UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
____________________________________
)
AMERICAN TRUCKING ASSOCIATIONS,
)
INC.; CUMBERLAND FARMS, INC.;
)
M&M TRANSPORT SERVICES, INC.; and
)
NEW ENGLAND MOTOR FREIGHT, INC.,
)
)
Plaintiffs,
)
)
v.
)
C.A. No. 18-378-WES
)
PETER ALVITI, JR., in his official )
capacity as Director of the Rhode
)
Island Department of Transportation;)
and RHODE ISLAND TURNPIKE AND
)
BRIDGE AUTHORITY,
)
)
Defendants.
)
____________________________________)
OPINION AND ORDER
WILLIAM E. SMITH, Chief Judge.
Before

the

Court

is

Defendants’

Motion

to

Dismiss

(“Defendants’ Motion”), ECF No. 21, to which Plaintiffs have
objected, ECF No. 23.

For the following reasons, Defendants’

Motion is granted.
I.

Factual Background
In 2016, the Rhode Island General Assembly passed the Rhode

Island Bridge Replacement, Reconstruction, and Maintenance Fund
Act of 2016 (“RhodeWorks Act”), R.I. Gen. Laws § 42-13.1-1 et seq.,
to redress the fact that 23 percent of Rhode Island bridges are
“classified as structurally deficient” and the sources of revenue
on

which

the

state

had

historically

relied

to

fund

its

 transportation

infrastructure

are

insufficient

to

fund

the

necessary maintenance and improvements to those bridges. See R.I.
Gen. Laws § 42-13.1-2(2)-(7).

The General Assembly found that

large commercial trucks “cause in excess of seventy percent (70%)
of the damage” to Rhode Island’s roads and bridges but contributed
“less than twenty percent (20%) of the state’s total annual
revenues to fund transportation infrastructure.” R.I. Gen. Laws §
42-13.1-2(8).

The General Assembly also found that, even after

making several changes to the state’s funding strategy, there still
existed a “funding gap between the revenue needed to maintain all
bridges in structurally sound and good condition and the annual
amounts generated by current dedicated revenue sources.” R.I. Gen.
Laws § 42-13.1-2(7).
To fill this funding gap, the General Assembly passed the
RhodeWorks
exclusively

Act,
from

which

authorized

“large

RIDOT

commercial

to

trucks”

collect
and

tolls

expressly

prohibited RIDOT from collecting similar tolls from any other type
of vehicle, including “passenger cars.” R.I. Gen. Laws § 42-13.14, -5. Under the Act, the Rhode Island Department of Transportation
(“RIDOT”) is vested with the power to determine the locations and
amounts of the tolls, while the Rhode Island Turnpike and Bridge
Authority (“RITBA”) collects the tolls and deposits the revenues
into

a

special

account,

called

the

“Rhode

Island

bridge

replacement, reconstruction, and maintenance fund” (“RI Bridge
2

 Fund”),

that

can

reconstruction,

be

used

only

maintenance,

and

to

fund

operation

the

“replacement,

of

Rhode

Island

bridges”; surplus revenues “shall not revert to the general fund
but shall remain” in this special account.

R.I. Gen. Laws §§ 42-

13.1-4, -9; see also RITBA’s Mot. Intervene 1, ECF No. 16.

The

Act imposes a $20.00 daily limit on the amount of tolls that a
truck making a “border-to-border through trip” using I-95 may be
charged.

R.I. Gen. Laws § 42-13.1-4(c).

In contrast, the Act

imposes a $40.00 daily limit on the amount of tolls that a truck
making other trips may be charged.

R.I. Gen. Laws § 42-13.1-4(d).

The first toll facilities became active in June 2018 and, at
the time the Complaint was filed, tolls were being collected at
two locations in southwestern Rhode Island on I-95.

Compl. ¶¶ 61-

62. Plaintiffs—various trucking, transport, and freight companies—
filed a Complaint in July 2018 asking this Court to declare the
tolls unconstitutional and to enjoin their collection.
1, 13.

