Appendix — Coral Construction Co. v. King County

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G1-755

NO.

ore

Sunreme Court, U.S,

FILED

NOV 5 1991

OFFICE OF THE CLERK

jn Ghe Supreme Court

Of Che Gnited States

October Term 1991

CORAL CONSTRUCTION COMPANY and

OREGON COLUMBIA CHAPTER OF THE

ASSOCIATED GENERAL CONTRACTORS

OF AMERICA, INC.

Petitioners,

KING COUNTY, WASHINGTON,

Respondent.

APPENDIX TO-PETITION FOR A WRIT OF

CERTIORARI TO THE UNITED STATES COURT

OF APPEALS FOR THE NINTH CIRCUIT

November 5, 1991

John F. Bradach

Counsel of Record

STOEL RIVES BOLEY JONES & GREY

900 SW Fifth Avenue, Suite 2300

Portland, OR 97204-1268

(503) 294-9379 or (503) 224-3380

Wm. Bradford Reynolds

Thomas G. Olp

John J. Vecchione

ROSS & HARDIES

888 - 16th Street, NW, Suite 300

Washington, DC 20006-4103

(202) 296-8600

Counsel for Petitioners Coral

Construction Company and Oregon

Columbia Chapter of the Associated

General Contractors

TABLE OF CONTENTS

Judgment, United States Court of Appeals

For the Ninth Circuit

Opinion of the Ninth Circuit Court of

Appeals in Coral Construction Company,

et al. v. King County, 941 F2d 910

(9th Cir 1991)

Order and Opinion of the United States

District Court for the Western District

of Washington, in Coral Counstruction

Company et al. v. King County, 729

F Supp 734 (WD Wash 1989)

King County Code, Chapter 4.18 Minority

and Women’s Business Enterprises

(6-89 Codification of Ordinance 8937,

May 1, 1989)

Page

A60

A78

JUDGMENT

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 90-35066

CT/AG#: C89-1488WD

CORAL CONSTRUCTION COMPANY, an Oregon

corporation, and OREGON COLUMBIA CHAPTER

OF THE ASSOCIATED GENERAL CONTRACTORS

OF AMERICA, INC., an Oregon non-profit

corporation,

Plaintiffs-Appellants,

KING COUNTY, a legal subdivision of the State of

Washington,

Defendant-Appellee.

PACIFIC LEGAL FOUNDATION; ASSOCIATED

GENERAL CONTRACTORS OF AMERICA, INC;

NORTHWt« tT WOMEN’S LAW CENTER,

ASSOCIATION OF WOMEN CONTRACTORS;

NATIONAL ASSOCIATION FOR THE

ADVANCEMENT OF COLORED PEOPLE

Amic: Curiae

APPEAL FROM the United States District

Court for the Western District of Washington

(Seattle).

THIS CAUSE came on to be heard on the

Transcript of the Record from the United States

District Court for the Western District of

Washington (Seattle) and was duly submitted.

ON CONSIDERATION WHEREOF, It is now

here ordered and adjudged by this Court, that the

judgment of the said District Court in this cause be,

and hereby is AFFIRMED IN PART, REVERSED IN

PART, and REMANDED.

Filed and entered AUGUST 8, 1991

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CORAL

CONSTRUCTION

COMPANY, an Oregon

corporation; and

OREGON COLUMBIA

CHAPTER OF THE

ASSOCIATED GENERAL

CONTRACTORS OF

AMERICA, INC., an

Oregon non-profit

corporation,

No. 90-35066

Plaintiffs-

Appellants,

KING COUNTY, a legal

subdivision of the State

of Washington,

ee ee eee eee ee ee a ee ee ee ee

Defendant-

Appellee.

O’SCANNLAIN, CIRCUIT JUDGE:

We must decide whether King County’s

Minority- and Women-Owned Business Enterprise set-

aside program for public contract awards violates the

equal protection clause of the fourteenth amendment.

In 1981, King County, Washington (which

encompasses the city of Seattle) implemented a

program establishing a preference for the use of

minority-owned businesses (MBEs) and women-

owned businesses (WBEs)’ in letting county contracts

or subcontracts.” See King County, Wash., Code ch.

4.18. Following the Supreme Court’s decision in City

of Richmond v. J.A. Croson Co., 488 U.S. 469 (1989), King

County amended the MWBE program in an effort to

comply with the dictates of Croson. See King County,

Wash., Ordinance 8937 (May 1, 1989). It is under this

amended version of the ordinance that the events at

issue here transpired.’

Under the County’s program as amended, a

"minority business" is one certified by the State of

Washington as being legitimately owned and con-

trolled by a minority person or persons. King County,

' Minority-owned and women-owned businesses are

referred to collectively as "MWBEs."

Contracts coming within the program’s purview

include architectural and engineering contracts, concession

contracts, construction contracts, consultant contracts, and

purchasing and service contracts. See King County, Wash.

Code ch. 4.18.030.

As will be noted later, the ordinance was again

amended on August 29, 1990. Unless otherwise specified,

references to the county ordinance are to the pre-1990

version of the ordinance.

Wash., Code §§ 4.18.010(S). The term "minority"

includes blacks, Hispanics, Asian-Americans, American

Indians, and Alaskan natives. Id. at § 4.18.010(T). A

"women’s business” similarly must be certified by the

state. Id. at § 4.18.010(HH).

The MWBE program provides two methods by

which MWBEs may receive preferences in bidding on

county contracts. For county contracts of $10,000 or

less, the "percentage preference method" gives a

contract bidder who is an MWBE or will use MWBEs

on the project a preference if its bid is within five

percent of the lowest bid. See id. at § 4.18.060(A)(1).

For county contracts of more than $10,000, the

"subcontractor set-aside method" applies, under which

the successful contractor must use MWBEs for a

prescribed percentage of the work performed on the

contract. See id. at § 4.18.060(A)(2). The actual

percentages of required MWBE participation are

individually determined on an ad hoc basis, according

to the availability of qualified MWBEs. See id. at

§ 4.18.060(A)(2)(a).

The program permits a reduction in the amount

of set-aside levels for a given contract if it is not

feasible to meet higher levels, qualified MWBEs are

unavailable, or MWBE price quotes are not

competitive. See 1d. at § 4.18.060(B). Likewise, the

percentage preference method can be used for county

contracts exceeding $10,000 if this alternative is a

"more feasible method of achieving” the MWBE

utilization goal. Id. at § 4.18.060(C). Finally, in certain

alata

circumstances, all or portions of the MWBE program

may be waived entirely. See id. at § 4.18.070(A)

(waiver available where a non-MWBE is the sole

source of a good or service, where no MWBE is

available or competitively priced, and where the

contract is awarded to certain governments or non-

profit groups).

On September 28, 1989, bids were opened for a

county contract to install guardrails along various

county roads. Coral Construction Company ("Coral

Construction"), an Oregon firm with a branch office

in King County, was the low bidder at $178,100.

However, utilizing the "percentage preference

method," the County awarded the contract to Dirt &

Aggregate Interchange, Inc. ("Dirt & Aggregate"), an

Oregon-based MBE which submitted a bid of

$185,153.50. Thereafter, Coral Construction and the

Oregon-Columbia chapter of the Associated General

Contractors of America, Inc. ("OCAGC"), brought this

suit in the United States District Court for the Western

District of Washington, alleging that King County’s

MWBE program, on its face and as applied to Coral

Construction, violated the Constitution’s equal

protection clause and federal civil rights statutes, 42

U.S.C. §§ 1981 & 1983. Plaintiffs requested damages,

injunctive and declaratory relief, and attorney’s fees.

In the district court, both sides filed cross-motions

for summary judgment pursuant to Rule 56 of the

Federal Rules of Civil Procedure, each asserting that

no disputed facts existed. On December 4, 1989, the

district court granted King County’s motion for

summary judgment and denied the motion of Coral

Construction and OCAGC. See Coral Construction Co.

v. King County, 729 F Supp 734 (W.D. Wash. 1989).

The court concluded that King County’s MWBE

program was constitutional because the County had

compiled a_ sufficient record of redressable

discrimination against minorities and women, and had

narrowly tailored its remedial measures.

Notwithstanding its victory in the district court,

King County amended its MWBE program yet again.

See King County, Wash., Ordinance 9609 (August 29,

1990). Specifically, the amendments, ‘enacted on

August 2%, 1990, incorporated two consultant reports

into the record underlying the MWBE program. The

first study, prepared by Perkins Coie (and hereinafter

referred to as the Perkins Coie Consultant Study),

documents through statistics and anecdotal evidence

the impact of discrimination in the local construction,

architecture, and engineering fields. The second

study, conducted by the Washington Consultant

Group, focused on discrimination in the local goods

and services industries. The two studies cost

approximately $411,000 and were paid for by several

local agencies. King County contributed $95,000.

The mechanics of the MWBE program were also

altered by the August 29, 1990 amendments. The

"percentage preference’ method for allocating set-

asides was modified; rather than using a fixed five-

percent preference, a flexible-percentage preference

iain aerate

was employed, the percentage to be determined on a

case-by-case basis. In addition, under the amended

version of the program, all prime contractors, even

those that are themselves women- or minority-owned,

are required to employ minority- and women-owned

subcontractors, unless the prime contractor itself will

perform twenty-five percent or more of the contract.

Finally, the new ordinance requires the County’s

Office of Civil Rights and Compliance to monitor the

effects of the MWBE program to ensure that it does

not disproportionately favor a particular racial or

ethnic group, and that it does not remain in force

longer than is necessary to offset the effects of prior

discrimination.

Coral Construction and OCAGC* appeal the

district court’s grant of summary judgment for King

County. King County has moved for partial dismissal

of this appeal, asserting that the plaintiffs’ request for

injunctive and declaratory relief is now moot as a

result of the August 1990 amendments.

The district court had subject matter jurisdiction

to hear this matter under 28 U.S.C. §§ 1331, 1343(a)(3),

and 1343(a)(4). This court has jurisdiction under 28

U.S.C. § 1291. We review a grant of summary

judgment de novo. See Columbia Pictures Indus. v.

Professional Real Estate Investors, Inc., 866 F.2d 278, 279

(9th Cir. 1989).

* Hereinafter the two plaintiffs will be referred to

collectively as "Coral Construction."

We begin by examining the minority set-aside

(MBE) component of King County’s program. Coral

Construction seeks damages, as well as injunctive and

declaratory relief. To determine if Coral Construction

is entitled to damages, we must review the ordinance

as it existed at the time of Coral Construction’s

purported injury. Accordingly, we review the MBE

program as amended on May 1, 1989, but prior to the

August 29, 1990 amendments, for all purposes.

In Croson, the Supreme Court definitively decided

that a governmental actor’s use of racial classifications,

including classifications that appear to be facially

benign, are subject to strict judicial scrutiny. Croson,

488 U.S. at 493 (plurality); id. at 520 (Scalia, J.,

concurring);’ See also Cone Corp. v. Hillsborough

County, 908 F.2d 908, 913 (11th Cir.) (hereinafter

Hillsborough County) ("When reviewing the

constitutionality of [an MBE], courts apply strict

> The number of Justices joining Justice O’Connor’s

opinion in Croson varied from part to part. Five Justices

joined parts I, IIIB, and IV of the opinion; hereinafter, these

sections shall be designated as “majority.” Justice

O’Connor garnered four Justices for parts IIIA and V; these

sections shall be referred to as "plurality." Finally, three

Justices joined part II oi the opinion; citation to this part of

the opinion shall so reflect.

scrutiny,” citing Croson), cert. denied, 111 S. Ct. 516

(1990). Such strict scrutiny, in turn, has two elements:

for an affirmative action program to survive such

scrutiny, there must be a compelling governmental

interest in employing a racial classification, and the

classification must be narrowly tailored to achieve the

compelling interest. Croson, 488 U.S. at 493-94; see also

Wygant v. Jackson Bd. of Educ., 476 U.S. 267, 274 (1986)

(plurality).

Tne Croson Court applied the strict scrutiny test

to an MBE program very similar in purpose to that

enacted by King County. Thus, the conclusions in

Croson are dispositive as to many aspects of the King

County program. There are, however, important

substantive differences between the two programs.

The Croson Court ruled upon a minority set-aside

program that expired by its own terms months before

its constitutionality was even argued in the Supreme

Court. As a result of Croson’s static posture, the

Supreme Court failed to address many of the

procedural accoutrements that necessarily accompany

strict scrutiny review of such programs, particularly

those programs, such as we are faced with here,

whose vitality remains during the pendency of the

judicial process. We shall review the merits of King

County’s MBE program with these- differences in

mind.

We begin with the "compelling government

interest" component of the strict scrutiny test.

The Croson Court identified several factors

suggesting the existence of a compelling governmental

interest. First, a set-aside program is valid only if

actual, identifiable discrimination has occurred within

the local industry affected by the program. "A

governmental actor cannot render race a legitimate

proxy for a particular condition merely by declaring

that the condition exists." Croson, 488 U.S. at 499-501.

Second, the governmental actor enacting the set-

aside program must have somehow perpetuated the

discrimination to be remedied by the program.

However, the governmental actor need not be an

active perpetrator of such discrimination; passive

participation will satisfy this sub-part of strict scrutiny

review. See id. at 492 (O’Connor, J., joined by

Rehnquist, C.J., and White, J.). Mere infusion of tax

dollars into a discriminatery industry may be sufficient

governmental involvement to satisfy this prong. See

id. ("It is beyond dispute that any public entity, state

or federal, has a compelling interest in assuring that

public dollars, drawn from the tax contributions of all

citizens, do not serve to finance the evil of private

prejudice.").°

As a threshold matter, Coral Construction

contests King County’s use of, and the district court’s

reliance upon, information compiled by the City of

Seattle, the Port of Seattle, the Municipality of

Metropolitan Seattle ("Metro"), and Pierce County,

Washington. In Croson, the Supreme Court declared:

"We have never approved the extrapolation of

discrimination in one jurisdiction from the experience

of another." 488 U.S. at 505. This prohibition, Coral

Construction reasons, requires the County to compile

the record on its own; any sharing of data is strictly

prohibited.

