The changing nature of urban affirmative action programs: the search for race-neutral alternatives

References

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• City of Richmond v. J.A. Croson Co United States Law Week January 24 1989 57 4138
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• While these four cities are quite diverse in terms of their geographical location, population size, ethnic mix, etc., these cities were not chosen for study simply because of these factors. Rather, each of these cities were selected because of the very different nature of their pre- and post-Croson MBE/WBE contracting programs.
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• Yancy , Robert . 1974 . Federal Government Policy and Block Business Enterprises , Cambridge, Massachisetts : Ballinger . Schwartz, Bernard, Behind Bakke: Affirmative Action and the Supreme Court New York University Press, New York, 1988
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• Rice . 1974 . Government Set-Asides, Minority Business Enterprises, and the Supreme Court , : 114
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• Bates , Timothy . 1990 . Major Studies of Minority Business: A Bibliographic Essay . Prepared for the Joint Center for Political and Economic Studies Conference on Minority Business Set-Aside Programs . May 1990 . For an excellent review of many of these studies
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• This report would later be extensively cited by the U.S. Supreme Court in their important Fullilove et. al. v. Klutznick decision.
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• H.R. Report No. 94-1791, 182
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• U.S. Commission on Civil Right . May 1975 . Minorities and Women as Government Contractors , May , 16 – 28 . Washington, D.C. : U. S. Government Printing Office . 86-88
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• Doctors , Samuel I. and Huff , Anne S. 1973 . Minority Enterprises and the President's Council , 4 – 6 . Cambridge, Massachusetts : Ballinger Publishing . See also The President's Advisory Council on Minority Business Enterprise, Minority Enterprise and Expanded Ownership: Blueprint for the 70s, U.S. Government Printing Office, Washington, D.C.,February, 1971
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• Doctors , Samuel I and Huffs , Anne S . 1973 . Minority Enterprise and the President's Council , 5 Cambridge, Massachussets : Ballinger Publishing .
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• Sowell , Thomas . 1975 . Affirmative Action Reconsidered , Washington, DC : American Enterprise Institute . Thomas Sowell, Preferential Policies. William Morrow & Co., New York, 1990
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• In Croson, the Court was clearly worried that the Richmond set-aside program had been motivated by racial politics. The Court observed that the strict scrutiny standard of review was particularly appropriate in Croson because of the political power wielded by blacks in the City of Richmond, where 50 percent of the population was black and five of 9 city council seats were held by blacks.
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• NAACP v. Allen , 2d 1974 614 61 Vulcan Society Inc. v. Civil Service Commission, 490 F. 2d. 387. 398 (CAS 1973).
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• Fullilove U.S. 51 1. Chief Justice Warren Burger was led to conclude in the Fullilove case that given all of the past legislative and administrative governmental efforts to help MBE's that it was “…inconceivable that Members of both Houses were not fully aware of the objectives of the MBE provision and of the reasons prompting its enactment.” hepth 9706099
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• 1975 . Richmond v. Croson , 488 U.S. 507
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• 1975 . Richmond v. Croson , 488 U.S. 509-510
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• Greenawalt , Kent . 1975 . Judicial Scrutiny of Benign Racial Preferences in Law School Admissions . Columbia Law Review , 559 : 578 – 579 .
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• (748 F. Supp. 1443, N.D.Cal. 1990).
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• 735 F. Supp. 1274; 1298; E.D. Pa. 1990.
