Engineering v. Metropolitan Dade ( 1997 )

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 96-5274
________________________
D.C. Docket No. 94-1848-CV-KLR
ENGINEERING CONTRACTORS ASSOCIATION OF SOUTH FLORIDA INC.,
ASSOCIATED GENERAL CONTRACTORS OF AMERICA, South Florida Chapter,
Inc., GOLD COAST ASSOCIATED BUILDERS AND CONTRACTORS, INC.,
CONSTRUCTION ASSOCIATION OF FLORIDA, INC., UNDERGROUND CONTRACTORS
ASSOCIATION OF SOUTH FLORIDA, INC., AIR CONDITIONING AND
REFRIGERATION ASSOCIATION, INC.,
Plaintiffs-Appellees,
versus
METROPOLITAN DADE COUNTY, JOAQUIN AVINO, County Manager of
Metropolitan Dade County, BETTY FERGUSON, JAMES BURKE, ARTHUR E.
TEEL, JR., SHERMAN S. WINN, BRUCE KAPLAN, PEDRO REBOREDO, MAURICE
FERRE, LARRY HAWKINS, DENNIS MOSS, JAVIER SOUTO, MIGUEL DE LA
PORTILLA, ALEXANDER PENELAS, NATACHA MILLAN, Individually and in
their official capacities as members of the Board of County
Commissioners,
Defendants-Appellants,
BLACK BUSINESS ASSOCIATION, INC., ALLIED MINORITY CONTRACTORS
ASSOCIATION, INC., NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF
COLORED PEOPLE, Miami Dade Branch,
Intervenors-Defendants-Appellants.
________________________
Appeals from the United States District Court
for the Southern District of Florida
________________________
(September 2, 1997)
Before CARNES, Circuit Judge, and FAY and CAMPBELL*, Senior Circuit
Judges.
______________________
*Honorable Levin H. Campbell, Senior U.S. Circuit Judge for
the First Circuit, sitting by designation.
CARNES, Circuit Judge:
This appeal involves an Equal Protection Clause challenge to
three substantially identical affirmative action programs
administered by Dade County, Florida. Those programs provide for
the use of race-, ethnicity-, and gender-conscious measures in
awarding County construction projects. Specifically, the programs
establish preferences for construction enterprises owned and
controlled by blacks, Hispanics, or women. The district court
declared all three programs unconstitutional and permanently
enjoined their operation. See Engineering Contractors Ass'n v.
Metropolitan Dade County, 943 F. Supp. 1546 (S.D. Fla. 1996). We
affirm.
I. BACKGROUND FACTS AND PROCEDURAL HISTORY
The following summary of undisputed facts, as well as the
procedural history of this case, is drawn primarily from the
district court's thorough opinion, see 943 F. Supp. at 1551-53.
A. UNDISPUTED FACTS
Three affirmative action programs enacted by the Dade County
Board of Commissioners are at issue in this appeal: (1) the Black
Business Enterprise ("BBE") program, enacted in 1982 and most
recently amended in 1994; (2) the Hispanic Business Enterprise
("HBE") program, enacted in 1994; and (3) the Women Business
Enterprise ("WBE") program, enacted in 1994. For the sake of
convenience, we adhere to the district court's convention of
2
referring to the programs collectively as the "MWBE" (Minority &
Women Business Enterprise) programs.
To qualify to participate in one of the MWBE programs, a
business must be owned and controlled by one or more black,
Hispanic, or female individuals, and it must have an actual place
of business in Dade County. MWBE joint ventures must have at least
one member that is certified under one of the three MWBE programs.
Additionally, each MWBE participant must demonstrate that it does
not exceed the size limits for "small business concerns" as defined
by the Small Business Administration of the United States
Department of Commerce. However, an MWBE participant that exceeds
the size limit may retain its certification if it demonstrates that
"it continues to experience the kinds of racial [or gender]
discrimination addressed by [the programs]." Metropolitan Dade
County Code § 2-8.2(3)(e).
The MWBE programs apply to certain classes of County contracts
for which "participation goals" have been set. This case concerns
only construction contracts, which means that only the following
three Standard Industry Classification ("SIC") classes of County
contracts are involved:
(1) SIC 15: General Building Construction;
(2) SIC 16: Heavy Construction other than Building
Construction;
(3) SIC 17: Specialty Trade Construction (including
electrical, plumbing, heating,
ventilation, and air conditioning).
For the foregoing classes of contracts, the County has set
participation goals of 15% for BBEs, 19% for HBEs, and 11% for
3
WBEs. The participation goals apply to all construction contracts
in excess of $25,000 that are funded in whole or in part by the
County. The County is required to make every reasonable effort to
achieve the participation goals, and may use any of the following
five "contract measures" to do so:
(1) Set Asides -- Under this measure a contract is set aside
for bidding solely among MWBEs. In general, the County
may use the set-aside measure if there are at least three
MWBE businesses available to perform the contract.
However, the County also may waive competitive bidding if
there are at least two MWBEs available, if neither of
those MWBEs has been awarded a County contract for like
goods or services in the last three years, and a price
analysis is done to ensure the price is competitive.
(2) Subcontractor Goals -- This measure requires a prime
contractor to subcontract a certain percentage of work to
MWBEs. The percentage is determined on a case-by-case
basis. A waiver is available if the prime contractor can
demonstrate that MWBEs are not available to do the work
at a competitive price. However, the inability of an
MWBE to obtain bonding is not considered grounds for a
waiver.
(3) Project Goals -- With this measure, the County creates
a pool of MWBE subcontractors from which it selects firms
for specified types of work under County contracts.
4
(4) Bid Preferences -- This measure artificially "reduces" an
MWBE bid price by as much as ten percent for purposes of
determining the lowest bid. The actual price the County
pays for the work is unaffected by this “reduction.”
(5) Selection Factors -- This measure is similar to a bid
preference, but operates on factors other than price.
For instance, when bid evaluation procedures assign
weights to various factors, MWBE performance on those
factors may be boosted by up to 10%.
Once a contract is identified as being covered by a
participation goal, it is submitted to a review committee for
determination of whether a contract measure should be applied. The
County Commission makes the final determination on that issue, and
its decision is appealable to the County Manager. The County
Manager's decision is final, unless the County Commission exercises
its discretion to review and override it.
Annually, the MWBE programs are reviewed for their efficacy.
Every five years, when the "Survey of Minority-Owned Business
Enterprises" is published by the Census Bureau, the County
Commission must decide whether to continue the programs.
B. PROCEDURAL HISTORY
The Dade County BBE program has been challenged before. In
South Florida Chapter of Associated General Contractors v.
Metropolitan Dade County, 723 F.2d 846 (11th Cir. 1984), this Court
upheld the program in its entirety. We did so applying the
5
standard enunciated by Chief Justice Burger in the principal
opinion in Fullilove v. Klutznick , 448 U.S. 448, 100 S. Ct. 2758
(1980), which was neither strict scrutiny nor any other traditional
standard of equal protection review.
Five years after we upheld Dade County's BBE program, the
Supreme Court pulled the props out from under our decision by
abandoning the Fullilove standard insofar as state and local race-
conscious remedial programs are concerned. Such programs must
satisfy the exacting strict scrutiny standard, the Court held in
City of Richmond v. J.A. Croson Co., 488 U.S. 469, 493-95, 109 S.
Ct. 706, 721-22 (1989) (four-member plurality opinion); accord id.
at 520, 109 S. Ct. at 735-36 (Scalia, J., concurring) (agreeing
that “strict scrutiny must be applied to all governmental
classifications by race”). The Croson decision prompted several
non-minority plaintiffs to bring a second constitutional challenge
to Dade County's BBE program. That case was tried in federal
district court July 1992, but before the court rendered a final
judgment the parties reached a settlement and stipulated to a
dismissal with prejudice. That abortive litigation is not without
effect on the present case, however, because by stipulation, the
evidence from that settled case has been made a part of the record
in this case.
This case was filed in September 1994 by six trade
associations whose members regularly perform work, either as prime
contractors or subcontractors, on County projects. The complaint
named only the County and certain related parties as defendants.
6
However, three entities have intervened as party defendants: (1)
the Black Business Association, Inc.; (2) the Allied Minority
Contractors Association, Inc.; and (3) the Miami Dade Branch of the
National Association for the Advancement of Colored People. The
plaintiffs challenge the County's MWBE programs only as they apply
to the construction industry, i.e., only with respect to SIC 15,
16, and 17.
The district court held a four-day bench trial in December
1995 and heard closing arguments on April 18, 1996. On September
17, 1996, the district court entered a comprehensive opinion
containing findings of fact and conclusions of law. Engineering
Contractors Ass'n v. Metropolitan Dade County, 943 F. Supp. 1546
(S.D. Fla. 1996).
Applying strict scrutiny, the district court found that the
County lacked the requisite "strong basis in evidence" to support
the race- and ethnicity-conscious measures contained in the BBE and
the HBE programs. Applying intermediate scrutiny to the WBE
program, the district court found that the County had presented
insufficient probative evidence to support its stated rationale for
implementing a gender preference. Therefore, the district court
concluded that the County had failed to demonstrate a "compelling"
interest in remedying race or ethnicity discrimination in the Dade
County construction market (for the BBE and HBE programs), and that
7
it likewise had failed to demonstrate an "important" interest in
remedying gender discrimination through its WBE program.1
In a separate analysis, the district court assumed the
existence of a sufficient evidentiary basis to support the
existence of the MWBE programs in order to examine whether the
programs were sufficiently related to the interests they purported
to serve. The court held that the BBE and HBE programs were not
narrowly tailored to serve a compelling governmental interest in
remedying past or present discrimination on the basis of race or
ethnicity, even if sufficient evidence to support the existence of
those programs had been demonstrated. Likewise, the district court
held that the WBE program was not substantially related to an
important governmental interest in remedying past or present
discrimination, even if the evidence had been sufficient to support
the existence of that program.
The district court followed its opinion with a final judgment
that enjoined the County from continuing to operate its MWBE
programs for construction work. This appeal followed.
II. ISSUES
1
The preceding paragraph describes the substance of the
district court's conclusions, although the district court's opinion
phrases those conclusions a little differently. In its opinion,
the district court holds that the BBE and HBE programs fail strict
scrutiny, and that the WBE program fails under intermediate
scrutiny, because the “evidence presented by the defendants does
not constitute an adequate showing of discrimination.” 943 F.
Supp. at 1584. Combining those holdings together with the district
court's statement of the legal standards governing strict and
intermediate scrutiny, 943 F. Supp. at 1554-56, we understand the
district court's conclusions to be as we have described them.
8
Despite the evidentiary complexity of this case, this appeal
presents only four major issues. The standards of review
applicable to those issues are set out in Part III of this opinion,
but before we get there we will briefly outline in this Part what
those issues are and describe our organizational approach for
considering them.
The first issue is whether the plaintiffs have standing. For
the reasons discussed in Part IV, we conclude that they do, which
necessitates that we address the remaining issues, i.e., the merits
issues. We begin addressing the merits with a discussion in Part
V of the legal standards for scrutinizing affirmative action
programs of the type involved in this case.
That leads into Part VI of this opinion, which involves the
second and third major issues presented in this appeal. The second
major issue is whether the district court erred in finding that the
County lacked a “strong basis in evidence” to justify the existence
of the BBE and HBE programs. Similarly, the third major issue is
whether the district court erred in finding that the County lacked
a sufficient probative basis in evidence to justify the existence
of the WBE program. To the extent practicable, we discuss
concurrently the evidence related to those two issues, because much
of the statistical evidence in this case is derived from studies
related to more than one MWBE program. As we review that evidence,
we will separately consider each MWBE program in light of the
standard of review applicable to it.
9
Finally, the fourth major issue, which we discuss in Part VII,
is whether the MWBE programs are adequately tailored to the
interests they are purported to serve. Because we conclude that
the district court did not clearly err in finding that the MWBE
programs lack a constitutionally sufficient evidentiary foundation,
our analysis of this issue is limited to the most obvious problems
associated with the County's tailoring of the MWBE programs. As
will be seen, there are several.
Our conclusion is contained in Part VIII.
III. STANDARDS OF REVIEW
The legal standards by which a race-, ethnicity-, or gender-
conscious affirmative action program is to be evaluated are
discussed in Part V of this opinion. Applying those standards in
the first instance is within the province of the district court,
not this Court. Our province is to review the decisions and
judgment of the district court, but our authority to do so is
confined by the standards of review. We examine them below,
separately discussing the standard of review applicable to each of
the four major issues in this appeal.