Resolution of this case requires a more searching

inquiry into the reasons underlying the Supreme

Court’s statement. Data sharing presents the risk that

data of "societal discrimination" will become the

factual basis for an MBE program. This is

* In Associated General Contractors v. City and County

of San Francisco, 813 F.2d 922 (9th Cir. 1987), we held that

"[a]t a minimum, the state or local government must be

acting to remedy government-imposed discrimination,

perpetuated by it or by one of its departments or

divisions." Id. at 930 (footnote omitted). We agree with

the district court that Croson implicitly overruled - or, at

the very least, construed broadly - this portion of

Associated General Contractors. See 729 F. Supp. at 737-38.

impermissible. See id. at 496-97 (plurality) (societal

discrimination alone cannot justify race-conscious

programs); td. at 526 (Scalia, J., concurring in the

judgment). Similarly, race-conscious programs must

be designed to minimize - if not avoid - burdens upon

nonculpable third parties. See United States v. Paradise,

480 U.S. 149, 183 (1987) (plurality) (race-conscious

decree "does not disproportionately harm the interests,

or unnecessarily trammel the rights, of innocent

individuals"). If an MBE program is based on outside

data, it is possible that innocent third parties -

residents of the jurisdiction covered by the program

but not shown to have engaged in discriminatory

activity - might be unnecessarily burdened.

Here, the City of Seattle, Port of Seattle, and

Metro are either completely within or coterminous

with the boundaries of King County. The data from

these jurisdiction’ is, almost by definition, relevant to

the question of discrimination within the County.

Likewise, the risk of unfairly burdening innocent third

parties is not present. Accordingly, the data from

these three jurisdictions was properly considered by

both the County and the district court.

In contrast, Pierce County is a completely

separate jurisdiction from King County. _ It is,

however, immediately adjacent to King County and is

part of the same metropolitan area. Likewise, the

world of contracting does not conform itself neatly to

jurisdictional boundaries. In this regard, contracting

differs markedly from a school system, which conducts

its business in relative isolation from other school

systems. Cf. Milliken v. Bradley, 418 U.S. 717 (1974).

For these reasons, amici National Association for the

Advancement of Colored People and the Northwest

Women’s Law Center argue that evidence of discrimi-

nation in Pierce County is indeed probative of

discrimination within King County.

It is true that the Pierce County data has some

probative value regarding discrimination within King

County. Conversely, much of it is irrelevant. While

some Pierce County developers and _ contractors

undoubtedly seek business in both jurisdictions, many

would not. It is vital that a race-conscious program

align itself as closely to the scope of the problem

legitimately sought to be rectified by the

governmental entity. To prevent overbreadth, the

enacting jurisdiction should limit its factual inquiry to

the presence of discrimination within its own

boundaries. Given the risk of unnecessary overlap,

the district court properly excluded the Pierce County

data from consideration.

(a)

With or without the Pierce County data, Coral

Construction contends that the record is insufficient to

support King County’s program. Undeniably, the

record in the present case is considerably more

extensive than that compiled by the Richmond City

—

Council in Croson. In particular, the 700-plus page

record contains the affidavits of at least 57 minority or

women contractors, each of whom complains in

varying degree of specificity about discrimination

within the local construction industry. The affiants

reflect a broad spectrum of the _ contracting

community; the breakdown is roughly as follows:

Black Contractors 23

Hispanic Contractors 13

Asian Contractors 10

Native American Contractors 6

Women Contractors’ 3

Other’ 2

These affidavits certainly suggests that ongoing

discrimination may be occurring in much of the King

County business community. Many complain of being

unable to obtain contracts for private sector work.

Barbara H. Pool, president of Seaway Construction

The record contains far more than three affiants

from women-owned contractors; however, many of the

other women were also minority, and attributed any

hostility to race-based factors.

* One individual hailed from the country of India,

and another identified himself only as a "minority."

Inc. in Seattle, testified: "I believe the refusal of prime

contractors, developers and architects to award

contracts to my business for private sector work is due

to discrimination against minority persons and

minority-owned businesses generally." Likewise,

David A. Zuluaga, president of D.A. Zuluaga

Construction Inc. in Seattle, wrote:

"I have tried repeatedly in

the past to obtain contracts and

subcontracts on private construc-

tion contracts and have been

- unsuccessful. I know from my

eleven years of experience in the

construction industry that my

businesses's prices are competitive

with nonminority businesses’

prices and that my _ business

performs as high quality work as

nonminority businesses. None-

theless, when I have submitted

bids to prime contractors for work

on private projects or when |

have attempted to negotiate

contracts with these persons, |

have been refused the right to

participate in the projects."

The complaints extend to subcontracting awards

on public projects. Mark W. Robison, president of

Robison Construction Inc. in Auburn, Washington,

averred: "We recently were in line to receive the site

work contract for the King County Goodwill Games

Pool Project, and were bypassed for a non-minority

firm when King County relaxed their requirements for

sgremmeneneesnanmnncet

MBE participation." Similarly, Charles D. de

Montigny, president of de Montigny Engineers Inc.,

declared that he has heard comments like "[t]here is

no minority requirement on this project, so we are

going to use someone else."”

Notably absent from the record, however, is any

statistical data in support of the County’s MBE

program. The Supreme Court has suggested on

several occasions that a statistical comparison is an

invaluable tool with which to evaluate an affirmative

action program. In _ International Brotherhood of

Teamsters v. United States, 431 U.S. 324 (1977), the

Court stated: |

{O]ur cases make it unmistakably

clear that statistical analyses have

served and will continue to serve

an important role in cases in

which the existence of discrimina-

tion is a disputed issue. We have

repeatedly approved the use of

statistical proof, where it reached

proportions comparable to those

* It is worthy of note that the MBE program may be

having some of its desired effects. Mr. de Montigny

averred:

There is a general perception that minority firms

don’t really know what they are doing. How-

ever, the MBE set-asides have made some

progress in that area. I have had some repeat

customers as a result of my first contract being

a minority set-aside.

in this case, to establish a prima

facie case of racial discrimination

in jury selection cases. Statistics

are equally competent in proving

employment discrimination.

Id. at 339 (citations, quotation, and footnote omitted).

Indeed, the Court has held that, for purposes of Title

VII, ‘[w]here gross statistical disparities can be shown,

they alone may in a proper case constitute prima facie

proof of a pattern or practice of discrimination."

Hazelwood School Dist. v. United States, 433 U.S. 299,

307-08 (1977); see also Croson, 488 U.S. at 501 (same,

quoting Hazelwood). In decisions since International

Brotherhood and Hazelwood, the Supreme Court has

focused its attention on delineating the proper

methods for interpreting statistical data. See, e.g,,

Bazemore v. Friday, 478 U.S. 385, 400 (1986) (holding

that, as a general rule, the failure to include variables

in a regression analysis affects only the probativeness

of the analysis, not its admissibility); Johnson v.

Transportation Agency, 480 U.S. 616, 632 (1987) (holding

that where a job requires special training, appropriate

statistical comparison should be with those in the

labor force who possess the necessary qualifications);

Wards Cove Packing Co. v. Atonio, 490 U.S. 642, 650-51

(1989) (holding that the proper statistical analysis is

between the racial composition of qualified persons in

the labor market and the persons holding the jobs at

issue).

Of course, statistics, standing alone, must be

analyzed carefully. See Forsberg v. Pacific Northwest

Bell Tel. Co., 840 F.2d 1409, 1418 (9th Cir. 1988). In

~ International Brotherhood, the Supreme Court warned:

"[S]tatistics are not irrefutable; they come in infinite

variety and, like any other kind of evidence, they may

be rebutted. In short, their usefulness depends on all

of the surrounding facts and circumstances." 431 U.S.

at 340. Statistical evidence often does not fully

account for the complex factors and motivations

guiding employment decisions, many of which may

be entirely race-neutral. Cf Penk v. Oregon State Bd. of

Higher Educ., 816 F.2d 458, 464-65 (9th Cir.), cert dented,

484 U.S. 853 (1987).

Unlike the cases resting exclusively upon

Statistical deviations to prove an equal protection

violation, the record here contains a plethora of

anecdotal evidence. However, anecdotal evidence,

standing alone, suffers the same flaws as statistical

evidence. Indeed, anecdotal evidence may even be

less probative than statistical evidence in the context

of proving discriminatory patterns or practices. While

anecdotal evidence may suffice to prove individual

claims of discrimination, rarely, if ever, can such

evidence show a systemic pattern of discrimination

necessary for the adoption of an affirmative action

plan. See Penk, 816 F.2d at 463-64.

Nonetheless, the combination of convincing

anecdotal and statistical evidence is potent. In

International Brotherhood, the Court conceded for

purposes of argument that "statistics alone" could not

support the finding of discrimination, but observed

that "[t]he individuals who testified about their

personal experiences with the company brought the

cold numbers convincingly to life." 431 U.S. at 339.

Similarly, the Eleventh Circuit, in passing upon a

minority set-aside program similar to that here,

concluded: "The testimony regarding . . . complaints

[of discrimination], combined with the gross statistical

disparities uncovered by the County studies, provides

more than enough evidence on the question of prior

discrimination and need for racial classification to

justify the denial of a motion for summary judgment."

Hillsborough County, 908 F.2d 908 at 916.

Here, the MBE program cannot stand without a

proper statistical foundation. | Undoubtedly, the

written testimony of the numerous affiants suggests

that there may be a systemic discrimination within

the King County construction industry. Without a

statistical foundation, the picture is incomplete. Strict

scrutiny demands a fuller story. Not enough has

been told so far to meet King County’s burden that

its program passes the "compelling governmental

interest” requirement.

(b)

King County contends that any deficiencies in

the record, such as the lack of a statistical foundation,

have been remedied by post-enactment studies.

Specifically, King County urges us to consider the

Perkins Coie Consultant Study completed in January

1990." In addition, as an exhibit to its motion for

partial dismissal on mootness grounds, King County

attached a second consultant study prepared by the

Washington Consulting Group and released in July

1990, although the County does not otherwise urge

this study upon us. Coral Construction, on ihe other

hand, contends that neither this court nor the district

court should consider any post-enactment data

purportedly supporting the MBE program.

Whether post-enactment studies may be

considered in reviewing an MBE program is not

simply a matter of appellate procedure but rather

implicates the core of the pertinent equal protection

analysis. The Croson Court noted that "a generalized

assertion that there has been past discrimination in an

entire industry provides no guidance for a legislative

body to determine the precise scope of the injury it

seeks to remedy.” Croson, 488 U.S. at 498 (majority).

Similarly, we have observed that "[bJefore [a] city

[may] embark[{ ] on an affirmative action program, it

must have convincing evidence that remedial action is

warranted.” Associated General Contractors v. City and

County of San Francisco, 813 F.2d 922, 932 (9th Cir.

1987). Relying on these statements, Coral

Construction reasons that any post-enactment data is

The study was submitted to the district court four

days prior to the hearing on the parties’ cross-motions for

summary judgment. The court expressly did not consider

the study in upholding King County’s program. 729 F

Supp. at 737 n.4.

iii ell

simply irrelevant. In so arguing, however, Coral

Construction has collapsed two entirely independent

inquiries into one.

It is true that a municipality must have some

concrete evidence of discrimination in a particular

industry before it may adopt a remedial program. See

id.; see also Croson, 488 U.S. at 509 (plurality) ("If the

city of Richmond had evidence before it that non-

minority contractors were systematically excluding

minority businesses from subcontracting opportunities,

it could take action to end the discriminatory

exclusion.”). Race-based classifications must be

reserved strictly for remedial settings. Croson, 488 U.S.

at 493 (plurality); 1d. at 524 (Scalia, J., concurring in

the judgment). Without any evidence of discrimina-

tion, it cannot be fairly said that the state is seeking

to "remedy" a problem. Moreover, the benign nature

of the classification is questionable where no evidence

of discrimination has been adduced. Cf. id. at 493-96

(plurality). Thus, any program adopted without some

legitimate evidence of discrimination is presumptively

invalid.

However, this requirement of some evidence

does not mean that a program will be automatically

struck down if the evidence before the municipality at

the time of enactment does not completely fulfill both

prongs of the strict scrutiny test. Rather, the factual

predicate for the program should be evaluated based

upon all evidence presented to the district court,

ea eae a

whether such evidence was adduced before or after

enactment of the MBE.

This rule - that a municipality have before it

some evidence of discrimination before adopting a

race-conscious program, while allowing post-adoption

evidence to be considered in passing on the constitu-

tionality of the program - is not a facile legal distinc-

tion. Rather, this rule recognizes the seemingly

conflicting demands sometimes placed upon a state or

municipality by the Constitution. "[T]he State has the

power to eradicate racial discrimination and its effects

in both the public and private sectors, and the

absolute duty to do so where those wrongs were

caused intentionally by the State itself.” Jd. at 518

(Kennedy, J., concurring) (emphasis added); see also

Associated General Contractors, 813 F.2d at 929 ("a state

or its political subdivision has the authority - indeed

the constitutional duty - to ascertain whether it is

denying its citizens equal protection of the laws and,

if so, to take corrective steps") (emphasis in original;

quotation and citations omitted). The remedy for

intentional discrimination often calls for race-specific

relief. See United States v. Paradise, 480 U.S. 149, 166

(1987) (plurality) ("It is now well established that

governmental bodies, including courts, may

constitutionally employ racial classifications essential

to remedy unlawful treatment of racial or ethnic

groups subject to discrimination."); Croson, 488 U.S. at

524 (Scalia, J., concurring in the judgment). A state or

municipality, when presented with evidence of its

own culpability in fostering or furthering race

discrimination, might well be remiss if it failed to act

upon such evidence. Thus, a municipality having

such evidence would face the dilemma of decidir?

whether to wait the months necessary for further

development of the record, risking constitutional

culpability due to its inaction, or to act and to risk

liability for acting prematurely but otherwise

justifiably. The rule we articulate today lessens the

likelihood of such dilemmas.

This rule also comports with the Supreme

Court's analysis set forth in Village of Arlington Heights

v. Metropolitan Housing Development Corp., 429 U.S. 252,

270 n.21 (1977) and Mount Healthy City School Dist. v.

