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Supreme Court hears bag ban arguments

Hoping for the best, but not really expecting it.

In the case Laredo Merchants Association v. The City of Laredo, lawyers spent almost an hour arguing whether Laredo’s 2015 ban was illegal under state law. If the Republican-led court rules against the city, bag bans across the state could be deemed illegal.

The city of Laredo’s lawyer, former Supreme Court justice Dale Wainwright, argued single-use bags are not garbage, so they are not covered by the several lines of state law that the case hinges on. The code says local governments may not “prohibit or restrict, for solid waste management purposes, the sale or use of a container or package in a manner not authorized by state law.”

The arguments made Thursday mirrored those in lower courts, where the case was originally decided in favor of Laredo before an appeals court overturned the verdict by a 2-1 margin. The city then appealed that decision to the Supreme Court.

[…]

The oral arguments represent the last public action taken on the case, but a decision by the Supreme Court could still be a long way away. The court has discretion over the timeframe for a verdict, and previous cases have taken anywhere from a few weeks to a couple of years to resolve.

See here for some background. An earlier Trib story that previewed the case had some further details.

The case hinges on only a few lines of the Texas Health and Safety Code, specifically section 361.0961, which states local governments may not “prohibit or restrict, for solid waste management purposes, the sale or use of a container or package in a manner not authorized by state law.” In the lower courts, arguments focused on the specifics of the law, including the definitions of “container or package” and “solid waste management.”

Attorney Christy Drake-Adams filed a friend-of-the-court brief on behalf of the Texas Municipal League and the Texas City Attorneys Association supporting the city of Laredo and arguing that siding with the merchants would represent a swift departure from Texas’ history of supporting local governments.

“There just seems to be a trend that the state wants to consolidate power in the state’s hands,” Drake-Adams said. “They don’t want the federal government telling them what to do, and yet they want to tell local governments what to do.”

Drake-Adams also said this case could create a dangerous precedent of strict, uniform regulations on cities.

“Extreme uniformity and regulation fails to address diverse local concerns,” Drake-Adams said. “Texas is a great example of why that can’t work. A state as large and diverse geographically as Texas, that simply can’t work.”

Supporters of the merchants’ case are arguing that statewide enforcement of the law should overrule any local ordinances, and the inconsistent local laws like the plastic bag bans seen in cities across Texas cause unnecessary strain on small businesses.

“Inconsistent local ordinances harm the sales of affected retailers, force the layoff of employees, deprive retailers of their existing inventory of bags, and impose an expensive and complex requirement on multisite retailers to comply with varying ordinances across the state,” wrote Edward Burbach in a friend-of-the-court brief on behalf of the Texas Retailers Association in support of the merchants.

Remember, the goal here as expressed by Ken Paxton and abetted by Greg Abbott is to kill off all local bag laws, on the way to generally bringing cities to heel under the state. And yeah, we’re hoping the Supreme Court will stop them. If there’s a silver lining, it’s that the law in question can – someday – be easily modified to fix the flaw that the pro-bag-litter faction is exploiting. That would require winning some elections first, of course. But at least it gives us something to aim for.

The “border adjustment tax” is a sales tax increase by another name

That’s a feature, not a bug.

Retailers across Texas and the country are warning that a proposed border adjustment tax would increase the cost of imports and, by extension, the price of food, clothing and other consumer goods. Texas companies, including Stage Stores of Houston and Neiman Marcus of Dallas, have joined more than 150 other U.S. firms in a coalition fighting a possible border tax, part of a broader tax overhaul championed by Rep. Kevin Brady, The Woodlands Republican who chairs the tax-writing Ways and Means Committee, and House Speaker Paul Ryan, R-Wisconsin.

The plan essentially proposes a 20 percent tax on imports, which the National Retail Federation, a trade group, expects would raise the price of consumer products by 15 percent. Randi Sonenshein, senior vice president of strategy and finance for Stage Stores, which has more than 800 locations in 38 states, said her company worries that the higher prices related to the tax would particularly hurt customers who shop at stores located in small and mid-size towns, where it primarily operates.

