American Car Rental Association, a District of Columbia corporation, Plaintiff – Appellant, v. Heidi Humphreys, et al., Defendants – Appellees. No. 25-1246. Appeal from the United States District Court for the District of Colorado (D.C. No. 1:24-CV-02450-DDD-KAS).
In 2024, the Colorado General Assembly enacted a law imposing a “congestion impact fee” of up to $3 per day on all short-term vehicle rentals (“the Fee”). Plaintiff American Car Rental Association (“ACRA”) sued under 42 U.S.C. § 1983, claiming the federal Anti-Head Tax Act (“AHTA”) preempts the Fee. The relevant AHTA provision forbids a State to “levy or collect a tax, fee, or charge … upon any business located at a commercial service airport … that is not generally imposed on sales or services by that State.” 49 U.S.C. § 40116(d)(2)(A)(v) (“Subsection (v)”). In district court, the parties focused on the phrase “not generally imposed on sales or services.” ACRA argued that AHTA bars the Fee because it applies only to car rentals and not all “sales and services.” The State defendants argued the Fee complies with AHTA’s “generally imposed on sales or services” because it applies both to airport and non-airport car rentals.
The district court agreed with the State defendants and granted their summary judgment motion. The court affirmed for a different reason, which the parties addressed in supplemental briefs. Colorado imposes the Fee on consumers. The AHTA prohibits a fee “upon any business located at a commercial service airport.” It therefore does not apply to the Fee and does not preempt the Colorado law.