Doyle, 429 U.S. 274, 285-86 (1977). In Arlington Heights,

the Court concluded that proof that a zoning

Ordinance was motivated in part by a racially-

discriminatory purpose would not necessarily require

invalidation of the ordinance. Rather, such proof

merely shifted the burden to the municipality to show

that it would have enacted the “ordinance in the

absence of the improper purpose.” 429 U.S. at “270

n.21. Likewise, in Mount Healthy, the Court held that

a public employee fired for, inter alia, exercising his

First Amendment rights did not have a cause of

action for damages where the employer proved that

the employee would have been terminated anyway.

429 U.S. at 285-86. Here, our analysis is similar; we

will not invalidate ar MBE program due to an

inadequate record where an adequate factual

predicate is subsequently proven.

A race-conscious remedy without a race-based

injury is constitutionally infirm. Croson, 488 U.S. at

499-502 (majority). For this reason, a remedy without

any evidence of a violation is presumptively void.

However, where a state has a good faith reason to

believe that systemic discrimination has occurred, and

is continuing to occur, in a local industry, we will not

strike down the program for inadequacy of the record

if subsequent factfinding bears out the need for the

program. In other words, a plan will not be

invalidated solely because the record at time of

enactment did not measure up to constitutional

standards.”

(Cc)

Alternatively, Coral Construction argues that

even if the consulting studies are relevant, this court

should not consider them in the first instance.

Rather, Coral Construction contends that it should

first be given an opportunity to challenge the studies

in the district court.

This point is well taken. As previously noted,

Statistics are not irrefutable, and may be rebutted. See

International Brotherhood, 431 U.S. at 340. Such rebuttal

Of course, the municipality that adopts such a

program without a complete record bears the risk that a

fuller development of the facts will not support the need

for the program, or that the program might not be

narrowly tailored

comes in two guises. First, rebuttal evidence may

consist of a neutral explanation for the statistical

disparities. See Penk, 816 F.2d at 464. Also, the

rebutting party may wish to attack the statistics

themselves. This may be accomplished 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. Jd. Coral

Construction should have "its day in court" and the

opportunity to attempt such a rebuttal. It would be

inappropriate to consider the consultant studies for

the first time on appeal. Since Coral Construction has

not yet been accorded its opportunity for rebuttal

before the trier of fact, we must reverse the grant of

summary judgment to King County as to the MBE

program.

We, therefore, remand this matter to the district

court for determination of whether the consultant

studies provide adequate factual justification to

establish a "compelling government interest” for King

County’s adopting the MBE program.

Coral Construction maintains that even if

discrimination does exist within the King County

business community, there is insufficient evidence of

governmental involvement to warrant an MBE

program. We disagree. Croson does not require a

showing of active discrimination by the enacting

agency; passive participation, such as the infusion of

tax dollars into a discriminatory industry, suffices.

Croson, 488 U.S. at 492 (O’Connor, J., joined by

Rehnquist, C.J., and White, J.) ("It is beyond dispute

that any public entity, state or federal, has a

compelling interest in assuring that public dollars,

drawn from the tax contributions of all citizens, do

not serve to finance the evil of private prejudice."). In

fact, the Croson Court concluded: "If the city of

Richmond had evidence before it that non-minority

contractors were systematically excluding minority

businesses from subcontracting opportunities it could

take action to end the discriminatory exclusion.” 1d.

at 509 (plurality). Here - assuming that the record

adequately supports a_ finding of systemic

discrimination - the County has adequately limited its

program to those businesses that receive tax doliars;

indeed, the program imposes obligations upon only

those businesses which voluntarily seek King County

tax dollars by contracting with the County.

We turr next to the "narrow tailoring” prong of

strict scrutiny review. We note at the outset that our

analysis will necessarily be limited, given that the

factual predicate for the program has not been fully

developed or litigated before the district court.

However, since Coral Construction may be entitled to

judgment if the MBE program is constitutionally

infirm in any manner, we shall conduct a_ brief

examination of the program to determine if the

program is flawed even before resort to the record is

necessary.

The Supreme Court has identified several

characteristics of a set-aside program which would

suggest that a program was adequately restricted to

remedying only prior discrimination within the

jurisdiction. First, an MBE program should be

instituted either after, or in conjunction with, race-

neutral means of increasing minority business

participation in public contracting. Id. at 507

(majority). The second characteristic of a narrowly-

tailored program is the use of minority utilization

goals set on a case-by-case basis, rather than upon a

system of rigid numerical quotas. See id. at 507-08

(majority). Finally, an MBE program must be limited

in its effective scope to the boundaries of the enacting

jurisdiction. See id. at 491-92 (O’Connor, J., joined by

Rehnquist, C.J., and White, J.). Each of these

characteristics will be considered in turn.

Among the various’ narrow _ tailoring

requirements, there is no doubt that consideration of

race-neutral alternatives is among the most important.

The reasons for this are numerous. First, race-neutral

alternatives enable government to increase minority

participation in an affected industry without a

corresponding stigma. Id. at 493 (plurality)

("Classifications based on race carry a danger of

stigmatic harm. Unless they are strictly reserved for

remedial settings, they may in fact promote notions of

racial inferiority and lead to a politics of racial

hostility."); id. at 516-17 (Stevens, J., concurring)

("Although [a race-based affirmative action program]

stigmatizes the disadvantaged class with the unproven

charge of past racial discrimination, it actually

imposes a_ greater stigma on_ its supposed

beneficiaries."). Many of the barriers to minority

business participation are the product of factors other

than race.” While there can be no doubt that one

reason that minority-owned and operated construction

firms tend to be less established than non-minority

Owned or operated firms is prior society-wide

discrimination, many of the problems caused by the

relative youth of minority-owned firms can _ be

resolved without resorting to stigmatizing and

fractionalizing racial classifications.

Likewise, a _ well-conceived race-neutral

alternative ensures that the minority beneficiaries of

the program are more likely to be the true victims of

discrimination; such a program prevents a_ race-

conscious program that merely acts as a windfall to

previously established minority firms. See id. at 508

In fact, many of the barriers facing minority

businesses are typical of those facing any entrepreneur

whose business is in its infancy. We note in passing that

to the extent that the sole barrier to minority business

participation is that faced by all new businesses, regardless

of ownership, an MBE program cannot stand. Only upon

showing of actual discrimination may a_ state or

municipality enact a race-based remedial program.

(majority) ("Under Richmond’s scheme, a successful

black, Hispanic, or Oriental entrepreneur from

anywhere in the country enjoys an_ absolute

preference over other citizens based solely on their

race.").

Nevertheless, while strict scrutiny requires

serious, good faith consideration of race-neutral

alternatives, strict scrutiny does not require exhaustion

of every possible such alternative. We stated in

Associated General Contractors that "[WJe . . . read the

admonition that only a ‘limited and properly tailored

remedy’ may be adopted as requiring exhaustion of

more neutral measures before resorting to race-

conscious ones." 813 F.2d at 939 (citation and

footnote omitted). However, we did not intend that

a government entity exhaust every alternative,

however irrational, costly, unreasonable, and unlikely

to succeed such alternative might be. Indeed, the

footnote immediately following this statement

suggests that some degree of practicality is subsumed

in the exhaustion requirement: "The [Human Rights

Commission] report suggests that race-neutral

measures can be effective. ... Such measures also

appear to be working well in Santa Clara, a

community near San Francisco." Id. at 939 n.36.

Thus, Associated General Contractors requires only that

a state exhaust race-neutral measures that the state is

authorized to enact, and that have a _ reasonable

possibility of being effective. Here, the record reveals

that the County considered alternatives, but

determined that they were not available as a matter

of law. See Rev. Code of Wash. § 39.08.015 (restricting

ability of counties to avoid bonding requirements);

Wash. Const., art. 8, sec. 7 (prohibiting county or city

from extending credit to businesses). The County

cannot be required to engage in conduct that may be

illegal; nor can it be compelled to expend precious tax

dollars on projects where potential for success is

marginal at best.”

Moreover, the record shows that King County

has adopted some race-neutral measures in

conjunction with the MBE program. For example, the

County annually hosts one or two training sessions

for small businesses, covering such topics as doing

business with the government, small business

management, and accounting techniques. In addition,

the County provides information on accessing small

business assistance programs. Inclusion of such race-

neutral measures is one factor suggesting that an

MBE plan is narrowly tailored. See Hillsborough

County, 908 F.2d at 916 n.i1 ("While the Croson Court

referred to these measures as alternatives to MBE

plans, inclusion of such measures in an MBE plan

would lend to the plan’s flexibility.”). King County

Coral Construction faults King County for failing

to lobby the state legislature to amend or repeal section

39.08.015. This criticism is meritless. A legislative entity

considering an MBE program is only required to exhaust

race-neutral alternatives that are legitimately within the

authority of the entity to enact. Pieading with superior

legislative bodies for expanded authority is not such a

required alternative.

has fulfilled its burden of considering race-neutral

alternative programs.

A second indicator of a program’s narrow

tailoring is program flexibility. An important means

of achieving such flexibility is through use of case-

by-case utilization goals, rather than rigid numerical

quotas or goals. See Croson, 488 U.S. at 507-08

(majority); see also Hillsborough County, 908 F.2d at

916-17. The Richmond program was fatally flawed

because of its use of a rigid 30% quota for each city

contract. See Croson, 488 U.S. at 507. Such a quota

"rests upon the ‘completely unrealistic’ assumption

that minorities will choose a particular trade in

lockstep proportion to their representation in the local

population.” Jd. Case-by-case utilization goals are,

however, "less problematic from an equal protection

standpoint because they treat all candidates

individually, rather than making the color of an

applicant’s skin the sole relevant consideration.” 1d. at

508. Moreover, such individualized procedures insure

that the beneficiaries of such preferential treatment

are those "who truly have suffered the effects of prior

discrimination.” Jd. Minority set-aside programs are

not to be windfalls for otherwise successful minority

contractors who have either overcome or otherwise

- not felt the sting of discrimination in the relevant

locality.

In this respect, King County’s program does not

suffer from the rigidity that plagued the Richmond

program. Under the "set-aside" method, the

prescribed percentage of MBE — subcontractor

participation is determined individually on each

contract according to the availability of qualified

MBEs. See King County, Wash. Code

§ 4.18.060(A)(2)(a). The "percentage preference”

method, used predominantly for contracts under

$10,000, is simply not a quota, as no MBE will receive

the relevant contract if its bid is not within the

prescribed preference. While the preference is locked

at five percent, such a fixed preference is not unduly

rigid, particularly in light of the waiver provisions

discussed below.

A valid MBE program should include a waiver

system that accounts for both the availability of

qualified MBEs and whether the qualified MBEs have

suffered from the effects of past discrimination by the

County or_prime contractors. See Croson, 488 U.S. at

508. King County’s program provides for waivers in

both instances. See King County, Wash., Code

§ 4.18.070(A)(3) (waiver available where "neither a

minority nor a women’s business is available to

provide needed goods or services"); Id. at

§ 4.18.070(A)(5) (waiver available "[w]hen available

minority and/or women’s businesses have given price

quotes which are unreasonably high in that they

exceed competitive levels beyond amounts which can

be attributed to cover costs inflated by the present

effects of discrimination’).

Similarly, in Hillsborough County, the Eleventh

Circuit identified several other attributes of a

narrowly tailored and flexible MBE. See 908 F.2d at

916-17. First, no goal could ever exceed fifty percent

MBE participation. Id. Second, a low bidder who

does not meet plan goals may nonetheless be

awarded the contract by demonstrating a good faith

effort to comply. /d. Finally, a low bidder may still

receive a contract, even in the absence of good faith

efforts to comply, if the next lowest bid is either

$100,000 or fifteen percent higher than the low bid.

Id.

King County’s program mirrors that of

Hillsborough County in many respects. As in

Hillsborough County, not only are the actual

percentages of required MBE participation determined

on a case-by-case basis, but set-aside levels may be

further reduced if the prescribed levels are not

feasible, if qualified MBEs are unavailable, or if MBE

price quotes are not competitive. King County, Wash.

Code § 4.18.060(B). Complete waiver of set-aside

requirements is permitted if a tton-MBE is the sole

source of a good or service, or if no MBE is otherwise

available or competitively priced. /d. at § 4 3.070.

Finally, when the preference method is employed, a

non-MBE will be awarded the contract if it is the

lowest bidder and no MBE is within five percent of

the low bid. Id. at § 4.18.060(A)(1). King County’s

MBE program is not facially unconstitutional for want

of flexibility.

An MBE program must also be limited in its

geographical scope to the boundaries of the enacting

jurisdiction. "[A] state or local subdivision (if

delegated the authority from the State) has the

authority to eradicate the effects of private discrimina-

tion within its own legislative jurisdiction." Croson,

488 U.S. at 491-92 (O’Connor, J., joined by Rehnquist,

C.J., and White, J.); cf. id. at 524 (Scalia, J., concurring

in the judgment) ("In my view there is only one

circumstance in which the States may act by race to

‘undo the effects of past discrimination’: where that

is necessary to eliminate their own maintenance of a

system of unlawful racial classification."). The task of

remedying society-wide discrimination _ rests

exclusively with Congress. See id. at 490; see also

Metro Broadcasting, Inc. v. FCC, 110 S. Ct. 2997, 3008

(1990); Milwaukee County Pavers Ass'n v. Fiedler, 922

F.2d 419, 423-24 (7th Cir.) ("The joint lesson of

Fullilove and Croson is that the federal government

can, by virtue of the enforcement clause of the

Fourteenth Amendment, engage in affirmative action

with a freer hand than states and municipalities can

do."), cert. denied, 111 S. Ct. 2261 (1991).

‘

King County’s MBE program fails this third

portion of the "narrow tailoring” requirement. The

program’s definition of "minority business" indicates

that a minority-owned business may qualify for

preferential treatment if the business has been

discriminated against "in the particular geographical

areas in which [it] operate{s].". See King County,

Wash., Code § 4.18.010(S). This definition is overly

broad. Since the County’s interest is limited to the

eradication of discrimination within King County, the

only question that the County may ask is whether a

business has been discriminated against in King

County.