“The plan will have a disproportionately negative impact on retailers,” she said. “It’s a tough thing to contemplate.”

Border adjustment is one component of a tax plan that aims to shift the U.S. tax code toward favoring production of goods over their consumption. Under the plan, companies would lose deductions for the costs of importing goods; at the same time, sales revenues from goods they export would be exempt from corporate income taxes.

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Companies with significant sales in foreign countries, including aerospace manufacturer Boeing, the industrial conglomerate General Electric, chemical maker Dow Chemical and pharmaceutical maker Pfizer, support the plan. But critics of border taxes say U.S. consumers will ultimately pay more, with the costs borne disproportionately by low- and middle income households.

If a border tax was enacted, apparel, autos, furniture and electronics equipment – much of which is imported – would see some of the largest price increases, at least initially, according to a recent analysis by the Wall Street investment bank Goldman Sachs. The National Retail Federation expects the cost of clothing, for example, would rise at least $350 a year for an average consumer.

Walmart, the nation’s largest retailer, as well as trade groups such as the U.S. Fashion Industry Association and the Association of Global Automakers, have joined the coalition against the plan, called Americans for Affordable Products.

The Texas Retailers Association, which represents companies of all sizes in every retail sector except convenience stores, has followed suit. George Kelemen, the association’s president and CEO, said every retail business in the state would be affected by the proposal in some way. In addition to clothing and other manufactured goods, food grown outside the United States, including everyday groceries, such as avocados, bananas and coffee would become pricier, he said.

“We are opposed to this,” he said. “It’s a cost passed on to the consumer.”

The real point of this is that once this is implemented, you – and by “you” I mean “Republicans” – can cut taxes elsewhere, which is always the goal. In that sense, it’s like the Craddick-era proposals to hike the state sales tax in return for a property tax cut. Dan Patrick would do that today if he thought he had the votes for it. I’m sure you can guess who would pay more and who would pay less in such a scenario. The bottom line is those tax cuts for the rich aren’t going to pay for themselves, but this might.

Abbott issues bag ban opinion

It’s complicated.

plastic-bag

Do plastic bag bans and restrictions in cities like Austin, Laredo, and Brownsville violate Texas law?

According to an opinion issued by Attorney General Greg Abbott’s office handed down on Friday afternoon, that depends on how you define two phrases: “container or package” and “solid waste management.”

Opinions on Texas law from the attorney general’s office are not binding, though they do carry weight statewide and could make other cities reconsider possible bans or restrictions on the use of single-use bags. Abbott said outright bans on single-use bags, which have been passed in in Austin and Laredo, are legal if they weren’t passed for the purpose of “solid waste management,” which isn’t clearly defined by state statute.

When it comes to restrictions on single-use bags, like Brownsville $1 fee-per-bag or Dallas’ recently passed nickel-per-bag fee, Abbott has a narrower view: He doesn’t think Texas law allows fees for bags at all, though it’s still not totally clear if single-use bags are indeed “containers or packages” in the law his office refers to.

The Texas law in question, from the state’s Solid Waste Disposal Act, was added to the Health and Safety Code in 1993. It says that cities can’t “prohibit or restrict, for solid waste management purposes, the sale or use of a container or package in a manner not authorized by state law … [or] assess a fee or deposit on the sale or use of a container or package.”

That raises two questions: What’s a “container or package?” And what does “solid waste management” mean?

For the purposes of plastic bag bans and fees, that isn’t clear. Brian Sledge, an environmental attorney and lobbyist in Austin, said the 1993 law stemmed from backlash against new packaging that food companies were using. The packaging mixed recyclable material, like aluminum, with nonrecyclables. Cities in states like California banned the packaging, causing the companies to head to states like Texas and ask for legislation that would avoid the same problem.

“Plastic bags weren’t really on the radar screen” in 1993, said Sledge. “It’s hard to think that a bag’s not a container. It holds stuff. But I don’t think that is the intent of the statute.”

