Appellants, at least five of whom are not residents of Alaska, challenged in state court the constitutionality of the "Alaska Hire" statute (which was enacted professedly for the purpose of reducing unemployment within the State) that requires that all Alaskan oil and gas leases, easements or right-of-way permits for oil and gas pipelines, and utilization agreements contain a requirement that qualified Alaska residents be hired in preference to nonresident. The trial court upheld the statute. The Alaska Supreme Court affirmed except for that part of the Act that contained a one-year durational residency requirement, which it held invalid. Held:
BRENNAN, J., delivered the opinion for a unanimous Court.
Robert H. Wagstaff argued the cause for appellants. With him on the briefs was Lee S. Glass.
Ronald W. Lorensen, Assistant Attorney General of Alaska, argued the cause and filed a brief for appellees. *
[ Footnote * ] Briefs of amici curiae urging reversal were filed by Edwin Vieira, Jr., for the National Right to Work Legal Defense Foundation; and by Peabody Testing - Bill Miller X-Ray, Inc.
Ronald Y. Amemiya, Attorney General, and Lawrence D. Kumabe and Michael A. Lilly, Deputy Attorneys General, filed a brief for the State of Hawaii as amicus curiae urging affirmance. [437 U.S. 518, 520]
MR. JUSTICE BRENNAN delivered the opinion of the Court.
In 1972, professedly for the purpose of reducing unemployment in the State, the Alaska Legislature passed an Act entitled "Local Hire Under State Leases." Alaska Stat. Ann. 38.40.010 to 38.40.090 (1977). The key provision of "Alaska Hire," as the Act has come to be known, is the requirement that "all oil and gas leases, easements or right-of-way permits for oil or gas pipeline purposes, utilization agreements, or any renegotiation of any of the preceding to which the state is a party" contain a provision "requiring the employment of qualified Alaska residents" in preference to nonresident. 1 Alaska Stat. Ann. 38.40.030 (a) (1977). 2 This employment preference is administered by providing persons meeting the statutory requirements for Alaskan residency with certificates of residence - "resident cards" - that can be presented to an employer covered by the Act as proof of residency. 8 Alaska Admin. Code 35.015 (1977). Appellants, individuals desirous of securing jobs covered by the Act but unable to qualify for the necessary resident cards, challenge Alaska Hire as violative of [437 U.S. 518, 521] both the Privileges and Immunities Clause of Art. IV, 2, and the Equal Protection Clause of the Fourteenth Amendment.
Although enacted in 1972, Alaska Hire was not seriously enforced until 1975, when construction on the Trans-Alaska Pipeline 3 was reaching its peak. At that time, the State Department of Labor began issuing residency cards and limiting to resident cardholders the displacement to oil pipeline jobs. On March 1, 1976, in response to "numerous complaints alleging that persons who are not Alaska residents have been dispatched on pipeline jobs when qualified Alaska residents were available to fill the jobs." Executive Order #76-1, Alaska Dept. of Labor (Mar. 1, 1976) (emphasis in original). Edmund Orbeck, the Commissioner of Labor and one of the appellees here, issued a cease-and-desist order to all unions supplying pipeline workers 4 enjoining them "to respond to all open job calls by dispatching all qualified Alaska residents before any non-residents are dispatched." Ibid. (emphasis in original). As a result, the appellants, all but one of whom had previously worked on the pipeline, were prevented from obtaining pipeline-related work. Consequently, on April 28, 1976, appellants filed a complaint in the Superior Court in Anchorage seeking declaratory and injective relief against enforcement of Alaska Hire.