Thus, in the case at bar, it is of no moment that

the successful bidder, Dirt & Aggregate, has its

principal place of business in Troutdale, Oregon. The

question is not one of business location, but of

business participation. Indeed, an MBE

headquartered in Seattle might not be eligible for

preferential treatment, whereas a similar business

located in Miami might. In order for an MBE to reap

the benefits of King County’s MBE program, it is

necessary to determine if the company has ever been

victimized by discrimination within King County.

This determination is not an insurmountable

burden for the County, as the rule does not require a

finding of specific instances of discriminatory

exclusion for each MBE. _ Rather, if the County

successfully proves malignant discrimination within

the King County business community, an MBE would

be presumptively eligible for relief if it had previously

sought to do business in the County." However, if

the MBE was a newcomer to King County, or

otherwise was untarnished by the systemic

discriminatory practices, then it may not benefit from

the MBE program. In other words, if systemic

discrimination in the County is shown, then it is fair

to presume that an MBE was victimized by the

discrimination. For the presumption to attach to the

MBE, however, it must be established that the MBE

is, or attempted to become, an active participant in

the County’s business community. Since King

County’s program permits MBE participation even by

MBEs who have no prior contact with King County,

the program is overbroad to that extent.”

The grant of summary judgment to King County

on the MBE program must be reversed on grounds of

overbreadth as well.

* We use the word ‘presumptively’ advisedly, tor we

do not wish to foreclose the possibility that the

presumption might be overcome in a proper Case.

- The majority in Croson did object to the Richmond

plan because, among other things, "there is no inquiry into

whether or not the particular MBE seeking a racial

preference has sufféred “from the effects of past

discrimination by the city or prime contractors.” 488 U.S.

at 508 (majority). However, we do not believe that the

Court meant to say that the inquiry must be more spec‘fic

than what we have outlined here

Having concluded that the MBE portion of the

King County program (as it stood in September 1989)

is constitutionally defective, at least in part, we must

next determine whether our conclusions entitle Coral

Construction to an award of damages. Coral

Construction has pleaded two claims upon which

such relief may be granted - 42 U.S.C. § 1981 and 42

U.S.C. § 1983. We consider each in turn, beginning

with Section 1983.

Section 1983 provides a private cause of action

for deprivations of federal rights under color of state

law. Meyerson v. State of Arizona, 709 F.2d 1235, 1238

(9th Cir. 1983), vacated on other grounds, 465 U.S. 1095

(1984). Section 1983 "was intended to create a species

of tort liability in favor of persons who are deprived

of rights, privileges, or immunities secured to them by

the Constitution.” Carey v. Piphus, 435 U.S. 247, 253

(1978) (quotations omitted). Actions taken pursuant to

a municipal ordinance are made "under color of state

law" sufficient to trigger potential liabilitv. See Monell

v. Department of Social Servs., 436 U.S. 658, 690 (1978).

Of particular import here is Section 1983's

causation requirement. [T]he basic purpose of a

§ 1983 damages award should be to compensate

persons for injuries caused by the deprivation of

constitutional rights..." Carey, 435 U.S. at 254.

"([Djamages are available under that section for

actions found to have been violative of constitutional

rights and to have caused compensable injury." Id. at 255

(emphasis in original; quotation omitted); see also

Mount Healthy City School Dist. v. Doyle, 429 U.S. 274,

285-86 (1977) (finding causation to be element of a

claim for wrongful termination based upon exercise of

First Amendment rights).

Here, our review of King County’s MBE program

must be inconclusive. We have identified one specific

provision of the program which is facially violative of

the equal protection clause: the scope of King

County’s program covers a broader geographic scope

than the County is authorized to consider.

Nonetheless, we cannot determine whether this

violation entitles Coral Construction to an award of

damages, as the record does not indicate whether

Coral Construction lost its bid to a business which

King County should not have considered.

Section 1981 provides, in part, that “[a]ll persons

within the jurisdiction of the United States shall have

the same right in every State and Territory to make

and enforce contracts... as is enjoyed by white

citizens.” Section 1981 differs from Section 1983 in

many important respects. First, Section 1981's

prohibitions extend to private citizens as well as to

state actors. See Runyon v. McCrary, 427 U.S. 160, 168

(1976). Moreover, section 1981 actually proscribes

certain conduct, whereas section 1983 is funda-

mentally a jurisdictional statute. In addition, section

1981 was founded upon the thirteenth, as well as the

fourteenth amendment, while the roots of section 1983

- are found exclusively in the fourteenth. See Jett v.

Dallas Independent School Dist., 491 U.S. 701, 721 (1989).

However, like Section 1983, section 1981 is by

nature a tort remedy. Al-Khazraji v. St. Francis College,

784 F.2d 505, 518 (3d Cir. 1986), aff'd on other grounds,

481 U.S. 604 (1987). Accordingly, it follows that

‘causation is also an element of a Section 1981 cause of

action. Even if Section 1981’s remedy is not perceived

as tort-like, we nonetheless have little hesitation in

finding a causation requirement in the statute. Rare

indeed is the civil rights remedy without such a

requirement. See, e.g., Mount Healthy City School Dist.

v. Doyle, 429 U.S. 274, 285-86 (1977) (in finding causa-

tion to be an essential part of a First Amendment

claim, Court observed that "[t]he constitutional

principle at stake is sufficiently vindicated if such an

employee is placed in no worse a position than if he

had not engaged in the conduct"); Yartzoff v. Thomas,

809 F.2d 1371, 1376 (9th Cir. 1987) (causation is part of

a prima facie Title VII case). Thus, as with its section

1983 claim for relief, Coral Construction must show a

causal link between the purported violation and its

injury to recover damages under section 1981.

Accordingly, the district court must resolve the

question of causation on remand.

A brief summary of our analysis and conclusions

to this point may be helpful here. We have

uncovered only one facial constitutional infirmity in

the MBE program as it stood in September 1989: the

program is geographically overbroad. However, we

cannot say whether this facial infirmity should enable

Coral Construction to recover damages, as the record

is inadequate at present to determine whether this

infirmity was the cause of Coral Construction’s harm.

Nor are we persuaded that there exists a suffici-

ently "compelling governmental interest" to justify

adoption of the County’s race-conscious program.

The record, as it existed in September 1989, does not

support a finding of systemic discrimination within

King County. Nonetheless, the subsequent consultant

studies may - or may not - support such a finding. If

the district court finds on remand that there was

systemic discrimination within the King County

business community, then the district court may go

on to consider any additional questions of "narrow

tailoring” that might arise from the expanded record.

II]

We turn next to Coral Construction’s request for

injunctive and declaratory relief regarding the MBE

program. This, of course, requires us to consider

King County’s motion for partial dismissal of this

appeal. King County contends that as a result of the

August 29, 1990, amendments to the MWBE program,

Coral Construction’s request for declaratory and

injunctive relief is moot. In opposition to King

County’s motion, Coral Construction claims that the

1990 amendments addressed only a few of its

numerous objections to the MWBE program, that the

amendments are in any event cosmetic, and finally,

that the amendments have not "completely and

irrevocably eradicated the effects" of the alleged

constitutional violation. See County of Los Angeles v.

Davis, 440 U.S. 625, 631 (1979) (case is moot if there is

no reasonable expectation that alleged violation will

recur, and interim relief or events have completely

and irrevocably eradicated the effects of the alleged

violation).

Ordinarily, a contention of mootness must be

resolved as a threshold matter, since the court would

lack jurisdiction to decide a moot case. See Koppers

Indus. v. EPA, 902 F.2d 756, 758 (9th Cir. 1990).

However, in cases involuing the amendment or repeal

of a statute or ordinance, mootness is “a matter

relating to the exercise rather than the existence of

judicial power." Carreras v. City of Anaheim, 768 F.2d

1039, 1047 (9th Cir. 1985) (quoting City of Mesquite v.

Aladdin's Castle, Inc., 455 U.S. 283, 289 (1982)). Simply

put, mootness here is not a jurisdictional issue; rather,

we may continue to exercise authority over a

~ purportedly moot case where the balance of interests

favors such continued authority.” The party moving

for dismissal on mootness grounds bears a heavy

burden. Halet v. Wend Investment Co., 672 F.2d 1305,

1308 (9th Cir. 1982). Moreover, voluntary cessation of

allegedly illegal conduct, standing alone, does not

necessarily render a case moot. See, e.g., City of

Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283, 289

(1982).

One factor to consider in deciding if a case is

moot as a result of subsequent statutory amendments

is whether the governmental entity is likely to reenact

the offending provision. See Barilla v. Ervin, 886 F.2d

1514, 1521 (9th Cir. 1989). However, even if the

government is unlikely to reena.t the provision, a

_ case is not easily mooted where ihe government is

otherwise unconstrained should °: later desire to

reenact the provision. See City of \..squite, 455 U.S. at

289 n.10 (quoting United States v. W.T. Grant Co., 345

U.S. 629, 632 (1953)). This principle is illustrated by

City of Mesquite and Carreras. In each of these two

That Coral Construction has sought damages does

not alter our analysis. Obviously, Coral Construction’s

request for damages remains a live controversy. Cf

Croson, 488 U.S. at 479 n.1 ("The expiration of the ordinance

has not rendered the controversy between the city and

Croson moot. There remains a live controversy between

the parties over whether Richmond’s refusal to award

Croson a contract pursuant to the ordiance was unlawful

and thus entitles Croson to damages."). Nonetheless,

damage claims may be parsed from requests for injunctive

or declaratory relief for purposes of mootness analysis. See

Wilson v. Nevada, 666 F.2d 378, 383 (9th Cir. 1982).

cases, the district court had enjoined, at least in part,

the challenged ordinance. Nonetheless, the Supreme

Court noted in City of Mesquite that the defendants

could "reenact[ ] precisely the same provision if the

District Court’s judgment were vacated," 1d. (footnote

omitted), even though in so doing the city would be

acting with the knowledge that its ordinance had

been previously enjoined. Here - unlike City of

Mesquite or Carreras - the district court approved of

the County’s ordinance. Thus, not only could the

County reenact its earlier ordinance, but it could do

so without the spectre of a prior finding of

unconstitutionality. This factor weighs against

mootness.

We thus decline to dismiss any part of this case

as moot. However, we also decline to address the

merits of Coral Construction’s arguments. Ordinarily,

when a plaintiff seeks to enjoin application of an

ordinance, statute or other law, we would review the

district court’s holding "in light of [the] law as it now

stands, not as it stood when the judgment below was

entered.” Diffenderfer v. Central Baptist Church, 404 U.S.

412, 414 (1972) (per curiam); see also Maryland

Highways Contractors Ass'n v. Maryland, 933 F.2d 1246,

1249 (4th Cir. 1991) (reviewing Maryland’s MBE

program as subsequently amended, citing Diffenderfer).

However, given the unique procedural posture of this

case, it would be premature to consider the present

version of the ordinance prior to a ruling on the

earlier version of the ordinance. We leave the

question of the amended program’s constitutionality

- and the corresponding question of the continued

necessity for injunctive or declaratory relief - to the

district court for determination on remand. See

Carreras, 768 F.2d at 1047 n.19.

Finally, we consider the gender-specific aspect

(WBE) of the set-aside program. We note in passing

that since the prior harm alleged by Coral

Construction was a result of the MBE aspect of the

MWBE program, rather than the WBE component, the

only relief sought by Coral Construction regarding

the WBE program is prospective or declaratory.

Accordingly, we consider the program as it presently

exists, rather than as it stood when the district court

entered judgment. See Diffenderfer, 404 U.S. at 414.

We first consider Coral Construction’s standing

to challenge the WBE program. King County has not

questioned the standing of either Coral Construction

or OCAGC to challenge the gender-based preference.

However, since standing is a jurisdictional issue, sé¢

Coakley v. Sunn, 895 F.2d 604, 606 (9th Cir. 1990), we

may consider it nostra sponte, see Air Line Pilots Ass'n,

Int’‘l v. Alaska Atrlines, Inc., 898 F.2d 1393, 1399 (9th

Cir. 1990); see also Donaghy v. City of Omaha, 933 F.2d

1448, 1455 (8th Cir. 1991) (federal courts are "under an

independent obligation” to establish whether a person

has standing to challenge an affirmative action

program).

Article Ill of the United States Constitution

requires that a plaintiff allege personal injury that is

fairly traceable to the defendant’s purportedly

unlawful conduct, and that the requested relief is

likely to redress the injury. Coakley, 895 F.2d at 606.

"That is, the litigant must allege a distinct and

palpable injury to himself; that the injury is somehow

directly linked to the challenged activity; and the

injury is One which is apt to be redressed by a

remedy that the court is prepared to give." Id. Here,

we consider whether Coral Construction has alleged

a “distinct and palpable injury." See generally Cone

Corp. v. Florida Dep’t of Transp., 921 F.2d 1190 (11th

Cir.) (hereinafter Department of Transportation)

(discussing injury element of standing as applied to a

challenge to an MBE program) cert. denied, 111 S. Ct.

2238 (1991).

Where only injunctive or declaratory relief is

sought, a plaintiff must show "a very significant

possibility” of future harm in order to have standing

to bring suit. See Nelsen v. King County, 895 F.2d 1248, —

1250 (9th Cir. 1990). "The complainant must allege an

injury to himself that is distinct and palpable, as

opposed to merely abstract, and the alleged harm

must be actual or imminent, not conjectural or

hypothetical.” Whitmore v. Arkansas, 110 S. Ct. 1717,

1723 (1990) (citations omitted). Moreover, "[a] federal

court is powerless to create its Own jurisdiction by

aaah eae

embellishing otherwise deficient allegations of

standing.” Id.

Indeed, one court has held in a setting similar to

the present case that a majority-owned contractor

lacked standing to seek injunctive or declaratory relief

regarding an MBE. See Department of Transp., 921 F.2d

at 1210. In Department of Transportation, the Eleventh

Circuit considered Cone Corporation’s challenge to an

MBE program administered by the _ Florida

Department of Transportation. The plaintiffs alleged

that they had lost work as a result of the MBE

program. However, the Eleventh Circuit observed

that the plaintiffs "alleged no facts . . . to support this

allegation; that is, they did not point to any specific

contract they lost because the Secretary discriminated

against them on account of their race." Id. at 1205-066

(footnote omitted). Likewise, ‘"[t]he plaintiffs’

allegations of future injury suffered the same

infirmity; the plaintiffs merely concluded that, because

of the Secretary's DBE requirements, ‘they will be

injured in their business or property.” /d. The court

concluded that these "bald conclusions" were insuffi-

cient to give rise to standing, and that the court

would "decline to imagine an injury sufficient to give

the plaintiffs standing when they have demonstrated

none." Id. at 1210.

