Brief Fact Summary.
Sewer owners sued the city of Indianapolis under the Equal Protection Clause for failing to provide refunds for sewer improvements when charges were omitted for sewer owners who had not fully paid off their debts under the Barrett Law.
Synopsis of Rule of Law.
Under the Equal Protection Clause, a rational basis will uphold a law that does not involve a fundamental right or suspect classification.
The Barrett Law in Indiana charged sewer companies involved in sewer improvement projects. Indianapolis changed its plan to the Septic Tank Elimination Program (STEP) that forgave any charges not yet paid under the Barrett Law. However, owners who fully paid the charges under the Barrett Law were not refunded. Sewer owners who fully paid for their improvements under the Barrett Law sued Indianapolis under the equal protection clause for failing to provide refunds under STEP. The Supreme Court of Indiana upheld Indianapolis’ decision to deny the requests for refunds. The Supreme Court of the United States granted certiorari.
Whether STEP will be upheld under the equal protection clause if the law does not involve a fundamental right or a classification of homeowners that is suspect?
Yes. The distinction between homeowners who paid the amount in full and homeowners who have not completed their payments maintained a rational relationship to reducing costs. The rational basis test was used because the law did not violate any fundamental right nor was the classification of owners suspect.
The Equal Protection Clause does not prevent State Legislatures from drawing lines that treat one class of individuals or entities differently from others, unless the difference in treatment is palpably arbitrary or amounts to an invidious discrimination.View Full Point of Law
(Roberts, CJ.) The disparity between homeowners who paid the amount in full under the Barrett Law and homeowners who have not completed their payments under STEP violates the Equal Protection Clause of the 14th Amendment. Administrative costs are not sufficient justification to charge some taxpayers more than others. Similarly, Indianapolis had records of each homeowner’s payments and charges. The only administrative charges that would be due by the state were to make payments to the homeowners.
Indianapolis’ decision to differentiate between past payments and future obligations does not violate the equal protection clause because a rational basis exists as it relates to relieving the city from the burden of collecting debts under two different systems, STEP and the Barrett Law.