At the time the suit was filed, the provision setting forth the qualifications for Alaskan residency for purposes of Alaska [437 U.S. 518, 522] Hire, Alaska Stat. Ann. 38.40.090, 5 included a one-year durational residency requirement. Appellants attacked that requirement as well as the flat employment preference given by Alaska Hire to state residents. By agreement of the parties, consideration of a motion for a preliminary injunction was consolidated with the determination of the suit on its merits. The case was submitted on affidavits, depositions, and memoranda of law; no oral testimony was taken. On July 21, 1976, the Superior Court upheld Alaska Hire in its entirety and denied appellants all relief. On appeal, the Alaska Supreme Court unanimously held that Alaska Hire's one-year durational residency requirement was unconstitutional under both the state and federal Equal Protection Clauses, 565 P.2d 159, 165 (1977), and held further that a durational residency requirement in excess of 30 days was constitutionally infirm. Id., at 171. 6 By a vote of 3 to 2, however, the court held that the Act's general preference for Alaska residents was constitutionally permissible. Appellants appealed the State Supreme Court's judgment insofar as it embodied the latter holding, and we noted probable jurisdiction. 434 U.S. 919 (1977). We reverse. [437 U.S. 518, 523]
Preliminarily, we hold that this case is not moot. Despite the Alaska Supreme Court's invalidation of the one-year durational residency requirement, a controversy still exists between at least five of the appellants - Tommy Ray Woodruff, Frederick A. Mathers, Emmett Ray, Betty Cloud, and Joseph G. O'Brien - and the state appellees. These five appellants have all sworn that they are not residents of Alaska, Record 43, 47, 49, 96, 124. Therefore, none of them can satisfy the element of the definition of "resident" under 38.40.090 (1) (D) that requires that an individual "has not, within the period of required residency, claimed residency in another state." They thus have a continuing interest in restraining the enforcement of Alaska Hire's discrimination in favor of residents of that State. 7
Appellants' principal challenge to Alaska Hire is made under the Privileges and Immunities Clause of Art. IV, 2: "The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States." That provision, which "appears in the so-called States' Relations Article, the same Article that embraces the Full Faith and Credit Clause, the Extradition Clause . . ., the provisions for the admission of new States, the Territory and Property Clause, and the Guarantee Clause," Baldwin v. Montana Fish and Game Comm'n, 436 U.S. 371, 379 (1978), "establishes a norm of comity," Austin v. New Hampshire, 420 U.S. 656, 660 (1975), that is to prevail among the States with respect to their treatment [437 U.S. 518, 524] of each other's residents. 8 The purpose of the Clause, as described in Paul v. Virginia, 8 Wall. 168, 180 (1869), is
Again, Toomer v. Witsell, 334 U.S. 385 (1948), the leading modern exposition of the limitations the Clause places on a State's power to bias employment opportunities in favor of its own residents, invalidated a South Carolina statute that required nonresidents to pay a fee 100 times greater than that paid by residents for a license to shrimp commercially in the three-mile maritime belt off the coast of that State. The Court reasoned that although the Privileges and Immunities Clause "does not preclude disparity of treatment in the many situations where there are perfectly valid independent reasons for it," id., at 396, "[i]t does bar discrimination against citizens of other States where there is no substantial reason for the discrimination beyond the mere fact that they are citizens of other States." Ibid. A "substantial reason for the discrimination" would not exist, the Court explained, "unless there is something to indicate that noncitizens constitute a peculiar source of the evil at which the [437 U.S. 518, 526] [discriminatory] statute is aimed." Id., at 398. Moreover, even where the presence or activity of nonresidents causes or exacerbates the problem the State seeks to remedy, there must be a "reasonable relationship between the danger represented by non-citizens, as a class, and the . . . discrimination practiced upon them." Id., at 399. Toomer's analytical framework was confirmed in Mullaney v. Anderson, 342 U.S. 415 (1952), where it was applied to invalidate a scheme used by the Territory of Alaska for the licensing of commercial fishermen in territorial waters; under that scheme residents paid a license fee of only $5 while nonresidents were charged $50.
Even assuming that a State may validly attempt to alleviate its unemployment problem by requiring private employers within the State to discriminate against nonresidents - an assumption made at least dubious by Ward 9 - it is clear that under the Toomer analysis reaffirmed in Mullaney, Alaska Hire's discrimination against nonresidents cannot withstand scrutiny under the Privileges and Immunities Clause. For although the statute may not violate the Clause if the State shows "something to indicate that noncitizens constitute a peculiar source of the evil at which the statute is aimed," Toomer v. Witsell, supra, at 398, and, beyond this, the State "has no burden to prove that its laws are not violative of the . . . Clause," Baldwin v. Montana Fish and Game Comm'n, 436 U.S. at 402 (BRENNAN, J., dissenting), certainly no showing was made on this record that nonresidents were "a peculiar source of the evil" Alaska Hire was enacted to remedy, namely, Alaska's "uniquely high unemployment." Alaska Stat. Ann. 38.40.020 (1977). What evidence the record does contain indicates that the major cause of Alaska's high unemployment was not the influx of nonresidents seeking employment, but rather the fact that a substantial number of Alaska's jobless residents - especially the unemployed Eskimo and Indian residents - were unable to [437 U.S. 518, 527] secure employment either because of their lack of education and job training or because of their geographical remoteness from job opportunities; 10 and that the employment of nonresidents threatened to deny jobs to Alaska residents only to the extent that jobs for which untrained residents were being prepared might be filled by nonresidents before the residents' training was completed.
