305:. The tax amounted to about 2 percent of the retail value of electricity. The Act further allowed electric companies in New Mexico to credit the amount of this tax against their existing tax liability from an existing 4 percent gross receipts tax on retail sales of electricity, essentially eliminating the effect of the tax upon New Mexico's in-state users of electricity. Electricity generated from in-state power plants but exported for sale to out-of-state customers did not have any gross receipts tax liability to credit the energy tax against.
31:
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the overall tax burden of electric companies. As the New Mexico
Electrical Energy Tax on generation ensured locally consumed electricity had no tax burden, it violated that statute. The Court stated that Congress, in enacting the ban on these types of state taxes and against the New Mexico tax in particular, had broad authority under the Commerce Clause to regulate interstate commerce, as the Court had held in cases such as
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The New Mexico
Supreme Court issued a ruling in 1978 and found that the state energy tax was valid. The court concluded, if the total tax burden on the electric companies was considered, that since the tax on electricity generated was applicable to both electricity sold in-state and out-of-state, and
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No State, or political subdivision thereof, may impose or assess a tax on or with respect to the generation or transmission of electricity which discriminates against out-of-State manufacturers, producers, wholesalers, retailers, or consumers of that electricity. For purposes of this section a tax is
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The
Supreme Court reversed the New Mexico Supreme Court, holding that the New Mexico energy tax was invalid under the Supremacy Clause since it violated 15 U.S.C. § 391. The Court noted that the statute was directed specifically at a state tax on generation or transmission of electricity and not on
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that the New Mexico energy tax was unconstitutional and void. In addition to the ownership interest in the Four
Corners Generating Station, Tucson Electric Power also had a part ownership interest in the San Juan Generating Station and El Paso Electric owned and operated the Rio Grande Generating
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that the credit against the state gross receipts tax was available to both in-state and out-of-state electric companies, it did not result in a discriminatory tax burden. The electric companies then appealed to the U.S. Supreme Court, claiming that the tax violated the
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discriminatory if it results, either directly or indirectly, in a greater tax burden on electricity which is generated and transmitted in interstate commerce than on electricity which is generated and transmitted in intrastate commerce.
437:, it had been stated that the statute had supposedly been drafted to do no more than what the Commerce Clause would accomplish on its own terms. However, the statute did more than that, and forbids the New Mexico energy tax.
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filed a motion with the U.S. Supreme Court regarding the New Mexico energy tax. The motion requested authorization to file an action against New Mexico under the Court's
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After opposing motions for summary judgment were filed in the district court, the court ruled for New Mexico. The electric companies appealed the case to the
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New Mexico attempted to tax the electricity generated and exported out-of-state from the Four
Corners Generating Station, shown in a 1972 photograph.
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for export and sold in neighboring states. In 1975 New Mexico enacted the
Electrical Energy Tax Act, which imposed a
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and included a provision regarding the New Mexico energy tax. The provision, codified at 15 U.S.C. § 391, stated:
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433:, Justice Rehnquist with whom Justice White joins, noted that when 15 U.S.C. § 391 had been discussed by the
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The five out-of-state electric companies with an ownership interest in the Four
Corners Generating Station,
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New Mexico's energy tax on the generation of electricity is invalid under the
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Stewart, joined by Burger, Brennan, Marshall, Blackmun, Powell, Stevens
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tax on the generation of electricity was invalid under the
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public domain material from this U.S government document
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Station, both of which were also located in New Mexico.
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United States
Supreme Court cases of the Burger Court
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59:Taxation and Revenue Department of New Mexico
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580:Heart of Atlanta Motel Inc. v. United States
417:Heart of Atlanta Motel Inc. v. United States
737:United States taxation and revenue case law
332:, filed an action in the district court of
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301:on the amount of electricity generated by
279:New Mexico Taxation and Revenue Department
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289:Most of the electricity generated at the
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747:History of San Juan County, New Mexico
534:Arizona Public Service Co. v. O'Chesky
118:Arizona Public Service Co. v. O'Chesky
18:1979 United States Supreme Court case
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318:Public Service Company of New Mexico
265:case in which the Court held that a
634:Arizona Public Service Co. v. Snead
457:Arizona Public Service Co. v. Snead
293:located in northwest New Mexico is
258:Arizona Public Service Co. v. Snead
24:Arizona Public Service Co. v. Snead
36:Supreme Court of the United States
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712:United States Supreme Court cases
644:141 (1979) is available from:
277:. Snead was the director of the
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291:Four Corners Generating Station
722:1979 in United States case law
310:Arizona Public Service Company
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732:United States energy case law
261:, 441 U.S. 141 (1979), was a
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263:United States Supreme Court
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694:Oyez (oral argument audio)
478:This article incorporates
314:Southern California Edison
275:United States Constitution
234:Rehnquist, joined by White
55:Arizona Public Service Co.
757:Coal in the United States
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363:New Mexico Supreme Court
43:Argued February 26, 1979
762:Arizona Public Service
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371:Tax Reform Act of 1976
367:United States Congress
166:William J. Brennan Jr.
45:Decided April 18, 1979
555:Katzenbach v. McClung
494:Arizona v. New Mexico
411:Katzenbach v. McClung
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389:Export-Import Clauses
355:Arizona v. New Mexico
350:original jurisdiction
326:Tucson Electric Power
752:Energy in New Mexico
395:Opinion of the Court
338:declaratory judgment
685:Library of Congress
198:Lewis F. Powell Jr.
95:99 S. Ct. 1629; 60
727:1979 in New Mexico
605:Wickard v. Filburn
431:concurring opinion
423:Wickard v. Filburn
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544:291 (1978).
538:91 N.M. 485
295:transmitted
231:Concurrence
178:Byron White
122:91 N.M. 485
706:Categories
522:§ 391
441:References
336:seeking a
285:Background
267:New Mexico
249:§ 391
128:291 (1978)
101:U.S. LEXIS
99:106; 1979
67:Docket no.
97:L. Ed. 2d
77:Citations
632:Text of
385:Commerce
223:Majority
61:, et al.
658:Findlaw
346:Arizona
273:of the
133:Holding
71:77-1810
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