Guidelines for Conducting a Disparity and Availability Study for the Federal DBE Program (2010) / Chapter Skim
Currently Skimming:
Pages 1-8
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 1... ...
Strict scrutiny requires that a government entity prove both its "compelling interest" in remedying identified race discrimination based upon a "strong basis in evidence," and that the measures adopted to remedy that discrimination are "narrowly tailored" to that evidence. In Croson, the Court struck down Richmond's Minority Business Enterprise Plan that required prime contractors awarded city construction contracts to subcontract at least 30% of the project to minority-owned business enterprises (MBEs)
|
From page 2... ...
To date, every court that has considered the issue has found the regulations to be constitutional on their face.5 Congress Established its Compelling Interest in Remedying Discrimination All courts agree that the first prong of strict scrutiny is satisfied by the Congressional record that forms the basis for the DBE Program. Relevant evidence included: • Disparities between the earnings of minority-owned firms and similarly situated white-owned firms; • Disparities in commercial loan denial rates between black business owners compared to similarly situated white business owners; • The large and rapid decline in minorities' participation in the construction industry when race-conscious contracting programs were struck down or abandoned; and • Various types of overt and institutional discrimination by prime contractors, trade unions, business networks, suppliers, and sureties against minority contractors.
|
From page 3... ...
or the effects of an ongoing DBE program, the adjustment must be based on demonstrable evidence that is logically and directly related to the effect for which the adjustment is sought." Disparity or availability studies should provide data probative of this inquiry. Judicial Review of Disadvantaged Business Enterprise Goal Setting Under Part 26 To develop a model disparity or availability study for state DOTs, it is critical to understand the cases reviewing state DOTs' application of Part 26.
|
From page 4... ...
The trial and appellate courts held this to be sufficient proof of discrimination such that race-neutral measures alone would be inadequate to ensure that DBEs operate on a "level playing field" for IDOT's contracts and subcontracts. Of particular importance for the Model Study Project is the court's affirmance of estimating the availability of DBEs by relying on the study's "custom census" approach rather than simply counting the certified DBEs among IDOT bidders, prequalified prime contractors, and registered subcontractors, as the plaintiff had urged.
|
From page 5... ...
The Sherbrooke and Northern Contracting courts reviewed ample targeted evidence of DBEs' availability to perform on state DOT contracts and subcontracts, as well as evidence of the discriminatory barriers those firms face in pursuing such opportunities. Additional Evidence of Discrimination Step 2 requires recipients to consider evidence of the effects of the DBE Program and discrimination on DBE availability.
|
From page 6... ...
The Ninth Circuit has further confused the issue by rejecting the only type of "capacity" marker required to be considered by the regulations it held to be constitutional -- past state DOT DBE utilization. WSDOT argued that DBE capacity should reflect the relationship between its Step 1 availability estimate and its past utilization.
|
From page 7... ...
Part 26 directs grantees to set goals based on the "relative availability of DBEs in your market."23 State DOTs must therefore apply economic principles to empirically establish the geographic and industry dimensions of their contracting marketplace to ensure that the evidence is narrowly tailored. The studies relied upon by IDOT, Mn/DOT, and NDOR defined the relevant geographic market as those locations and industries that collectively accounted for at least 75% of the contract dollars awarded.
|
From page 8... ...
Western States further implies, and the U.S.DOT guidance provides, that when a Ninth Circuit recipient determines that not all the enumerated groups have suffered discrimination in its market, it must petition U.S.DOT for a waiver of the prohibition against separate goals for racial and ethnic minorities and white women. If a group is not found to suffer discrimination in the state DOT's marketplace, then certified DBEs owned by such persons cannot be counted by a prime contractor toward meeting a DBE contract goal.
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.