A. STANDING
Standing is a jurisdictional question. “The federal courts
are under an independent obligation to examine their own
jurisdiction, and standing 'is perhaps the most important of [the
jurisdictional] doctrines.'” FW/PBS, Inc. v. City of Dallas, 493
U.S. 215, 231, 110 S. Ct. 596, 607 (1990) (quoting Allen v. Wright,
10
468 U.S. 737, 750, 104 S. Ct. 3315, 3324 (1984)) (alteration in
FW/PBS). As with all jurisdictional issues, this Court reviews
standing de novo. See, e.g., McKusick v. City of Melbourne, Fla.,
96 F.3d 478, 482 (11th Cir. 1996) (citation omitted).
B. EVIDENTIARY FOUNDATION OF THE BBE AND HBE PROGRAMS
Both the Supreme Court and this Court have held that a
district court makes a factual determination when it determines
whether there exists a sufficient evidentiary basis justifying
affirmative action on the basis of race or ethnicity. See Wygant
v. Jackson Bd. of Educ., 476 U.S. 267, 277, 106 S. Ct. 1842, 1849
(1986) (“[T]he trial court must make a factual determination that
the employer had a strong basis in evidence for its conclusion that
remedial action was necessary.”); Ensley Branch, NAACP. v. Seibels,
31 F.3d 1548, 1565 (11th Cir. 1994) (same); Howard v. McLucas, 871
F.2d 1000, 1007 (11th Cir. 1989) (same).
We review a district court's factual findings only for clear
error. See Fed. R. Civ. P. 52(a) (mandating that “[f]indings of
fact shall not be set aside unless clearly erroneous”). The
Supreme Court has provided considerable guidance on how the
appellate courts are to apply the clearly erroneous standard.
Because this appeal is concerned chiefly with whether the district
court clearly erred in finding that the County had failed to
demonstrate a sufficient evidentiary foundation to justify the
existence of the MWBE programs, a detailed review of the Supreme
Court's guidance on the clearly erroneous standard is warranted.
11
We cannot hold a district court's finding of fact is clearly
erroneous unless, in view of the entire record, we are “left with
a definite and firm conviction that a mistake has been committed.”
Anderson v. City of Bessemer City, 470 U.S. 564, 573, 105 S. Ct.
1504, 1511 (1985) (citation and internal quotation marks omitted).
That is an exacting standard, purposefully designed to restrict
second guessing in the factfinding arena. As the Supreme Court has
explained:
This standard plainly does not entitle a reviewing
court to reverse the finding of the trier of fact simply
because it is convinced that it would have decided the
case differently. ... If the district court's account of
the evidence is plausible in light of the record viewed
in its entirety, the court of appeals may not reverse it
even though convinced that had it been sitting as the
trier of fact, it would have weighed the evidence
differently. Where there are two permissible views of
the evidence, the factfinder's choice between them cannot
be clearly erroneous.
Id. at 573-74, 105 S. Ct. at 1511 (citations omitted).
Furthermore, our scope of review is no less circumscribed when the
district court's factfindings rest on physical or documentary
evidence instead of credibility determinations. See id. at 574,
105 S. Ct. at 1511-12.
The Supreme Court has explained with unmistakable clarity our
duty in evaluating the district court's factfindings in this case.
That duty most emphatically is not to decide whether we agree with
the district court's view of the evidence. Instead, we must
determine only whether the district court's view of the evidence,
as reflected in its factfindings, is a permissible one, i.e., a
plausible one in light of the entire record.
12
C. EVIDENTIARY FOUNDATION OF THE WBE PROGRAM
Neither the Supreme Court nor this Court has squarely held
that a district court makes a factual determination when it
determines whether there exists a sufficient evidentiary basis
justifying affirmative action on the basis of gender. Although we
have had occasion to review the evidentiary foundation of gender-
conscious affirmative action, we have conducted that review without
specifically explaining whether we were reviewing the evidence de
novo or instead reviewing the district court's view of the evidence
for clear error.
For example, in Ensley Branch, 31 F.3d at 1581, we reviewed
the evidentiary foundation of a gender-conscious affirmative action
program and concluded that “[t]he record before us contains
substantial anecdotal and statistical evidence of past
discrimination against women.” Although we did not explain
specifically in that case that we were reviewing the district
court's evidentiary factfindings, instead of reviewing the evidence
de novo, a close reading of the opinion reveals the nature of our
review. We examined the district court'sfindings that “[f]or many
years announcements for positions as police patrolman and
firefighter were restricted to males only” and that “women were
grossly underrepresented in a variety of City positions.” Id.
(citation and internal quotation marks omitted). After reviewing
those factual findings, we concluded: “These and related findings
by the district court justify the district court's finding that
there is more than ample reason for the Personnel Board and the
13
City of Birmingham to be concerned that they would be in time held
liable for discrimination.” Id. (emphases added) (citations and
internal quotation marks omitted).
As a close look at our Ensley Branch opinion reveals, when we
review the evidentiary basis of a gender-conscious affirmative
action program, we do not review the evidence de novo. Instead, we
review the evidence to determine whether it can “justify the
district court's finding” that the gender-conscious affirmative
action program is or is not rooted in evidence of current or past
discrimination in the relevant economic sphere. In other words,
the same clearly erroneous standard governs our review of the
evidentiary sufficiency issue involving gender-conscious programs
that governs our review of the evidentiary sufficiency issue
involving race- or ethnicity-conscious programs.
That is true even though, as we will explain in more detail
later, gender-conscious affirmative action programs may rest safely
on a weaker evidentiary foundation than race- or ethnicity-
conscious programs. For gender-conscious programs, we decide if
the district court clearly erred in determining whether the
government had a sufficient probative basis in evidence to justify
affirmative action. For race- or ethnicity-conscious programs, we
decide if the district court clearly erred in determining whether
the government had a strong basis in evidence to justify
affirmative action. Because in both circumstances the district
court makes the same basic type of determination (factual), it
14
would be illogical to apply a different standard of review. We
review both determinations under the clearly erroneous standard.
D. "NARROW TAILORING" AND "SUBSTANTIAL RELATIONSHIP"
A district court applies law to the facts when it determines
whether a race- or ethnicity-conscious remedy is narrowly tailored
to serve a compelling government interest, and whether a gender-
conscious remedy bears a substantial relation to an important
governmental interest. After identifying the factual predicate for
the affirmative action program in question, the district court
makes a legal determination about whether the program's terms are
sufficiently tied to its legitimate goals to pass constitutional
muster. This Court reviews de novo a district court's application
of law to the facts. See Simmons v. Conger, 86 F.3d 1080, 1084
(11th Cir. 1996).
We now apply the foregoing standards of review to the issues
in this appeal, beginning with the standing issue.
IV. STANDING
The intervenors' have mounted a two-pronged attack on the
plaintiffs' standing. First, the intervenors argue that because
the plaintiffs failed to put on any evidence that the were or would
be affected by each of the MWBE programs, they had no standing to
challenge each program. We disagree.
The undisputed facts reveal that the plaintiffs are six trade
associations whose members regularly perform work for the County.
There are a number of companies within each association, and the
15
intervenors stipulated that the County "will likely exclude in the
future -- based on racial, ethnic and sexual criteria --
plaintiffs' non-[MWBE] members from bidding for certain contracts.”
That stipulation covered all three programs, and relieved
plaintiffs of the duty to put on any evidence that they would be
affected by any or all of the three programs. The very purpose of
a stipulation is to relieve a party of the burden it would
otherwise have of introducing evidence to prove a fact. See Fed.
R. Civ. P. 16(c)(3) (providing that at the pretrial conference the
district court may take action directed toward “obtaining
admissions of fact and of documents which will avoid unnecessary
proof”).
As this Court recently explained, parties may not stipulate to
jurisdiction, but they may stipulate to facts that bear on our
jurisdictional inquiry. See West Peninsular Title Co. v. Palm
Beach County, 41 F.3d 1490, 1492 n.4 (11th Cir.), cert. denied, 116
S. Ct. 338 (1995). When the record contains such stipulations, we
look to the record to determine whether “the stipulated facts give
rise to jurisdiction.” Id. (emphasis omitted). Here, the parties'
stipulation that the plaintiffs likely will be excluded from
performing future contracts with the County due to the race-,
ethnicity-, and gender-conscious criteria of the MWBE programs is
the end of the inquiry as to whether the plaintiffs likely will be
adversely affected by all three affirmative action programs at
issue in this case.
16
The second prong of the intervenors' attack on the plaintiffs'
standing is similar to the first. The intervenors contend that
because the plaintiffs failed to establish -- by stipulation or
evidence -- which of the five “contract measures” likely will
adversely affect them, they lack standing to challenge the MWBE
programs in toto. We disagree. The existence of each the programs,
including all of its component parts, must withstand the appropriate
level of constitutional scrutiny if that program is to be upheld. Either
a program is grounded on a proper evidentiary factual predicate or it is
not. If it is, then that program sails on to the next stage of the
analysis, where each component contract measure is tested against the
“narrow tailoring” and “substantial relationship” requirements. On the
other hand, if a program is not grounded on a proper evidentiary basis,
then all of the contract measures go down with the ship, irrespective of
any narrow tailoring or substantial relationship analysis.
By stipulation, the plaintiffs' members are competing with MWBEs for
County construction contracts, and because of the MWBE programs they do
not compete on an equal basis. When the government loads the dice that
way, the Supreme Court says that anyone in the game has standing to raise
a constitutional challenge. “The injury in cases of this kind is that
a discriminatory classification prevent[s] the plaintiff from competing
on an equal footing.” Adarand Constructors, Inc. v. Pena, ___ U.S. ___,
___, 115 S. Ct. 2097, 2105 (1995) (alteration in original) (citation and
internal quotation marks omitted). "To establish standing, therefore,
a party challenging a set-aside program ... need only demonstrate that
it is able and ready to bid on contracts and that a discriminatory policy
prevents it from doing so on an equal basis." Northeastern Florida
Contractors v. City of Jacksonville, 508 U.S. ___, ___, 113 S. Ct. 2297,
17
2303 (1993). We are satisfied that the plaintiffs have standing to
challenge the constitutionality of the MWBE programs, and we turn now to
the merits of that challenge.
V. LEGAL STANDARDS FOR SCRUTINIZING AFFIRMATIVE ACTION PROGRAMS
A. RACIAL AND ETHNIC PREFERENCES
Because the BBE and HBE programs create preferences based on race
and ethnicity, the relevant constitutional standard applicable to those
programs is the strict scrutiny test articulated in City of Richmond v.
J.A. Croson Co., 488 U.S. 469, 109 S. Ct. 706 (1989). That test requires
a “searching judicial inquiry” into the justification for the preference,
because without that kind of close analysis “there is simply no way of
determining what classifications are 'benign' or 'remedial' and what
classifications are in fact motivated by illegitimate notions of racial
inferiority or simple racial politics.” Id. at 493, 109 S. Ct. at 721.
Accordingly, strict scrutiny is designed both to “'smoke out'
illegitimate uses of race by assuring that the legislative body is
pursuing a goal important enough to warrant use of a highly suspect tool”
and to “ensure[] that the means chosen 'fit' this compelling goal so
closely that there is little or no possibility that the motive for the
classification was illegitimate racial prejudice or stereotype.” Id.
Under strict scrutiny, an affirmative action program must be based
upon a "compelling governmental interest" and must be "narrowly tailored"
to achieve that interest. E.g., Ensley Branch, 31 F.3d at 1564
(citations omitted). As we have observed:
In practice, the interest that is alleged in support of
racial preferences is almost always the same -- remedying past
or present discrimination. That interest is widely accepted
as compelling. As a result, the true test of an affirmative
action program is usually not the nature of the government's
interest, but rather the adequacy of the evidence of
discrimination offered to show that interest.
18
Id. at 1565 (citations and internal quotation marks omitted).
If a race- or ethnicity-conscious affirmative action program is to
be upheld, "the district court must make a factual determination that
[there exists] a strong basis in evidence" to support the conclusion that
remedial action is necessary. Id. (citation and internal quotation marks
omitted); see also Croson, 488 U.S. at 500, 109 S. Ct. at 725 (plurality
opinion). As we explained in Ensley Branch, "[c]ertain aspects of this
inquiry are well established." 31 F.3d at 1565. A "strong basis in
evidence" cannot rest on "an amorphous claim of societal discrimination,
on simple legislative assurances of good intention, or on congressional
findings of discrimination in the national economy." Id. (citing and
applying Croson) (internal quotation marks omitted). However, a
governmental entity can “justify affirmative action by demonstrating
'gross statistical disparities' between the proportion of minorities
hired ... and the proportion of minorities willing and able to do the
work.” Id. (citations omitted). “Anecdotal evidence may also be used
to document discrimination, especially if buttressed by relevant
statistical evidence.” Id. (citation omitted). Accordingly, “if the
[County] could show that it had essentially become a 'passive
participant' in a system of racial exclusion practiced by elements of the
local construction industry,” the Supreme Court has made it “clear that
the [County] could take affirmative steps to dismantle such a system.”
