Massachusetts v. United States
435 U.S. 444 (1978)

Annotate this Case

U.S. Supreme Court

Massachusetts v. United States, 435 U.S. 444 (1978)

Massachusetts v. United States

No. 76-1500

Argued December 6, 1977

Decided March 9, 1978

435 U.S. 444




As part of a comprehensive program to recoup the costs of federal aviation programs from those who use the national airsystem, Congress enacted the Airport and Airway Revenue Act of 1970, which imposes an annual "flat fee" registration tax on all civil aircraft, including those owned by the States and by the Federal Government, that fly in the navigable airspace of the United States. The Act also imposes a 7 cent per gallon tax on aircraft fuel, which, together with a 5 cent per pound aircraft tire and 10 cent per pound tube tax and the registration tax, was intended to reflect the cost of benefits from the programs to noncommercial general aircraft, but States were exempted from the fuel, tire, and tube taxes. After the registration tax was collected under protest from it with respect to a helicopter it used exclusively for police functions, the Commonwealth of Massachusetts instituted this refund action, contending that the United States may not constitutionally impose a tax that directly affects the essential and traditional state function of operating a police force. The District Court dismissed the complaint on the ground, inter alia, that the registration tax was a user fee which did not implicate the constitutional doctrine of implied immunity of state government from federal taxation. The Court of Appeals affirmed.

Held: The registration tax does not violate the implied immunity of a state government from federal taxation. Pp 435 U. S. 453-470

(a) A State enjoys no constitutional immunity from a nondiscriminatory federal revenue measure which operates only to ensure that each member of a class of special beneficiaries of a federal program pays a reasonable approximation of its fair share of the cost of the program to the Federal Government. Pp. 435 U. S. 454-463.

(b) Even if it were feasible for the Federal Government to recover all costs of a program through charges for measurable amounts of use of its facilities, rather than by imposing a flat fee, so long as the federal taxes imposed do not discriminate against state functions, are based on a fair approximation of the State's use of the facilities, and are structured to produce revenues that will not exceed the total cost to the Federal Government of the benefits supplied, there can be no substantial basis for a claim that the Federal Government may be using its

Page 435 U. S. 445

taxing powers to control, unduly interfere with, or destroy a State's ability to perform essential services. Pp. 435 U. S. 463-467.

(c) Here, the registration tax (1) is nondiscriminatory, since it applies not only to private users of the airways, but also to civil aircraft operated by the United States; (2) is, together with the 7 cent per gallon fuel tax and the 5 cent per pound tire and 1 cent per pound tube tax, a fair approximation of the cost of the benefits civil aircraft receive from the federal programs, since, even though the taxes do not give weight to every factor affecting appropriate compensation for airport and airway use, the fuel tax and tire and tube tax are geared directly to use, whereas the registration tax is designed to give weight to factors affecting the level of use of the navigational facilities; and (3) is not excessive in relation to the cost of the Government benefits supplied, since not only have the user fees proved to be insufficient to cover the annual civil aviation outlays, but the States, being exempt from the fuel tax, pay far less than private noncommercial users of the airways. Pp. 435 U. S. 467-470.

548 F.2d 33, affirmed.

BRENNAN, J., delivered the opinion of the Court, in which WHITE, MARSHALL, and STEVENS, JJ., joined, and in Parts I, II-C, and III of which STEWART and POWELL, JJ., joined. STEWART and POWELL, JJ., filed an opinion concurring in part and concurring in the judgment, post, p. 435 U. S. 470. REHNQUIST, J., filed a dissenting opinion, in which BURGER, C.J., joined, post, p. 435 U. S. 471. BLACKMUN, J., took no part in the decision or consideration of the case.

Page 435 U. S. 446

MR. JUSTICE BRENNAN delivered the opinion of the Court. *

As part of a comprehensive program to recoup the costs of federal aviation programs from those who use the national airsystem, Congress in 1970 imposed an annual registration tax on all civil aircraft that fly in the navigable airspace of the United States. 26 U.S.C. § 4491. [Footnote 1] The constitutional question presented in this case is whether this tax, as applied to an aircraft owned by a State and used by it exclusively for police functions, violates the implied immunity of a state government from federal taxation. We hold that it does not.


Since the passage of the Air Commerce Act of 1926, 44 Stat. 568, the Federal Government has expended significant amounts of federal funds to develop and strengthen an integrated national airsystem and to make civil air transportation safe and practical. It has established, developed, and improved a wide array of air navigational facilities and services that benefit all aircraft flying in the Nation's navigable airspace, [Footnote 2] and it has also made substantial grants to state and local governments to assist in planning and developing airports.

In 1970, after an extended study of the national airsystem, Congress concluded that the level of annual federal outlays on aviation, while significant, had not been sufficient to permit the national airsystem to develop the capacity to cope satisfactorily with the current and projected growth in air transportation. To remedy this situation, Congress enacted two laws, the Airport and Airway Development Act of 1970 (Development Act), 84 Stat. 219, and the Airport and Airway Revenue Act of 1970 (Revenue Act), 84 Stat. 236, which together constitute a comprehensive program substantially to expand and improve the national airport and airway system over the decade beginning July 1, 1970. In the Development Act, Congress provided for vastly increased federal expenditures both for airport planning and development and for the further expansion of federal navigational services. More importantly for present purposes, the Revenue Act adopted several measures to ensure that federal outlays that benefited the civil users of the airways would, to a substantial extent, be financed by taxing measures imposed on those civil users. [Footnote 3]

Page 435 U. S. 448

The Revenue Act, therefore, enacted for the first time, or increased, several taxes on civil aviation. Congress conceived of each of these revenue measures as user fees, and calculated that they would produce revenues that would defray a significant and increasing percentage of the civil share of the annual total federal airport and airway expenditures for the fiscal years 1970 to 1979. [Footnote 4] To assure that the revenues from these user taxes would be expended only for the expansion, improvement, and maintenance of the air transportation system, an Airport and Airway Trust Fund was created, and Congress provided that the amount of revenue generated by the aviation user charges would, during the 1970's, be paid into this trust fund, as would any money appropriated from general revenues for aviation purposes. [Footnote 5] Revenue Act, § 208, 84 Stat. 250, 49 U.S.C. § 1742; see H.R.Rep. No. 91-601, p. 41 (1969) (hereinafter H.R.Rep.); S.Rep. No. 91-706, pp. 23-25 (1970) (hereinafter S.Rep.).

