Arizona v. New Mexico
Encyclopedia
Arizona v. New Mexico, 425 U.S. 794 (1976), is an opinion from the United States Supreme Court
which denied a motion from the State of Arizona
seeking authorization to file suit against the State of New Mexico
by invoking the original jurisdiction
of the court.
located in northwest New Mexico is transmitted for export and sold in neighboring states. In 1975 New Mexico enacted the Electrical Energy Tax Act, which imposed a tax
on electricity generated by power plants within the state. The tax amounted to about 2 percent of the retail value of electricity. The Act further allowed electric companies in New Mexico to credit the amount of this tax against their existing tax liability from an existing 4 percent gross receipts tax on retail sales of electricity, essentially eliminating the effect of the tax upon New Mexico's in-state users of electricity. Electricity generated from in-state power plants but exported for sale to out-of-state customers did not have any gross receipts tax liability to credit the energy tax against.
Arizona filed a motion seeking to invoke the original jurisdiction of the Supreme Court under Article III
Section 2 of the United States Constitution
for authorization to file a complaint against New Mexico. Section 2 of Article III states that in cases in which a state is a party, the Supreme Court will have original jurisdiction, meaning that the trial will take place before the court. The complaint alleged that the New Mexico energy tax was invalid as it placed an unconstitutional burden on interstate commerce in violation of the Commerce Clause
, denied Arizona due process
and equal protection
under the law under the Fourteenth Amendment
, and abridged the privileges and immunities
guarantied by Article IV
, Section 2 of the Constitution.
New Mexico in its reply to the motion argued that the Court should deny the motion as the three Arizona electric companies
had filed an action in the district court of Santa Fe County
seeking a declaratory judgment
that the energy tax was invalid, and that the companies had refused to pay the tax.
cases. In this case, the Court concluded that the pending state court case was the appropriate forum for litigation of the same issues involving the New Mexico energy tax.
Justice Stevens
filed a concurring opinion
noting that the complaint of Arizona failed to allege that the New Mexico tax has an impact on the electric rates paid by Arizona consumers, and that Arizona was not sufficiently affected by the tax to justify the original jurisdiction of the court. Because the Arizona electric companies, including the Salt River Project
, which is a unit of the Arizona state government, had access to a state court to litigate the issue, Stevens concurred in the judgment.
, 441 U.S. 141 (1979), the Court held that the New Mexico energy tax was invalid under the Supremacy Clause
of the Constitution in light of a federal statute prohibiting such a tax. The federal statute had been enacted specifically to prohibit state electric generation and transmission taxes, such as the New Mexico energy tax, that discriminate against interstate commerce.
Supreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
which denied a motion from the State of Arizona
Arizona
Arizona ; is a state located in the southwestern region of the United States. It is also part of the western United States and the mountain west. The capital and largest city is Phoenix...
seeking authorization to file suit against the State of New Mexico
New Mexico
New Mexico is a state located in the southwest and western regions of the United States. New Mexico is also usually considered one of the Mountain States. With a population density of 16 per square mile, New Mexico is the sixth-most sparsely inhabited U.S...
by invoking the original jurisdiction
Original jurisdiction
The original jurisdiction of a court is the power to hear a case for the first time, as opposed to appellate jurisdiction, when a court has the power to review a lower court's decision.-France:...
of the court.
Background
Most of the electricity generated at the Four Corners Generating StationFour Corners Generating Station
The Four Corners Generating Station is a coal-fired power plant located near Fruitland, New Mexico, United States, on property located within the Navajo Indian Reservation that is leased from the Navajo Nation.-Description:...
located in northwest New Mexico is transmitted for export and sold in neighboring states. In 1975 New Mexico enacted the Electrical Energy Tax Act, which imposed a tax
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
on electricity generated by power plants within the state. The tax amounted to about 2 percent of the retail value of electricity. The Act further allowed electric companies in New Mexico to credit the amount of this tax against their existing tax liability from an existing 4 percent gross receipts tax on retail sales of electricity, essentially eliminating the effect of the tax upon New Mexico's in-state users of electricity. Electricity generated from in-state power plants but exported for sale to out-of-state customers did not have any gross receipts tax liability to credit the energy tax against.
Arizona filed a motion seeking to invoke the original jurisdiction of the Supreme Court under Article III
Article Three of the United States Constitution
Article Three of the United States Constitution establishes the judicial branch of the federal government. The judicial branch comprises the Supreme Court of the United States and lower courts as created by Congress.-Section 1: Federal courts:...
Section 2 of the United States Constitution
United States Constitution
The Constitution of the United States is the supreme law of the United States of America. It is the framework for the organization of the United States government and for the relationship of the federal government with the states, citizens, and all people within the United States.The first three...
for authorization to file a complaint against New Mexico. Section 2 of Article III states that in cases in which a state is a party, the Supreme Court will have original jurisdiction, meaning that the trial will take place before the court. The complaint alleged that the New Mexico energy tax was invalid as it placed an unconstitutional burden on interstate commerce in violation of the Commerce Clause
Commerce Clause
The Commerce Clause is an enumerated power listed in the United States Constitution . The clause states that the United States Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Courts and commentators have tended to...