Croson, 488 U.S. at 492, 109 S. Ct. at 721 (plurality opinion).
Here, the district court reviewed the evidence and made a factual
determination that the County lacked the requisite strong basis in
evidence to support the County's conclusion that race- and ethnicity-
conscious remedial action is necessary. 943 F. Supp. at 1584. As
previously explained, our role in re-reviewing that evidence is limited.
19
Our task is not to determine whether the district court's factfinding is
“correct” in the sense of ultimate truth. Instead, under the clearly
erroneous standard, our duty is to examine the record solely to determine
whether the district court's view of the evidence is a permissible one,
a plausible one in light of the entire record.
B. GENDER PREFERENCES
1. The Effect of the VMI Decision
At first blush, the relevant constitutional standard to be applied
to the WBE program is not entirely clear. Traditionally, gender-based
affirmative action programs have been governed by intermediate scrutiny,
meaning that “[t]o withstand constitutional challenge, ...
classifications by gender must serve important governmental objectives
and must be substantially related to achievement of those objectives.”
Craig v. Boren, 429 U.S. 190, 197, 97 S. Ct. 451, 456-57 (1976). That
has been the standard for two full decades, and the district court
applied it to this case. See 943 F. Supp. at 1556.
The district court was concerned, however, by the Supreme Court's
recent decision in United States v. Virginia, 116 S. Ct. 2264 (1996)
(invalidating the maintenance of single-sex education program at Virginia
Military Institute) (hereinafter “VMI”). In VMI, the Court held that
"[p]arties who seek to defend gender-based government action must
demonstrate an 'exceedingly persuasive justification' for that action."
Id. at 2274 (citations omitted). The phrase “exceedingly persuasive
justification” permeates the Court's VMI opinion, id. at 2271, 2274,
2276, 2282, 2287, and that phrase connotes more intense scrutiny than do
customary descriptions of intermediate scrutiny. See id. at 2294
(Scalia, J., dissenting) (suggesting that the majority had effectively
adopted a form of strict scrutiny for gender classifications).
20
Nevertheless, the VMI Court expressly disclaimed "equating gender
classifications, for all purposes, to classifications based on race or
national origin." Id. at 2275 (majority opinion).
The district court assumed without deciding that traditional
intermediate scrutiny still applies to gender-conscious affirmative
action programs. See 943 F. Supp. at 1556. Finding that the WBE program
lacked a sufficient evidentiary foundation to withstand traditional
intermediate level scrutiny, the district court found it unnecessary to
decide whether the VMI decision raised the constitutional hurdle over
which gender-conscious affirmative action programs must leap. See id.
We conclude that the district court was correct to apply intermediate
scrutiny to the WBE program.
First, although the phrase “exceedingly persuasive justification”
has more linguistic verve than conventional descriptions of intermediate
scrutiny, it does not necessarily follow that a new constitutional
standard for judging gender preferences is embodied in that phrase.
Concurring in VMI, Chief Justice Rehnquist suggested that the “phrase is
best confined, as it was first used, as an observation on the difficulty
of meeting the applicable test, not as a formulation of the test itself.”
VMI, 116 S. Ct. at 2288 (Rehnquist, C.J., concurring). Similarly,
Justice Scalia suggested that the answer to whether the justification for
a gender classification is “exceedingly persuasive” is properly derived
from considering whether the classification serves important governmental
objectives and is substantially related to their achievement. Id. at
2294 (Scalia, J., dissenting). That is an attractive resolution of the
issue -- especially in view of the fact that the majority opinion in VMI
recites the time-honored intermediate scrutiny standard with approval
even as it explains how a district court must evaluate whether the
21
proffered justification for a gender classification is “exceedingly
persuasive.” See id. at 2275 (majority opinion).
Moreover, a holding that the Supreme Court has abandoned traditional
intermediate scrutiny in favor of a more restrictive formulation would
mean that the Court has overruled sub silentio its long line of
precedents applying intermediate scrutiny to gender classifications. See
id. at 2288 (Rehnquist, C.J., concurring) (listing Supreme Court
precedents applying traditional intermediate scrutiny). Even if the VMI
case portends a major change in the Supreme Court's approach to gender
classifications, “we are not at liberty to disregard binding case law
that is so closely on point and has been only weakened, rather than
directly overruled, by the Supreme Court.” Florida League of Prof'l
Lobbyists v. Meggs, 87 F.3d 457, 462 (11th Cir. 1996). The Supreme Court
has cautioned us that “[i]f a precedent of this Court has direct
application in a case, yet appears to rest on reasons rejected in some
other line of decisions, the Court of Appeals should follow the case
which directly controls, leaving to this Court the prerogative of
overruling its own decisions.” Rodriguez de Quijas v. Shearson/American
Express, Inc., 490 U.S. 477, 484, 109 S. Ct. 1917, 1921-22 (1989); see
also Agostini v. Felton, ___ U.S. ___, ___, ___ S. Ct. ___, ___, (June
23, 1997) (reaffirming that holding of Rodriguez de Quijas). Of course,
we take that admonition seriously. See, e.g., Brisentine v. Stone &
Webster Eng'g Corp., ___ F.3d ___, ___ (No. 96-6866, 11th Cir. 1997);
Scala v. City of Winter Park, ___ F.3d ___, ___ n.2 (No. 96-3121, 11th
Cir. 1997).
There is a long line of directly applicable Supreme Court precedents
applying traditional intermediate scrutiny to gender classifications.
More specifically, the Supreme Court held in Mississippi University for
22
Women v. Hogan, 458 U.S. 718, 724, 102 S. Ct. 3331, 3335 (1982), that
intermediate scrutiny was the appropriate test to apply to a gender-based
classification favoring women, which is the same type of classification
created by the County's WBE program. Instead of overruling Mississippi
University for Women, the VMI Court cited that case as “immediately in
point” and the “closest guide” for the VMI decision itself. VMI, 116 S.
Ct. at 2275, 2271. The Supreme Court is not in the business of
overruling its own precedents by citing them with approval, and we
decline to hold that the Court did so in the VMI case. Unless and until
the Supreme Court tells us otherwise, intermediate scrutiny remains the
applicable constitutional standard in gender discrimination cases, and
a gender preference may be upheld so long as it is substantially related
to an important governmental objective.
2. The Requisite Evidentiary Showing
In attempting to satisfy the important governmental objective prong
of the intermediate scrutiny test, the County contends that the objective
of the WBE program is to “redress discrimination against women.” That
stated objective is typical, and it is unquestionably a sufficiently
“important” one to sustain a gender-conscious affirmative action program.
See Califano v. Webster, 430 U.S. 313, 318, 97 S. Ct. 1192, 1195 (1977)
(upholding affirmative action in the calculation of Social Security
retirement benefits where “[t]he challenged statute operated directly to
compensate women for past economic discrimination”); see also, e.g.,
Ensley Branch, 31 F.3d at 1580 (holding that “the government interest
prong of the inquiry can be satisfied by a showing of societal
discrimination in the relevant economic sector”). Therefore, as in the
racial analogue, “the true test of an affirmative action program is
usually not the nature of the government's interest, but rather the
23
adequacy of the evidence of discrimination offered to show that
interest.” Id. at 1565 (citation and internal quotation marks omitted).
Although it is clear that both gender-conscious and race- or
ethnicity-conscious programs must be tested for evidentiary sufficiency,
the measure of the evidence required is less clear in the gender context.
The Supreme Court has not addressed the question explicitly, and there
is a similar dearth of guidance in the reported decisions of other
federal appellate courts. As the Third Circuit has observed, “Few cases
have considered the evidentiary burden needed to satisfy intermediate
scrutiny in this context and there is no Croson analogue to provide a
ready reference point.” Contractors Ass'n v. City of Philadelphia, 6
F.3d 990, 1010 (3d Cir. 1993). The Supreme Court has told us plainly
that race- and ethnicity-conscious programs must be tested for a “strong
basis in evidence,” and a body of appellate jurisprudence has developed
to provide that label with meaningful content. See, e.g., Croson, 488
U.S. at 499-504, 109 S. Ct. at 724-27 (identifying factors that cannot
form a “strong basis in evidence”); Ensley Branch, 31 F.3d at 1565
(citing and applying Croson). In the gender context, however, we must
work without an analogous evidentiary label from the Supreme Court, and
the jurisprudence is less developed.
Regardless of what label might be affixed to the standard, it is
clear to us that a gender-conscious affirmative action program can rest
safely on something less than the “strong basis in evidence” required to
bear the weight of a race- or ethnicity-conscious program. We agree with
the Third Circuit that “[l]ogically, a [local government] must be able
to rely on less evidence in enacting a gender preference than a racial
preference because applying Croson's evidentiary standard to a gender
preference would eviscerate the difference between strict and
24
intermediate scrutiny.” Contractor's Ass'n, 6 F.3d at 1010; see also
Peter Lurie, Comment, The Law as They Found It: Disentangling Gender-
Based Affirmative Action Programs from Croson, 59 U. Chi. L. Rev. 1563,
1584-89 (1992) (concluding that “[t]he factual predicate required cannot
be equal to that needed to support a racial classification” because
“[a]ppending a Croson-style factual predicate to the standard
disingenuously transforms” intermediate scrutiny into strict scrutiny).
While there is a difference between the evidentiary foundation
necessary to support a race- or ethnicity-conscious affirmative action
program and the evidentiary foundation necessary to support a gender
preference, that difference is one of degree, not of kind. In both
circumstances, the test of the program is the adequacy of evidence of
discrimination, but in the gender context less evidence is required. The
difficulty, of course, is in determining how much less.
Thus far, the Third Circuit is the only federal appellate court that
has explicitly attempted to clarify the evidentiary requirement
applicable to gender-conscious programs. In Contractors Association, it
announced that the intermediate scrutiny standard “requires the
[government] to present probative evidence in support of its stated
rationale for the gender preference, discrimination against women-owned
contractors.” Contractors Ass'n, 6 F.3d at 1010 (emphasis added). After
announcing the “probative evidence” standard, the Contractors Association
court went on to hold that the evidence of discrimination against women
that the government had offered was “insufficient to create an issue of
fact.” Id. at 1011. It reached that conclusion even though the
government had offered some evidence of discrimination against women,
including a statistical study, an affidavit, and the testimony of a
witness who had appeared at a city council hearing. See id.
25
Plainly, the evidence offered by the government in Contractors
Association was “probative” as that word is commonly understood, because
it tended, at least to some extent, to prove discrimination against
women. See, e.g., Black's Law Dictionary 1203 (6th ed. 1990) (defining
“probative evidence” as evidence “tending to prove” or which “contributes
toward proof”). The probative evidence in Contractors Association was
nonetheless judged “insufficient.” We think that the court's holding in
Contractor's Association is more helpful than the “probative evidence”
standard the opinion articulates. Under the Third Circuit's holding,
evidence offered in support of a gender preference must not only be
“probative,” it must also be “sufficient.”
We agree with the Third Circuit's de facto requirement that a
proponent of a gender-conscious affirmative action program must present
not only probative evidence of discrimination, but sufficient probative
evidence of it. Of course, that formulation begs the question of when
the evidence becomes “sufficient,” but no more so than the Supreme
Court's requirement of a “strong basis in evidence” in the racial
analogue begs the question of when the evidence becomes “strong.” In
both contexts, the evidentiary standards necessarily are tautological
when the words alone are considered and must draw meaning from an
evolving body of case law that will define them. Although the difference
between the “strong basis in evidence” standard applicable to race- or
ethnicity-conscious programs and the less-stringent “sufficient probative
evidence” standard applicable to gender-conscious programs cannot be
measured or described with scientific precision, we have previously
recognized two principal guidelines that mark the boundaries of
intermediate scrutiny evidentiary analysis.
26
First, “[u]nder the intermediate scrutiny test, a local government
must demonstrate some past discrimination against women, but not
necessarily discrimination by the government itself.” Ensley Branch, 31
F.3d at 1580. Indeed, “[o]ne of the distinguishing features of
intermediate scrutiny is that, unlike strict scrutiny, the government
interest prong of the inquiry can be satisfied by a showing of societal
discrimination in the relevant economic sector.” Id. (citations
omitted). Thus, to be sufficient the evidence need not be about
governmental discrimination.
Second, the intermediate scrutiny evidentiary review is not to be
directed toward mandating that gender-conscious affirmative action is
used only as a “last resort,” Hayes v. North State Law Enforcement
Officers Ass'n, 10 F.3d 207, 217 (4th Cir. 1993) (racial discrimination
case), but instead to ensuring that the affirmative action program is “a
product of analysis rather than a stereotyped reaction based on habit,”
Contractors Ass'n, 6 F.3d at 1010 (quoting Metro Broadcasting, Inc. v.