Moreover, even if the State's showing is accepted as sufficient to indicate that nonresidents were "a peculiar source of evil," Toomer and Mullaney compel the conclusion that Alaska Hire nevertheless fails to pass constitutional muster. For the discrimination the Act works against nonresidents does not bear a substantial relationship to the particular "evil" they are said to present. Alaska Hire simply grants all Alaskans, regardless of their employment status, education, or training, a flat employment preference for all jobs covered by the Act. A highly skilled and educated resident who has never been unemployed is entitled to precisely the same preferential treatment as the unskilled, habitually unemployed Arctic Eskimo enrolled in a job-training program. If [437 U.S. 518, 528] Alaska is to attempt to ease its unemployment problem by forcing employers within the State to discriminate against nonresidents - again, a policy which may present serious constitutional questions - the means by which it does so must be more closely tailored to aid the unemployed the Act is intended to benefit. Even if a statute granting an employment preference to unemployed residents or to residents enrolled in job-training programs might be permissible, Alaska Hire's across-the-board grant of a job preference to all Alaskan residents clearly is not.
Relying on McCready v. Virginia, 94 U.S. 391 (1877), however, Alaska contends that because the oil and gas that are the subject of Alaska Hire are owned by the State, 11 this ownership, of itself, is sufficient justification for the Act's discrimination against nonresidents, and takes the Act totally without the scope of the Privileges and Immunities Clause. As the State sees it "the privileges and immunities clause [does] not apply, and was never meant to apply, to decisions by the states as to how they would permit, if at all, the use and distribution of the natural resources which they own . . . ." Brief for Appellees 20 n. 14. We do not agree that the fact that a State owns a resource, of itself, completely removes a law concerning that resource from the prohibitions of the Clause. Although some courts, including the court below, have read McCready as creating an "exception" to the Privileges and Immunities Clause, we have just recently confirmed that "[i]n more recent years . . . the Court has recognized [437 U.S. 518, 529] that the States' interest in regulating and controlling those things they claim to `own' . . . is by no means absolute." Baldwin v. Montana Fish and Game Comm'n, 436 U.S., at 385 . Rather than placing a statute completely beyond the Clause, a State's ownership of the property with which the statute is concerned is a factor - although often the crucial factor - to be considered in evaluating whether the statute's discrimination against noncitizens violates the Clause. Dispositive though this factor may be in many cases in which a State discriminates against nonresidents, it is not dispositive here.
The reason is that Alaska has little or no proprietary interest in much of the activity swept within the ambit of Alaska Hire; and the connection of the State's oil and gas with much of the covered activity is sufficiently attenuated so that it cannot justifiably be the basis for requiring private employers to discriminate against nonresidents. The extensive reach of Alaska Hire is set out in Alaska Stat. Ann. 38.40.050 (a) (1977). That section provides:
Although appellants raise no Commerce Clause challenge to the Act, the mutually reinforcing relationship between the Privileges and Immunities Clause of Art. IV, 2, and the Commerce Clause - a relationship that stems from their common [437 U.S. 518, 532] origin in the Fourth Article of the Articles of Confederation 16 and their shared vision of federalism, see Baldwin v. Montana Fish and Game Comm'n, 436 U.S., at 379 -380 - renders several Commerce Clause decisions appropriate support for our conclusion. West v. Kansas Natural Gas, 221 U.S. 229 (1911), struck down an Oklahoma statutory scheme that completely prohibited the out-of-state shipment of natural gas found within the State. The Court reasoned that if a State could so prefer its own economic well-being to that of the Nation as a whole, "Pennsylvania might keep its coal, the Northwest its timber, [and] the mining States their minerals," so that "embargo may be retaliated by embargo" with the result that "commerce [would] be halted at state lines." Id., at 255. West was held to be controlling in Pennsylvania v. West Virginia, 262 U.S. 553 (1923), where a West Virginia statute that effectively required natural gas companies within the State to satisfy all fuel needs of West Virginia residents before transporting any natural gas out of the State was held to violate the Commerce Clause. West and Pennsylvania v. West Virginia thus established that the location in a given State of a resource bound for interstate commerce is an insufficient basis for preserving the benefits of the resource exclusively or even [437 U.S. 518, 533] principally for that State's residents. Foster Packing Co. v. Haydel, 278 U.S. 1 (1928), went one step further; it limited the extent to which a State's purported ownership of certain resources could serve as a justification for the State's economic discrimination in favor of residents. There, in the face of Louisiana's claim that the State owned all shrimp within state waters, the Court invalidated a Louisiana law that required the local processing of shrimp taken from Louisiana marshes as a prerequisite to their out-of-state shipment. The Court observed that "by permitting its shrimp to be taken and all the products thereof to be shipped and sold in interstate commerce, the State necessarily releases its hold and, as to the shrimp so taken, definitely terminates its control." Id., at 13.
