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

Legal Standards for Government Affirmative Action Contracting Programs
that a given group is being utilized less than would be expected based on its availability, and
courts have adopted the Equal Employment Opportunity Commission’s “80 percent” rule, that is,
that a ratio less than 80 percent presents a prima facie case of discrimination. 109
Calculations of the availability of minority- and women-owned firms are therefore the crucial
foundation for examining the government’s compelling interest in pursuing affirmative action in
contracting. 110 In addition to creating the disparity ratio, correct measures of availability are
necessary to determine whether discriminatory barriers depress the formation of firms by
minorities and women, and the success of such firms in doing business in both the private and
public sectors. 111
Cleveland need not prove that the statistical inferences of discrimination are “correct.” In
upholding Denver’s M/WBE Program, the Tenth Circuit noted that strong evidence supporting
Denver’s determination that remedial action was necessary need not have been based upon
“irrefutable or definitive” proof of discrimination. Statistical evidence creating inferences of
discriminatory motivations was sufficient and therefore evidence of market area discrimination
was properly used to meet strict scrutiny. It is the plaintiff who must prove by a preponderance
of the evidence that such proof does not support those inferences. 112
It is also the case that if M/WBEs are “overutilized” because of the entity’s program, that does
not end the inquiry. Where the government has been implementing affirmative action remedies,
M/WBE utilization reflects those efforts; it does not signal the end of discrimination. For
example, the Tenth Circuit held that Denver’s overutilization of M/WBEs on City projects with
goals went only to the weight of the evidence because it reflected the effects of a remedial
program. Denver presented evidence that goals and non-goals projects were similar in purpose
and scope and that the same pool of contractors worked on both types. “Particularly persuasive”
was evidence that M/WBE participation declined significantly when the program was amended
in 1989. “The utilization of M/WBEs on City projects has been affected by the affirmative action
programs that have been in place in one form or another since 1977. Thus, the non-goals data is
Works II, 36 F.3d at 1526-1527; O’Donnell, 963 F.2d at 426; Cone Corp. v. Hillsborough County, 908 F.2d 908,
916 (11th Cir. 1990), cert. denied, 498 U.S. 983 (1990).
109 Engineering Contractors II, 122 F3d at 914; see 29 C.F.R. § 1607.4(D) (“A selection rate for any race, sex, or
ethnic group which is less than four-fifths (4/5) (or eighty percent) of the rate for the group with the highest rate
will generally be regarded by the Federal enforcement agencies as evidence of adverse impact, while a greater
than four-fifths rate will generally not be regarded by Federal enforcement agencies as evidence of adverse
impact.”).
110 Philadelphia III, 91 F.3d at 603; Webster, 51 F.Supp.2d at 1372 (no explanation for the source nor any indicia of
the accuracy or reliability of availability figures).
111 Webster, 51 F.Supp.2d at 1372; see Northern Contracting II, at *70 (IDOT’s custom census approach was
supportable because “discrimination in the credit and bonding markets may artificially reduce the number of
M/WBEs”).
112 Concrete Works IV, 321 F.3d at 971.
NERA Economic Consulting 42