FCC, 497 U.S. 547, 582-83, 110 S. Ct. 2997, 3018-19 (1990)).
Nevertheless, any “'analysis' that rests upon unsupported factual
premises cannot possibly be 'reasoned,' and an untrue and widely-held
generalization about men or women is by definition a 'stereotype.'”
Lamprecht v. FCC, 958 F.2d 382, 393 n.3 (D.C. Cir. 1992) (Thomas, Circuit
Justice). That is why the intermediate scrutiny evidentiary “inquiry
turns on whether there is evidence of past discrimination in the economic
sphere at which the affirmative action program is directed.” Ensley
Branch, 31 F.3d at 1581. Unsupported generalizations will not suffice.
Although sufficiency-of-the-evidence standards may elude precise
formulation, we believe the foregoing two guidelines will assist courts
in determining when a government has presented sufficient probative
27
evidence in support of its stated rationale for enacting a gender
preference, i.e., when the evidence is sufficient to show that the
preference rests on evidence-informed analysis rather than on
stereotypical generalizations. Under those guidelines, the government
must satisfy an “intermediate” standard -- less stringent than the
“strong basis in evidence” standard associated with strict scrutiny, yet
more demanding than merely any probative evidence. The Third Circuit's
actual holding in Contractors Association that the evidence there was
insufficient, a holding with which we agree, provides some guidance to
bench and bar. We hope our decision about whether the district court
clearly erred in finding that the specific evidentiary showing in this
case is insufficient will provide additional guidance. Future cases may
serve to clarify further the evidentiary standard applicable to gender-
conscious affirmative action programs, but for the time being we need
only decide whether the district court clearly erred in finding that Dade
County failed to meet its evidentiary burden in this case.
In this case, the district court reviewed the evidence that the
County offered in support of the WBE program, and it made a factual
determination that the evidence was “insufficient to provide the factual
predicate to support the County's state[d] rationale for its gender
preference program.” 943 F. Supp. at 1584. As with the racial and
ethnicity preference programs, we have a limited role to play in
evaluating that factfinding. We will not review the evidence to
determine whether we would have reached a different conclusion if we had
been sitting as the trier of fact. Instead, we will review the evidence
only to determine whether the district court's view of the evidence is
a permissible one, a plausible one in light of the entire record.
VI. THE EVIDENCE
28
The County put forward two types of evidence in support of its MWBE
programs: (1) statistical evidence and (2) nonstatistical or "anecdotal"
evidence. Because much of the statistical evidence is derived from
studies related to more than one MWBE program, we will review the
statistical evidence for all three of the programs simultaneously,
bearing in mind that a less stringent standard of review applies to the
WBE program. After reviewing the statistical evidence, we will review
the anecdotal evidence, which is focused almost exclusively on the BBE
program.
Before turning to the evidentiary details, however, we address an
issue that bears on much of the analysis that will follow. With respect
to the BBE program, most of the statistical evidence presented by the
County is “post-enactment” evidence, i.e. evidence based on data related
to years following the County's initial enactment of the BBE program in
1982. As we and a number of other circuits have held, the use of that
kind of evidence is permissible:
Although Croson requires that a public employer show strong
evidence of discrimination when defending an affirmative
action plan, the Supreme Court has never required that,
before implementing affirmative action, the employer must have
already proved that it has discriminated. On the contrary,
formal findings of discrimination need neither precede nor
accompany the adoption of affirmative action.
Ensley Branch, 31 F.3d at 1565; see also Concrete Works v. City & County
of Denver, 36 F.3d 1513, 1521 (10th Cir. 1994), cert. denied, 514 U.S.
1004, 115 S. Ct. 1315 (1995); Contractors Ass'n, 6 F.3d at 1003-04 (3d
Cir. 1993); Harrison & Burrowes Bridge Constructors, Inc. v. Cuomo, 981
F.2d 50, 60 (2d Cir. 1992); Coral Constr. Co. v. King County, 941 F.2d
910, 920 (9th Cir. 1991).
Without repeating everything we had to say in Ensley Branch on this
subject, it warrants emphasis that consideration of post-enactment
29
evidence is appropriate when affirmative action programs are scrutinized,
because “[a] violation of federal statutory or constitutional
requirements does not arise with the making of a finding; it arises when
the wrong is committed.” Wygant v. Jackson Bd. of Educ., 476 U.S. 267,
289, 106 S. Ct. 1842, 1855 (1986) (O'Connor, J., concurring). Therefore,
if the County can demonstrate that, notwithstanding its affirmative
action efforts, it remains a “'passive participant' in a system of racial
exclusion practiced by elements of the local construction industry,”
Croson, 488 U.S. at 492, 109 S. Ct. at 721 (plurality opinion), there is
no justification for invalidating the County's voluntary efforts to
dismantle that exclusionary system, at least to the extent that those
efforts are narrowly tailored to accomplishment of that goal. This is
particularly true in light of the fact that the relief granted to the
plaintiffs by the district court is a permanent injunction against the
continued operation of the MWBE programs. See Contractors Ass'n, 6 F.3d
at 1004 (observing that “[b]ecause injunctions are prospective only, it
makes sense to consider all available evidence ... including the post-
enactment evidence”).
Although post-enactment evidence is admissible to determine whether
an affirmative action program is constitutional, such evidence carries
with it the hazard that the program at issue may itself be masking
discrimination that might otherwise be occurring in the relevant market.
In view of that hazard, the County contends that the district court erred
when it “failed to consider that the 12 year pre-existing BBE program
caused the foregoing [statistical] measures of participation to
understate disparity for Black participation.” On that point, the County
is mistaken, because the district court did consider that possibility.
30
In fact, the district court observed that the County's use of post-
enactment evidence was “skewed by the challenged affirmative action
program,” 943 F. Supp. at 1558, even though the court nevertheless
considered in detail the post-enactment evidence that the County itself
chose to present. What the district court did not do is speculate about
what the data might have shown had the BBE program never been enacted.
We find no fault in that approach, because a strong basis in evidence can
never arise from sheer speculation. Government actors are free to
introduce post-enactment evidence in defending affirmative action
programs, but if that evidence fails to meet the applicable evidentiary
burden, a federal court cannot simply presume that, absent the programs,
sufficient evidence of discrimination would have been found. Like the
district court, we take the County's evidence as we find it, or rather
as the County presented it.
A. THE STATISTICAL EVIDENCE
The County presented five basic categories of statistical evidence
to the district court: (1) County contracting statistics; (2) County
subcontracting statistics; (3) marketplace data statistics; (4) The
Wainwright Study; and (5) The Brimmer Study. Below, we describe and
summarize each of those categories of statistical evidence in turn.
1. County Contracting Statistics
The heart of the County's statistical analysis is a study that
2
compares the following three factors for County nonprocurement
2
When Dade County engages with the private sector in business
activities, the County classifies those activities as “procurement”
or “nonprocurement.” In general, nonprocurement business
activities
include construction, personal and professional services, leases,
and concessions. Approximately 90% of the County's overall
31
construction contracts: (1) the percentage of bidders that were MWBE
firms; (2) the percentage of awardees that were MWBE firms; and (3)
the proportion of County contract dollars that have been awarded to
MWBE firms. The study makes those comparisons for two time
periods: 1989-91 and 1993. Fiscal year 1992 was not included in
the study, because of the extraordinary expenditures associated
with Hurricane Andrew. The statistics for the years that were
included may be summarized as follows:
construction expenditures fall are classified as nonprocurement,
which understandably prompted the County to focus its statistical
presentation on nonprocurement construction contracting data. The
County's expert, Dr. Manuel Carvajal, testified that the
nonprocurement construction contracting statistics were the most
probative statistical evidence of discrimination that the County
had.
32
BBE: 1989-91
Category BBE Bidders (%) BBE Awardees (%) Contract $ (%)
SIC 15 13.8 15.0 1.8
SIC 16 5.2 3.4 0.5
SIC 17 16.2 13.5 4.8
BBE: 1993
Category BBE Bidders (%) BBE Awardees (%) Contract $ (%)
SIC 15 17.5 24.6 7.8
SIC 16 16.6 24.1 9.9
SIC 17 21.3 20.0 14.0
Defendants' Exhibit L.
HBE: 1989-91
Category HBE Bidders (%) HBE Awardees (%) Contract $ (%)
SIC 15 31.0 33.0 15.0
SIC 16 23.2 21.9 14.2
SIC 17 28.6 31.1 7.2
HBE: 1993
Category HBE Bidders (%) HBE Awardees (%) Contract $ (%)
SIC 15 31.7 33.9 24.4
SIC 16 22.5 26.5 18.2
SIC 17 29.5 30.0 32.7
Defendants' Exhibit M.
WBE: 1989-91
Category WBE Bidders (%) WBE Awardees (%) Contract $ (%)
33
SIC 15 6.9 6.0 1.0
SIC 16 3.2 2.2 2.9
SIC 17 13.3 13.5 4.4
WBE: 1993
Category WBE Bidders (%) WBE Awardees (%) Contract $ (%)
SIC 15 13.5 6.1 0.9
SIC 16 9.2 5.7 5.3
SIC 17 9.8 15.0 25.4
Defendants' Exhibit N.
At least one thing is fairly obvious from the foregoing
statistics. For the BBE and HBE statistics, there are no
consistently negative disparities between the bidder and the
awardee percentages. In fact, by 1993, the BBE and HBE bidders are
being awarded more than their proportionate "share" of the total
number of County contracts in every SIC category, when the bidder
percentages are used as the baseline for predicting those shares.
There are a couple exceptions to that observation, but in general
it is true. Therefore, as an initial matter, we certainly cannot
conclude that the district court clearly erred by failing to find
a strong basis in evidence of discrimination against BBEs and HBEs
from disparities between bidder and awardee percentages.
For WBEs, the bidder/awardee results are decidedly mixed. For
SIC 17, WBEs consistently have been awarded more than their
proportionate share of County contracts. For SIC 15 and SIC 16 in
years 1989-91, the difference between the WBE bidder and awardee
34
percentages is small, but disfavorable to the WBEs. For those same
categories in 1993, however, the difference between WBE bidders and
awardees is more disfavorable to WBEs -- at the same time the
favorable disparity in SIC 17 has also increased. Without further
analytical refinement, we cannot say that the district court
clearly erred by failing to find in the mixed picture presented by
the WBE bidder/awardee disparities a sufficiently probative basis
in the evidence of discrimination in the relevant economic sector
to justify the County's use of a gender preference.
The County's study refined the foregoing statistical analysis
by bringing into the mix the percentage of County construction
contract dollars actually being awarded to MWBEs. To do that, the
study calculated "disparity indices" for each program and SIC code.
In colloquial terms, a disparity index compares the amount of
contract awards a group actually got to the amount we would have
expected it to get based on that group's bidding activity and
awardee success rate. More specifically, a disparity index
measures the participation of a group in County contracting dollars
by dividing that group's contract dollar percentage by the related
bidder or awardee percentage, and multiplying that result by 100%.
The closer the resulting index is to 100%, the greater the measured
group's participation in the contracting dollars. For instance, if
the BBEs represented 10% of bidders, and were awarded 10% of
contract dollars, the bidder disparity index would be:
(Contract Dollar % ÷ Bidder % ) x 100 %=
(10% ÷ 10%) x 100%=
35
1 x 100% = 100% or "full participation"
Similarly, if the BBEs represented 10% of awardees, but were
awarded only 5% of contract dollars, the awardee disparity index
would be:
(Contract Dollar % ÷ Awardee % ) x 100 %=
(5% ÷ 10%) x 100%=
.5 x 100% = 50% or "half participation"
The utility of disparity indices or similar measures to
examine the utilization of minorities or women in a particular
industry has been recognized by a number of federal circuit courts.
See Concrete Works, 36 F.3d at 1523 n.10 (10th Cir. 1994)
(employing disparity index); Contractors Ass'n, 6 F.3d at 1005 (3d
Cir. 1993) (employing disparity index); Associated Gen. Contractors
v. Coalition for Economic Equity, 950 F.2d 1401, 1414 (9th Cir.
1991) (employing similar statistical data); see also Stuart v.
Roache, 951 F.2d 446, 451 (1st Cir. 1991) (employing similar
statistical data); Cone Corp v. Hillsborough County, 908 F.2d 908,
915-16 (11th Cir. 1990) (employing similar statistical data).
In general, and as the district court recognized, disparity
indices of 80% or greater, which are close to full participation,
are not considered indications of discrimination. For instance,
the EEOC's disparate impact guidelines use the 80% test as the
boundary line for determining a prima facie case of discrimination.
29 C.F.R. § 1607.4D. Additionally, none of the circuits that have
explicitly endorsed the use of disparity indices have indicated
that an index of 80% or greater might be probative of
36
discrimination. See Concrete Works, 36 F.3d at 1524 (10th Cir.