Compl. ¶¶

Plaintiffs contend that the tolling regime violates the

Commerce Clause of the U.S. Constitution because (1) it intends to
discriminate

in

favor

of

in-state,

and

against

out-of-state

entities; (2) it has the practical effect of discriminating against
trucks

traveling

excessive

costs

in
on

interstate
interstate

commerce;
vehicles

as

and
it

(3)

it

is

not

imposes
a

fair

approximation of the payers’ uses of the tolled facilities. Compl.
¶¶ 5-7; see U.S. Const. art. I, § 8, cl. 3.
3

 Defendants — Peter Alviti, in his official capacity as the
Director of RIDOT, and RITBA1 — have moved to dismiss on three
grounds.

First, they argue that the tolls constitute “a tax under

State law” as described in the Tax Injunction Act (“TIA”) and,
therefore, the Court lacks subject matter jurisdiction to enjoin
the “assessment, levy or collection” of those tolls.

28 U.S.C. §

1341; Defs.’ Mot. to Dismiss (“Defs.’ Mot.”) 7-25, ECF No. 21.
Second, even if the tolls are not “taxes” under the TIA, they argue
that principles of comity and federalism nonetheless require the
Court to decline to exercise its jurisdiction.
30.

Third, Defendants argue that the Eleventh Amendment protects

them from suit.
II.

Defs.’ Mot. 25-

Defs.’ Mot. 30-38.

Discussion
A. Tax Injunction Act
The TIA provides: “The district courts shall not enjoin,

suspend or restrain the assessment, levy or collection of any tax
under State law where a plain, speedy and efficient remedy may be
had in the courts of such State.” 28 U.S.C. § 1341.

The parties

do not dispute that Rhode Island state courts offer a “plain,
speedy
claims.

and

efficient

remedy”

for

Plaintiffs’

Commerce

Clause

Therefore, the only question before the Court is whether

the RhodeWorks tolls constitute “a tax” under the TIA.

The Court granted RITBA’s Motion to Intervene as a defendant
(ECF No. 16) on August 17, 2018.
1

4

 The question presents a close call, one which pits the actual
language of the TIA and the context surrounding its enactment in
the 1930s against several more modern decisions of the First
Circuit that attempt to distinguish between fees and taxes.

“The

Supreme Court has not addressed the precise issue in dispute here,
the means of defining a ‘tax’ for purposes of the Tax Injunction
Act.” See Am. Landfill, Inc. v. Stark/Tuscarawas/Wayne Joint Solid
Waste Mgmt. Dist., 166 F.3d 835, 838 (6th Cir. 1999).

It has,

however, differentiated between a “tax” and a “toll” in other
situations, most notably in its opinion in Sands v. Manistee River
Imp. Co., 8 S.Ct. 113 (1887).

In that case, a Michigan law allowed

private corporations to clean up and improve sections of the
Manistee River and then charge tolls to recoup the costs of that
clean up.

The improvements had to be approved by the governor and

the attorney general; the toll amounts had to be set by an
administrative agency and could only be imposed upon the improved
section of the river based on the distance traveled; and the use
of the improved area had to remain open to all travelers, subject
to their payment of the tolls.

Sands used the improved section of

river to transport his logs downstream but failed to pay the
requisite tolls, leading the plaintiff, Manistee River Import Co.,
to sue for the payment of the delinquent tolls.
In his defense, Sands argued that the imposition of tolls,
“without notice to the parties interested, or affording them any
5

 opportunity of contesting the validity or propriety of such tolls,”
amounted to a deprivation of property without due process in
violation of the Fourteenth Amendment. Id. at 114-15; U.S. Const.
amend. XIV.

Sands further argued that the Michigan statute

allowing for the imposition of tolls violated the Contracts Clause
because a 1787 ordinance provided that navigable waters in the
territory of Michigan would be forever free from taxes, imposts,
and duties.

According to Sands, the ordinance functioned as a

contract between the federal government and the citizens of the
territory and

the imposition of tolls on the Manistee River

amounted to a “tax” in violation of that contract.

