Claiming that it only wanted shippers of out-of-state waste into the state to pay their fair share of disposal costs, Oregon imposed a surcharge on disposal of out-of-state waste. The fee was about three times as large as that for in-state waste. The Court found the plan to be a prohibited form of protectionism.
The higher fee for “foreign” waste favored economic interests in Oregon over out-of-state interests. This put the burden on Oregon officials to prove that legitimate interests of the state were present that could not be served by any alternative means that did not discriminate against sister states.
The Court found that no such justifications existed. It was true that out-of-state shippers did not pay general taxes in Oregon, as did their Oregon counterparts, but the gap between in-state and out-of-state disposal fees caused by the surcharge was too wide to be justified on this basis. In addition, general taxes, such as income taxes, and disposal fees are so different in nature that an attempt to weigh the respective tax burdens would be pointless.