1994) (crediting disparity indices ranging from 0% to 3.8%);
Contractors Ass'n, 6 F.3d at 1005 (3d Cir. 1993) (crediting
disparity index of 4%). The district court did not consider
disparity indices of 80% or greater to be probative of
discrimination. In light of the foregoing authority, including the
EEOC's guidance on the subject, we cannot say that view of the
evidence was clearly erroneous.
After calculation of the disparity indices, the County's study
tested the statistical significance of the results through the
application of standard deviation analysis. The standard deviation
figure describes the probability that the measured disparity is the
result of mere chance. As we previously have recognized:
Social scientists consider a finding of two standard
deviations significant, meaning there is about one chance
in 20 that the explanation for the deviation could be
random and the deviation must be accounted for by some
factor other than chance.
Peightal v. Metropolitan Dade County, 26 F.3d 1545, 1556 n.16 (11th
Cir. 1994) (quoting Waisome v. Port Authority, 948 F.2d 1370, 1376
(2d Cir. 1991)).
The disparity indices for the County's contracting statistics,
together with their corresponding standard deviation values, 3 are
as follows:
BBE: 1989-91
3
Disparity indices that the County's expert identified as
having no statistical significance are indicated by the inclusion
of a dash in the corresponding “Standard Deviation Value” column.
37
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 12.6% 3.26 11.6% 3.39
SIC 16 10.1% 2.61 15.5% 1.94
SIC 17 29.7% 2.35 35.6% 1.84
BBE: 1993
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 44.9% 1.81 31.9% 2.59
SIC 16 59.3% 1.40 40.9% 2.50
SIC 17 65.6% -- 69.9% --
Defendants' Exhibit L.
HBE: 1989-91
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 48.4% 2.86 45.5% 2.98
SIC 16 61.2% 2.12 64.9% 1.89
SIC 17 25.3% 3.53 23.2% 3.69
HBE: 1993
38
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 76.9% 1.06 72.1% 1.19
SIC 16 80.8% -- 68.8% 1.31
SIC 17 110.9% -- 109.1% --
Defendants' Exhibit M.
WBE: 1989-91
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 14.6% 2.19 16.8% 1.92
SIC 16 89.8% -- 128.9% --
SIC 17 33.2% 1.99 32.7% 1.94
WBE: 1993
Bidder Standard Awardee Standard
Disparity Deviation Disparity Deviation
Category Index Value Index Value
SIC 15 6.3% 2.87 13.8% 1.64
SIC 16 57.3% 1.05 91.4% --
SIC 17 257.8% -- 169.1% --
Defendants' Exhibit N.
In the absence of further refinement, the foregoing statistics
would indicate statistically significant underutilization of BBEs
in County construction contracting. With the exception of SIC 17
for 1993, there are substantial and statistically significant
39
unfavorable disparities for County contract dollars -- in terms of
bidder participation, awardee participation, or both. For SIC 17
in 1993, there is a substantial unfavorable disparity with respect
to both bidder and awardee participation, but neither figure is
statistically significant.
With HBEs, the results are less dramatic. For 1989-91, there
are substantial and statistically significant unfavorable
disparities for County contract dollars in all three SIC
categories. However, by 1993, there are no statistically
significant unfavorable disparities, and in SIC 17 the disparity
(albeit statistically insignificant) is favorable toward Hispanics.
For WBEs, the picture is mixed. For 1989-91, there is a
substantial and statistically significant unfavorable disparity
only in SIC 15. However, with standard deviation values of 1.9 for
both bidder and awardee participation, the substantial unfavorable
disparity in SIC 17 very closely approaches statistical
significance. On the other hand, the disparities for SIC 16 in
1989-91 during the same time frame are favorable to WBEs. Turning
to 1993, the only category with a statistically significant
unfavorable disparity is SIC 15. For SIC 16, the disparity for
awardee participation is insubstantial, and for bidder
participation is substantial but statistically insignificant. For
SIC 17, the disparities (though statistically insignificant) are
favorable toward WBEs.
As this circuit and others have recognized, when the proponent
of an affirmative action plan produces sufficient evidence to
40
support an inference of discrimination, the plaintiff must rebut
that inference in order to prevail. See Concrete Works, 36 F.3d at
1522 (10th Cir. 1994); Contractors Ass'n, 6 F.3d at 1006 (3d Cir.
1993); Howard v. McLucas, 871 F.2d 1000, 1007 (11th Cir. 1989). As
we explained in Howard, which involved public employment, once the
proponent of affirmative action:
introduces its statistical proof as evidence of its
remedial purpose, thereby supplying the [district] court
with the means for determining that [it] had a firm basis
for concluding that remedial action was appropriate, it
is incumbent upon the nonminority [employees] to prove
their case; they continue to bear the ultimate burden of
persuading the [district] court that the [public
employer's] evidence did not support an inference of
prior discrimination and thus a remedial purpose, or
that the plan instituted on the basis of this evidence
was not sufficiently "narrowly tailored."
Id. at 1007 (quoting Wygant v. Jackson Bd. of Educ., 476 U.S. 267,
293, 106 S. Ct. 1842, 1856 (O'Connor, J., concurring in part and
concurring in the judgment)).
Typically, when statistical evidence is sufficient to support
an inference of discrimination, plaintiffs have at their disposal
at least three methods of rebutting that inference with a “neutral
explanation.” Contractors Ass'n, 6 F.3d at 1007. Plaintiffs may
do so by: “(1) showing that the statistics are flawed; (2)
demonstrating that the disparities shown by the statistics are not
significant or actionable; or (3) presenting contrasting
statistical data.” Coral Constr. , 941 F.2d at 921 (citation
omitted); Contractors Ass'n, 6 F.3d at 1007 (listing same methods).
We need not decide whether the foregoing statistical analysis was
sufficient to support an inference of discrimination such that the
41
plaintiffs were required to rebut that inference, because the
plaintiffs did produce sufficient evidence to establish a neutral
explanation for the disparities, whether they were required to or
not.
The plaintiffs have contended throughout this litigation that
the disparities illustrated by the County's statistical analysis,
which we have set out, are better explained by firm size than by
discrimination. The plaintiffs point out that minority and female-
owned firms tend to be smaller, and that it stands to reason
smaller firms will win smaller contracts. The plaintiffs produced
evidence based on 1987 Census data, which indicates that, on
average, minority and female-owned construction firms in Dade
County compare to non-MWBE firms as follows:
Category Employees Payroll Sales
Black 3.1 $45,238 $162,867
Hispanic 4.3 $70,893 $427,032
Women 6.6 $113,761 $632,500
Non-MWBE 14.1 $272,839 $1,268,29
1
Plaintiffs' Exhibit 54 at 39.
The plaintiffs' explanation for the disparities in County
contract dollar awards is a plausible one, in light of the
uncontroverted evidence that MWBE construction firms tend to be
substantially smaller than non-MWBE firms. Of course, it is hardly
surprising that MWBE firms bidding on or performing County
contracts are smaller than non-MWBE firms, because the County
42
requires them to be small in order to be counted as MWBE firms.
The Dade County Code requires that, absent a special exemption,
firms participating in the MWBE programs may not exceed the size
limits for “small business concerns” as defined by the Small
Business Administration. See Metropolitan Dade County Code § 2-
3.2(3). Thus, the relative smallness of the MWBE firms is a matter
of definition imposed by the County on the programs. Moreover, as
the County's own expert, Dr. Manuel Carvajal admitted, firm size
plays a significant role in determining which firms win contracts.
According to Dr. Carvajal:
The size of the firm has got to be a major determinant
because of course some firms are going to be larger, are
going to be better prepared, are going to be in a greater
natural capacity to be able to work on some of the
contracts while others simply by virtue of their small
size simply would not be able to do it.
More simply put: Because they are bigger, bigger firms have a
bigger chance to win bigger contracts. It follows that, all other
factors being equal and in a perfectly nondiscriminatory market,
one would expect the bigger (on average) non-MWBE firms to get a
disproportionately higher percentage of total construction dollars
awarded than the smaller MWBE firms. The County's own expert
admitted as much.
Anticipating the plaintiffs' neutral explanation for the
identified contract dollar disparities, the County's study
conducted regression analyses to control for firm size. As
explained in greater detail in the district court's opinion,
regression analysis is a statistical procedure for determining the
relationship between a dependent and independent variable, e.g.,
43
the dollar value of a contract award and firm size. See 943 F.
Supp. at 1564-65. The point of a regression analysis is to
determine whether the relationship between the two variables is
statistically meaningful. Here, the County's regression analyses
were directed toward identifying those disparities that were
unexplained by firm size, the theory being that those unexplained
disparities are necessarily the result of some other factor, such
as discrimination. The statistical significance of the calculated
results is once again expressed by standard deviation analysis.
The district court did not consider unexplained disparities that
corresponded to standard deviation values of less than two to be
probative of discrimination, and based on our Peightel decision,
that view of the evidence is not clearly erroneous. See Peightel,
26 F.3d at 1556 n.16 (recognizing that relationships corresponding
to a standard deviation of two or more are generally considered
significant).
The County's regression analyses were conducted twice, using
two different proxies for firm size: (1) total awarded value of all
contracts bid on; and (2) largest single contract awarded. The
regression analyses “explained” most of the unfavorable disparities
respecting MWBE participation in County contracting expenditures,
meaning that after the analysis was performed, most of the
unfavorable disparities became statistically insignificant, i.e.,
corresponded to standard deviation values of less than two. The
results of the regression analyses can be summarized as follows:
44
C The BBE regression analyses for firm size, based on total
value of all contracts bid on, served to explain all the
disparities except SIC 15 for 1989-91, and explained all
the disparities for 1993.
C The BBE regression analysis for firm size, based on the
largest contract awarded, served to explain all the
disparities except SIC 15 for 1989-91, and explained all
the disparities for 1993.
Defendants' Exhibit L.
C The HBE regression analyses for firm size, based on total
value of all contracts bid on, served to explain all the
disparities except SIC 17 for 1989-91, and all the
unfavorable disparities in 1993.
C The HBE regression analyses for firm size, based on the
largest contract awarded, failed to explain the
disparities for SIC 15 and SIC 17 for 1989-91. However,
for 1993, the regression explained all the unfavorable
disparities.
Defendants' Exhibit M.
C The WBE regression analyses for firm size, based on total
value of all contracts bid on, explained all the
unfavorable disparities for 1989-91. For 1993, the
regression explained all the disparities except for SIC
15.
C The WBE regression analyses for firm size, based on the
largest contract awarded, explained all of the
45
unfavorable disparities for 1989-91, and all the
disparities except for SIC 15 for 1993.
Defendants' Exhibit N.
Based on the foregoing, the district court concluded that the
demonstrated disparities were better explained by firm size than by
discrimination. In the district court's view, the few unexplained
disparities that remained after regressing for firm size did not
provide a strong basis in evidence of discrimination for BBEs and
HBEs, and did not sufficiently demonstrate the existence of
discrimination against WBEs in the relevant economic sector. We do
not consider that view of the evidence to be an implausible one in
light of the entire record, which is to say we do not find it to be
clearly erroneous.
Turning first to the BBE statistics, the firm-size regression
analyses explained all but one of the negative disparities in the
BBE study. The only unexplained negative disparity remaining after
regressing for firm size was the disparity for SIC 15 for 1989-91.
However, even the disparity for SIC 15 was explained by the 1993
regressions for firm size. The district court did not view an
unfavorable disparity for a single SIC code during 1989-91 to form
a strong basis in evidence for implementing a racial preference,
particularly when even that one unfavorable disparity was explained
by the firm-size regressions for 1993. The district court's view
does not leave us “with the definite and firm conviction that a
mistake has been committed.” United States v. United States Gypsum
Co., 333 U.S. 364, 395, 68 S. Ct. 525, 542 (1948).
46
Regarding the HBE statistics, both of the regression methods
failed to explain the unfavorable disparity in 1989-91 for SIC 17,
and one of the methods failed to explain the unfavorable disparity
for SIC 15 during the same time period. However, in 1993, both
regression methods explained all the unfavorable disparities.
Moreover, as illustrated by the foregoing tables, the 1993
disparities for SIC 17 were favorable to HBEs. The district court
did not consider those results to constitute a strong basis in
evidence of discrimination against HBE contractors, and we cannot
conclude that the district court's evaluation of the evidence is
clearly erroneous.
Finally, turning to the WBE statistics, the only unfavorable
disparity left unexplained by the firm-size regression analyses was
the 1993 disparity for SIC 15. All of the other unfavorable
disparities were explained by the firm-size regressions, and as
illustrated by the foregoing tables, the 1993 disparities for SIC
17 were favorable to WBEs. The district court did not consider
one unexplained disparity for a single SIC code in a single year to
be sufficiently probative of discrimination to support the County's
stated rationale for implementing a gender preference. Even
bearing in mind that the County's evidentiary burden is lower for
the WBE program than for the BBE or HBE programs, we believe the
district court's view of the evidence is a permissible one.