Sands, 8 S.

Ct. at 115.
The Court first held that the tolls did not violate the Due
Process Clause because a toll did not constitute a taking of
property “any more than there is a taking of property from a
traveler in requiring him to pay for his lodgings in a public inn
. . . The tolls exacted from the defendant are merely compensation
for benefits conferred, by which the floating of his logs down the
stream

was

facilitated.”

Id.

It

further

found

that

it

was

impossible to give Sands, or any other citizen “who may have
occasion to use the stream,” notice or opportunity to “present
their views upon the tolls to be charged” because “[s]uch parties
cannot be known in advance.” Id. at 116.

6

 In expounding on why imposing a “toll” did not constitute a
deprivation

of

property

without

due

process,

the

Court

distinguished tolls from taxes, observing that:
There is no analogy between the imposition of
taxes and the levying of tolls for improvement
of highways; and any attempt to justify or
condemn proceedings in the one case, by
reference to those in the other, must be
misleading. Taxes are levied for the support
of government, and their amount is regulated
by
its
necessities.
Tolls
are
the
compensation
for
the
use
of
another’s
property, or of improvements made by him; and
their amount is determined by the cost of the
property,
or
of
the
improvements,
and
considerations of the return which such values
or expenditures should yield.
Id. at 115.
The Court also rejected Sands’ Contracts Clause argument.

It

primarily relied on the fact that the U.S. Constitution preempted
all existing laws, including the 1787 ordinance at issue, and that
Michigan assented to this preemption when it became a state in
1837.

Id. at 116.

However, it took the opportunity to opine that,

even in the absence of preemption, there was a distinction between
“taxes” and “compensation for improvements,” which would defeat
the Contracts Clause claim.

Id. at 117 (“‘By the terms [‘]tax,

impost and duty,[’] mentioned in the ordinance, is meant a charge
for

the

use

of

the

government,

not

compensation

for

improvements.’”) (quoting Huse v. Glover, 119 U.S. 543, 549 (1886))
(emphasis added).

7

 In

the

years

between

the

publication

of

Sands

and

the

enactment of the TIA, a number of state courts similarly concluded
that “tolls” and “taxes” were mutually exclusive. See, e.g., Ruler
v. York County, 139 A. 136 (Pa. 1927) (holding that “[t]olls on
highways are not taxes”) (citing Sands, 123 U.S. at 294); Masters
v. Duval County, 154 So. 172 (Fla. 1934) (holding that “[t]olls
are not taxes” under the Florida Constitution because “tolls are
collected from every one who uses the bridge as a passageway
whether a resident or a nonresident of the taxing unit . . . while
taxes may be levied upon residents or upon property having its
situs in the taxing unit”) (citing Sands, 123 U.S. at 294); People
ex

rel.

Curren

v.

Schommer,

63

N.E.2d

744,

747

(Ill.

1945)

(concluding that “[t]here appears to be a clear cut and definite
distinction between the legal conception of tolls and taxes” and
explaining the difference between the two by reference to Sands);
In re Opinions of the Justices, 120 A. 629, 630 (N.H. 1923)
(holding

that

the

legislature,

which

was

constitutionally

precluded from assessing certain taxes, was within its authority
to impose tolls for use of state highways because “[t]here is no
analogy between the imposition of taxes and the levying of tolls
for improvement of highways”) (quoting Sands, 123 U.S. at 294).
Additionally, a treatise on the Law of Taxation, published
approximately a decade before the TIA was enacted, differentiated
between tolls and taxes as follows:
8

