasonable.
There is no material issue of fact bearing on whether the toll discounts represent a "fair approximation of use." On the undisputed facts, they do, and are eminently reasonable. The first prong of the Northwest Airlines test is, therefore, met.
Defendants have adduced evidence that compellingly establishes the second Northwest Airlines prong — that the toll not be excessive in relation to the benefits conferred. Defendants' expert reports persuasively demonstrate that the tolls charged for use of the TBTA bridges, used to strengthen the city's mass transit system, confer vast benefits enjoyed by all
The Second Circuit has held, as to this prong, that there must be a "functional relationship" between a fee or toll and those who pay it. See Bridgeport & Port Jefferson Steamboat Co. v. Bridgeport Port Auth., 567 F.3d 79, 87 (2d Cir.2009) (while holding that a ferry toll did not bear a close enough functional relationship to the benefits conferred on its passengers, stating that "a user fee ... may reasonably support the budget of a governmental unit that operates facilities that bear at least a `functional relationship' to facilities used by the fee payers"); cf. Automobile Club of N.Y., Inc. v. Port Auth. of N.Y. & N.J., 887 F.2d 417, 422 (2d Cir.1989) (finding a close "functional relationship" between the PATH train and the Port Authority's bridges and tunnels, noting that PATH "benefits the entire interstate transportation network because the effects of eliminating PATH would extend all the way north to the George Washington Bridge and all the way south to each of the Staten Island bridges"); Molinari, 838 F.Supp. at 726-27 ("Those who pay the tolls on the Verrazano-Narrows Bridge benefit from the subways, buses and the commuter rail lines because, without those facilities, it would become increasingly more difficult, if not impossible, for them to commute once they crossed the Narrows."). Such a functional relationship is easily shown here. Defendants have impressively demonstrated the value of mass transit in reducing congestion on bridges and tunnels throughout New York City. That benefit is enjoyed especially by commuters to and from locations where mass transit options also exist, providing an alternative option to those particular arteries for commuters and thus decreasing the traffic thereon. But, as defendants' experts have shown, it benefits all commuters, including because those commuters eventually reach portions of the city that are served, and benefited by, a smoothly functioning mass transit system. See Molinari, 838 F.Supp. at 726 (rejecting argument that, because mass transit did not provide an alternative to use of the Verrazano Bridge, it did not contribute to reducing bridge congestion).
Plaintiffs do not factually dispute any of this. Nor do they dispute that under the second prong of the Northwest Airlines test, it is fair to consider the benefits that flow from the tolls charged on TBTA bridges on the entire transportation system within the New York City area. See
Instead, plaintiffs appear to argue that, for the differential tolls to be valid, there must be a disproportionate, or outsized, benefit received by those who pay the higher fee. See Pl Br. 19 ("Any benefits motorists enjoy from lower road and highway congestion due to a strong mass transit system are enjoyed by TBTA facility users and non-users alike, so an analysis under the prong linking those unquantifiable indirect benefits with TBTA tolls is not valid."). But plaintiffs offer no legal support for the notion that, for a fee or toll to be valid under the second Northwest Airlines prong, its benefits must redound lopsidedly to those who pay that fee or toll. Rather, it is enough that such persons benefit in fair relation to the fees or tolls they pay. Here, the undisputed evidence shows, emphatically, that they do.
The differential toll policies in question, therefore, satisfy all three prongs of the Northwest Airlines test. The Court, accordingly, rejects plaintiffs' claim that these policies violate the Dormant Commerce Clause, or infringe plaintiffs' right to travel.
Plaintiffs also bring claims under the New York State Constitution, and state common law claims for unjust enrichment and money had and received.
Plaintiffs concede that "the New York State law claims ... are derivative of the federal claims." Pl. Br. 1 n. 1.
For the foregoing reasons, the Court rejects plaintiffs' claims that the Rockaway and Staten Island Resident Discount toll policies are unconstitutional, and enters summary judgment in favor of defendants on all claims. The Clerk of Court is directed to terminate the motion pending at docket number 86, and to close this case.
SO ORDERED.
Dkt. 68 at 10.
