Supreme decisions: as usual, the states won some and lost some during the recent Supreme Court session.

The Supreme Court ended its term during the summer by upholding the states' broad power over property and taxing, but these wins were offset by the loss of its strongest voice for states' rights with the retirement of Justice Sandra Day O'Connor.

If nothing else, the just-completed term showed again how the vote of a single justice can prove crucial.

PROPERTY WARS

By a 5-4 vote, the court ruled that cities and states can condemn property to make way for economic development, "reflecting our long-standing policy of deference to legislative judgments in this field," said Justice John Paul Stevens in Kelo v. City or New London. The decision is likely to be remembered best for the plight of the plaintiffs and the words of the dissenters, but it affirmed the traditional power of cities and states to regulate property.

Susette Kelo, a nurse, had sued to block the city from bulldozing her pink Victorian home whose porch offered a grand view of Long Island Sound. She and several of her neighbors were the last hold-outs in the Fort Trumbull area of New London. The city itself had fallen on hard times after its last major employer, U.S. Naval Undersea Warfare Center, closed in 1996. Even before that, the state of Connecticut had declared New London a "distressed municipality" because of decades of economic decline and its high unemployment rate.

Hope was revived in 1998, however, when Pfizer Inc., the pharmaceutical giant, announced plans to locate a research center there. The city's redevelopment agency set out to take advantage of Pfizer's arrival by buying up the land near the waterfront. The 90 acres of cleared land were slated to have an office complex, a hotel, a marina and a "riverwalk" with restaurants and shops. The development promised to bring jobs and new tax revenue to a city that was in desperate need of both.

All that stood in the way were Kelo and her neighbors. They refused to sell, even though city officials were prepared to pay them compensation that amounted to more than twice the market value of their homes. They contended the forced seizure of their homes violated the Fifth Amendment to the Constitution, which says "private property (shall not) be taken for public use, without just compensation." Taking private property for private development is not a "public use," they insisted.

The Supreme Court, and indeed many courts, dealt regularly and often with the question of when cities or states must pay "just compensation" to property owners who had been denied permission to build on their land. Rarely, however, had the high court dealt with the phrase "for public use."

In the nation's early days, it was clear the government could take land for roads, forts and canals. In the 19th century, land was condemned to make way for the railroads. In the late 19th century, the courts also upheld state laws that gave manufacturers the power to flood land upstream from their factories so they could store water to drive their mills.

In the 20th century, the high court all but ignored complaints from store owners and others who asserted their property rights. In a short, unanimous opinion in 1954, the justices ruled that local officials may condemn and bulldoze whole blocks of a city's "blighted" neighborhoods as part of an urban renewal project. The store owner in that case, Berman v. Parker, had complained that because his store was not "blighted," he should have the right to keep it. The justices disagreed and said the power of "eminent domain" could be used to further the greater good of the city and its residents.

THE GREATER GOOD

The State and Local Legal Center filed a friend-of-the-court brief in the Kelo case on behalf of NCSL and other groups reminding the justices of this history and urging that they not reverse course. "Eminent domain is often indispensable for revitalizing local economies, creating much-needed jobs, and generating revenue that enables cities to provide essential services," said Richard Ruda, chief counsel for the center. Moreover, empowering judges to decide which projects suit the public's interest "would be unworkable and transform courts into super-legislatures," he added.

The brief described the economic revival that followed the building of a new Nissan auto plant in Mississippi and a new motor speedway near Kansas City. Others mentioned Baltimore's Inner Harbor. These projects could not have gone forward, officials said, had they not been able to condemn many parcels of land.

The Supreme Court recited these themes in refusing to set a strict, new test for the use of the eminent domain power. "For more than a century, our public use jurisprudence has wisely ... favored affording legislatures broad latitude in determining what public needs justify the use of the takings power," Stevens wrote. "Promoting economic development is a traditional and long accepted function of government.

"Just as we decline to second-guess the city's considered judgment" about its redevelopment plan, "we emphasize that nothing in our opinion precludes any state from placing further restrictions on its exercise of the takings power," Stevens concluded.

CHANGE IS COMING

The fight now moves to the state legislatures, said Scott Bullock of the Institute of Justice, the attorney who represented Kelo and her neighbors. "This decision has generated outrage across the country, and I think it's going to result in real change in the state legislatures," he said.

At least seven states--Arkansas, Florida, Kentucky, Maine, New Hampshire, South Carolina and Washington--have laws that appear to forbid the use of eminent domain for economic development, except to eliminate blight. The Michigan Supreme Court also adopted such a limit last year.

O'Connor was among the dissenters in the Kelo case, along with Chief Justice William H. Rehnquist and Justices Antonin Scalia and Clarence Thomas. "Under the banner of economic development, all private property is now vulnerable to being taken," she said.

But O'Connor spoke for the court in another case in upholding the state's broad power to regulate property through measures such as rent control. Hawaii has had the nation's highest prices for gasoline, and the court's 9-0 decision in Lingle v. Chevron upheld a Hawaii law that limited the rents for service stations that were owned by the major oil companies. Perhaps more important, the justices rejected an appeals court opinion that had struck down the Hawaii law because it failed to "substantially advance" the goal of lowering gasoline prices. If this approach were followed, judges could second-guess all manner of state laws, O'Connor said.