, denied Arizona due process
Due process
Due process is the legal code that the state must venerate all of the legal rights that are owed to a person under the principle. Due process balances the power of the state law of the land and thus protects individual persons from it...
and equal protection
Equal Protection Clause
The Equal Protection Clause, part of the Fourteenth Amendment to the United States Constitution, provides that "no state shall ... deny to any person within its jurisdiction the equal protection of the laws"...
under the law under the Fourteenth Amendment
Fourteenth Amendment to the United States Constitution
The Fourteenth Amendment to the United States Constitution was adopted on July 9, 1868, as one of the Reconstruction Amendments.Its Citizenship Clause provides a broad definition of citizenship that overruled the Dred Scott v...
, and abridged the privileges and immunities
Privileges and Immunities Clause
The Privileges and Immunities Clause prevents a state from treating citizens of other states in a discriminatory manner...
guarantied by Article IV
Article Four of the United States Constitution
Article Four of the United States Constitution relates to the states. The article outlines the duties states have to each other, as well as those the federal government has to the states...
, Section 2 of the Constitution.
New Mexico in its reply to the motion argued that the Court should deny the motion as the three Arizona electric companies
Electrical power industry
The electric power industry provides the production and delivery of electric energy, often known as power, or electricity, in sufficient quantities to areas that need electricity through a grid connection. The grid distributes electrical energy to customers...
had filed an action in the district court of Santa Fe County
Santa Fe County, New Mexico
-2010:Whereas according to the 2010 U.S. Census Bureau:*76.2% White*0.9% Black*3.1% Native American*1.2% Asian*0.1% Native Hawaiian or Pacific Islander*3.6% Two or more races*14.9% Other races*50.6% Hispanic or Latino -2000:...
seeking a declaratory judgment
Declaratory judgment
A declaratory judgment is a judgment of a court in a civil case which declares the rights, duties, or obligations of one or more parties in a dispute. A declaratory judgment is legally binding, but it does not order any action by a party. In this way, the declaratory judgment is like an action to...
that the energy tax was invalid, and that the companies had refused to pay the tax.
Decision
The Supreme Court in a per curiam opinion denied the motion of Arizona. The opinion noted, based upon its decisions in Massachusetts v. Missouri, 308 U.S. 1 (1939), and Illinois v. City of Milwaukee, 406 U.S. 91 (1972), that the original jurisdiction of the Supreme Court was to be used only in appropriate cases based upon the seriousness of the case and whether another forum was available with jurisdiction over the parties and where the issues could be litigated. By using its discretion and limiting the instances where original jurisdiction was granted, the Court could devote its time and resources to its appellateAppellate jurisdiction
Appellate jurisdiction is the power of the Supreme Court to review decisions and change outcomes of decisions of lower courts. Most appellate jurisdiction is legislatively created, and may consist of appeals by leave of the appellate court or by right...
cases. In this case, the Court concluded that the pending state court case was the appropriate forum for litigation of the same issues involving the New Mexico energy tax.
Justice Stevens
John Paul Stevens
John Paul Stevens served as an Associate Justice of the Supreme Court of the United States from December 19, 1975 until his retirement on June 29, 2010. At the time of his retirement, he was the oldest member of the Court and the third-longest serving justice in the Court's history...
filed a concurring opinion
Concurring opinion
In law, a concurring opinion is a written opinion by one or more judges of a court which agrees with the decision made by the majority of the court, but states different reasons as the basis for his or her decision...
noting that the complaint of Arizona failed to allege that the New Mexico tax has an impact on the electric rates paid by Arizona consumers, and that Arizona was not sufficiently affected by the tax to justify the original jurisdiction of the court. Because the Arizona electric companies, including the Salt River Project
Salt River Project
The Salt River Project is the umbrella name for two separate entities: the Salt River Project Agricultural Improvement and Power District, an agency of the state of Arizona that serves as an electrical utility for the Phoenix metropolitan area, and the Salt River Valley Water Users' Association, a...
, which is a unit of the Arizona state government, had access to a state court to litigate the issue, Stevens concurred in the judgment.
Subsequent developments
The case that the three electric companies had filed in state court eventually was appealed to the Supreme Court. In Arizona Public Service Co. v. SneadArizona Public Service Co. v. Snead
Arizona Public Service Co. v. Snead, 441 U.S. 141 , is a United States Supreme Court decision which held that a New Mexico tax on the generation of electricity was invalid under the Supremacy Clause of the United States Constitution.-Background:...
, 441 U.S. 141 (1979), the Court held that the New Mexico energy tax was invalid under the Supremacy Clause
Supremacy Clause
Article VI, Clause 2 of the United States Constitution, known as the Supremacy Clause, establishes the U.S. Constitution, U.S. Treaties, and Federal Statutes as "the supreme law of the land." The text decrees these to be the highest form of law in the U.S...
of the Constitution in light of a federal statute prohibiting such a tax. The federal statute had been enacted specifically to prohibit state electric generation and transmission taxes, such as the New Mexico energy tax, that discriminate against interstate commerce.