The State of Minority- and Women- Owned ... - Cleveland.com

Legal Standards for Government Affirmative Action Contracting Programs
African Americans, credit availability appeared to be a problem. Plaintiff’s expert also identified
discrimination against nonminority females in one data set.
After finding that Chicago met the compelling interest prong, the court held that the City’s
program was not narrowly tailored to address these market distortions and barriers because:
• There was no meaningful individualized review of M/WBEs’ eligibility;
• There was no sunset date for the ordinance or any means to determine a date;
• The graduation threshold of $27.5M was very high and few firms have graduated;
• There was no personal net worth limit;
• The percentages operated as quotas unrelated to the number of available firms;
• Waivers were rarely granted;
• No efforts were made to impact private sector utilization of M/WBEs; and
• Race-neutral measures had not been promoted, such as linked deposit programs, quick
pay, contract downsizing, restricting prime contractors’ self-performance, reducing bonds
and insurance requirements, local bid preferences for subcontractors and technical
assistance.
Chicago is the only city ever to have received a stay to permit revision of its program to meet
narrow tailoring. It amended its ordinance to meet the court’s 2004 deadline and continues to
implement M/WBE subcontracting goals without interruption.
3. Cleveland’s Compelling Interest in Remedying Identified Discrimination in
Its Contracting Market Area
As just described, much of the discussion in the case law has revolved around what type of
evidence is sufficiently “strong” to establish the continuing existence and effects of economic
discrimination against minorities resulting in diminished opportunities to do business with the
government. Proof of the disparate impacts of economic factors on M/WBEs and the disparate
treatment of such firms by actors critical to their success is necessary to meet strict scrutiny.
Discrimination must be shown using statistics and economic models to examine the effects of
systems or markets on different groups, as well as by evidence of personal experiences with
discriminatory conduct, policies or systems. 101 Specific evidence of discrimination or its absence
may be direct or circumstantial, and should include economic factors and opportunities in the
private sector affecting the success of M/WBEs. 102
101 Adarand VII, 228 F.3d at 1166 (“statistical and anecdotal evidence are appropriate”).
102 Id.
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