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• 1975 . San Francisco Administrative Code , 559 Chapter 12D.2 Finding 13
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• 1975 . Ibid , 559
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• Associated General Contractors of California, Inc. v. Coalition for Economic Equity . 1991 . Coalition for Economic Equity , 559 December : 15363 – 15399 . et. al. and City and County of San Francisco (No. 90-16582)
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• Associated General Contractors of California, Inc. v. Coalition for Economic Equity . 1991 . Coalition for Economic Equity , 559 December : 15394 et. al. and City and County of San Francisco (No. 90-16582)
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• Contractors Association of Eastern Pennsylvania, Inc. v. City of Philadelphia, . 1991 . Supp. 1274; E.D.Pa. , 559 December : 735
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• Ward , James D . 1991 . The Croson Decision and the Demise of Set-Asides: A National Survey . Paper presented at the 1991 Conference of the American Political Science Association . September 2 1991 , Washington, D.C.. Vol. 2 , For an impact analysis of this program in St. Paul Minnesota,
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• A comprehensive survey of 24 cities conducted by D. J. Miller & Associates, found that most cities have not enacted comprehensive race-neutral programs in the post-Croson environment. Their survey revealed that 13% of the cities had established small business enterprise set-aside or goal programs, 13% had established small business training programs, 16% were providing bid assistance, 24% had established a program that provided direct financial assistance, and 75% had programs that provided technical, financial, or managerial assistance.
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• 259 Ga. 14. (1989).
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• It is important to note that the Port Authority of New York and New Jersey also runs an array of special contracting programs that seek to assist minority and women-owned business enterprises as well. Prior to the Supreme Court's decision in Croson, the Port Authority ran mandatory MIWBE contracting programs. Since the decision, however, these programs have been suspended pending the findings of several discrimination studies authorized by the Port Authority Board of Commissioners in late 1990. Past M/WBE mandatory programs have been replaced by new race-neutral initiatives including a non-mandatory MIWBE program and a Small Business Enterprise Program. The Port Authority has also continued to offer an array of other supplemental programs designed to assist the M/WBE firm. These efforts include: loan programs, classroom training, the Loaned Executive Assistance Program, and the Office of Business and Job Opportunity (OBJO) .
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• In order to be eligible to participate in the LBE program, a firm had to: (1) perform at least 25% of its gross receipts in economically distressed areas, or employ at least 25% of its work force from economically disadvantaged areas, and (2) not exceed an averaged gross income level in construction of $625,000 for specialty work; $850,000 for mechanical and electrical work; $1.0 million for general contracting; or $2.0 million for heavy construction.
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• In addition, the Port Authority of New York and New Jersey has utilized its influence to help develop a series of financial assistance programs that involve the cooperation of governmental and private institutions. While the Port Authority does not directly loan money to contractors in any of these programs, they have played a leading role in encouraging their development and continuation. The New York Business Development Corpordion makes medium and long term loans, at both fixed and floating rates of interest. Loans may be for as much as $1 million, and may be used for working capital, equipment, supplies, or real estate. An additional type of loan program that the Port Authority has helped to foster is contract financing, which are loans issued to finance a specific contract. The Business Consortium Fund provides contract financing for qualified vendors and contracts with the Port Authority's member corporations. The maximum loan size is $500,000 to one company at any time. The New York State Urban Development Corporation provides contract financing for MIWBE firms in New York State that have received a Port Authority construction contract (sub-contractors are also eligible). The term of these loans may not exceed 18 months, the rate is 7% per year.
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• This program is marketed specifically towards women and minority-owned businesses (minority defined as 51% ownership), and businesses that are located in economically distressed neighborhoods. Loans are for a minimum of $5,000 up to a maximum of $50,000;
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• The BTA program works with a network of City, State, and Federal agencies, as well as some private surety agents, producers and underwriters, trying to match the bonding, working capital and management training needs of small contractors with appropriate programs and services.
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• The EVC program is staffed by a team of retired business owners and executives that encompasses a broad range of businesses. These individuals provide assistance in business planning, sales and marketing, and general and administrative issues.