See here for the background. My layman’s opinion is that Abbott quite reasonably concluded that the 1993 law really doesn’t speak to the municipal restrictions being placed on plastic bags these days. Either the Lege can address it with a newer law, or the courts can decide when the matter comes before them. The Texas Retailers Association, which asked Rep. Dan Flynn to request the opinion and which is suing Austin and may sure Dallas, has been pushing for a state law to prevent these municipal ordinances in addition to its legal actions, so they’re working both fronts. Expect this to come up again in the 2015 Lege.

Dallas adopts plastic bag fee

A fee, not a ban.

plastic-bag

Stores in Dallas will charge customers five cents for most kinds of plastic or paper carryout bags, under a measure approved Wednesday by the City Council.

At the urging of council member Dwaine Caraway, the council voted 8-6 to assess an “environmental fee” for single-use carryout bags. The five-cent charge takes effect Jan. 1.

Single-use bags will be banned entirely at retail outlets in city buildings and at city-sponsored events. The ban apparently would apply, for example, to gift shops at city-owned museums, American Airlines Center, even the Omni Dallas Hotel, which adjoins the Dallas convention center.

Caraway has complained for months that plastic bags, in particular, were creating litter problems throughout the city.

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The Texas Retailers Association opposed the bag fee, even though stores will keep 10 percent of the money they collect, and even though the measure approved Wednesday is less stringent than the outright ban on single-use bags that Caraway originally sought.

Gary Huddleston, a member of the association’s executive committee, said the fee will be burdensome to stores and customers alike.

“We personally believe the solution to litter in the city of Dallas is a strong recycling program and also punishing the people that litter, and not punishing the retailer,” said Huddleston, director of consumer affairs for the Kroger Co.

Stores will have to devote administrative resources to tracking the fees, he said, and the nickel that customers must pay for each disposable bag is a nickel that otherwise might have been used “to buy more product in my store.”

City officials said the money collected from the bag fee will go toward enforcement and education efforts. Those efforts could cost $250,000 and require the hiring of 12 additional employees, said Jill Jordan, an assistant city manager.

After the council vote, Huddleston would not rule out a legal challenge by the retailers association. Texas Attorney General Greg Abbott has already been asked to weigh in on the legality of Texas cities’ banning of single-use bags. Council member Sheffie Kadane, who opposed the five-cent fee, said the city can almost count on being sued by retailers or plastic bag manufacturers or both.

See here for some background on the debate in Dallas. As you know, AG Greg Abbott has been asked for an opinion about the legality of municipal bag laws. This opinion was requested by State Rep. Dan Flynn, on behalf of the Texas Retailers Association and its CEO, Ronnie Volkenning. The Trib reports on environmental groups responding to this request.

Supporters of the ordinances say plastic bags harm the environment. The Texas Campaign for the Environment has been one of the most vocal supporters of the ordinances. “We want the attorney general to stay out of this issue altogether,” said Robin Schneider, the group’s executive director.

The Texas Municipal League was the first to submit a brief to the attorney general’s office. The brief included a statement from state Sen. Kel Seliger, R-Amarillo, from 2011 in which he argued for local control over the issue.

“For the state to determine what a city’s problems are or solutions that it may have or may not have is a little bit of an overextension of the Legislature,” Seliger said.

Because the cities are responsible for supplying plastic bags, they should be able to determine if they wish to ban them, he said in an interview.

“They spend much more time as garbage than they do as carriers of groceries anyway,” Seliger added.

The Texas Municipal League argued in its brief that a plastic bag should not be classified as a “container” or a package” — the two words specifically mentioned in the Heath and Safety Code.

“A plastic bag is not a container or a package, but merely the means by which a container or a package is transported,” the brief said.

Volkening said the most environmental position would be to encourage the recycling of plastic bags, not banning their use.

That may be Volkening’s opinion, but as you may recall from Tyson Sowell’s guest post here, groups like the Texas Campaign for the Environment think the ban is the way to go. In fact, they’d push for a ban on paper bags as well. Regardless, I like Seliger’s statement, which you would think would be appealing to conservatives. And it is for many, but there’s a significant number for whom local control is only for policies they like. We’ll see which group is happy with Abbott’s forthcoming opinion.

