Gray's Disposal Co. v. Metropolitan Government of Nashville

122 S.W.3d 148, 2002 Tenn. App. LEXIS 927
CourtCourt of Appeals of Tennessee
DecidedDecember 31, 2002
StatusPublished
Cited by13 cases

This text of 122 S.W.3d 148 (Gray's Disposal Co. v. Metropolitan Government of Nashville) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gray's Disposal Co. v. Metropolitan Government of Nashville, 122 S.W.3d 148, 2002 Tenn. App. LEXIS 927 (Tenn. Ct. App. 2002).

Opinion

OPINION

W. FRANK CRAWFORD, P.J., W.S.,

delivered the opinion of the court, in which

ALAN E. HIGHERS, J. and DAVID R. FARMER, J., joined.

Garbage haulers filed suit against metro government challenging legality of “tipping fees” imposed by government on disposal of residential solid waste collected outside the city district and disposed of at government-owned waste facility. This suit was consolidated with government action against appellant-haulers for collection of unpaid tipping fees. Court granted government’s Motion for Summary Judgment as to the action filed by appellant-haulers, finding that the tipping fee was not a tax, a rational basis existed for the fee, the fee did not constitute an unlawful flow control mechanism, and the fee was authorized by T.C.A. § 68-211-835(b), thereby immunizing the government from antitrust liability. The trial court further granted government’s Motion for Summary Judgment filed in government’s suit against haulers, finding that no genuine issue of material fact existed as to the amount owed by appellants in unpaid tipping fees. On appeal, haulers challenged fees on double taxation, equal protection, and federal interstate commerce clause grounds, asserting that the tipping fee was an illegal flow control device, unenforceable “double tax,” and violation of haulers’ equal protection rights under 42 U.S.C. § 1983, as it was discriminately applied to haulers disposing of waste from outside the city district, and not those disposing of waste collected within the city district. Haulers further appealed trial court’s grant of summary judgment in the consolidated case on the basis that haulers could not be held liable for payment of fees imposed under an unconstitutional flow control regulation. We affirm the trial court’s grant of summary judgment as to the action filed by appellant-haulers, and vacate the summary judgment Order entered in favor of the government in the action initiated by ap-pellees.

This case involves a dispute over the legality of tipping fees assessed by the Metropolitan Government of Nashville, Davidson County, Tennessee (“Metro”), against individual garbage haulers who collected solid waste from private residents in the General Service District of Nashville, and disposed of the refuse at a government-owned waste facility.

Pursuant to Section 1.03 of the Charter of the Metropolitan Government, read in conjunction with T.C.A. §§ 7-1-105 and 7-2-108(5)(A), Davidson County, Tennessee is divided into two service districts, a General Services District (“GSD”) and an Urban Services District (“USD”). Metro maintains jurisdiction and authority over both districts. The GSD consists of the total area of Davidson County, Tennessee. *152 The USD encompasses the principal city of Nashville and subsequent annexed areas. USD residents “generally receive more services and pay a higher property tax rate.” 1

Under Section 1.05 of the Metropolitan Charter, Metro provides solid waste disposal services to all residents in the GSD and USD. Metro only provides solid waste collection services to residents within the USD. In the USD, the Metropolitan Government collects all residential solid waste through a combination of Public Works’ employees and equipment and private haulers under contract by competitive bidding.

Appellant Gray’s Disposal Co., Inc. (“Gray’s”), is a Tennessee corporation engaged in the “business of collecting garbage as a[sic] agent for the disposal of garbage for owners and residents located and situated in the General Services District.” Gray’s disposed of GSD collected refuse at the Metropolitan Thermal Transfer Corp. (“Thermal”), a solid waste disposal facility owned by Metro. Gray’s did not haul garbage for Nashville, Davidson County residents living within the USD. In November of 1995, Gray’s filed for reorganization under Chapter 11 of the United States Bankruptcy Code. Gray’s continues to operate as a private garbage hauler for GSD residents.

Appellant Ray Webster, d/b/a/ Hermitage Hills Sanitary Co. (“Webster”), is a sole proprietorship organized for the purposes of providing garbage disposal services exclusively to homeowners and residents located in the GSD. Webster disposed of the waste collected from GSD clients at the Thermal facility. Webster did not supply garbage disposal services to homeowners and residents located within the USD. Webster sold Hermitage Hills Sanitary Co. in 1997 for approximately $800,000.00.

In 1975, Metro passed an ordinance imposing a per ton fee on solid waste deliveries to the Thermal facility. This fee is presently labeled a “tipping fee.” Tipping fees are only assessed to deliveries of solid waste collected by haulers outside of the USD. 2 According to appellee’s brief:

*153 The Department of Public Works does not charge itself a tipping fee for delivery of solid waste to Nashville Thermal because there would be no net gain to the Solid Waste Fund through such a budget transfer and the Department would incur more administrative costs. Likewise, the Metropolitan Government does not charge a tipping fee to the private haulers of solid waste on solid waste collected in the USD through their contracts 3 with the Metropolitan Government.

Tipping fees are not paid in cash upon delivery, but are billed to the private haulers on a monthly basis. The amount charged in each bill is based on the weight of the solid waste delivered to Thermal by the individual hauler. Revenues from the tipping fees are deposited in the Metropolitan Government’s Solid Waste Disposal Fund. All costs associated with the collection and disposal of solid waste are paid directly from this fund.

As stated, Gray’s and Webster both utilized the Thermal facility for disposal of solid waste collected from GSD residents. Around 1983, pursuant to the 1975 ordinance, Metro began assessing tipping fees on every delivery of GSD collected waste disposed of at the Thermal facility, including disposals made by appellants. 4 According to the filed Affidavit of Gene Nolan (“Nolan”), Associate Director of Finance for Metro, the stated purpose for these fees is to supplement and balance the program budget for the Public Works Solid Waste Disposal Fund. Nolan further testified that “[t]ax revenues, alone, are not sufficient to pay for the cost of garbage disposal in Davidson County.”

On November 6, 1998, appellants filed a complaint against Metro and Thermal asserting multiple causes of action. Specifically, appellants alleged that the tipping fees charged constituted unlawful flow control devices, violated appellants’ rights under the Tennessee Human Rights Law and Tennessee Civil Rights Statutes, were “contrary to Section 1.05 of the Charter of the Metropolitan Government of Nashville, Davidson County, Tennessee, violated the Interstate Commerce Clause of the United States Constitution and 42 U.S.C. §

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Bluebook (online)
122 S.W.3d 148, 2002 Tenn. App. LEXIS 927, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grays-disposal-co-v-metropolitan-government-of-nashville-tennctapp-2002.