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

Legal Standards for Government Affirmative Action Contracting Programs
The following are factors Cleveland must consider to determine whether it has a strong basis in
evidence to adopt a M/WBE program for its locally-funded contracts.
a. Definition of Cleveland’s Market Area
Croson counsels that a state or local government may only remedy discrimination within its own
contracting market area. Richmond was specifically faulted for including minority contractors
from across the country in its program. 103 This Study empirically establishes the geographic and
product dimensions of the City’s contracting and procurement market area in order to ensure that
the evidence is narrowly tailored. 104
b. Examining Disparities between M/WBE Availability and Utilization
Next, statistical examination of the availability of minorities and women to participate in
Cleveland’s projects and the history of utilizing M/WBEs as prime contractors and as
subcontractors by the City and its prime contractors is required as part of this Study. 105 Simple
disparities between an area’s overall minority population and its prime contractors’ utilization of
minority- and women-owned firms are not enough. 106 The primary inquiry is whether there are
statistically significant disparities between the availability of M/WBEs and the utilization of such
firms.
Where there is a significant statistical disparity between the number of qualified minority
contractors willing and able to perform a particular service and the number of such
contractors actually engaged by the locality or the locality’s prime contractors, an
inference of discriminatory exclusion could arise.… In the extreme case, some form of
narrowly tailored racial preference might be necessary to break down patterns of
deliberate exclusion. 107
This is known as the “disparity ratio” or “disparity index.” A disparity ratio measures the
participation of a group in the agency’s contracting dollars by dividing that group’s contract
dollar percentage by the related bidder or awardee percentage, and multiplying that result by
100%. Courts, including the Fifth Circuit, have looked to disparity indices in determining
whether Croson’s evidentiary foundation is satisfied. 108 An index less than 100 percent indicates
103 Croson, 488 U.S. at 508.
104 Concrete Works II, 36 F.3d at 1520 (to confine data to strict geographic boundaries would ignore “economic
reality”).
105 An availability study is a subset of a disparity study, in that statistical evidence of disparities between the
difference of availability of M/WBEs and their utilization as prime contractors and subcontractors is not
included.
106 Croson, 488 U.S. at 501-02; Drabik II, 214 F.3d at 736.
107 Croson, 488 U.S. at 509; see Webster, 51 F.Supp.2d at 1363, 1375.
108 Scott, 199 F.3d at 218, n11 (“we [do not] attempt to craft a precise mathematical formula to assess the quantum
of evidence that rises to the Croson "strong basis in evidence" benchmark. The sufficiency of a municipality's
findings of discrimination in a local industry must be evaluated on a case-by-case basis”); see also Concrete
NERA Economic Consulting 41