 A ‘toll’ is a sum of money for the use of
something,
generally
applied
to
the
consideration which is paid for the use of a
road, bridge or the like, of a public nature.
The term toll, in its application to the law
of taxation, is nearly obsolete.
It was
formerly applied to duties on imports and
exports; but tolls, as now understood, are
applied most exclusively to charges for
permission to pass over a bridge, road or
ferry owned by the person imposing them.
Tolls are not taxes.
A tax is a demand of
sovereignty;
a
toll
is
a
demand
of
proprietorship.
Thomas A. Cooley, The Law of Taxation 77 (Clark A. Nichols ed.,
4th ed. 1924) (emphasis added) (internal citations omitted).
Although

neither

Sands,

nor

the

subsequent

state

court

cases, nor the Cooley treatise, purport to analyze the meaning of
the term “tax” as it is used in the TIA, these authorities
nonetheless provide compelling evidence that, at the time Congress
enacted the TIA in 1937, it would have understood “taxes” and
“tolls” to be mutually exclusive concepts. “A fundamental canon of
statutory construction is that, unless otherwise defined, words
will be interpreted as taking their ordinary, contemporary, common
meaning.”

Perrin v. United States, 444 U.S. 37, 42 (1979); see

also Astoria Fed. Sav. & Loan Ass’n v. Solimino, 501 U.S. 104, 108
(1991) (“[W]here a common-law principle is well established . . .
courts may take it as given that Congress has legislated with an
expectation that the principle will apply except when a statutory
purpose to the contrary is evident.”) (quotation omitted).

9

 Defendants naturally disagree.

They argue that there was not

a clear distinction between “taxes” and “tolls” prior to the
enactment of the TIA, as evidenced by the fact that some cases,
published

immediately

before

and

after

the

TIA

was

enacted,

described certain toll-like exactions as “taxes.”
First, Defendants contend that, in several cases decided in
the years immediately before and after the enactment of the TIA,
the Supreme Court used the term “tax” to discuss certain tolls
similar to the tolls here.

See Defs.’ Reply 3, ECF No. 25.

However, in all the cases to which Defendants cite, the challenged
exactions were called “taxes” in the enabling legislation and the
Court’s analysis did not appear to turn on the difference between
“taxes” and “tolls.”
Blodgett,

276

U.S.

See generally Interstate Busses Corp. v.
245

(1928)

(addressing

a

Commerce

Clause

challenge to a Connecticut statute imposing a one-cent-per-mile
“excise tax” on vehicles traveling interstate); Continental Baking
Co.

v.

Woodring,

286

U.S.

352

(1932)

(addressing

various

constitutional challenges to a Kansas statute imposing a variety
of

obligations

and

classifications

on

vehicles

traveling

interstate, including a “tax of five-tenths mill per gross ton
mile”); Dixie Ohio Exp. Co. v. State Rev. Comm’n of Ga., 306 U.S.
72 (1939) (addressing a Commerce Clause challenge to the “Georgia
Maintenance Tax Act”).

Defendants’ point is that the Court chose

to describe these so-called “tolls” as taxes because that was what
10

 they really were, not because that is what the legislatures chose
to call them.

The point is a fair one inasmuch as the Court could

have found the fees to be tolls regardless of the label.

But these

cases do little to undermine the fundamental distinction between
tolls and taxes found by the Court in the Sands case.
Second, Defendants contend that, to determine whether an
exaction is a “tax” within the meaning of the TIA (as opposed to
the pre-TIA landscape discussed above), the Court must engage in
the three-pronged test set forth in San Juan Cellular Telephone
Co. v. Pub. Serv. Comm’n of P.R., 967 F.2d 683 (1st Cir. 1992).
That test weighs the characteristics of the challenged assessment
to determine whether it is more akin to a “tax” or a “regulatory
fee.”2

San Juan Cellular, 967 F.2d at 685.

In San Juan Cellular, the First Circuit laid out a spectrum
of government-imposed assessments, placing the “classic tax” at
one end and the “classic fee” at the other:
The classic ‘tax’ is imposed by a legislature
upon many, or all, citizens[,] [and] raises
money, contributed to a general fund, and spent
for the benefit of the entire community . . .
The classic ‘regulatory fee’ is imposed by an
agency upon those subject to its regulation .
. . [to] serve regulatory purposes directly by
. . . deliberately discouraging particular
conduct by making it more expensive . . . [o]r
. . . indirectly by . . . raising money placed
A regulatory fee, for purposes of this analysis, is roughly
the same thing as a toll in the sense that it is a fee that has
certain specific characteristics that distinguish it from what we
commonly think of as a tax.
2

11

 in a special fund to help defray the agency’s
regulation-related expenses.
Id. at 685.