The County contends that the district court's evaluation of
the foregoing evidence was flawed, because the district court
focused its attention on the disaggregated data -- that is, data
47
broken down by SIC code. Even though the County's expert, Dr.
Carvajal, indicated that there were valid reasons for
disaggregating the data by SIC code “insofar as they reflect
different kinds of work, different bidding practices, perhaps a
variety of other factors that could make them heterogenous with one
another,” the County maintains that the district court should have
given more weight to the statistics that were consolidated for all
three SIC codes. According to the County, the district court's
approach caused it to disregard substantial and statistically
significant unfavorable disparities that exist in the aggregate for
BBEs, even after regressing for firm size. [County Br. at 21-26]
Notably, the County makes no parallel argument for the HBE and WBE
statistics, the apparent reason being that the aggregated data for
those programs yielded no statistically significant unfavorable
disparities after regressing for firm size.
The implicit reasoning underlying the County's aggregated data
argument seems to be that the district court erred by holding, in
effect, that aggregated data cannot form a strong basis in evidence
to support a racial preference. However, that is not what the
district court did. Instead, the district court declined to assign
dispositive weight to the BBE aggregated data for 1989-91 when: (1)
the BBE aggregated data for 1993 showed no statistically
significant unfavorable disparities after regressing for firm size;
(2) the BBE disaggregated data left only the disparity for SIC 15
in 1989-91 unexplained after the firm-size regressions were
applied; and (3) the County's own expert testified as to the
48
utility of examining the disaggregated data “insofar as they
reflect different kinds of work, different bidding practices,
perhaps a variety of other factors that could make them
heterogenous with one another.”4
Under those circumstances, we cannot conclude that the
district court clearly erred in assigning less weight to the
aggregated data when it decided whether the County had a strong
basis in evidence for implementing a racial preference. Even if we
were convinced that we would have weighed the evidence differently,
had we been sitting as the trier of fact, that alone is not a basis
for concluding that the district court's account of the evidence is
implausible. See Anderson, 470 U.S. at 573-74, 105 S. Ct. at 1511.
We conclude that the district court did not clearly err in finding
that a strong basis in evidence of discrimination against BBEs was
not shown by the 1989-91 aggregated data. Similarly, we conclude
that the district court did not clearly err in finding that the
evidentiary foundation formed by the disaggregated County
contracting statistics was too weak to support the weight of any of
the MWBE programs in view of the constitutional requirements
applicable to them. We turn now to the second category of
statistical evidence that the County presented to the district
court.
4
As noted by the district court, the aggregation of disparity
statistics for nonheterogenous data populations can give rise to a
statistical phenomenon known as “Simpson's Paradox,” which leads to
illusory disparities in improperly aggregated data that disappear
when the data are disaggregated. See 943 F. Supp. at 1560 n.16;
see also Plaintiffs' Exhibit 55 at 3-6 (discussing and illustrating
Simpson's Paradox).
49
2. County Subcontracting Statistics
The County performed a subcontracting study as part of its
statistical case. The object of the subcontracting study was to
measure the participation of each MWBE group in the County's
subcontracting business. For each MWBE category, the study
compared the proportion of the designated group that filed a
subcontractor's release of lien on a County construction project
between 1991 and 1994 with the proportion of sales and receipts
dollars that the same group received during the same time period.
For example, between 1991 and 1994, 11.5% of all firms that
filed a subcontractor's release of lien for SIC 17 County
construction projects were BBEs, while the sales and receipts of
those BBEs comprised only 6.3% of the total sales and receipts
claimed by all firms that filed a subcontractor's release of lien
with the County. According to the study's calculations, this leads
to a disparity index of 54.9%,5 which corresponds to a standard
deviation value of 1.37 (not statistically significant). Although
the disparity index in this example is not statistically
significant, some of the indices for some of the MWBE groups and
SIC codes were. Nevertheless, the district court found the
County's subcontracting study “insufficiently probative to support
the use of race and ethnicity conscious measures,” 943 F. Supp. at
1567, and an inadequate evidentiary foundation for use of a gender
preference, id. at 1572.
(6.3% ÷ 11.5%) x 100% = 54.8% . 54.9% (difference apparently
5
due to rounding in the study's calculations).
50
As noted, the objective of the subcontracting study was to
estimate the participation of each MWBE group in the County's
subcontracting business. However, the district court pointed out
serious methodological problems with the study's approach to
achieving that objective. Most notably, the denominator used in
the calculation of the MWBE sales and receipts percentages is based
upon the total sales and receipts from all sources for the firm
filing a subcontractor's release of lien with the County. That
means, for instance, that if a nationwide non-MWBE construction
company performing 99% of its business outside of Dade County filed
a single subcontractor's release of lien with the County during the
relevant time frame, all of its sales and receipts for that time
frame would be counted in the denominator against which MWBE sales
and receipts are compared. As the district court pointed out, see
943 F. Supp. at 1567, that is not a reasonable way to measure Dade
County subcontracting participation.
The County responds to the foregoing criticism by pointing out
that a strong majority (72%) of the subcontractors included in the
study are "located in" Dade County. We do not believe the district
court was required to view that as a satisfactory resolution of the
identified methodological problem. Twenty-eight percent of the
subcontractors included in the study are not “located in” Dade
County. Even as to the seventy-two percent, the County did not put
on evidence sufficient to prove that the nominal "location" of a
subcontractor serves as an acceptable proxy for that
subcontractor's source of revenue. We conclude that the district
51
court did not clearly err by declining to credit the County's
subcontracting statistics because “the data underlying the
defendants' subcontracting analysis are inappropriate,” 943 F.
Supp. at 1567. We turn now to the third category of statistical
evidence that the County presented to the district court.
3. Marketplace Data Statistics
The County's statistical case included a study that its
expert, Dr. Carvajal, described as designed “to see what the
differences are in the marketplace and what the relationships are
in the marketplace.” That study was based on a sample of 586
contractors that had filed a “certificate of competency” with Dade
County as of January 1995, drawn from a population of 10,462 firms
that had filed such a certificate. For the selected firms, a
telephone survey was conducted. That survey inquired about the
race, ethnicity, and gender of the firm's owner and asked for
information on the firm's total sales and receipts from all sources
(both public and private, within Dade County and without).
After the results of the telephone interviews were compiled,
Dr. Carvajal examined the data to determine whether meaningful
relationships existed between (1) the race, ethnicity, and gender
of the surveyed firm owners, and (2) the reported sales and
receipts of those firms. His hypothesis, of course, is that
“marketplace” discrimination may be responsible for unfavorable
disparities that exist when the sales and receipts of MWBE firms
are compared to those of non-MWBE firms. Dr. Carvajal performed a
regression analysis on the data, which was designed to filter out
52
the portion of identified disparities that may be attributable to
firm size, using the number of employees as a proxy for size.
Before discussing the results of the marketplace study, it
bears emphasis that the study's statistical universe is larger than
the number of firms that are willing, able, or qualified to perform
work on County construction contracts. Filing a “certificate of
competency” with the County means simply that a firm is a licensed
construction contractor, nothing more. Therefore, the parameters
of the study's statistical universe necessarily includes firms that
are unwilling, unable, or unqualified to perform County
construction contracts. We do not view that weakness in the
methodology as rendering the marketplace study meaningless,
particularly in the gender context where “the government interest
prong of the inquiry can be satisfied by a showing of societal
discrimination in the relevant economic sector,” Ensley Branch, 31
F.3d at 1580 (citations omitted). Indeed, we appreciate the
difficulty that would accompany an effort to identify the
statistical pool of contractors willing, able, and qualified to
perform on County contracts. Nevertheless, we believe this problem
is a factor that the district court was permitted to take into
account when evaluating the weight of the statistical results,
particularly insofar as the race- and ethnicity-conscious programs
are concerned. As the Supreme Court has recognized, “[w]hen
special qualifications are required to fill particular jobs,
comparisons to the general population (rather than to the smaller
group of individuals who possess the necessary qualifications) may
53
have little probative value.” Croson, 488 U.S. at 501, 109 S. Ct.
at 726 (quoting Hazelwood Sch. Dist. v. United States, 433 U.S.
299, 308 n.13, 97 S. Ct. 2736, 2742 n.13 (1977)).
Turning now to the results of the marketplace analysis, we
need not dwell long on the data for BBEs or WBEs. After regressing
for firm size, neither the BBE nor WBE data contained any
statistically significant unfavorable disparities -- either in the
aggregate or broken down by SIC code. Therefore, we cannot hold
that the district court clearly erred in finding that the
marketplace data survey was not probative of discrimination against
BBEs or WBEs.
By contrast, the marketplace data for HBEs revealed
unfavorable disparities in SIC 15, SIC 17, and in the aggregate,
that were statistically significant even after the firm-size
regressions were conducted. We think the district court was
certainly permitted to consider those unexplained disparities as
some evidence of discrimination against HBEs in the marketplace.
However, the district court was not required to assign those
disparities controlling weight in its evaluation of whether, in
view of all the evidence, the County had a strong basis in evidence
for implementing an ethnic preference for Hispanics. As previously
explained, the study's statistical pool is not limited to “the
number of minorities qualified to undertake the particular task.”
Croson, 488 U.S. at 502, 109 S. Ct. at 726. Moreover, we believe
the district court was well within permissible bounds in viewing
the marketplace data results as undermined by the dissimilar
54
results of the previously-discussed County contracting statistics.
See supra Part VI.A.1. We turn now to the fourth category of
statistical evidence that the County presented.
4. The Wainwright Study
At trial, the County introduced a statistical analysis
prepared by Mr. Jon Wainwright. The Wainwright study analyzed the
personal and financial characteristics of self-employed persons
working full-time in the Dade County construction industry, based
on data drawn from the 1990 Public Use Microdata Sample database,
which is derived from the decennial census. More specifically, the
study: (1) compared construction business ownership rates of MWBEs
to those of non-MWBEs and (2) analyzed disparities in personal
income between MWBE and non-MWBE business owners. The study
concluded that blacks, Hispanics, and women are less likely to own
construction businesses than similarly situated white males, and
MWBEs that do enter the construction business earn less money than
similarly situated white males. We will consider each of those
conclusions in turn.
The business ownership analysis of the Wainwright study
attempted to discern whether blacks, Hispanics, and women enter the
construction business at lower rates than similarly situated white
males. In determining whether persons were “similarly situated,”
the study considered “human capital” variables such as years of
education, years of labor market experience, marital status, and
English proficiency. Also considered were “financial capital”
variables such as interest and dividend income, and home ownership.
55
The analysis indicates that blacks, Hispanics, and women enter the
construction business at rates lower than would be expected if the
numerosity of those groups, together with the identified human and
financial capital variables, were the only factors affecting entry
into the construction business. For blacks and women (but not
Hispanics), the identified disparities are substantial and
statistically significant.
The theory underlying the business ownership component of the
Wainwright study is that any significant disparities that exist
after accounting for the identified human and financial capital
variables must be due to the ongoing effects of current and past
discrimination. In light of Croson, the district court was
certainly not required to accept that theory. In Croson, the local
government took a similar approach when it sought to carry its
evidentiary burden by relying on evidence that minority membership
in local contractors' associations was too low. The Supreme Court
rejected that attempt, reasoning as follows:
There are numerous explanations for this dearth of
minority participation, including past societal
discrimination in education and economic opportunities as
well as both black and white career and entrepreneurial
choices. Blacks may be disproportionately attracted to
industries other than construction. See The State of
Small Business: a Report of the President 201 (1986)
(“Relative to the distribution of all business, black-
owned businesses are more than proportionately
represented in the transportation industry, but
considerably less than proportionately represented in the
wholesale trade, manufacturing, and finance industries”).
...
For low minority membership in these associations to
be relevant, the city would have to link it to the number
of MBE's eligible for membership.
56
488 U.S. at 503, 109 S. Ct. at 727 (emphasis added).
In a pluralistic and diverse society, it is unreasonable to
assume that equality of opportunity will inevitably lead different
groups with similar human and financial capital characteristics to
make similar career choices. See Local 28 of Sheet Metal Workers
Int'l Ass'n v. EEOC, 478 U.S. 421, 494, 106 S. Ct. 3019, 3059
(1986) (O'Connor, J., concurring in part and dissenting in part)
("[I]t is completely unrealistic to assume that individuals of each
race will gravitate with mathematical exactitude to each employer
or union absent unlawful discrimination."). “Similarly situated”
women, men, blacks, whites, Native Americans, Italian-Americans,
and every other group that might be listed all bring their own
values and traditions to the socio-economic table, and may
reasonably be expected to make voluntary choices that give effect
to those values and traditions. As the Supreme Court recognized in
Croson, the disproportionate attraction of a minority group to non-
construction industries does not mean that discrimination in the
construction industry is the reason. See 488 U.S. at 503, 109 S.
