City of Trenton v. New Jersey

Background

The dispute began when New Jersey recovered a $14,310 judgment against the City of Trenton under a 1907 law that requires municipalities diverting water for public supply to make annual payments to the State Treasurer for water taken beyond legally diverted amounts, with a 100-gallons-per-capita threshold based on the 1905 census. Trenton argued it had a perpetual, fee-free right to take water from the Delaware River through prior grants and a purchase of the local water company, and that the state law violated the Federal Constitution by impairing contracts and taking property without due process or just compensation.

Reasoning

The central question was whether a municipality can use the Federal Constitution to block a state law that charges for diverted water. The Court explained that private water companies, organized for profit, hold private rights protected by the Constitution, but a city is a political subdivision created by the State and is subject to the State’s control. Citing precedent, the Court held that states may modify or withdraw powers given to municipalities and regulate governmental property and functions. On that basis the Court concluded municipalities cannot invoke the contract clause or the Fourteenth Amendment against state regulation of water diversion. The Court found no substantial federal question and dismissed the writ of error.

Real world impact

The ruling leaves the state court judgment intact and confirms that New Jersey may impose license fees and regulate water use by cities. Municipal claims of perpetual, constitutional immunity from such state regulation were rejected, reinforcing state authority over water conservation and allocation.