At first blush, one might suspect that Coral

Construction’s complaint suffers the same standing

infirmities as that in Department of Transportation, in

respect to its challenge of the WBE aspect -f the set-

aside program. Coral Construction has not pointed to

a contract lost to a woman-owned business. More-

over, the chain of events that would lead to injury

here initially appears to be too speculative to give rise

to standing -- Coral Construction would have to bid

for another King County project, the project would

have to be awarded to a woman-owned subcon-

tractor, and Coral Construction would have to be the

lowest bidder. See id. at 1201-04.

However, further analysis reveals the fallacy of

such logic. In its amended complaint, Coral

Construction alleges that "it intends to bid public

contracts to be let by the defendant in the future.”

Unlike Department of Transportation, this conclusion is

adequately supported by factual allegations within the

complaint. Coral Construction has a branch office in

King County. Coral Construction specializes in

guardrail installation, highway signing, and related

work, all of which is virtually the exclusive domain of

public agencies. It is highly probable that Coral

Construction will again bid on work let by King

County.

This alone, however, is insufficient to confer

standing upon Coral Construction. Coral

Construction must also demonstrate imminent

economic injury. See S.J. Groves & Sons Co. v. Fulton

County, 920 F.2d 752, 758 (11th Cir.), cert. denied, 111 S.

Ct. 2274 (1991). While we conclude that Coral

Construction will undoubtedly continue to bid on

County projects, to presume that the company will be

the low bidder but lose the project to a WBE is too

speculative to confer standing. See Department of

Transp., 921 F.2d at 1205-06. The question is whether

Coral Construction has alleged a more certain injury

than a potential lost bid.

Coral Construction alleges that "because it is not

a member of the race or gender classes granted

preference by the Ordinance and Chapter 4.18, it is

not and will not be permitted to have its bid for such

contracts considered on the same basis as those of the

race and gender classes granted preferences by such

provisions." In S.J. Groves, the Eleventh Circuit

rejected such a claim as a basis for standing. 920 F.2d

at 758. However, in so holding the court observed

that "Groves is able to compete with other bidders on

an equal basis," td. (emphasis in original); the MBE

set-aside applied equally to all bidders. Here, this is

not the case. Under the 1989 version of the WBE

program, ma/ority contractors did not enjoy an equal

playing field for contracts awarded under the set-

aside method, as WBE contractors were exempt from

the subcontractor set-aside requirements. Perhaps

more significantly, under the County program and

unlike that in S.J. Groves, contracts to be awarded

under the preference method entitled WBEs to an

automatic five percent competitive advantage.

As a result of the objectively unequal bidding

process under the preference method of awarding

contracts, an injury results not only when Coral

Construction actually loses a bid, but every time the

company simply places a bid. Indeed, Coral

Construction suffers injury for standing purposes

even when it is the successful bidder, as it must

adjust its bid to reflect the fixed five-percent

adjustment given to WBEs. Each bid placed by the

company undoubtedly reflects the unequal

competition.

Coral Construction has standing to challenge the

WBE program.”

As a second threshold matter, we must deter-

mine the degree of judicial scrutiny afforded gender-

conscious programs. In Associated General Contractors,

we employed intermediate scrutiny, see 813 F.2d at

939, under which gender classifications are reviewed

to ensure that they are substantially related to

important governmental objectives, see City of Cleburne

v. Cleburne Living Center, 473 U.S. 432, 441 (1985).

However, Coral Construction urges us to adopt strict

scrutiny, the same standard of review applied to race-

conscious programs.

Because Coral Construction has standing, we need

not determine whether OCAGC has associational standing.

See Pennell v. City of San Jose, 485 U.S. 1, 8 n4 (1988)

(concluding that since association had standing, giving

Court jurisdiction, it was unnecessary to determine

whether the individual litigant also had standing).

We are bound by prior decisions of our court

unless the prior panel’s decision is "clearly incon-

sistent with subsequent Supreme Court decisions."

Sheehan v. United States, 896 F.2d 1168, 1172 n.7 (9th

Cir.), amended, 917 F.2d 424 (1990). The Croson Court,

of course, considered only an MBE set-aside program.

However, the Court’s plurality concluded its opinion

by noting:

If there is no duty to attempt

either to measure the recovery by

the wrong or to distribute that

recovery within the injured class

in an evenhanded way, our

history will adequately support a

legislative preference for almost

any ethnic, religious, or racial

group with the political strength

to negotiate "a piece of the

action" for its members.

Croson, 488 U.S. at 510-11 (quoting Fullilove v.

Klutznick, 448 U.S. 448, 539 (1980) (Stevens, J.,

dissenting)). Relying on this passage, Coral

Construction contends that gender-based preferences

should be subject to as stringent a review as those

based on race.

Coral Construction bolsters its argument by

noting that another circuit apparently has changed its

degree of scrutiny as a result of Croson. In Michigan

Road Builders Ass’n v. Milliken, 834 F.2d 583 (6th Cir.

1987), aff'd, 489 U.S. 1061 (1989), the Sixth Circuit

employed intermediate scrutiny to review a WBE pro-

gram, citing our holding in Associated General

Contractors. However, two years later and following

Croson, the same court seemingly applied strict

scrutiny when considering a gender-based affirmative

action program. See Conlin v. Blanchard, 890 F.2d 811,

816 (6th Cir. 1989) ("In order for a race or sex based

remedial measure to withstand scrutiny under the

fourteenth amendment there must first be some show-

ing of prior discrimination by the governmental entity

involved, and second, the remedy adopted by the

state must be tailored narrowly to achieve the goal of

righting the prior discrimination."). Coral

Construction urges us to follow the Sixth Circuit’s

lead.”

Finally, Coral Construction refers us to the

critique of intermediate scrutiny found in Contractors

Ass'n of Eastern Pennsylvania v. City of Philadelphia, 735

F. Supp. 1274, 1302-03 (E.D. Pa. 1990). There, the

court identified several problems with the intermedi-

ate scrutiny standard. First, the court suggested that

a lesser standard of review gives undue deference to

legislative bodies to fashion remedies for past wrongs,

a task better suited for the judiciary. /d. at 1302.

Second, this lesser standard makes it easier for a

"© At least one other court has seemingly applied strict

scrutiny to a gender-conscious program. See American

Subcontractors Ass'n v. City of Atlanta, 259 Ga. 14, 376 S.E.2d

662, 664 (1989).

ae tna ei

legislature to enact gender-based relief over race-

based relief, even though blacks have suffered more

egregious discrimination over time. Id. Finally, the

court noted that application of intermediate scrutiny

"provides ‘relatively little guidance in individual

cases."" Id. (quoting Associated General Contractors, 813

F.2d at 939).

We are cognizant of the problems with interme-

diate scrutiny. See Associated General Contractors, 813

F.2d at 939-42. Nonetheless, such standard of review

remains the law of this circuit, if not of the land;

certainly Associated General Contractors cannot be said

to be "clearly inconsistent" with Croson on this matter.

Contractors Association is telling in one other aspect.

Despite the litany of problems it found with interme-

diate scrutiny, the court applied intermediate scrutiny

nonetheless. See id. at 1304." Accordingly, we find

ourselves powerless to overrule Associated General

Contractors on this point, even if we were so inclined.

Thus, we shall employ intermediate scrutiny to review

King County’s WBE program.

In addition, intermediate scrutiny may not be as

irrational as the Contractors Association Court suggested.

The Seventh Circuit recently noted that "it can be argued

that if sex discrimination is not so serious a wrong as racial

discrimination we need not worry about confining its use

to the remedial setting." Milwaukee County Pavers Ass'n v.

Fiedler, 922 F.2d 419, 422 (7th Cir.), cert dented, 111 S. Ct.

2261 (1991).

Under intermediate scrutiny, a gender-based

classification must serve an important governmental

objective, and there must be a direct, substantial

relationship between the objective and the means

chosen to accomplish the objective. Mississippi Univ.

for Women v. Hogan, 458 U.S. 718, 724 (1982). In the

context of WBE preferences, the two prongs of this

intermediate scrutiny test tend to converge into one.

A governmental entity "may invoke a compensa-

tory purpose to justify a discriminatory classification

‘only if members of the gender benefited by the

classification actually suffer a disadvantage related to

the classification.” Associated General Contractors, 813

F.2d at 940 (quoting Weinberger v. Wiesenfeld, 420 U.S.

636, 648 (1975)). "[I]f the statutory objective is to

exclude or ‘protect’ members of one gender because

they are presumed to suffer from an inherent handi-

cap or to be innately inferior, the objective itself is

illegitimate.” Hogan, 458 U.S. at 725.

However, the mere recitation of a benign, com-

pensatory purpose will not automatically shield a

gender-specific program from constitutional scrutiny.

See Califano v. Webster, 430 U.S. 313, 317 (1977)

(quoting Weinberger v. Wiesenfeld, 420 U.S. 636, 648

(1975)). “The notion that women need help in every

business and profession is as pernicious and offensive

as its converse, that women ought to be excluded

from all enterprises because their place is in the

home." Associated General Contractors, 813 F.2d at 941.

Some degree of discrimination must have occurred in

a particular field before a gender-specific remedy may

be instituted in that field. See Hogan, 458 U.S. at 729

(striking down a woman-only state-sponsored nursing

school, where state "made no showing that women

lacked opportunities to obtain training in the field of

nursing or to attain positions of leadership in that

field").

Unlike the strict standard of review applied to

race-conscious programs, intermediate scrutiny does

not require any showing of governmental involve-

ment, active or passive, in the discrimination it seeks

to remedy. In Associated General Contractors, we

observed that the "[g]overnment has the broad power

to assure that physical differences between men and

women are not translated into permanent handicaps,

and that they do not serve as a subterfuge for those

who would exclude women from participating fully in

our economic system.” 813 F.2d at 940. Similarly, in

Webster the Supreme Court observed that "[rjeduction

of the disparity in economic condition between men

and women caused by the long history of discrimina-

tion against women has been recognized as such an

important governmental objective." 430 U.S. at 317.

But see Michigan Road Builders, 834 F.2d at 595 ("WBE

preferences .. . cannot withstand constitutional attack

since evidence of record that the state discriminated

against women is nonexistent.").

In Associated General Contractors, we applied these

principles to San Francisco’s WBE preference program.

Remedying disadvantages women faced in the

marketplace, we concluded, was an important and

legitimate concern. 813 F.2d at 941. We were,

however, troubled by the preference’s sweeping

scope. "The ordinance," we observed, "is unusual in

the breadth of the subsidy it gives to women"; indeed,

the program subsidized WBEs in virtually every

industry in which San Francisco contracted, including

industries for which there was no reason to believe

that women were disadvantaged. See id.

Nonetheless, we concluded that the program

survived a facial challenge. "Although the city’s

program may extend preferences to some fields where

women are not disadvantaged, experience suggests

that these are still the exceptions." Jd. at 942. In

accordance with Hogan, however, we left the door

open to industry-specific challenges: "We may reach

a different conclusion if and when the WBE prefer-

ences are challenged as applied to an industry where

women are not disadvantaged." 1d.

In the present case, we conclude, as we did in

Associated General Contractors, that King County’s WBE

preference survives a facial challenge. Like San

Francisco, King County has a legitimate and

important interest in remedying the many disadvant-

ages that confront women business owners. More-

over, the means chosen are substantially related to the

objective. The utilization goals under both the set-

Ae Bi tee ett Sod be tached te sansa Canin

aside and preference methods are legitimate means of

furthering the objective, and are not unduly onerous.

Similarly, while King County’s program, like that in

San Francisco, gives preference to women in all

industries contracting with the County, this alone is

insufficient to warrant invalidating the entire

program. See id. at 941-42.

On the record presently before us, an industry-

specific challenge must also fail. The record

adequately indicates discrimination against women in

the King County construction industry. Particularly

telling is the twenty-two-page affidavit of Anne C.

Symonds, president of the consulting engineering firm

of Anne Symonds & Associates, Inc. For the years

1985-87, Symonds noted that less than seven percent

of the firm’s business came from private contracts;

most of the firm’s work resulted from gender-based

set-asides. Additionally, Symonds observed that, to

the best of her knowledge, her firm, established in

1980, was the first woman-owned engineering firm in

the state of Washington. Symonds averred that she

has attempted to obtain more private contract work,

but has been unsuccessful. She attributed her lack of

success to the "discriminatory attitude toward me and

towards women and minority businesses generally.”

The district court properly granted summary

judgment to King County as to the WBE portion of

its set-aside program.

Coral Construction seeks an award of attorney’s

fees under 42 USC § 1988, which permits the award

of attorney’s fees to a prevailing party under several

specified civil rights statutes, including sections 1981

and 1983. By its own terms, thet section provides that

a party must "prevail" to be eligible for recovery of

attorney’s fees. See Hanrahan v. Hampton, 446 U.S. 754,

756 (1980). As a general rule, a party who obtains the

reversal of judgment on appeal is not a "prevailing

party” unless such reversal also resulted in entry of

judgment for that party. See id. at 757-59. No such

judgment has yet been entered here. Accordingly, an

award of attorney's fees at this time would be

premature.

For the foregoing reasons, the district court’s

grant of summary judgment for King County is

reversed as to the MBE portion of the set-aside

program. On remand, the district court should

determine whether the MBE progiam, as it existed in

September 1989, meets the "compelling governmental

interest" requirement in light of the additional factual

support offered by the County. The district court

shall also consider whether there is a causal link

between the program’s geographic overbreadth and

Coral Construction’s injury. If either of these

questions is answered in the affirmative, Coral

Construction would be entitled to judgment and an

award of damages.

We leave the issue of the continued jurisdiction

over Coral Construction’s requests for injunctive and

declaratory relief to the sound discretion of the

district court.