Ct. at 727.
Moreover, the district court had before it other evidence
tending to show that disparities in construction business ownership
are not attributable to discriminatory barriers to entry. At
trial, there was evidence that between 1982 and 1987, the growth
rate of MWBE firms was considerably more robust than that of non-
MWBE firms. That data showed the following:
57
Ownership Growth Rate in Number of Firms
1982-87
Black 250%
Hispanic 289%
Women 121%
non-MWBE -26%
Plaintiffs' Exhibit 54 at 39. If the construction market itself
were discriminatory, it is difficult to understand how the 1982-87
growth rate of MWBE firms in that market accelerated so much
compared to that of non-MWBE firms. The answer, at least for
Hispanics and women, cannot be the Dade County MWBE programs,
because the HBE and WBE programs were not enacted until 1994. For
all of the foregoing reasons, we cannot conclude that the district
court clearly erred in assigning little or no weight to the
business ownership portion of the Wainwright study.
We turn now to the personal income component of the Wainwright
study. That analysis compared the personal incomes of MWBE
construction business owners to non-MWBE construction business
owners. As with the business ownership component of the study,
regression analyses were performed on the identified disparities to
filter out a litany of human capital and financial capital
variables, on the theory that the remaining disparities reflect the
effects of discrimination. After those regressions were performed,
the disparities for Hispanic and women owners were not substantial,
i.e., they resulted in disparity indices of 80% or more.
For the black owners, however, the income disparity ratio was
72.2%, which was statistically significant at two standard
58
deviations. While that disparity is some evidence of
discrimination against BBEs in the marketplace, there are at least
two reasons why the district court was not required to assign the
disparity controlling weight in evaluating whether, in view of all
the evidence, the County had a strong basis in evidence for
implementing a racial preference.
First, the business owner income component of the Wainwright
study fails to take account of firm size in its regression
analysis, because the Public Use Microdata Sample database contains
data on business owners, not their businesses. Recognizing that
weakness in the database, Dr. Wainwright testified that “I tried to
approach the size and capacity issue from an individual [business
owner] standpoint as best we could,” by including in his “financial
capital” variables the interest and dividend income earned by the
owner, as well as whether the business was incorporated. We do not
believe the district court was required to give regressions based
on those types of variables the same weight as regressions based on
more direct measures of firm size, which brings us to our second
point.
The district court was not required to consider the Wainwright
study in isolation from the other statistical evidence, including
the County Contracting Statistics and Marketplace Data Statistics.
In those other two statistical analyses, regressions conducted for
more direct measures of firm size successfully explained virtually
all of the identified disparities. Accordingly, the district court
was permitted to take account of the fact that “[t]he regression
59
analyses are ... conflicting,” 943 F. Supp. at 1575, and to assign
less weight to the disparity identified by the personal income
component of the Wainwright study, which was based on a more
indirect proxy for firm size. After all, we are required to review
the district court's findings in light of the entire record. We
turn now to the fifth and final category of statistical evidence
the County presented.
5. The Brimmer Study
The final component of the County's statistical presentation
was a study conducted under the supervision of Dr. Andrew F.
Brimmer. The Brimmer study concerns only black-owned construction
firms. The key component of the study is an analysis of the
business receipts of black-owned construction firms for the years
1977, 1982, and 1987, based on the Census Bureau's Survey of
Minority and Women Owned Businesses (“SMOBE”), which is produced
every five years. The analysis was designed to determine whether
disparities existed when the sales and receipts of black-owned
construction firms in Dade County were compared with the sales and
receipts of all Dade County construction firms.
The Brimmer study demonstrated the existence of substantial
disparities for black-owned construction business receipts for 1977
and 1987, but not 1982. For 1977 and 1987, the disparity indices
never exceeded 58% in any of the construction SIC codes. In 1982,
however, the disparity index for SIC 15 was 94%, or almost at
parity, and the disparity indices for SIC 16 and 17 were
substantially above parity, at 141% and 169%, respectively.
60
According to the County, however, the favorable results in 1982
were the result of heavy spending related to a federally funded
Metrorail project that required the use of race-conscious measures,
not to a lack of discrimination in the industry. However, the
Brimmer study made no attempt to filter out the effect of the
Metrorail project in calculating the disparity indices, apparently
because that information is not available from the SMOBE data.
The district court discounted the significance of the
unfavorable disparities identified in the Brimmer study for 1977
and 1987, primarily due to the study's complete failure to take
firm size into account. See 943 F. Supp. at 1573. Even assuming
that without the effect of the Metrorail project, the disparities
for 1982 would have been comparable to the unfavorable disparities
for 1977 and 1987, we cannot say that the district court's
treatment is an impermissible way to view the Brimmer study.
Because firm-size regression analyses were successful in explaining
most of the unfavorable disparities identified by other statistical
studies that the County introduced into evidence, we cannot hold
that the district court's evaluation of the Brimmer study was an
implausible view of the evidence in light of the entire record.
6. Summary
To summarize, the County's statistical evidence is subject to
more than one interpretation. The factfinder in this case examined
the statistical data, and found that it was insufficient to form
the requisite strong basis in evidence for implementing a racial or
ethnic preference, and that it was insufficiently probative to
61
support the County's stated rationale for implementing a gender
preference. For the reasons we have explained previously, we
cannot hold that the district court's view of the statistical
evidence is an impermissible one. As the Supreme Court has
explained, “Where there are two permissible views of the evidence,
the factfinder's choice between them cannot be clearly erroneous.”
Anderson, 470 U.S. at 574, 105 S. Ct. at 1512. Therefore, we
cannot hold that the district court clearly erred in finding that
the statistical evidence was too weak an evidentiary foundation to
bear the weight of any of the MWBE programs under the standards of
review applicable to them.
B. THE ANECDOTAL EVIDENCE
In addition to the statistical evidence, the County and the
intervenors introduced a great deal of anecdotal evidence about
discrimination in the County construction market. Most of that
anecdotal evidence was concerned with perceived discrimination
against BBEs, although a much smaller fraction of it was concerned
with discrimination against WBEs. No anecdotal evidence at all was
presented about discrimination against HBEs. The anecdotal
evidence took three basic forms: (1) the testimony of two County
employees responsible for administering the MWBE programs; (2) the
testimony, primarily by affidavit, of twenty-three MWBE contractors
and subcontractors; and (3) a survey of black-owned construction
firms. The district court's opinion contains a detailed
description of all three forms of the anecdotal evidence, see 943
F. Supp. at 1577-79. Therefore, we will keep our description of
62
that evidence to the minimum necessary to an understanding of its
substance.
The two County employees who presented anecdotal testimony
were Herbert Johnson and Gregory Owens. At the time of trial,
Johnson had worked for the County for over 15 years and he was then
in charge of the Dade County Performing Arts Center construction
project, which was projected to cost approximately $170 Million.
Owens is the former director of the County's Department of Business
and Economic Development, which implements the County's MWBE
programs. He served in that capacity from 1991 to 1995.
Both Johnson and Owens testified that the decentralized
structure of the County construction contracting system affords
great discretion to the numerous County employees that are involved
in the process. According to their testimony, that discretion
creates the opportunity for discrimination to infect the system.
Additionally, both employees (but primarily Owens) gave examples of
incidents of discrimination that they believed had occurred in
County contracting. For instance, Owens testified that MWBEs often
complain about getting lengthy “punch lists” -- lists of work that
must be redone -- when non-MWBEs on the same project did not
receive lengthy punch lists. Both witnesses testified about the
difficulty that MWBEs encounter in obtaining bonding and financing.
Additionally, the County and the intervenors introduced the
testimony of twenty-three MWBE contractors, all but seven of whom
testified solely by sworn declaration at the suggestion of the
district court. Those witnesses described numerous incidents in
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which they believe they have encountered discrimination in the Dade
County construction market, which included: situations in which a
project supervisor or foreman would refuse to deal directly with
a black or female firm owner, instead preferring to deal with a
white male employee; instances in which an MWBE owner knew itself
to be the low bidder on a subcontracting project, but was not
awarded the job; instances in which a low bid by an MWBE owner was
“shopped” to solicit even lower bids from non-MWBE firms; instances
in which an MWBE owner received an invitation to bid on a
subcontract within a day of the bid due date, together with a
“letter of unavailability” for the MWBE owner to sign in order to
obtain a waiver from the County; and instances in which an MWBE
subcontractor was hired by a prime contractor, but subsequently was
replaced with a non-MWBE subcontractor within days of starting work
on the project.
Finally, the County and the intervenors introduced a study
based on anecdotal accounts of discrimination. That study was
prepared by Dr. Joe R. Feagin, who chairs the Department of
Sociology at the University of Florida. In conducting his study,
Dr. Feagin interviewed persons at 78 construction firms that had
been certified by the County as black-owned businesses. According
to Dr. Feagin's report, those interviewees reported difficulties
and unfavorable experiences consistent with the ones described by
the individual witnesses, including: difficulty in securing bonding
and financing; slow payment by general contractors; unfair
performance evaluations that were tainted by racial stereotypes;
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difficulty in obtaining information from the County on contracting
processes; and higher prices on equipment and supplies than were
being charged to non-MWBE firms.
The picture painted by the anecdotal evidence is not a good
one. Clearly, numerous black (and some female) construction firm
owners in Dade County perceive that they have been the victims of
discrimination. Additionally, at least two County employees who
are intimately familiar with the County's procedures believe that
the County's decentralized contracting system affords enough
discretion to County employees to let discrimination taint the
process. The question is whether such evidence is sufficient to
overcome the weaknesses found by the district court in the County's
statistical data and to make the district court's findings clearly
erroneous in light of the entire record.
Several circuits, including this one, have discussed the value
and significance of anecdotal evidence in evaluating whether the
government has established a sufficient factual predicate to
justify a race-conscious or gender-conscious affirmative action
program. We have found that kind of evidence to be helpful in the
past, but only when it was combined with and reinforced by
sufficiently probative statistical evidence. In Cone Corp., we
held that anecdotal testimony “combined with the gross statistical
disparities uncovered by the County studies, provides more than
enough evidence on the question of prior discrimination and the
need for racial classification to justify the denial of a motion
for summary judgment,” 908 F.2d at 916 (emphasis added).
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Similarly, in Ensley Branch, we recognized that “[a]necdotal
evidence may also be used to document discrimination, especially if
buttressed by relevant statistical evidence,” 31 F.3d at 1565
(citation omitted). In that case, we held that a city had a
sufficient basis in evidence to support the existence of a gender-
conscious affirmative action program when “[t]he record before us
contains substantial anecdotal and statistical evidence of past
discrimination against women.” Id. at 1581 (emphasis added).
Our treatment of anecdotal evidence in Cone Corp. and Ensley
Branch is consistent with the formulation in Justice O'Connor's
Croson plurality opinion that “evidence of a pattern of individual
discriminatory acts can, if supported by appropriate statistical
proof, lend support to a local government's determination that
broader remedial relief is justified,” 488 U.S. at 509, 109 S. Ct.
at 730 (citation omitted) (emphasis added). In light of Croson's
guidance on the point, and our decisions in Cone Corp. and Ensley
Branch, we believe that anecdotal evidence can play an important
role in bolstering statistical evidence, but that only in the rare
case will anecdotal evidence suffice standing alone. While such
evidence can doubtless show the perception and, on occasion, the
existence of discrimination, it needs statistical underpinnings or
comparable proof to show that substantial amounts of business were
actually lost to minority or female contractors as the result of
the discrimination. Other circuits share this view as to the
limitations of anecdotal evidence. See Concrete Works, 36 F.3d at
1520 (10th Cir. 1994) (deeming “anecdotal evidence of public and
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private race and gender discrimination appropriate supplementary
evidence”) (emphasis added); Contractors Ass'n, 6 F.3d at 1003 (3d
Cir. 1993) (recognizing that the “combination of anecdotal and
statistical evidence is potent” and that anecdotal evidence, taken
alone, could satisfy Croson only in the “exceptional” case, if at
all) (emphasis added) (citation and internal quotation marks
omitted); Coral Constr., 941 F.2d at 919 (9th Cir. 1991)
(recognizing the value of anecdotal evidence when combined with a
“proper statistical foundation,” but stating that anecdotal
evidence alone “rarely, if ever, can ... show a systematic pattern
of discrimination necessary for the adoption of an affirmative
action plan”).
As we have explained, the district court's assessment of the
statistical evidence in this case is not clearly erroneous.
