Court Restricts Congress' Power to Legislate on Behalf of Disabled

In a rather startling decision, the Eighth Circuit has held that Congress does not have the power under the Commerce Clause to prohibit a $2 fee charged for disabled parking placards because the fee has no substantial effect on interstate commerce. Klingler v. Director, Department of Revenue, 2004 WL 936687 (8th Cir. May 3, 2004). The court's restrictive view of interstate commerce harkens back to pre-1937 decisions striking down New Deal legislation.

The plaintiffs claimed that the fee violated a regulation under the Americans with Disabilities Act that prohibits any "surcharge" on a disabled person to cover the costs of complying with the ADA's nondiscrimination requirements. The court declined to address whether the fee even violated the ADA regulation but went straight to the constitutional issue, saying, "this is one of those rare occasions where the appropriate resolution of the constitutional issue is reasonably straightforward and determinate and the resolution of the statutory issue is, by contrast, difficult and complex."

The court rejected the plaintiffs' claim that it need only examine whether Title II of the ADA, which prohibits public entities from discriminating against the disabled, is permissible legislation under the Commerce Clause. Instead, the court scrutinized whether the particular form of discrimination affects interstate commerce-that is, whether the $2 placard fee itself is "closely connected to some national commercial market." The court thought it important that Congress made "no findings that the type of parking placard fees being regulated here substantially affect interstate commerce." As the dissent points out, however, "Congress could not possibly make express findings about every situation to which the ADA might be extended, nor is it required to do so under the Commerce Clause."

The court set forth several ways in which the placard fee could be viewed as related to interstate commerce, but then rejected every one. The fee "does involve the collection of money, and can thus perhaps be classified as 'economic' in a sense." But the court insisted that Congress only has the power to regulate activities that are "commercial" rather than more broadly "economic," and held that "nonprofit revenue collection for state government" is not commercial. The court agreed that the transferable parking placards enable disabled persons to get into stores, use rental cars, and otherwise participate in interstate commerce, but the court then opined that the $2 fee does not substantially restrict those activities. Finally, the fee "could be deemed to affect interstate commerce substantially" because "[o]ne could reasonably presume that a sizeable portion of the [$400,000 per year generated by the fee] would, in the absence of the placard fee, have ended up flowing through the various channels of interstate commerce." But the court felt that this effect was too indirect and remote.

The plaintiffs argued that this case was similar to those under the Civil Rights Act of 1964 holding that Congress could prohibit discrimination in hotels that served interstate travelers or at a small local restaurant whose food had moved in interstate commerce. The court distinguished those cases by finding that the economic transactions at issue were significant in the aggregate, whereas there was no finding that the $2 fee was. Yet the discrimination that Congress was prohibiting in the Civil Rights Act is no more commercial than discriminatory imposition of the placard fee, and the interstate commerce link seems equally strong or attenuated in both.

The dissent argued that the majority was attacking each of these interstate commerce justifications as though they were "an ordinary fact to be proved by a preponderance of the evidence." However, they were instead legislative facts, and "we owe it to Congress to assume the existence of any state of facts reasonably conceivable by the legislature at the time the statute was enacted." When the constitutionality of a statute is in question, "We should give Congress the benefit of the doubt."

The implications to the majority's approach are profound. Although the activity challenged in this case involves a public entity, the court's analysis is equally applicable to a private setting. Much of what Congress does under its Commerce Clause power is motivated by noncommercial concerns, and certainly has little to do with interstate commerce in the literal sense. Fair housing laws that protect the elderly and disabled against discrimination in private housing, for example, have little to do with interstate commerce. Similarly, the Endangered Species Act is under attack by conservative judges who believe that Congress only has the power to protect commercially viable species traded in interstate commerce. The Supreme Court has recently begun cutting back on the broad deference that it has given Congress since 1937. If the Eighth Circuit's decision in Klingler is any indication, soon Congress may only be able to protect the elderly, disabled and other vulnerable communities when doing so serves commercial purposes. It remains to be seen how far the Court will go but, clearly, the power of Congress to protect against discrimination is shrinking.