SW Legal studies in Business

Proposed State Constitutional Amendment Likely Unconstitutional
Description

The Alabama high court was asked by the Alabama legislature to give an opinion about the likely constitutionality of a proposed amendment to the state constitution that would require certain construction projects to be performed only by Alabama companies or companies that only hired Alabama residents. The court opined that the Commerce Clause would be violated.

Topic Constitutional Law
Key Words

Commerce Clause; State Spending; Instate Companies

C A S E   S U M M A R Y
Facts

A state senate bill in the Alabama legislature proposed an amendment to the state constitution. Members of the state senate requested an opinion of the state supreme court to determine if the proposed amendment would violate the U.S. Constitution. The proposed amendment stated that certain public works projects, such as highway construction and public transportation, would not be funded unless the company receiving the funds "is an Alabama based company or corporation employing only Alabama residents."

Decision

Question answered. Although the Commerce Clause speaks in terms of powers bestowed upon Congress, it also limits the power of the States to erect barriers against interstate trade. The proposed amendment would, on its face, discriminate against interstate trade by providing differential treatment between in-state businesses and out-of-state businesses desiring to work on state highways, roads, bridges, and railroads. Discriminatory laws motivated by simple economic protectionism are subject to a virtually per se rule of invalidity under the Commerce Clause, which can be overcome only by a showing that the State has no other means to advance a legitimate local purpose.

Citation

Opinion of the Justices, ---So.3d--- (2010 WL 876820, Sup. Ct., Ala., 2010)

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