To determine whether an exaction constitutes a “tax”

or a “regulatory fee,” the court laid out three factors for
consideration: (1) the nature of the entity imposing the exaction;
(2) the scope of the population subject to the exaction; and (3)
whether the revenues from the exaction are expended for general
public purposes, of a sort often financed by a general tax, or
whether the revenues provide more narrow benefits to regulated
individuals and entities and serve to defray the agency’s cost of
regulation.

Id.

at

686.

Although

none

of

these

factors

is

dispositive, in close cases, the First Circuit has instructed
courts to “emphasize the revenue’s ultimate use, asking whether it
provides a general benefit to the public, of a sort often financed
by a general tax, or whether it provides more narrow benefits to
regulated companies or defrays the agency’s costs of regulation.”
Id. at 685.
The first factor — the nature of the entity imposing the
charge — clearly favors finding the RhodeWorks tolls to be fees or
tolls, and not taxes.

The toll amounts and locations are set by

RIDOT, a government agency, and not by the General Assembly itself.
See Bidart Bros. v. California Apple Comm’n, 73 F.3d 925, 931 (9th
Cir. 1996) (“An assessment imposed directly by the legislature is

12

 more

likely

to

be

a

tax

than

an

assessment

imposed

by

an

administrative agency.”).3
Likewise, the second factor — the nature of the population
subject to the charge — also cuts in favor of finding the tolls to
be akin to fees and not taxes.

The tolls are imposed upon a narrow

class of payors (large commercial trucks) which, by RIDOT’s own
estimates, makes up only 2.5 percent of weekday traffic and 0.8
percent of weekend traffic. Bidart, 73 F.3d at 931 (“An assessment
imposed upon a broad class of parties is more likely to be a tax
than an assessment imposed upon a narrow class.”).
assessment

upon

a

narrow

class

of

parties

However, “an

can

still

be

characterized as a tax under the TIA” if it serves a revenueraising purpose that benefits the community as a whole.

Id.

(citing Wright v. McClain, 835 F.2d 143, 145 (6th Cir. 1987)
(finding assessments imposed only upon parolees to be “a tax” under
the TIA because the funds were used for purposes that “related
directly to the general welfare of the citizens of Tennessee”)).

However, RIDOT does contract with the State Tax Division
to collect delinquent tolls and, therefore, the collectionsprocess includes at least one tax-specific actor. See 28 U.S.C.
§ 1341 (“The district courts shall not enjoin, suspend or restrain
the assessment, levy or collection of any tax under State law
. . . .”) (emphasis added); Defs.’ Reply 23, Ex. A – Memorandum of
Understanding Between Rhode Island Division of Taxation and RIDOT.
This Court may consider extrinsic evidence, such as the Memorandum
of Understanding, in determining whether it has jurisdiction. See
Ins. Brokers West, Inc. v. Liquid Outcome, LLC, 241 F. Supp. 3d
339, 342-43 (D.R.I. 2017).
3

13

 But see GenOn Mid-Atlantic, LLC v. Montgomery Cty., Md., 650 F.3d
1021, 1022 (4th Cir. 2011) (finding an “excise tax” to be a “fee,”
despite that it was projected to raise between $11.7 and $17.6
million annually, which would be deposited directly into the
general fund, because the class of payors (a single energy plant)
was too narrow to qualify as a “tax” under the TIA).
The third factor — whether the revenue is used for general
public purposes that benefit the community as a whole, or for more
limited regulatory purposes that benefit the regulated group and
defray the agency’s costs of administration — suggests the tolls
are

“taxes.”

