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CHEMCLENE CORPORATION ET AL. v. COMMONWEALTH PENNSYLVANIA (08/22/85)

decided: August 22, 1985.

CHEMCLENE CORPORATION ET AL., PETITIONERS
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF ENVIRONMENTAL RESOURCES, RESPONDENT



Appeal from the Order of the Pennsylvania Environmental Hearing Board in case of Chemclene Corporation et al. v. Commonwealth of Pennsylvania, Department of Environmental Resources, Docket No. 81-168-M.

COUNSEL

Marc E. Gold, with him, Robert B. McKinstry, Jr., Wolf, Block, Schorr and Solis-Cohen, for petitioners.

Timothy Bergere, with him, Louis A. Naugle and Michele Straube, Assistant Counsels, and Peter Shelley, of Counsel, for respondent.

President Judge Crumlish, Jr., and Judges Rogers, Craig, MacPhail, Barry, Colins and Palladino. Opinion by Judge Rogers.

Author: Rogers

[ 91 Pa. Commw. Page 318]

Chemclene Corporation, Tonawanda Transport Service, Inc., Frontier Chemical Waste Process, Inc., and South Jersey Pollution Control, Inc. (appellants), are engaged in the business of transporting hazardous waste in interstate commerce. They have filed a petition for review of an adjudication of the Environmental Hearing Board (board): (1) dismissing their three constitutional challenges to Section 505(e) of the Solid Waste Management Act (SWMA), Act of July 7, 1980, P.L. 380, 35 P.S. § 6018.505(e), which requires that transporters of hazardous waste file a collateral bond with the Department of Environmental Resources (DER) as a condition for obtaining state hazardous waste transportation licenses; and (2) dismissing their contention that DER's procedures for fixing the amounts of such bonds were void for having been promulgated without compliance with the Act of July 31, 1968, P.L. 769, as amended, 45 P.S. §§ 1102-1208, commonly known as the Commonwealth Documents Law (CDL).

The SWMA provides, inter alia, that no person or municipality shall transport hazardous waste within the Commonwealth without first obtaining a license from DER. Section 505(e) provides, in part, that:

Prior to the issuance of any license for the transportation of hazardous waste, the applicant . . . shall file with the department of collateral bond on a form prescribed and furnished by the department. Such bond shall be payable to the Commonwealth and conditioned upon compliance by the licensee with every requirement

[ 91 Pa. Commw. Page 319]

    of this act, rule and regulation of the department, order of the department and term and condition of the license. The amount of the bond required shall be in an amount determined by the secretary, but in an amount no less than $10,000. The department may require additional bond amounts if the department determines such additional amounts are necessary to guarantee compliance with this act. The licensee may elect to deposit cash or automatically renewable irrevocable letters of credit . . . or negotiable bonds of the United States. . . . No corporate surety bond is authorized by this subsection.

In the Fall of 1980, DER notified each of the appellants of the amount of the collateral bond it was to file with its application for license. The amount of the bond of each applicant was to be determined by reference to a matrix and bond table developed by DER. The appellants filed appeals from this action with the board alleging: (1) that Section 505(e) of the SWMA was unconstitutional; (2) that DER's bond assessment procedures had not been promulgated as provided by the CDL; and (3) that the amounts of their individual bonds were too high. It was agreed by the parties that the appeals would be consolidated and the proceedings bifurcated with the board first deciding the common legal issues, the constitutionality of the Section 505(e) bond requirement and the validity of DER's bond assessment procedures, based upon briefs and a stipulated record and that then, if a transporter desired, the board would hear argument concerning the amount of that bond. The board determined that it was without power to decide the question of the constitutionality of the bond requirement; and it held that DER's bond assessment procedures

[ 91 Pa. Commw. Page 320]

    were valid because they were not required to be promulgated in the manner prescribed by the CDL. The appellants withdrew their complaints concerning the amounts of their bonds. The board thereupon entered an order dismissing the appeals.

Constitutional Issues

The appellants contend that Section 505(e) of the SWMA is unconstitutional because: (1) the regulation of hazardous waste transportation, including the requirement that a bond for compliance with state law be filed, has been preempted by federal law; (2) that Section 505(e) imposes an undue burden on interstate commerce; and (3) that Section 505(e) denies transporters of hazardous waste the equal protection of the laws because by Section 505(a) of SWMA, owners of hazardous waste treatment, storage and disposal facilities may file bonds with corporate sureties and are not required to post collateral.

Preemption

The appellants advance two arguments in support of their preemption theory: (1) that the Section 505(e) bond requirement has been expressly preempted by Section 114 of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. § 9614, and (2) that any state compliance bond requirement has been preempted by the pervasive nature of federal statutes and regulations in the field of hazardous waste transportation.

Where a state's exercise of its police powers is challenged as subversive of Article VI, Section 2, the so-called supremacy clause of the United States Constitution, "we start with the assumption that the historic police powers of the States were not to be superseded

[ 91 Pa. Commw. Page 321]

    by the Federal Act unless that was the clear and manifest purpose of Congress." Rice v. Sante Fe Elevator Corp., 331 U.S. 218, 230 (1947). However, when Congress has unmistakably ordained that its enactments alone were intended to regulate a part of commerce, either by express statutory command, Jones v. Rath Packing Co., 430 U.S. 519 (1977), or by implicit legislative design, City of Burbank v. Lockheed Air Terminal, Inc., 411 U.S. 624 (1973), state laws regulating that aspect of commerce must fall. State laws may be thus preempted because of square conflict with particular provisions of federal law or because of general incompatibility with basic federal objectives as evidenced by federal statutes and regulations. See Ray v. Atlantic Richfield Co., 435 U.S. 151 (1978).

The appellants contend that the collateral bond requirement of Section 505(e) of the SWMA, 35 P.S. § 6018.505(e), is expressly preempted by Section 114(d) of CERCLA, 42 U.S.C. ...


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