Yellow Transportation, Inc. v. Michigan

Background

An interstate trucking company headquartered in Kansas sued Michigan after the Michigan Public Service Commission changed a long-standing reciprocity policy. Under the old “bingo card” system some States waived or discounted registration fees for out-of-state carriers. Michigan shifted how it applied reciprocity and billed the company $10 per vehicle for 1992; the company paid under protest and sued. Congress’ ISTEA law created a Single State Registration System and capped fees at the amount a State “collected or charged as of November 15, 1991,” and the ICC issued rules saying States must consider reciprocity agreements when measuring that amount.

Reasoning

The central question was whether those waived or discounted fees under preexisting reciprocity agreements count for the 1991 fee cap. Applying the usual deference to an agency’s rules, the Court found the statute ambiguous on that point and held the ICC’s interpretation was a permissible reading. Because the agency’s construction was reasonable, the Court reversed the Michigan Supreme Court and enforced the ICC rule requiring States to count fees charged or collected under reciprocity agreements as of November 15, 1991.

Real world impact

The decision affects interstate trucking companies and state regulators by preserving pre-1991 fee arrangements and limiting States’ ability to abandon reciprocity to raise registration revenues. The Court noted comments that dropping reciprocity could sharply increase carrier fees and State revenue. The case was remanded to Michigan’s courts for further proceedings consistent with the opinion.

Dissents or concurrances

Justice Stevens concurred in the judgment but said the statute was not ambiguous; he relied on the agency’s delegated authority to justify freezing reciprocity arrangements, reaching the same practical result by different reasoning.