Posted on August 27, 2004

County Drops Minority Program

Tere Figueras, (Miami), Aug. 26

A federal judge has declared a county program that benefits minority architects and engineers unconstitutional, prompting Miami-Dade County to stop using its affirmative action guidelines for awarding contracts.

U.S. District Judge Adalberto Jordan ruled Friday that applying the county’s Minority and Women Business Enterprise program to engineering and architecture firms was unconstitutional. He issued a strongly worded warning to Miami-Dade public officials that the “consequences will be severe,” and punitive damages “ a virtual certainty,” should similar challenges come from other industries.

This week, county attorneys said that the minority preference program can no longer be applied during the bidding or awarding of any county contract.

Construction contracts will not be affected, however, having been removed from the minority preference programs following a similar legal challenge nearly a decade ago.

County officials said the ruling will have major consequences.

“This is a sweeping strike,” said Commission Chairwoman Barbara Carey-Shuler, who was called to testify in court to explain her defense of the the county program, which includes set-asides and participation goals for Hispanics, blacks and women. “This will shut them out.”

“This has ramifications for the county across the board,” said county attorney Robert Cuevas. “It looks at the factual underpinnings for the entire minority business programs the county has in place.”

Said Carey Shuler: “This affects the airport, the seaport, the Public Health Trust, everything.”

Cuevas said the county does not plan to appeal.

In the last year, the county has awarded $16 million in contracts for goods and services, said assistant county manager Alex Muñoz.

A quarter, or $4 million worth, of those contracts included the application for the minority preference program, he said.

Contracts that have already been awarded will not be affected by the ruling and the county’s subsequent action.

But pending contracts will be affected: County officials will have to issue revisions to contracts that are currently out to bid — and cancel bids that have been accepted on contracts yet to be awarded.

“We’re mobilizing, and getting committees together,” said Muñoz, who said staffers will do their best to make sure the changes don’t clog up contracts already in the pipeline. “Anything that’s time sensitive is going to be looked at and expedited.”

The victors in the case, local firms Hershell Gill Consulting Engineers and Brill Rodriguez, Inc., filed their lawsuit in 1998. The actual policies for architects and engineers that were challenged by the firms have not been in place for four years, however. The minority business guidelines for architects and engineers were halted after a federal injunction in 2000.

Hershell Gill, whose engineering firm was one of the plaintiffs, said he was “pleased” with the judge’s ruling. The program “creates artificial terms, and it’s not fair competition.”

He said his firm has not had business with the county since the injunction was put in place, however.

Friday’s ruling marks the second time the county has lost a legal challenge to the minority business program. In 1995, a group of contracting associations sought to overturn the portion of the county program that applied to set-asides for minority construction contractors.

The county jettisoned that part of the program after it lost the case, and established a small business program for construction contracts in its place. A similar program was also put in place after the federal injunction halting the program for architects and engineers, said Muñoz.

“We may do now what we’ve done in the past,” he said. But the decision will have to wait until the county commission resumes meeting in September. “Right now, we’re without policy guidance.”

Carey-Shuler, for her part, said the county has to find a way to ensure a diverse pool of businesses and professionals have a fair shot at competing for county businesses. “We have to think creatively,” she said.

Jordan, in his ruling, noted the earlier legal challenge — as well as the commission’s decision to continue with the minority business program despite a report from then-County Manager Merrit Stierheim that county studies showed there was no statistical basis for continuing the program for architectural and engineering contracts.

The commission at the time had debated whether the study accurately reflected the marketplace.

The judge declined to issue punitive damages in the case, referring a bit sarcastically to the plaintiff’s “modest request of $225 million” as “improperly seeking to hit the County’s pocketbook.”

He did note that another challenge to Miami-Dade rules is pending — the use of the minority preference program for the purchase of security guard services — and stated that county commissioners could be subject to punitive damages as individuals if the county tries to use the same defense.

He said the county failed to prove that such a program was necessary, and failed to meet the burden required for programs based on race, ethnicity or gender.

The case “does not fit neatly into the traditional affirmative action paradigm, for Miami-Dade County is a unique community — a place truly representative of the proverbial American melting pot,” Jordan wrote.