West, Pennsylvania v. West Virginia, and Foster Packing thus establish that the Commerce Clause circumscribes a State's ability to prefer its own citizens in the utilization of natural resources found within its borders, but destined for interstate commerce. Like Louisiana's shrimp in Foster Packing, Alaska's oil and gas here are bound for out-of-state consumption. Indeed, the construction of the Trans-Alaska Pipeline, on which project appellants' nonresidency has prevented them from working, was undertaken expressly to accomplish this end. 17 Although the fact that a state-owned resource is destined for interstate commerce does not, of itself, disable the State from preferring its own citizens in the utilization of that resource, it does inform analysis under the Privileges and Immunities Clause as to the permissibility of the discrimination the State visits upon nonresident based on its ownership of the resource. Here, the oil and gas upon [437 U.S. 518, 534] which Alaska hinges its discrimination against nonresidents are of profound national importance. 18 On the other hand, the breadth of the discrimination mandated by Alaska Hire goes far beyond the degree of resident bias Alaska's ownership of the oil and gas can justifiably support. The confluence of these realities points to but one conclusion: Alaska's Hire cannot withstand constitutional scrutiny. As Mr. Justice Cardozo observed in Baldwin v. G. A. F. Seelig, Inc., 294 U.S. 511, 523 (1935), the Constitution "was framed upon the theory that the peoples of the several states must sink or swim together, and that in the long run prosperity and salvation are in union and not division." 19
[ Footnote 2 ] The complete text of 38.40.030 (a) is as follows:
[ Footnote 4 ] App. 13-14. The vast majority of pipeline jobs were filled through union displacement. Deposition of David Finrow, Deputy Director of the Wage and Hour Division of the Alaska Dept. of Labor, in No. 3025 (Sup. Ct. Alaska), pp. 18-19. 28, 48.
[ Footnote 5 ] Section 38.40.090 provides:
[ Footnote 6 ] Appellees have not cross-appealed this portion of the Alaska Supreme Court's decision, which rests upon an independent and adequate state ground. Murdock v. Memphis, 20 Wall. 590 (1875).
[ Footnote 7 ] As to the remaining three appellants - Sidney S. Hicklin, Ruby E. Dorman, and Harry A. Browning - the case does appear moot. At the time this suit was instituted, all three claimed to be Alaskan residents, but none had lived in the State continuously for one year. Record 45, 51-52, 126-127. Consequently, the only aspect of Alaska Hire they challenged was the Act's one-year durational residency requirement. When this requirement was held invalid by the Alaska Supreme Court, their controversy with the appellees seems to have terminated.
[ Footnote 8 ] Although this Court has not always equated state residency with state citizenship, compare Travis v. Yale & Towne Mfg. Co., 252 U.S. 60, 78 -79 (1920), and Blake v. McClung, 172 U.S. 239, 246 -247 (1898), with Southern R. Co. v. Mayfield, 340 U.S. 1, 3 -4 (1950); Douglas v. New Haven R. Co., 279 U.S. 377, 386 -387 (1929); and La Tourette v. McMaster, 248 U.S. 465, 469 -470 (1919), it is now established that the terms "citizen" and "resident" are "essentially interchangeable," Austin v. New Hampshire, 420 U.S. 656, 662 n. 8 (1975), for purposes of analysis of most cases under the Privileges and Immunities Clause of Art. IV, 2. See Toomer v. Witsell, 334 U.S. 385, 397 (1948).