The financing measures in the Revenue Act are intended to promote two purposes. First, they are designed to serve the congressional policy of having those who especially benefit from Government activity help bear the cost. See H.R.Rep.

Page 435 U. S. 449

38; S.Rep. 5. Second, the financing provisions are intended to ensure that the capacity of the national air system would not again be found to be insufficient to meet the demands of increasing use. Congress believed that the inadequacy in past levels of investment in aviation had been due to the substantial competition from nonaviation budgetary requests. See H.R.Rep. 3. The trust fund and the user fees were, therefore, established to provide funding for aviation that would "generally match and grow with the demand" for use of the airways. Id. at 8.

The tax challenged in this case is one of several adopted in the Revenue Act, the annual aircraft registration tax. Revenue Act, § 206, 26 U.S.C. § 4491. It imposes an annual "flat fee" tax on all civil aircraft -- including those owned by State and National Governments [Footnote 6] -- that fly in the navigable

Page 435 U. S. 450

airspace of the United States. [Footnote 7] The amount of the annual charge depends upon the type and weight of the aircraft: those with piston-driven engines pay $25 plus 2 cents per pound of the maximum certificated takeoff weight in excess of 2,500 pounds, whereas turbine-powered aircraft pay $25 plus 3 1/2 cents per pound of the maximum certificated takeoff weight. Seen 1, supra.

As is apparent from both the rate of tax in § 441 and the legislative history of the Revenue Act, Congress did not contemplate that the annual registration tax would generate significant amounts of revenue, but rather that the bulk of the funds generated by the system would come from other user taxes, [Footnote 8] each of which is related more directly to the level

Page 435 U. S. 451

of use of the navigable airspace. Thus, commercial aviation's share of the cost of the federal activities would be raised primarily through an 8% tax on the price of domestic air passenger tickets, see Revenue Act, § 203, 26 U.S.C. § 4261; a $3 "head tax" on international flights originating in the United States, ibid.; and a 5% tax on the cost of transporting property by air, Revenue Act, § 204, 26 U.S.C. § 4271. Noncommercial general aviation -- the generic category that includes state police aircraft -- would pay most of its share through a 7 cent per gallon tax on aircraft fuel. See Revenue Act,§ 202, 26 U.S.C. § 4041.

But while the registration tax was expected to produce only modest revenues, and was understood to be only indirectly related to system use, Congress regarded it as an integral and essential part of the network of user charges. [Footnote 9] Moreover, it is

Page 435 U. S. 452

the only tax imposed on those general noncommercial aircraft owned and operated by States. Although Congress was generally of the view that the States should be required to pay aviation user charges, since "there would appear to be no reason why [they] should not pay for their fair share of the use of the airway facilities," H.R.Rep. 46; see S.Rep. 17-18, and, in fact, made the States subject to all the other user charges, it retained a statutory exemption for the States from the aircraft fuel, tire, and tube taxes. See 68A Stat. 480, as amended, 26 U.S.C. § 4041(g) (1976 ed.); 26 U.S.C. § 4221.

The Commonwealth of Massachusetts owns several aircraft that are subject to the tax imposed by § 4491, including a helicopter which the Commonwealth uses exclusively for patrolling highways and other police functions. [Footnote 10] In 1973, the United States notified the Commonwealth that it had been assessed for a tax of $131.43 on this state police helicopter for the period from July 1, 1970, to June 30, 1971. The Commonwealth refused to pay, and the United States thereafter levied on one of the Commonwealth's bank accounts and collected this tax, plus interest and penalties.

Pursuant to 28 U.S.C. § 1346 (1970 ed. and Supp. V), the Commonwealth then instituted this action for a refund of the money collected, contending that the United States may not constitutionally impose a tax that directly affects the essential and traditional state function of operating a police force. The District Court dismissed the complaint in an unreported decision. It first indicated its view that the most recent decisions of this Court had so limited a State's constitutional immunity from federal taxation that a constitutional challenge could not succeed unless the tax was discriminatory or the State showed that the tax actually impaired a State function. Because the Commonwealth had not alleged that this nondiscriminatory

Page 435 U. S. 453

annual fee had, in fact, impaired the operations of its police force, the District Court concluded dismissal was mandatory. In the alternative, the District Court held that the tax in question is a user fee and that, whatever the present scope of the constitutional principle of implied immunity of a state government from federal taxes, a user fee does not implicate the doctrine. The Court of Appeals for the First Circuit affirmed, solely on the latter ground. 548 F.2d 33 (1977). We granted certiorari, 432 U.S. 905 (19177), to resolve a conflict between this decision and Georgia Dept. of Transp. v. United States, 430 F.Supp. 823 (ND Ga.1976), appeal docketed, No. 77-16. See also City of New York v. United States, 394 F.Supp. 641 (SDNY 1975), affirmance order, 538 F.2d 308 (CA2 1976); Texas v. United States, 72-2 USTC

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