b. Struck down: The Court found that California’s rule setting welfare benefits based on the recipient’s state of prior residence violated the Fourteenth Amendment P-or-I Clause: “[T]he Clause does not tolerate a hierarchy of 45 subclasses of similarly situated citizens based on the location of their prior residence.” Even if California was acting for the purpose of reducing expenditures (rather than in order to deter in-migration of poor people), using a means predicated on length of state citizenship was not acceptable, since a family’s financial needs were not dependent on how long it had been in the state or where it had previously resided.
i. Strict scrutiny: The Court in Saenz seems to have applied strict scrutiny to California’s rule disfavoring recent newcomers: the Court said that “[n]either mere rationality nor some intermediate standard of review should be used to judge the constitutionality of a state rule that discriminates against some of its citizens because they have been domiciled in the State for less than a year.” California’s fiscal justification did not come even close to satisfying this strict standard of review.
c. Significance: So Saenz probably means that the Fourteenth Amendment Privileges or Immunities Clause requires the states to satisfy strict scrutiny before they may treat newly-arrived residents less favorably than those of longer standing.
i. Bona fide residence requirements: One last note: Saenz probably does not change the rule that a state is entitled to impose a requirement of bona fide residency as a pre-condition to receiving state benefits.
4. Distinguished from Article IV Clause: It is important to distinguish the Fourteenth Amendment Privileges or Immunities Clause from the Privileges and Immunities Clause of Article IV, §2 (described supra, p. 114). To summarize the distinction: The Fourteenth Amendment Clause bars a state from abridging any U.S. citizen’s rights of “national” citizenship (of which the most important now seems to be the right to travel, and relocate, from one state to another). The Article IV Clause protects rights of “state” citizenship, but only when a non-resident of the state is not treated the same as a resident with respect to an important state right, essentially a right involving commerce.
Introductory Note: We turn now to two other specific constitutional protections of private (usually economic) interests: (1) the ban on the taking of private property for public use, without just compensation; and (2) the prohibition on the impairment of contracts. These two protections are related to the same concern which gave rise to the substantive due process doctrine, the danger that public action will interfere with private property rights. But the “taking” and “contract” clauses also protect an additional interest: the interest in “settled expectations,” or as they are sometimes called, “vested rights.” See Tribe, p. 587. The rationale behind the two clauses is that pre-existing interests in physical property and in contracts should not be disturbed by the government except under certain limited conditions.