AG opinion sought on bag bans

Whatever.

plastic-bag

As proponents continue to tout the benefits of banning plastic bags, the debate over whether Texas cities like Austin actually have the ability to enact such ordinances has made its way to the attorney general’s office.

In a letter seeking an opinion from Attorney General Greg Abbott, state Rep. Dan Flynn, R-Canton, questioned whether the city bans are in compliance with the state’s health and safety laws.

“At least nine cities in Texas have enacted bans on plastic bags and adopted fees on replacement bags in recent years,” the letter stated. “This appears to be in contravention of state law.”

The letter, which was received last week by the attorney general’s office, asks the office to interpret a specific section of the Texas Health and Safety Code. The section states that a municipal district may not pass legislative restrictions or charge fees relating to the consumption of a “container or package” for waste management purposes.

“I can’t begin to tell you how many phone calls we received about the legality of the bans,” said Flynn, whose district does not have any communities that have imposed bag bans. Even though it doesn’t affect him directly, “there are a lot of people who are really inconvenienced by it,” he said.

One of the most vocal opponents of bag bans, the Texas Retailers Association, approached Flynn about writing the letter to the attorney general’s office.

“It sure looks to us that the plain meaning of the statute’s language is that the state meant to stop local governments from adopting ordinances that prohibit or restrict the use of these bags,” said Ronnie Volkening, the president and CEO of the retailers association. “If the state Legislature enacted that language, then the cities are in fact engaging in an activity that they should not.”

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The push for an opinion from the attorney general’s office comes a year after the retailers group filed a lawsuit targeting Austin’s plastic bag ban last February. But the group dropped the lawsuit after Austin officials asked it to disclose information on the sales of plastic bags.

“They were asking for proprietary information that retailers will not disclose for sensitive reasons,” Volkening said, adding that it would be very expensive for the association to contest the request. “Rather than disclosing that information, we felt it was necessary to drop the suit.”

A copy of that now-dropped lawsuit is here. Rep. Flynn’s letter basically recapitulates its arguments. I assume that the cities that have adopted these bans have attorneys at their disposal who can interpret state law and advise their clients how likely they are to get their posteriors handed to them in court some day, so I presume there is a counterargument to be made here. If any lawyers would like to weigh in on that, I’d be delighted to hear it. Whether the timing of this request has anything to do with the developments in San Antonio or not I couldn’t say, but thanks to Rep. Flynn we can now say with confidence that it is possible to carry water in a plastic bag.

Austin bag ban lawsuit filed

This bears watching.

The Texas Retailers Association is suing the city of Austin over a disposable bag ban set to take effect [today], saying the ban violates state law and should be tossed out.

The ban will prohibit all Austin retailers from offering thin, so-called single-use paper and plastic bags at checkout counters.

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The lawsuit, filed Monday in Travis County district court, says the ban violates part of the state’s health and safety code that prevents local governments from banning or restricting “for solid waste management purposes, the sale or use of a container or package in a manner not authorized by state law.”

The retailers’ group said it “has not been able to discover a single state law authorizing the banning of bags in any manner, let alone the manner adopted by the city,” the lawsuit says.

The bag ban will also hurt businesses financially because many still have single-use bags in stock that they’ll have to store or dispose of, they are required to create signs alerting customers to the ban, and they might lose customers to nearby cities that don’t have bag bans, the lawsuit says.

The retailers association is not seeking an injunction — a short-term ruling — to try to stop the ban by Friday, president Ronnie Volkening said. For now, it is still encouraging its Austin members to comply with the ban, he said.

But the association wants a judge to decide whether the ban is valid and can be enforced in the long run, Volkening said.

Austin passed its ban one year ago, making it the most expansive ban on single-use bags in the state. If the plaintiffs win, it will be interesting to see what if any effect this has on other cities that have enacted various ordinances to reduce or eliminate plastic bag usage. Conversely, if Austin wins, it’ll be interesting to see if this emboldens other cities to pass their own ordinances.I’ll keep an eye on it.