As to the WBE portion of the set-aside program,

the district court’s grant of summary judgment for

King County is affirmed.

Parties will bear their own costs.

AFFIRMED IN PART, REVERSED IN PART, and

REMANDED.

UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF WASHINGTON

CORAL CONSTRUCTION

COMPANY, an Oregon

corporation; and

OREGON COLUMBIA

CHAPTER OF THE

ASSOCIATED GENERAL

CONTRACTORS OF

AMERICA, INC., an

Oregon non-profit

corporation,

No. C89-1488WD

Plaintiffs-

Appellants,

KING COUNTY, a legal

subdivision of the State of

Washington,

Defendant-

Appellee.

i a a a Le Le Le Le Le Le La a Le a Le La La oe ae a

OPINION: ORDER ON MOTIONS FOR

SUMMARY JUDGMENT

WILLIAM L. DWYER, UNITED

STATES DISTRICT JUDGE

Plaintiffs and defendant have filed cross-motions

for summary judgment. The parties agree that no

disputes of fact exist and that this case will be fully

decided on the present record. The court has con-

sidered all materials filed by the parties and has heard

oral argument of counsel. A number of letters from

non-parties have been received; these cannot be con-

sidered and have been placed in the chambers file.

Being fully advised, the court now finds and rules as

follows:

I. BACKGROUND

On May i, 1989, the King County Council passed

an ordinance amending the county’s set-aside program

for minority- and women-owned business enterprises

("MWBE’s"). Proceedings of the King County Council

Regular Meeting, Record at 1, 2 (May 1, 1989); King

County, Wash., Code ch. 4.18. The program provides

two methods by which MWBE’s may receive prefer-

ences in bidding on county contracts. Under one

method, contractors whose bids are within five per-

cent of the lowest responsive bid are given preference

in the award of the contract if their bids show that

they are MWBE’s or will use MWBE’s on the project.

King County, Wash., Code § 4.18.060(A)(1) ("percent-

age preference method"). Thus, an MWBE whose bid

was five percent higher than the lowest responsive

bid could nevertheless be awarded the contract over

a low bidder who was not a MWBE.

Under the other set-aside method, contractors for

county contracts of more than $10,000 must, with

certain exceptions and limitations, use MWBE’s for

particular percentages of work on hose contracts.

King County, Wash., Code § 4.18.060(A)(2).

Plaintiff Coral Construction Company was the

low bidder on a King County guardrail construction

contract. Applying the percentage preference method,’

the county awarded the contract to a minority

business enterprise ("MBE"), whose bid was higher

than that of Coral Construction.

Coral Construction and an Oregon chapter of the

Associated General Contractors of America, Inc.,

brought this suit claiming that King County’s set-

aside program, on its face and as applied to Coral

Construction, violates plaintiffs’ equal protection

rights. Plaintiffs rely on a recent case, City of

Richmond v. J.A. Croson Co., 488 U.S. 469 (1989), in

which the Supreme Court ruled that a municipal set-

aside program violated the equal protection clause.’

' The percentage preference method was used not-

withstanding the contract’s value of more than $10,000.

See King County, Wash., Code § 4.18.060(C) (county depart-

ment may use alternate set-aside method if alternate is

"more feasible method of achieving" MWBE utilization

goal).

The equal protection clause provides: ‘No State

shall . . . deny to any person within its jurisdiction the

equal protection of the laws." U.S. Const. amend. XIV, § 1. |

In Croson the Court examined a set-aside pro-

gram adopted by the city of Richmond, Virginia. The

Richmond program required prime contractors to

award at least 30 percent of the dollar amount of each

city construction contract to MBE’s. 109 S. Ct. at 707.

Government classifications based on race may be

employed only if justified by compelling government

interests, and if their use is necessary to accomplishing

their legitimate purpose. Palmore v. Sidoti, 466 U.S.

429, 432-33 (1984). Remedying the effects of past dis-

crimination can represent such a compelling interest.

See Croson, 109 S. Ct. at 720 (plurality opinion). A

majority’ of the Court in Croson agreed that strict

scrutiny is required in judicial review of race-based

affirmative action programs, in order 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." Jd. at 721 (plurality

opinion); id. at 735 (Scalia, J., concurring in the

judgment). In other words, courts must strictly

scrutinize the use of racial classifications to determine

A majority of the court adopted parts I, III-B, and

IV of Justice O’Connor’s opinion, which addressed the

background of the case, the evidence supporting

Richmond’s program, and the "narrow _ tailoring"

requirement, respectively. Croson, 109 S. Ct. at 712-17, 723-

29. Two Justices joined in part II of Justice O’Connor’s

opinion, while three joined in parts III-A and V of that

opinion. Two Justices filed opinions concurring in parts of

the opinion and concurring in the judgment. Justice Scalia

concurred in the judgment. Three Justices dissented.

whether the compelling interest relied upon by the

government actually exists and suffices.

Applying this standard, the Court found that

Richmond’s set-aside program (1) was not supported

by adequate evidence of past discrimination to estab-

lish Richmond’s compelling interest; and (2) was not

tailored narrowly enough to its goal of remedying the

effects of past discrimination. Id. at 723-29.

The Croson Court did not, however, conclude

that race-based set-aside programs violate the equal

protection clause per se. Justice O’Connor stated:

"Nothing we say today precludes a state or local

entity from taking action to rectify the effects of

identified discrimination within its jurisdiction .. .. In

the extreme case, some form of narrowly tailored

racial preference might be necessary to break down

patterns of deliberate exclusion.” I/d. at 729 (plurality

opinion). A majority of the court agreed with this

statement. See id. at 734 (Kennedy, J., concurring); id.

at 739 (Marshall, dissenting); see also Joint Statement,

Constitutional Scholars’ Statement on Affirmative Action

After City of Richmond v. J.A. Croson Co., 98 Yale L.].

1711, 1712 (1989) [hereinafter Constitutional Scholars’

Statement] ("On at least four noteworthy occasions...

the Supreme Court has made clear that affirmative

action remedies, if carefully devised, can be entirely

constitutional.").

The Richmond program did not include

preferences for women-owned business enterprises

("WBE’s"), so the Croson Court did not address such

programs. The Ninth Circuit has held that WBE set-

aside programs are subject to "mid-level review" -- a

standard less searching than "strict scrutiny.” WBE

programs must demonstrate "exceedingly persuasive

justification” to survive mid-level review. Associated

Gen. Contractors v. City & County of San Francisco, 813

F.2d 922, 939-40 (9th Cir. 1987) ("AGC") (quoting

Mississippi Univ. for Women v. Hogan, 458 U.S. 718, 724

(1982)), petition for mandamus dismissed, 110 S. Ct. 296

(1989). Also, the means used to further the goal of

remedying he effects of past discrimination against

women must be "substantially related" to the

achievement of that goal. Id. at 941. |

Il. DISCUSSION

Plaintiffs contend that King County’s MBE set-

aside program suffers from the same two defects

found fatal to Richmond’s program. They also argue

that the WBE aspects of the program do not Satisfy

the standards set forth in AGC

In Croson, virtually no evidence of past discrimi-

nation had been presented to support the rigid quota

imposed by the Richmond set-aside program. The

disparity in that case between the evidence of the

harm and the breadth of the remedy has no parallel

in the King County set-aside program. King County

has evidence of greater weight, detail, and specificity

to support the adoption of its more flexible MWBE

set-aside program. Applying strict scrutiny to the

MBE aspect of the program, the evidence supporting

King County’s program is sufficient under the Croson

requirements, and the program is narrowly tailored.

The WBE set-aside program survives the less intense

scrutiny applied to gender-based programs.

A. Basis in Evidence for King County’s Program

The Croson Court found that the Richmond City

Council lacked the required "strong basis in evidence

for [the council’s] conclusion that remedial action was

necessary." Croson, 109 S. Ct. at 724 (quoting Wygant

v. Jackson Bd. of Educ., 476 U.S. 267, 277 (1986) (plurality

opinion)). Although the Court did not specify the

quantity of evidence that would be sufficient, it

rejected Richmond’s evidence as not "approaching a

prima facie case of a constitutional or statutory

violation by anyone in the Richmond construction

industry." Jd. (emphasis in original).

The set-aside program at issue here is supported

by a strong basis in evidence of past discrimination in

the King County construction industry. Several dozen

people gave written or oral descriptions of such dis-

crimination. See, e.g., Letter of Reginald S. Frye,

Record at 230, 232-33; Affidavit of Dianne M. Strobel,

Record at 430; Affidavit of Rigo Vela, Record at 468.

Many of the sources relied upon by the County

Council provided specific examples of past discrimina-

tion in the construction industry in King County.

The contrast between the evidence in Croson and

that before the King County Council is striking. The

Croson Court found: "There was no direct evidence of

race discrimination on the nart of the city in letting

contracts or any evidence that the city’s crime contrac-

tors had discriminated against minority-owned subcon-

tractors." Id. at 714. The district court that approved

the Richmond plan based its findings of past discrimi-

nation on several factors, including statements by a

few proponents of the set-aside program that there

had been discrimination in the construction industry,

and reports of a significant disparity between the

percentage of minorities receiving contracts from the

city and the percentage of minorities in the city

population. See id. at 724. The detailed and specific

descriptions of discrimination found in the King

County record, on the other hand, are not the type of

"generalized assertion(s]" of past discrimination

criticized by the Croson Court. See id. at 723.’

Moreover, in Croson much of the evidence was

found to be of "little probative value" because it did

not apply specifically to discrimination in the local

-construction industry. /d. at 714, 723-24. The Court

* After this action was commenced, King County

received a draft of a detailed report on past discrimination

in the local construction industry. A copy of that report

has been filed with the court. Plaintiffs contend that it

should not be considered. The record contains sufficient

evidence to support the county’s program in the absence

of the disputed report. The court has not considered the

report in reaching its decision.

thus found Richmond’s evidence inadequate to

identify past discrimination sufficiently to support the

"rigid quota” prescribed by the set-aside program. Id.

at 727. In contrast, nearly all of King County’s

evidence applies specifically to the construction

industry within the county’s jurisdiction.’

Plaintiffs argue that the county inappropriately

relied on evidence of discrimination in other jurisdic-

tions, such as Pierce County, Seattle, and the

Municipality of Metropolitan Seattle ("Metro"). The

Croson Court did not bar the "sharing" of evidence

among local jurisdictions with inclusive or common

geographic borders. The Court merely held that

evidence of discrimination in the national construction

industry was not enough to support imposition of a

local race-based remedy. Id. 109 S. Ct. at 726-27. King

County could properly consider evidence from Seattle,

which is located within the county, and from Metro,

whose borders are identical to those of the county.*

> Plaintiffs argue that Croson, in citing AGC with

approval, implicitly adopted a minimum standard for

evidence of discrimination, i.e., evidence superior to that

rejected by teh AGC court. See Croson, 109 S. Ct. at 719,

725. They assert that King County’s evidence is not as

detailed or specific as that rejected as inadequate in AGC.

See 813 F.2d at 931-34. However, the citations to AGC in

Croson were used to support other conclusions. Those

citations do not adopt any evidentiary standards that mi; ght

be inferred from AGC.

® Plaintiffs argue that the county inappropriately relied

on evidence of discrimination in other jurisdictions, such

(continued...)

Plaintiffs also argue that the county may rely

only on evidence of discrimination by the county, and

not on evidence that merely shows past discrimination

in the local private construction industry. See AGC,

813 F.2d at 931-32 (lack of evidence of past discrimi-

nation by city officials was the disputed ordinance’s

"most significant shortcoming"). This holding in AGC

has been effectively overruled by Croson. The

plurality found:

[If] the city could show that it

had essentially become a "passive

participant" in a system of racial

exclusion practiced by elements of

the local construction industry,

*(...continued)

as Pierce County, Seattle, and the Municipality of

Metropolitan Seattle ("Metro"). The Croson Court did not

bar the "sharing" of evidence among local jurisdictions with

inclusive or common geographic borders. The Court

merely held that evidence of discrimination in the national

construction industry was not enough to support imposi-

tion of a local race-based remedy. Id. 109 S. Ct. at 726-27.

King County could properly consider evidence from Seattle,

which is located within the county, and from Metro,

whose borders are identical to those of the county.

Some of the present record refers to evidence of dis-

crimination outside King County and/or the construction

industry. E.g., Transcript, Pierce County Council Fiscal

Management Comm., Record at 119. Even when all such

evidence is disregarded, however, the remaining evidence

is fully sufficient to support the county’s finding of past

discrimination in the King County construction industry.

we think it clear that the city

could take affirmative steps to

dismantle such a system. It is

beyond dispute that any public

entity, state or federal, has a

compelling interest in assuring

that public dollars, drawn from

the tax contributions of all

citizens, do not serve to finance

the evil of private prejudice.

Croson, 109 S. Ct. at 720. King County’s construction

project dollars flowed through the local construction

industry, making the county a "passive participant” in

the discrimination described on the record.

A Supreme Court plurality opinion alone could

not overturn the Ninth Circuit’s holding in AGC. See,

e.g., Powers v. Alabama Dep’t of Educ., 854 F.2d 1285,

1292 n.11 (11th Cir. 1988), cert. denied, 109 S. Ct. 3158

(1989). However, six Justices support the plurality’s

opinion that a state government entity seeking to

impose a race-based remedy need not obtain evidence

of its own direct discrimination to justify that remedy.

Id. 109 S. Ct. at 717-20 (plurality opinion) (Justice

O’Connor joined by two other Justices); id. 109 S. Ct.

at 745-49 (Marshall, J., dissenting) (joined by two

other Justices).’ Where multiple opinions leave the

* Justice Kennedy also seems to have agreed with this

opinion. See Croson, 109 S. Ct. at 735 (Kennedy, J.,

(continued...)

Court’s ultimate holding in some doubt, "a lower

federal-court must do its level best to extract the

holding that commanded a majority . . . to arrive at

the governing principles and limitations." Shurberg

Broadcasting of Hartford, Inc. v. FCC, 876 F.2d 902, 910

(D.C. Cir. 1989) (separate opinion of Silberman, J.).

