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

Legal Standards for Government Affirmative Action Contracting Programs
important to all small and emerging businesses. 159 Difficulty in accessing procurement
opportunities, restrictive bid specifications, excessive experience requirements, and overly
burdensome insurance and/or bonding requirements, for example, might be addressed by the
City without resorting to the use of race or gender in its decision-making. Further, governments
have a duty to ferret out and punish discrimination against minorities and women by their
contractors, staff, lenders, bonding companies or others. 160 At a minimum, agencies must track
the utilization of M/WBE firms as a measure of their success in the bidding process, including as
subcontractors. 161
However, strict scrutiny does not require that every race-neutral approach must be implemented
and then proven ineffective before race-conscious remedies may be utilized. 162 While an entity
must give good faith consideration to race-neutral alternatives, “strict scrutiny does not require
exhaustion of every possible such alternative…however irrational, costly, unreasonable, and
unlikely to succeed such alternative might be…. [S]ome degree of practicality is subsumed in the
exhaustion requirement.” 163
2. Targeted Goal Setting
Numerical goals or benchmarks for M/WBE participation must be substantially related to their
availability in the relevant market. 164 Goals can be set at various levels of particularity and
participation. The entity may set an overall, aspirational goal for its annual, aggregate spending.
One unanswered question is whether goals or benchmarks for overall agency contracting may be
set higher than estimates of actual current availability. To freeze the goals at current head counts
would set the results of discrimination—depressed M/WBE availability—as the marker of the
elimination of discrimination. It therefore should be reasonable for the government to seek to
attempt to level the racial and gender playing field by setting targets somewhat higher than
current headcount. In upholding the DBE regulations, the Tenth Circuit stated that:
[B]ecause Congress has evidence that the effects of past discrimination have excluded
minorities from the construction industry and that the number of available minority
subcontractors reflects that discrimination, the existing percentage of minority-owned
businesses is not necessarily an absolute cap on the percentage that a remedial program
might legitimately seek to achieve. Absolute proportionality to overall demographics is
an unreasonable goal. However, Croson does not prohibit setting an aspirational goal
above the current percentage of minority-owned businesses that is substantially below the
159 See 49 CFR § 26.51.0.
160 Croson, 488 U.S. at 503 n.3; Webster, 51 F.Supp.2d at 1380.
161 See, e.g., Virdi, at n.8.
162 Grutter, 529 U.S. at 339.
163 Coral Construction, 941 F.2d at 923.
164 Webster, 51 F.Supp.2d at 1379, 1381 (statistically insignificant disparities are insufficient to support an
unexplained goal of 35 percent M/WBE participation in County contracts); see also Baltimore I, 83 F.Supp.2d at
621.
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