Although

not

referred

to

as

“taxes”

in

the

authorizing legislation, the tolls were enacted with the express
intention

of

infrastructure

raising

revenues

“funding

gap”

to

and

cover
are

a

longstanding

expected

to

raise

approximately $500 million over ten years. Defs.’ Reply 28; R.I.
Gen. Laws § 42-13.1-2(7); see Wright, 835 F.2d at 144 (“[T]he label
given an assessment by state law is not dispositive of whether the
assessment is a ‘tax under state law.’ Rather, the definition of
the term ‘tax’ is a question of federal law[.]”).

Even if, as

Plaintiffs argue, this amount constitutes only a small percentage
of Rhode Island’s overall state budget, these truck “tolls” still
serve

a

critical

revenue-raising

purpose

(transportation

infrastructure), that but for their collection, would require the
General

Assembly

to

fund

through
14

general

revenue.

See

Am.

 Landfill, Inc. v. Stark/Tuscarawas/ Wayne Joint Solid Waste Mgmt.
Dist., 166 F.3d 835, 840 (6th Cir. 1999) (“The [TIA] makes no
exception for challenges to taxes which constitute a small portion
of a state’s revenue sources rather than a large portion.”).
Additionally, although the revenues from the tolls are deposited
into a special account, not the general fund, the purpose for which
the funds are used is unquestionably a general public purpose that
benefits the community as a whole:
pressed

to

demonstrate

that

Plaintiffs would be hard-

highway

construction

and

bridge

maintenance benefit less than the entire community.
The First Circuit has held that “the most salient factor in
the decisional mix concerns the destination of the revenues raised
by the impost” and that the “revenue’s ultimate use” is paramount.
San Juan Cellular, 967 F.2d at 685; Cumberland Farms, Inc. v. Tax
Assessor, State of Me., 116 F.3d 943, 947 (1st Cir. 1997) (citation
omitted); see also Am. Landfill Inc., 166 F.3d at 839-40 (holding
that, despite being deposited into a special fund, waste disposal
“assessments”

were

taxes

because

they

were

approved

by

the

legislature, were separate from the permitting fees which provided
payors with the privilege of operation, and served several public
purposes that benefitted the entire community).

The use of a

special fund here is little more than a budgeting device that is
allowing the state to pay for what would otherwise be raised
through general revenue taxation through a separate off-budget
15

 fee.

The use of the fund does not change the character of the

fee.
Moreover,

the

Supreme

Court’s

holding

in

analysis of San Juan Cellular are not at odds.

Sands

and

the

The holding in

Sands that tolls are not taxes is still good law; and the TIA would
not operate to deprive district courts of jurisdiction in a case
that challenged the constitutionality of an actual toll.

But for

a fee to be a toll – as conceived by Sands and consistent with the
San Juan Cellular test – it must have certain characteristics:
per Sands, it must be a fee that compensates the owner of something
for use of that thing by another – a ferry, a private highway – or
to compensate a person for certain improvements to property made
by him.

In other words, there is a direct correlation between the

fee or toll and the use of the property.

As stated in the Cooley

treatise above, it is “a demand of proprietorship” not sovereignty.
In contrast, a tax, as the Court said in Sands and the First
Circuit discussed in San Juan Cellular, is essentially a revenue
raising device, a demand of the sovereign.

It is often, but not

always imposed on a broad class of persons but, more importantly,
it supplants other government revenue sources which would be needed
to fund necessities like roads and bridges and the like.
Here, the facts are clear that the fees, while dubbed “tolls,”
are really a highly targeted and sophisticated tax designed to
fund

infrastructure

maintenance
16

and

improvements

that

would

 otherwise need to be paid for by other forms of tax-generated
revenue.

As such, the Court is without jurisdiction under the

TIA; the federal case must be dismissed and ultimately heard in
the courts of Rhode Island.
III. Conclusion
For the above-stated reasons, Defendants’ Motion to Dismiss
(ECF No. 21) is GRANTED.

IT IS SO ORDERED.

William E. Smith
Chief Judge
Date: March 19, 2019

17