The opinions of these six Justices constitute the

majority holding on this issue. See Constitutional

Scholars’ Statement, supra, at 1713; cf. Winter Park

Communications, Inc. v. FCC, 873 F.2d 347, 354 (D.C.

Cir. 1989) (relying on opinions in Croson of three

Justices in plurality and three in dissent for continued

vitality of Fullilove v. Klutznick, 448 U.S. 448 (1980)).

The Supreme Court’s post-Croson summary

affirmance cf a Sixth Circuit decision similar to AGC

does not alter this holding in Croson. See Michigan

Road Builders Ass‘n, Inc. v. Milliken, 834 F.2d 583, 595

(6th Cir. 1987) (requiring showing of past government

discrimination), aff'd without opinion, 109 S. Ct. 1333

(1989). A summary affirmance by the Supreme Court

affirms only the judgment of the lower court, not

necessarily that court’s reasoning. Mandel v. Bradley,

432 U.S. 173, 176 (1977). Summary actions by the

Supreme Court are not to be read as "a renunciation

by [the] Court of doctrines previously announced in

’(... continued)

concurring) (among matters left unexamined by Richmond

City Council was "extent to which the City contributed to

[past discrimination], either by intentional acts or by

passive complicity in acts of discrimination by the private

sector") (emphasis added).

[its] opinions after full argument," nor should they be

understood "as breaking new ground." Id. at 176. Ct.

at 2240-41. The Court’s holding in Croson remains

undisturbed by its later affirmance of Michigan Road

Builders.

The record contains ample evidence of past

discrimination against women in the local construc-

tion indusiry. See, e.g., Affidavit of Cindy M. Strouss,

Record at 605, 605-07; Affidavit of Anne C. Symonds,

Record at 673-694. This evidence provides the

"exceedingly persuasive justification" required to

support the gender-based remedy imposed by the

county’s WBE set-aside program, see AGC, 813 F.2d at

939-40, and identifies the past discrimination clearly

enough to assure that the remedy will be normal.

B. Narrow Tailoring of the Remedy

The strict scrutiny standard requires that race-

based measures "fit" the compelling goal which

justifies their use. 109 S. Ct. at 721 (plurality opinion).

Under the less stringent mid-level scrutiny, gender

based remedies must be "substantially related” to the

goal of eliminating the effects of gender discrimina-

tion. AGC, 813 F.2d at 941.

The Croson Court found that the Richmond MBE

program suffered two defects that made it unconstitu-

tionally broad. First, the city did not appear to have

considered the use of race-neutral means to increase

minority business participation in city contracting.

Croson, 109 S. Ct. at 728. The Court noted:

Many of the barriers to minority

participation in the construction

industry relied upon by the city

to justify a racial classification

appear to be race neutral. If

MBEs_ disproportionately lack

capital or cannot meet bonding

requirements, a race-neutrai

program of city financing for

small firms would, a fortiori, lead

to a greater minority participa-

tion. The principal opinion in

Fullilove found that Congress had

carefully examined and rejected

race-neutral alternatives before

enacting the MBE set-aside.

There is no evidence in_ this

record that the Richmond City

Council has considered any

alternatives to a race-based quota.

ld.

King County’s MWBE program does not suffer

from this defect. The county considered the race-

neutral alternatives suggested in Croson. King

County, Wash., Code § 4.18.005(E) (finding that "no

effective [race-neutral] alternatives appear to be

presently available"). Those alternatives were rejected

because state law bars the county from implementing

them. See In re Marriage of Johnson, 96 Wash. 2d 255,

261-68, 634 P2d 877 (1981) (state constitution prohibits

gifts or loans of public funds to private entities)

(citing Wash. Const. Art. VIII, § 5); RCW ch. 39.08

(state statute restricting county bonding procedures).

Plaintiffs argue that several race-neutral

alternatives could have been but were not considered

by the county. However, the deposition of Terry

Koyano, cited by plaintiffs in support of this

argument, shows that the county did consider many

of the alternatives plaintiffs suggest. | Koyano

Deposition at 27-36. Croson does not compel the

county to consider every imaginable race-neutral

alternative, nor to try alternatives that would be

plainly ineffective. The record establishes that King

County carefully considered race-neutral alternatives

before implementing its race-based remedy.

The second defect cited in Croson was the

Richmond program’s "rigid numerical quota." See

infra. The Court held:

[The] 30% quota cannot be said

to be narrowly tailored to any

goal, except perhaps outright

racial balancing. It rests upon

the completely unrealistic

assumption that minorities will

choose a particular trade in

lockstep proportion to their

representation in the local

population.

Croson, 109 S. Ct. at 728. The Court was concerned

that the Richmond program was not tied to the local

availability of MBE’s, but instead to the number of

minorities in the local population. /d.

.The King County program is not a rigid quota

system. Two methods may be used to provide

benefits to MWBE’s. The percentage preference

method used to award the contract at issue in this

case is far less burdensome to non-MWBE’s than the

quota imposed by Richmond. The King County

program includes several measures to conform the

remedy provided to the identified discrimination. For

example, MWBE utilization requirements are tied to

the availability of qualified MWBE contractors, not to

the percentage of minorities or women in _ the

population in general. King County, Wash., Code

§ 4.18.060(B). The county may waive or reduce the

MWBE preferences if qualified MWBE’s are not avail-

able, or if a bidding MWBE’s higher price is not

attributable to the effect of past discrimination. /d.

§ 4.18.070(A)(5). These provisions prevent the

county’s MWBE program from extending benefits not

related to past discrimination. See Croson, 109 S. Ct. at

728-29 (noting similar waiver provisions in federal set-

aside program approved in Fulltlove).

The Richmond MBE program potentially pro-

vided benefits to groups not subjected to past dis-

crimination. /d. at 728. The Court criticized this

overinclusion that resulted from the program’s

rigidity: "Under Richmond’s scheme, a successful

[minority] entrepreneur from anywhere in the country

enjoys an absolute preference over other citizens

based solely on their race." Id. at 729. King County

avoids this pitfall by allowing denial of MWBE

program benefits in particular contracts or categories

of contracts if the group in question has not been

discriminated against. King County, Wash., Code

§ 4.18.010(S), -(HH).

The MWBE program at issue here is narrowly

tailored to remedy the effects of the past dis-

crimination identified in the local construction

industry. The county considered race-neutral

alternatives, and adopted some of them, but still

found evidence of ongoing effects of past discrimi-

nation. The remedy adopted is different in kind from

the racial quota employed by Richmond, and avoids

the overinclusiveness which led the Supreme Court to

find that city’s remedy unconstitutional.

I]. CONCLUSION

The Supreme Court has held that race-based

government programs must remain a last resort in

attempts to remedy the effects of past discrimination.

The Croson holding requires that such programs be

based on sufficient evidence of past discrimination,

and that they be limited to redressing actual discrimi-

nation. Local governments are also strictly limited in

their use of gender-based programs. King County

had enough evidence before it to prove the discrimi-

nation it sought to redress, and the remedy it has

adopted is narrowly tailored to the need. The

County’s program is constitutional under both the

Croson and the AGC standards.

Accordingly, plaintiffs’ motion for summary

judgment is denied, and defendant’s motion for

summary judgment is granted. The clerk is directed

to enter judgment accordingly, and to send copies of

this order to all counsel of record.

Dated: December 4, 1989.

Chapter 4.18

MINORITY AND WOMEN’S BUSINESS ENTERPRISES

Sections:

facts:

4.18.005

4.18.010

4.18.020

4.18.030

4.18.040

4.18.050

4.18.060

4.18.070

4.18.080

4.18.090

4.18.100

4.18.110

4.18.120

4.18.130

4.18.005

Findings.

Definitions.

Powers and duties.

Utilization goals.

Accomplishment of utilization goals.

Utilization requirements, general.

Utilization requirements, specific.

Waivers.

Monitoring,

enforcement.

Special report required.

reporting and

Authorization to implement

procedures.

Effect of ordinance, status’ of

solicitations.

Severability.

Study and report.

Findings.

The county council hereby finds the following

A. In hiring and dealing with contractors and

subcontractors of all types, public and private owners,

developers, contractors,

sureties

against

have discriminated

minority

and

discriminate

institutions

and do

women’s

financial

and businesses doing

business with King County based on the race and sex

of the owners of these businesses.

B. But for the provisions of its past and

present minority and women’s business enterprise

ordinances, King County would have been, and

would continue to be, a passive participant in the

discrimination against these businesses.

C. The provisions of this chapter are necessary

to remedy the discrimination against minority and

women’s businesses and to prevent King County from

financing and participating in this discrimination with

its contracting dollars.

D. The market from which King County draws

contractors extends throughout the State of

Washington.

E. King County is prohibited by state law

from helping minority and women’s businesses over-

come the effects of discrimination through financial

assistance or reduction of bonding requirements.

While the existence of such alternative remedies must

continue to be explored, no effective alternatives

appear to be presently available.

F. Further study of the nature and extent of

the discrimination against minority and women’s

businesses must be conducted to determine whether

additional amendments to the program are necessary.

The continuation of the program during the period of

this study is necessary to prevent irreparable injury to

such businesses. (Ord. 8937 § 1, 1989.)

4.18.010 Definitions.

All words shall have their urdinary and usual

meanings except those defined in this section which

shall have in addition, the meaning set forth below.

In the event of conflict, the specific definition spelled

out below shall presumptively, but not conclusively

prevail.

A. "Affirmative Action Plan,” shall mean the

written, formal King County policy adopted annually,

stating the goals and programs of county government

to be preformed in the areas of contract compliance,

equal employment opportunity and minority/women’s

business contracting.

B. "Affirmative Efforts,” shall mean making

vigorous attempts in good faith to contact and

contract with minority/women’s businesses. Where

affirmative efforts are required by, or are grounds for,

waiving provisions of this chapter, the director of the

department of executive administration’s determina-

tion shall be based on procedures to be outlined in

accordance with the dictates of this chapter.

C. "Architectural and Engineering Contracts”

shall mean contracts for the performance of archi-

tectural and engineering services by licensed and

registered firms and persons acting as consultants to

King County.

D. "Broker" shall mean a_ business which

purchases goods or services from another business or

businesses for the sole purpose of resale to the county

or a contractor doing business with the county.

E. "Certification" shall mean the process by

which the Office of Minorities and Women’s

Businesses of the State of Washington determines a

business meeting the criteria for a minority-owned

business enterprise, a women-owned business enter-

prise, a women-owned business enterprise, and/or a

combination minority and women’s business enter-

prise set forth in WAC chap. 326-02 and WAC chap.

326-20.

F. “Combination Minority and Women

Business” means a business certified as a combination

minority and women’s business enterprise by the

Office of Minority and Women’s Businesses of the

State of Washington which is legitimately owned and

controlled by minority males or minority businesses

defined in this chapter.

G. "Commercially Useful Function,” shall mean

the performance of real and actual services in the

discharge of any contractual endeavor. The contrac-

tor must perform a distinct element of work which

the business has the skill and expertise as well as the

responsibility of actually performing, managing and

supervising. In determining whether a business is

performing a commercially useful function, factors,

including but not limited to the following, will be

considered:

1. Whether the business has the skill and

expertise to perform work for which it is being/has

been certified;

2. Whether the business actually

performs, manages and supervises the work for which

it is being/has been certified; and

3. | Whether the business purchases goods

and/or services from non-minority/women’s business

enterprise and simply resells goods to the county,

county contractor, or other person doing business

with the county for the purpose of allowing those

goods to be counted towards fulfillment of minority/

women’s business enterprise utilization goals.

H. "Concession Contracts," shall mean those

contractual arrangements for the sale of food,

beverages and/or items of personal property at any

facility owned and/or managed by King County.

I. “Conduit,” shall mean a minority/women’s

business with which a contractor has agreed to

subcontract, when the minority/women’s business

does not perform the subcontract, and instead the

subcontract is performed by a non-minority/women’s

business. |

J. "Construction Contracts,” shall mean, those

contractual arrangements made by King County for

the construction, repair, rehabilitation, alteration,

conversion or extension of buildings, parks, streets or

other improvements to real property.

K. "Consultant Contracts," shall mean those

contractual arrangements made for the procurement

of expert personal, professional and/or technical

services. Consultant contracts shall not include

architectural and engineering contracts as defined by

this chapter.

L. "Contract Awarding Authority,” shall mean

any person with the power to enter into a contractual

arrangement binding King County and shall also

mean the particular office, agency or division on

whose behalf the contract is entered. In addition, this

term shall include, but shall not be limited to heads

of county departments, divisions or offices.

M. "Contractor" shall mean any person,

partnership, corporation, or other type of business

entity which has a contract with King County or

serves in a subcontracting capacity with an entity

having a contract with King County for the provision

of goods and/or services.

N. "Corporate Sponsored Dealership,” shall

mean a bona fide minority/women’s business which

meets the following standards in lieu of the fifty-one

percent ownership criterion of subsection R.1., and

the contract criteria of subsection R.2. The minority/

women owners have entered into an agreement, con-

tract, or arrangement with a national or regional

corporation and have been granted a license to offer,

sell or distribute goods or services at wholesale or

retail, leasing or otherwise using the name, service

mark, trademark or related characteristic of the

sponsoring corporation. Capital investment for the

dealership is jointly contributed by the minority/

women owners and the sponsoring corporation, with

the sponsoring corporation initially contributing the

largest percentage. The original investment con-

tributed by the minority/women owners may be less

than fifty-one percent with a specified time limit

established with the sponsoring corporation for the

minority/women owners to become the sole owner of

the dealership. The standards for qualifying a

corporate sponsored dealership as a bona fide

minority/women’s business enterprise shall include,

but are not limited to:

1. The minority/jwomen owners must

have contributed a minimum of 25% of the capitali-

zation investment (total required equity capital) in the

dealership corporation.

2. The dealership contract must include

a binding agreement stating that the buy-out of the

corporate sponsor's interest by the minority/women

owners will occur within 10 years.

3. If the sponsoring corporation retains

majority voting rights and control of the board of

directors, then the minority/women owners must

annually apply at least fifty percent of the net profit

and bonuses toward the buy-out of the corporate

sponsors’ interest within the buy-out time limit

established with the corporation.