Without the requisite statistical foundation for the anecdotal
evidence to reinforce, supplement, support, and bolster, we cannot
say on the facts and circumstances of this case that the district
court clearly erred by failing to find that the anecdotal evidence
formed a sufficient evidentiary basis to support any of the MWBE
programs -- either taken alone or in combination with the
statistics that the district court found to be ambiguous at best.
By so holding, we do not set out a categorical rule that every case
must rise or fall entirely on the sufficiency of the numbers. To
the contrary, anecdotal evidence might make the pivotal difference
in some cases; indeed, in an exceptional case, we do not rule out
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the possibility that evidence not reinforced by statistical
evidence, as such, will be enough.
In this case, however, the district court did not find a
sufficient evidentiary foundation to support the MWBE programs in
the statistical evidence, in the anecdotal evidence, or in the
combination of the two. We may or may not have made that same
finding had we been in the district court's position, but we cannot
say that the district court's account of the evidence is
implausible in light of the entire record. Therefore, the district
court's judgment enjoining the continued operation of the MWBE
programs is due to be affirmed on that ground, i.e., because of the
County's failure to satisfy the factfinder that the programs rested
on a constitutionally sufficient evidentiary foundation. For the
sake of completeness, however, we will continue our review to the
next step of the analysis.
VII. NARROW TAILORING AND SUBSTANTIAL RELATIONSHIP
We turn now to the “narrow tailoring” prong of our strict
scrutiny review of the BBE and HBE programs, and then to the
“substantial relationship” prong of our intermediate scrutiny
review of the WBE program. Our discussion in this section requires
us to assume, contrary to our previous holding, that the County did
have a sufficient evidentiary foundation for enacting the MWBE
programs in the first place. By making that assumption, we can
address whether the programs are sufficiently linked to the
legitimate government purpose they are purported to serve, which is
remedying the effects of present and past discrimination against
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blacks, Hispanics, and women in the Dade County construction
market.
A. “NARROW TAILORING” AND THE BBE AND HBE PROGRAMS
As the Fourth Circuit has recognized, “The essence of the
'narrowly tailored' inquiry is the notion that explicitly racial
preferences ... must be only a 'last resort' option.” Hayes v.
North State Law Enforcement Officers Ass'n, 10 F.3d 207, 217 (4th
Cir. 1993); see also Croson, 488 U.S. at 519, 109 S. Ct. at 735
(Kennedy, J., concurring in part and concurring in the judgment)
(“[T]he strict scrutiny standard ... forbids the use even of
narrowly drawn racial classifications except as a last resort.”).
Even though, under a carefully tailored affirmative action program,
“innocent persons may be called upon to bear some of the burden of
the remedy,” Metro Broadcasting, Inc. v. Federal Communications
Comm'n, 497 U.S. 547, 596, 110 S. Ct. 2997, 3025-26 (1990)
(citation and internal quotation marks omitted), such programs must
be vigorously scrutinized to ensure that they do not go too far.
That is so, because “even in the pursuit of remedial objectives, an
explicit policy of assignment by race may serve to stimulate our
society's latent race consciousness, suggesting the utility and
propriety of basing decisions on a factor that ideally bears no
relationship to an individual's worth or needs.” United Jewish
Orgs. v. Carey, 430 U.S. 144, 173, 97 S. Ct. 96, 1014 (1977)
(Brennan, J., concurring in part).
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In this circuit, we have identified four factors that should
be taken into account when evaluating whether a race- or ethnicity-
conscious affirmative action program is narrowly tailored:
In making this evaluation, we consider: (1) the necessity
for the relief and the efficacy of alternative remedies;
(2) the flexibility and duration of the relief, including
the availability of waiver provisions; (3) the
relationship of numerical goals to the relevant labor
market; and (4) the impact of the relief on the rights of
innocent third parties.
Ensley Branch, 31 F.3d at 1569 (citations and internal quotation
marks omitted). The preceding four factors are not a mechanical
formula for determining whether an affirmative action program is
narrowly tailored, but they do provide a useful analytical
structure. Here, we will concentrate on the first factor, because
that is where the County's MWBE programs are most problematic.6
Turning now to the necessity for the relief and the efficacy
of alternative remedies, we flatly reject the County's assertion
that “given a strong basis in evidence of a race-based problem, a
race-based remedy is necessary.” That simply is not the law. If
a race-neutral remedy is sufficient to cure a race-based problem,
then a race-conscious remedy can never be narrowly tailored to that
problem. See Croson, 488 U.S. at 507, 109 S. Ct. at 729 (holding
6
However, we do note that we agree with the district court's
analysis of the remaining factors with respect to the BBE and HBE
programs, see 943 F. Supp. at 1582-83, with one exception. That
one exception is that we do not agree with the district court that
it was “irrational” for the County to set a goal of 19% HBE
participation when Hispanics make up more than 22% of the relevant
contracting pool in every SIC category, and more than 30% for SIC
15. We see nothing impermissible about setting numerical goals at
something less than absolute parity. Stated somewhat differently,
a local government need not choose between a program that aims at
parity and no program at all.
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that affirmative action program was not narrowly tailored where
“there does not appear to have been any consideration of the use of
race-neutral means to increase minority business participation in
city contracting”); id. at 509, 109 S. Ct. at 730 (plurality
opinion) (reserving race-conscious remedies for the “extreme case”
when “necessary to break down patterns of deliberate exclusion”);
see also, e.g., United States v. Paradise, 480 U.S. 149, 171, 107
S. Ct. 1053, 1066 (1987) (“In determining whether race-conscious
remedies are appropriate, we look to several factors, including ...
the efficacy of alternative remedies ....”). Supreme Court
decisions teach that a race-conscious remedy is not merely one of
many equally acceptable medications the government may use to treat
a race-based problem. Instead, it is the strongest of medicines,
with many potentially harmful side-effects, and must be reserved
for those severe cases that are highly resistant to conventional
treatment.
Here, the County has clearly failed to give serious and good-
faith consideration to the use of race and ethnicity-neutral
measures to increase BBE and HBE participation in the County
construction market. The legislative findings accompanying the BBE
ordinance merely contain the conclusory statement that “race
neutral programs cannot address the above problems and do not focus
limited County money, efforts and personnel on the problems caused
by racial discrimination.” That conclusion was based on an equally
conclusory analysis contained in the Brimmer study, and a report
that the Small Business Administration was able to direct only five
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percent of SBA financing to black businesses from 1968 to 1980. In
view of that perfunctory analysis, the County's conclusion that
race-neutral solutions are ineffective is “entitled to little or no
weight,” Croson, 488 U.S. at 500, 109 S. Ct. at 725, which is what
the district court gave it.
Insofar as the HBE program is concerned, the County conceded,
with admirable candor, that “the record is bare of any county
consideration of alternatives to an ethnic-conscious measures [sic]
or any experiences upon which to support its recital in the
ordinance of their ineffectiveness.” Having reviewed the record in
toto, we agree. It is clear as window glass that the County gave
not the slightest consideration to any alternative to a Hispanic
affirmative action program. Awarding construction contracts based
upon ethnicity is what the County wanted to do, and all it
considered doing, insofar as Hispanics were concerned.
The testimony of the County's own witnesses indicates that
many of the problems that face Black and Hispanic construction
firms could be addressed without the imposition of a race or
ethnicity-conscious remedy. As noted by the district court, 943 F.
Supp. at 1581, both Johnson and Owens testified as witnesses for
the County that the following factors cause problems for MWBE
contractors: the decentralized County contracting system, which
affords a high level of discretion to County employees; the
complexity of County contract specifications; difficulty in
obtaining bonding; difficulty in obtaining financing; unnecessary
bid restrictions; inefficient payment procedures; and insufficient
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or inefficient exchange of information. Virtually all of these
problems are problems caused by County processes and procedures,
which the County could change. Primarily, these problems facing
MWBE contractors are institutional barriers to entry that affect
any new entrant into the County construction market. If the
relative institutional youth of Black and Hispanic-owned
construction firms causes those barriers to have a disproportionate
impact on BBEs and HBEs, it follows that those firms should be
helped the most by dismantling those barriers, something the County
could do at least in substantial part.
The similarities between the race- and ethnicity-neutral
options available to the County, and those available to the City of
Richmond in Croson are striking. Writing for the plurality,
Justice O'Connor explained:
[T]he city has at its disposal a whole array of
race-neutral devices to increase the accessibility of
city contracting opportunities to small entrepreneurs of
all races. Simplification of bidding procedures,
relaxation of bonding requirements, and training and
financial aid for disadvantaged entrepreneurs of all
races would open the public contracting market to all
those who have suffered the effects of past societal
discrimination or neglect. Many of the formal barriers
to new entrants may be the product of bureaucratic
inertia more than actual necessity, and may have a
disproportionate effect on the opportunities open to new
minority firms. Their elimination or modification would
have little detrimental effect on the city's interests
and would serve to increase the opportunities available
to minority business without classifying individuals on
the basis of race. The city may also act to prohibit
discrimination in the provision of credit or bonding by
local suppliers and banks. Business as usual should not
mean business pursuant to the unthinking exclusion of
certain members of our society from its rewards.
488 U.S. at 509-10, 109 S. Ct. at 730.
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Despite that clear admonition in Croson, the record in this
case does not indicate that the County has even seriously
considered, and certainly has not tried, most of the race- and
ethnicity-neutral alternatives available to it for increasing black
and Hispanic participation in County contracting and for
eliminating discrimination that may be occurring in that
marketplace. Although the County does offer some limited technical
and financial aid that might benefit BBEs and HBEs, even those
half-hearted programs have not been evaluated for their
effectiveness.
Most notably, the record indicates that the County has not
taken any action whatsoever to ferret out and respond to instances
of discrimination if and when they have occurred in the County's
own contracting process. If such conduct has occurred -- and the
County's own anecdotal evidence suggests that it has on at least
some occasions -- the County has taken no steps to inform, educate,
discipline, or penalize its own officials and employees responsible
for the misconduct. The first measure every government ought to
undertake to eradicate discrimination is to clean its own house and
to ensure that its own operations are run on a strictly race- and
ethnicity-neutral basis. The County has made no effort to do that.
Nor has the County passed local ordinances to outlaw discrimination
by local contractors, subcontractors, suppliers, bankers, or
insurers. Instead of turning to race- and ethnicity-conscious
remedies as a last resort, the County has turned to them as a first
resort. Because the County's BBE and HBE programs are not narrowly
74
tailored, those programs would violate the Equal Protection Clause
even if they were supported by a sufficient evidentiary foundation.
B. “SUBSTANTIAL RELATIONSHIP” AND THE WBE PROGRAM
When a gender-conscious affirmative action program rests on a
sufficient evidentiary foundation, the government is not required
to implement the program only as a last resort. Under intermediate
scrutiny, the government may implement a gender preference so long
as it can show that the program is substantially related to an
important government interest. See supra Part V.B. Additionally,
under intermediate scrutiny, a gender-conscious program need not
closely tie its numerical goals to the proportion of qualified
women in the market. See Ensley Branch, 31 F.3d at 1582.
The district court drew no distinction between its analysis of
whether the County's BBE and HBE programs were narrowly tailored
and whether the WBE program bore a substantial relationship to the
County's stated rationale for implementing gender-conscious
affirmative action, in response to perceived discrimination against
women-owned contractors. That approach was error. Although the
County has set a participation goal for WBEs of 11%, when the
availability of WBE bidders ranges across SIC codes from 3.2% to
13.3%, the waiver provisions included in the WBE program make that
numerical target sufficiently flexible to withstand intermediate
scrutiny. If the WBE program rested on a sufficient evidentiary
foundation, we could not conclude that it would fail the
substantial relationship prong of the intermediate scrutiny
analysis. However, because the district court did not clearly err
75
in finding that the County had failed to present sufficient
probative evidence in support of its stated rationale for
implementing a gender preference, the district court's error in
applying the substantial relationship test does not change the
result.
VIII. CONCLUSION
Sitting as the trier of fact, the district court found that
the County lacked a strong basis in evidence to justify race- or
ethnicity-conscious affirmative action. Likewise, the district
court found that the County had failed to present sufficient
probative evidence in support of its stated rationale for
implementing a gender preference. Having reviewed the evidence, we
conclude that neither of those findings is clearly erroneous. We
also conclude that the County's race- and ethnicity-conscious
programs are not narrowly tailored to serve a compelling
governmental interest. The County's gender-conscious program is
sufficiently flexible to satisfy the substantial relationship prong
of intermediate scrutiny, but that is not enough in view of the
County's failure to present sufficient probative evidence of
discrimination against women in the relevant parts of the local
construction industry.
For the foregoing reasons, the district court's judgment
declaring unconstitutional Metropolitan Dade County's usage of
race-, ethnicity-, and gender-conscious measures in connection with
County construction projects and enjoining the County from using
those measures is AFFIRMED.
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