Diehl, Inc. v. Ohio Department of Agriculture

Summary

The Ohio Supreme Court held that fees assessed by the Ohio Department of Agriculture against milk processors based on the total amount of milk received, including out-of-state milk, did not violate the dormant Commerce Clause. Applying the Pike balancing test, the court concluded that the fee was imposed evenhandedly, served the legitimate local interest of funding dairy-safety inspections, and imposed no clearly excessive burden on interstate commerce.

Holdings

1. The fee schedule did not violate the dormant Commerce Clause because it applied evenhandedly without favoring Ohio milk over out-of-state milk, served the legitimate local interest of funding milk-safety regulation and inspections, and imposed at most incidental and nonexcessive effects on interstate commerce.
2. The assessment was a fee because it was a charge imposed by the government in return for a service it provided, namely milk-safety inspections and related regulation.

Questions Presented

1. Whether Ohio's monthly assessment on milk processors, calculated on the total amount of milk received including out-of-state milk, violated the dormant Commerce Clause.
2. Whether the assessment was a regulatory fee rather than an unconstitutional tax.

Disposition

affirmed