[ Footnote 10 ] For example, a report quoted in the State's Memorandum in Opposition to Plaintiffs' Motion for Partial Preliminary Injunction and Second Motion for Preliminary Injunction, Record 58, observed:
[ Footnote 11 ] At the time Alaska was admitted into the Union on January 3, 1959, 99% of all land within Alaska's borders was owned by the Federal Government. In becoming a State, Alaska was granted and became entitled to select approximately 103 million acres of those federal lands. Alaska State-hood Law, 72 Stat. 340, 6, note preceding 48 U.S.C. 21. The selection process is not yet complete, but since 1959 large portions of land have been conveyed to the State, in fee, by the Federal Government. Full title to those lands and to the minerals on and below them is vested in the State. 72 Stat. 342, 6 (i), note preceding 48 U.S.C. 21.
[ Footnote 12 ] The term "utilization agreement" is not defined in the Act. Alaska's Commissioner of Natural Resources gave the following definition of the term:
[ Footnote 13 ] According to one of the administrative regulations implementing Alaska Hire, "[s]uppliers shall have the same hiring requirements as an employer covered by this chapter, as to that portion of their supply business that is the result of a project or activity of a lessee, contractor or subcontractor." 8 Alaska Admin. Code 35.080 (a) (1977).
[ Footnote 14 ] The Commissioner of Natural Resources expressed this understanding of the scope of the Act:
Mr. Martin: ". . . I think it would cover relationships such as anything on a work pad or an associated construction road or possibly a site for a support camp or construction camp."
Mr. Wagstaff (attorney for appellants): "What about things such as docks if shipping is being used?"
Mr. Martin: "I would think that it could possibly include that." Deposition of Guy R. Martin, supra, at 4.
[ Footnote 15 ] Heim v. McCall, 239 U.S. 175 (1915) and Crane v. New York, 239 U.S. 195 (1915) - if they have any remaining vitality, see Sugarman v. Dougall, 413 U.S. 634, 643 -645 (1973); C. D. R. Enterprises, Ltd. v. Board of Education, 412 F. Supp. 1164 (EDNY 1976), summarily aff'd sub nom. Lefkowitz v. C. D. R. Enterprises, Ltd., 429 U.S. 1031 (1977) - do not suggest otherwise. In those cases, a New York statute that limited employment "in the construction of public works" to United States citizens and also required that an employment preference be given to New York citizens in such projects was upheld against challenges under both the Constitution and the Treaty of 1871 with Italy. Although the Art. IV, 2, Privileges and Immunities Clause, along with the Due Process, Equal Protection, and Privileges and Immunities Clauses of the Fourteenth Amendment, was listed as one of the constitutional bases for attacking the statute, no out-of-state United States citizen challenged the law. As a consequence, both the appellants and the Court were concerned almost exclusively with the statute's discrimination against resident aliens. This was reflected in the Court's holding, which was limited to the Fourteenth Amendment and Treaty challenges and expressed no view on appellants' passing Art. IV, 2, privileges and immunities claim.
[ Footnote 16 ] That Article provided: "The better to secure and perpetuate mutual friendship and intercourse among the people of the different states in this union, the free inhabitants of each of these states, paupers, vagabonds and fugitives from justice excepted, shall be entitled to all privileges and immunities of free citizens in the several states; and the people of each State shall have free ingress and regress to and from any other State, and shall enjoy therein all the privileges of trade and commerce, subject to the same duties, impositions, and restrictions, as the inhabitants thereof respectively; provided, that such restrictions shall not extend so far as to prevent the removal of property, imported into any State, to any other State of which the owner is an inhabitant; provided, also that no imposition, duties or restriction, shall be laid by any State on the property of the United States, or either of them." 9 Journal of the Continental Congress 908-909 (1777) (Library of Congress ed., 1907).
[ Footnote 17 ] In authorizing the construction of the Trans-Alaska Pipeline, Congress expressly found that "[t]he early development and delivery of oil and gas from Alaska's North Slope to domestic markets is in the national interest because of growing domestic shortages and increasing dependence upon insecure foreign sources." 43 U.S.C. 1651 (a) (1970 ed., Supp. V) (emphasis added).
[ Footnote 18 ] In enacting the Alaska Natural Gas Transportation Act of 1976, 15 U.S.C. 719 et seq. (1976 ed.) Congress declared:
[ Footnote 19 ] In light of our conclusion that Alaska Hire is invalid under the Privileges and Immunities Clause of Art. IV, 2, we have no occasion to address appellant's challenges to the Act under the Equal Protection Clause of the Fourteenth Amendment. [437 U.S. 518, 535]