WINE WINS

The states did not fare so well when it comes to regulating wine and marijuana, however. In Granholm v. Heald, the court in a 5-4 decision struck down the state laws in Michigan and New York that barred out-of-state vintners from shipping wine directly to consumers. These states permitted in-state wineries to sell directly to their residents, and the court said the Constitution's protection for the free flow of interstate commerce forbids this type of discrimination in favor of home-state products.

The four dissenters, including O'Connor, said the 21st Amendment permits this type of discrimination for alcohol products. The amendment, which in 1933 repealed the national prohibition on alcohol, says the "importation into any state ... of intoxicating liquors, in violation of the laws thereof, is hereby prohibited." This grant of state power has under-girded the so-called "three tiered system"--of producers, wholesalers and retailers--under which beer, wine and liquor are regulated and sold in the United States.

Some lawyers feared the court's decision may trigger challenges to that regulatory structure. For now, however, the court's opinion seems to give states two choices. They can either permit out-of-state wineries to sell directly to their residents on the same basis as in-state wineries, or they can repeal the special exemptions for their home wineries.

POT PROBLEMS

California was a big winner in the wine decision because it is the nation's leading wine producer, but it was on the losing end of the marijuana ruling. In 1996, its voters approved a measure that permits "seriously ill" people to obtain and use marijuana "for medical purposes" if it had been recommended by their doctor. Many cancer and AIDS patients said marijuana had proved to be uniquely effective in relieving their pain and nausea. Nine other states have since adopted similar laws.

But the Bush administration said the federal drug-control laws entirely forbid the use of marijuana. Then-Attorney General John Ashcroft appealed the issue to the Supreme Court when an appeals court in San Francisco ruled that federal authorities did not have the power to regulate marijuana that was grown at home by patients. The appeals court reasoned that while the Constitution gave the federal government the power to regulate the free flow of interstate commerce, home-grown marijuana involved neither commerce nor air interstate transaction.

That reasoning failed to persuade the Supreme Court. Marijuana travels in an interstate market--albeit an illegal one--and the federal authorities could not control this market if hundreds of thousands of people in California and elsewhere were free to produce and use marijuana, the court said in Gonzales v. Raich. And since federal law trumps state laws, the strict federal ban on the use of marijuana must stand, the 6-3 majority concluded.

The dissenters--O'Connor, Rehnquist and Thomas said they saw no limits to the federal power. The reds "may now regulate quilting bees, clothes drives and potluck suppers throughout the 50 states," Thomas said.

But in the last week of the court's term, the justices upheld a $100 flat tax for trucks that operate within Michigan. In the past, the court has struck down state taxes and fees that were assessed to inter-state truckers, and Congress has limited the registration fees to $10 for trucks that cross state lines.

Michigan's $100 tax applies only to trucks that pick up and drop off loads within the state. However, since it applies to trucks that also travel across state lines, the American Trucking Association contended the tax put a burden on interstate commerce.

The justices disagreed in a 9-0 ruling in ATA v. Michigan and said states may impose taxes that apply "evenhandedly to all carriers" and do not "tax activity that takes place, in whole or in part, outside the State."

COMING CASES TO WATCH

This fall the Supreme Court will take up state-law controversies involving abortion and the "right to die." It will also decide whether states can be sued under the federal law that forbids discrimination against disabled persons.

At least 33 states have laws on the books that require doctors to notify the parents of a girl under age 18 before they perform an abortion. Typically, these laws make an exception for cases where the girl's life is at stake.

A case from New Hampshire tests whether a law must include an exception when the health of the young woman is threatened.

Two years ago, lawyers for Planned Parenthood and the American Civil Liberties Union sued to block a newly passed New Hampshire law that told abortion doctors to wait at least 48 hours after giving written notice to the girl's parents. The challengers said this mandatory delay could handcuff doctors and prevent them from acting in the face of a medical emergency.

A federal judge and the U.S. court of appeals in Boston agreed and said the law was unconstitutional "on its face" because it did not include a health exception.

New Hampshire Attorney General Kelly Ayotte appealed to the Supreme Court and argued this is the wrong way to view the matter. Most pregnant girls do not face a medical crisis when they see their doctor. A few might face such an emergency, and if so, they may ask a judge to waive the required parental notification and to permit an immediate abortion, she said.

Therefore, the state law should be upheld as constitutional and allowed to go into effect, she argued in the case of Ayotte v. Planned Parenthood.

If the high court agrees with this approach, it could have a wide impact. Many disputed abortion regulations have been blocked from taking effect because they might have an adverse impact on some patients.

Oregon has the nation's only "right to die" law. It permits patients who are terminally iii to ask a doctor for medication that will end their lives.

In Gonzales v. Oregon, the Supreme Court will hear the Bush administration's claim that doctors violate the federal drug laws when they prescribe medication for the purpose of ending a life.

The justices also will try again to decide when or if states can be sued for violating the Americans with Disabilities Act.

Four years ago, the court in a 5-4 ruling said disabled state employees could not sue a state agency in federal court for alleged discrimination, citing the principle of "state sovereign immunity."

Last year, the court in another 5-4 ruling held that a paralyzed man in a wheelchair could sue when he was unable to gain access to a state courthouse. Justice Sandra Day O'Connor cast the deciding vote in both cases.

This fall, without O'Connor, the court will consider whether a paraplegic prisoner can sue the state for what he said was inhumane treatment. The case is U.S. v. Georgia.

David G. Savage covers the U.S. Supreme Court for the Los Angeles Times. He is a frequent contributor to State Legislatures magazine.