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• This program is administered by New York City's Department of Housing Preservation and Development. It seeks to provide contractors with instructions on the City's contract process, and help them develop management plans that will enable them to sustain, strengthen and expand their businesses. Participants in the SCAP Program receive 56 hours of instruction in 14 four-hour sessions, and are scheduled over the course of three months. The SCAP program was begun by HPD in 1986. Since that time, it has run a total of six training sessions that have enrolled a total of 291 firms with 439 participants. Eighty-one percent of all the firms participating have been minority (50% African-American; 23 % Hispanic; 8% Asian) and 14% of all the firms have been women owned.
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• Prior to the creation of this policy, San Francisco had a MBEIWBEILBE program authorized by Ordinance No. 139- 84, which was in effect from April 2, 1984-June 30, 1989. This ordinance required the City to set aside 10% of its contracting dollars for MBEs and 2% for WBEs. It also provided MBEs and WBEs and LBEs a 5 % bidding preference that was taken into account when City purchasers calculated the lowest bid. In addition, the ordinance set an overall goal that 30% of City contract dollars would be earned by MBEs and 10% by WBEs. This ordinance was challenged in Federal district court, but expired before the litigation was settled.
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• An “economically disadvantaged” business is a business whose average gross annual receipts in the three fiscal years immediately preceding its application for certification as an MBE or WBE does not exceed the following limits: (1) public works/const~ction - $14 million; (2) goodslmaterials and general services suppliers - $2 million; (3) professional services - $2 million (Ordinance 175-89, Section 12D.5) 39. Human Right Commission, "Progress Report:
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• Human Right Commission . 1990 . Progress Report: Minority/Women/Local Business Enterprise Ordinance II 1 – 2 . FY
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• Prior to the issuance of the amended ordinance, Mayor Art Agnos issued a strongly worded Executive Directive to the Heads of all city departments, boards, agencies, and commissions which pointed out that while some departments had made progress towards meeting the goals outlined in Ordinance 175-89 others had not. The Mayor found this record to be “unacceptable” and stated the following: In light of the poor performance citywide, effective immediately, all departments, agencies, boards and commissions of the City and County of San Francisco must revise their contracting policies, procedures and practices to ensure effective and meaningful utilization of economically disadvantaged MBEs, WBEs and LBEs, or to make good faith efforts to utilize economically disadvantaged MBEs, WBEs and LBEs in all City contracts and services. Each department is to prepare a plan, to be submitted to this office within the next thirty (30) days, detailing your efforts to improve performance for the next year….Failure to utilize MBEs, WBEs and LBEs on City contracts and services, or to make good faith efforts to utilize them, will result in the review of each department's budget to tie spending authority to specific achievement goals.….Reaching these goals is a City priority. I will have departmental progress towards these goals reviewed monthly if necessary (Executive Directive, Office of the Mayor, October 12, 1990, pp. 1-2).
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• Gruenstein , John . 1990 . “ Documenting Discrimination with a Statistical Disparity Model: The City of San Francisco ” . In In American Bar Association, Minority and Women Business Programms Revisiting: Public Contracting in the 1990s , Dallas, Texas : American Bar Association . For a discussion of the data collection problems encountered in conducting a Croson style disparity analysis see Thomas Boston, “Establishing a Factual Predicate to Meet the Croson Standard: The Challenge of Data Collection.” Paper Prepared for the Joint Center for Political and Economic Studies, August 1 1990;
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• 1992 . The No 1 State . The Wall Street Journal Reports: Black Enterpreneurship , April : R6 Maryland leads the nation in terms of the number of black firms per 1,000 population (4.78) and black-owned firms as a percent of total firms (8.9%), In comparison, Ohio ranks firms accounting for 3.1% of total firms. Source: Bureau of the Census, 1987 cited
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• in The Wall Street Journal Reports: Black Entrepreneurship Maryland leads the nation in terms of the number of black firms per 1,000 population (4.78) and black-owned firms as a percent of total firms (8.9%). In comparison, Ohio ranks 20th, with 1.48 firms per 1,000 population and with black firms accounting for 3.1% of total firms. Source: Bureau of the Census, 1987 cited in April 3 1992 R6
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