4. The minority/women owners must

show active participation in the decision-making

process on the board of directors of the dealership.

5. The minority‘women owners must

have operational control, and as such have day-to-

day management control of the dealership, with

responsibility for sales, service volume and profits.

6. The sponsoring corporation must have

specifically developed a national or regional corporate

sponsored dealership program to address the present-

day issue of lack of opportunities for minorities or

women in the dealership industry, which includes

such features as: capitalization assistance from the

sponsoring corporation, ongoing business operations

training, technical assistance to the dealership owner,

and a corporate sponsored minority and women’s

business program.

7. The minority/women owners must

demonstrate that the relationship between the

corporate sponsor and the minority/women’s business

was not formed for the primary purpose of achieving

certification under this subsection N, or any other

similar provision of any other ordinance, regulation,

rule or law.

8. The minority/women owners having

prior business or management experience relating to

the business being entered into as an owner.

O. "Department," shall refer to any department

as defined by King County ordinance or other applic-

able law and shall include all county agencies not

associated with a department. These agencies shall

similarly discharge those duties this chapter requires

of departments and shall include the King County

prosecuting attorney, the King County assessor, and

the King County council.

P. "Front" shall mean a_ business which

purports to be a minority/women’s business but

which is actually owned and/or controlled in a

manner which is inconsistent with the requirements

of certification.

Q. "Joint Venture,” shall mean an association of

two or more persons, partnerships, corporations or

any combination of them, established to carry on a

single business activity which is limited in scope or

direction. The degree to which a joint venture may

satisfy relevant utilization goals cannot exceed the

proportionate interest of the minority/women’s

business held as a member of the joint venture in the

work to be pertormed. The agreement establishing

the joint venture, partnership or other multi-entity

relationship shall be in writing. Further, minority/

women’s participation in a joint venture shall be

based on the sharing of real economic interest in the

venture and shall include proportionate control over

management, interest in capital acquired by the joint

venture, and interest in earnings.

R. "Legitimately Owned and Controlled,” shall

mean for the purpose of determining whether a busi-

ness is a "minority business" that minorities shall

possess:

1. Ownership of at least fifty-one percent

interest in the business, unless the minority business

qualifies as a corporate sponsored dealership under

the provisions of subsection N. The ownership shall

be real and continuing, and shall go beyond the pro

forma ownership of the business reflected in the

ownership documents. The minority owner(s) shall

enjoy the customary incidents of ownership and shall

share in the risks and profits commensurate with their

ownership interests, as demonstrated by an examina-

tion of the substance, rather than the form, of

arrangements.

2. Control over management, interest in

capital, interest in profit or loss and contributions to

capital, equipment and expertise on which the claim

of minority-owned status under this chapter is based.

The minority Owners must posses and exercise the

legal power to direct the management and policies of

the business and to make the day-to-day as well as

major decisions on matters of management, policy,

and operations. If the owners of the business who

are not minorities are disproportionately responsible

for the operation of the business, then the business is

not controlled by minorities. The business must be

owned, controlled, and managed on a day-to-day,

full-time basis by the minority owner(s). The require-

ments of this subsection R.2. shall not apply, if the

minority business qualifies as a corporate sponsored

dealership under the provisions of subsection N.

3. Ownership and control shall be

measured as though not subject to the community

property interest of a spouse if both spouses certify

that:

a. Only one spouse participates

the management of the business;

b. The nonparticipating spouse

relinquishes control over his/her community property

interest in the subject business.

S. "Minority Business,” means a_ business

certified by the Office of Minority and Women's

Businesses of the State of Washington as a minority

business enterprise which is legitimately owned and

controlled by a minority person or persons as detined

in this section. The director of the department of

executive administration is authorized to determine

that specific racial groups have not been discriminated

against in their ownership and operation of particular

trades or areas of business or in the particular

geographical areas in which they operate. The

director may exclude such businesses from considera-

tion as "minority businesses" under this chapter, in

connection with contracts involving such trades or

areas of business, as provided in Section 4.18.080 of

this chapter.

T. "Minority or Minorities" means a person

who is a citizen of the United States and who is a

member of one or more of the following historically

disadvantaged racial groups:

1. Black: Having origins in any of the

Black racial groups of Africa;

2. Hispanics: Of Mexican, Puerto Rican,

Cuban, or Central or South American culture or

origin;

3. Asian American: Having origins in

any of the original peoples of the Far East, Southeast

Asia, the Indian subcontinent, or the Pacific Islands;

4. American Indian or Alaskan Native:

Having origins in any of the original peoples of

North America.

The director of the department of executive adminis-

tration shall have discretion to make a final decision

as to whether an individual is a minority.

U. "Nonprofit Corporation" shall mean a

corporation organized pursuant to R.C.W. Ch. 24.03.

In the case of nonprofit corporations organized under

the laws of a state other than Washington, a non-

profit corporation shall mean one organized for one

or more of the purposes set forth in R.C.W. 24.03.015

and meeting the definitions in R.C.W. 24.03.005.

V. "Pass-Through" means buying or obtaining

goods from a non-women’s business, non-minority

business or non-combination women/minority busi-

ness, and reselling or transferring those goods to the

county, county contractors or other persons doing

business with the county for the purpose of obtaining

any advantage or benefit conferred under this

chapter, without performing a commercially useful

function.

W. "Percentage Factor" shall mean the special

ranking factors established by this chapter to be

applied in certain competitive bid situations where

minority/women’s businesses respond to solicitation or

are included as subcontracts in responding parties’

responses to solicitation.

X. "Purchasing Contracts,” shall mean; but not

be limited to, those contracts which are awarded by

the department of executive administration as the

representative of King County, or any contract

awarded by King County for the purchase of tangible

goods.

Y. "Responding Party," shall mean any person,

partnership, corporation or business entity which

makes a proposal as defined in this chapter in

response to a solicitation as defined in this chapter.

Z. “Service Contracts," shall mean those

contracts for technical, professional or other work

performed by a vendor, such as the making of

repairs, servicing, maintenance and/or cleaning, and

which does not involve the provision of substantial

tangible items such as materials, supplies or equip-

ment. For the purposes of this chapter, the term

"service contracts" shall not include construction,

rental or leasing of equipment or the traditional

professional services such as consulting, legal services,

feasibility studies and design studies.

AA. "Set Aside,” shall mean that proportion of

each contract awarding authority’s annual expendi-

ture for contract goods and services which equals the

contract awarding authority’s annual goals for partici-

pation of minority/women’s businesses as established

by this chapter.

BB. "Small Business Concern” means a small

business as defined pursuant to Section 3 of the

federal Small Business Act and relevant regulations

promulgated thereto.

CC. "Solicitation," shall mean a_ contract

awarding authority’s request for the provision of any

one or more of the following: goods and services of

any kind, equipment leases, and rentals/purchase of

space. Solicitation shall include requests for

proposals, invitations to bid and similar items.

"Solicitation specifications," shall mean any docu-

ments, literature or other information accompanying

a solicitation which provides additional data

regarding the contract awarding authority's request.

DD. "Utilization Goals," shall mean. those

separately designated annual goals for the use by

King County of minority/women’s businesses. The

goals shall be expressed as a numerical percentage of

the total dollar value of all contracts to be awarded

by the county. These goals shall be applicable to

businesses organized for profit, along with govern-

mental agencies and quasi-governmental agencies,

unless the agencies are specifically excepted by or in

accordance with the provisions of this chapter.

EE. "Utilization Requirements,” shall mean those

efforts which responding parties, King County and

the particular department shall make to meet the

county’s utilization goals, including but not limited to

the percentage factors and set aside requirements

established by this chapter.

FF. "Violating Party," shall mean a person or

entity which has violated a provision or provisions of

this chapter.

GG. "Waiver Statement," shall mean a written

statement directed to the director, department of

executive administration, containing reasons why any

provision or provisions of this chapter shall not apply

to a particular person, partnership, corporation,

business entity, contract awarding authority, depart-

ment, or other entity. Where a waiver or waivers are

granted, the utilization goals shall be applied in a

manner so as to reflect the loss of the monetary value

of those contracts exempted from the requisites of this

chapter.

HH. "Women’s Business," means a_ business

certified by the Office of Minority and Women’s

Businesses of the State of Washington as a women’s

business enterprise. The director of the department of

executive administration is authorized to determine

that women as a class have not been discriminated

against in their ownership and operation of particular

trades or areas of business or in the particular

geographical areas in which they operate. The

director may exclude such businesses from considera-

tion as "women’s businesses” under this chapter, in

connection with contracts involving such trades or

areas of business, according to the procedure

provided for in Section 4.18.080 of this chapter.

4.18.020 Powers and duties. In addition to the

powers and duties given to the King County execu-

tive elsewhere in this chapter, the executive shall,

through the director, department of executive

administration have responsibility for administering,

monitoring and enforcing the goals and requirements

identified in this chapter:

B. In addition to the powers and duties given

the director, department of executive administration

elsewhere in this chapter, the director, department or

executive administration shall:

1. Establish rules, regulations, and

procedures for implementing and administering this

chapter;

2. Recommend to the King County

executive annual utilization goals for King County;

3. Have the authority to enter into

cooperative agreements with other government

agencies concerned with increasing the participation

of minority/women’s businesses in government

contracting;

4. With the advice of contract awarding

authorities, formulate and periodically update a plan

to make minority/women’s businesses aware of con-

tracting opportunities with King County;

5. Review all King County solicitation

lists and where possible, place minority/women’s

businesses on such lists. These lists shall be updated

periodically.

4.18.030 Utilization goals. A. On or before the

first day of March of each year, the director, depart-

ment of executive administration shall submit to the

King County executive for approval proposed utiliza-

tion goals for King County for that calendar year.

Separate utilization goals shall be established for the

use of minority businesses and for the use of

women’s businesses. These utilization goals shall be

established separately for each of the following types

of contracts: architectural and engineering contracts,

concession contracts, construction contracts, consultant

contracts, and purchasing and service contracts. The

utilization goals shall be made part of the King

County Affirmative Action Plan and shall be trans-

mitted with the plan to the King County council for

its approval. Existing utilization goals shall remain in

effect until newly submitted ones receive final King

County council approval.

1. The utilization goals’ shall be

reasonably achievable. To the extent that relevant

information is available, the utilization goals shall be

based on the numbers of qualified minority businesses

and women’s businesses operating in King County.

2. The purpose of this chapter is to

remedy the past effects of discrimination by

increasing the opportunities for minority and

women’s businesses to provide goods and services to

King County using reasonably achievable goals.

a. Each utilization goal _ shall

represent a minimum percentage of the dollars paid

annually by each contract awarding authority to

minority/women’s businesses.

b. The proposed utilization goals

shall be accompanied by a statement which shall

identify the factors in this subsection and any other

factors used in formulating the proposed utilization

goals.

c. Any proposed reduction in

utilization goals shall be accompanied by a statement

which documents that reducing utilization levels is

consistent with this purpose.

B. Each department shall annually formulate a

contract foregast estimating the number, probable

monetary value, (if known), type of contracts and the

estimated solicitation date for the contracts the

department expects to award along with any waivers

it expects to request in the upcoming year. In

addition an impiementation plan describing how the

particular department will accomplish its utilization

goals shall be formulated. On or betore January Ist

of each year, each department will submit these

documents to the director, department of executive

administration.

4.18.040 Accomplishment of utilization goals. A.

For all contracts, accomplishment of utilization goals

established by this chapter shall be based on the

dollar amount of the contract in question.

Accomplishment of the goals shall be calculated in the

following manner:

1. General -- The dollar value of any and

all contracts awarded by a contract awarding

authority to a minority/women’s business shall be

counted towards accomplishment of the applicable

utilization goals.

a. The total dollar value of each

contract awarded to business owned and controlled

by both minority males and non-minority females

shall be apportioned on the basis of the percentage of

ownership to the utilization goals for minorities and

women respectively.

b. The total dollar value of a

contract with a minority/women’s business owned

and controlled by minority women shall be either

counted toward the minority utilization goal or the

goal for women, or apportioned on the basis of

ownership between minorities and women, not to

both.

2. Subcontracts -- lf a contractor uses

subcontractors who are minority/women’s businesses,

the amount is given to the minority/women’s business

for their work on the contract shall be credited

towards meeting the applicable utilization goals.

3. Joint Ventures -- Where one or more

minority/women’s businesses are participants in a

joint venture with one or more non-minority or non-

women’s businesses, the amount of money received

by the minority/women’s business enterprise shall be

calculated in proportion to their participation in the

joint venture in accomplishing the applicable

utilization goals.

4. Supplies/Materials -- The contract

awarding authority or a prime contractor may count

toward its utilization goals:

a. expenditures for materials and

supplies obtained from minority/women’s business

suppliers and manufacturers; provided that, the

minority/women’s business assume the actual and

contractual responsibility for the provision of the

materials and supplies;

b. its entire expenditure made to a

minority/women’s business manufacturer; that is, a

supplier that produces goods from raw materials or

substantially alters them from resale;

c. the amount of the commission

paid to minority/women’s businesses and resulting

from a particular contract with the county; provided

that a minority/women’s business supplier performs a

commercially useful function in the process.

5. Brokers - Fronts - or Similar Pass-

Through Arrangements. Businesses acting as brokers,

fronts, conduits or similar pass-through arrangements

shall not be certified as minority/women’s business

enterprises, unless the brokering service reflects

normal industry practice and the broker performs a

commercially useful function. Such businesses deter-

mined to be acting under these arrangements or

persons who create such arrangements shall be sub-

ject to the penalties enumerated in this chapter.

B. The director, department of executive

administration shall calculate the accomplishment of

utilization goals for King County. In the event of

disputes regarding these calculations, a department

may request review of the director’s decision by the

King County executive.

C. After having met their annual utilization

goals, departments shall continue to make affirmative

efforts to do business with minority/women’s

businesses.

D. The failure of a department or King County

to meet the annual dollar utilization goals established

from time to time by this chapter shall not constitute

grounds for a lawsuit against a department or the

county, provided that the department or the county

has made affirmative efforts to meet those goals. The

100

failure of a department to meet the requirements of

this chapter shall be reviewed by the King County

executive and corrective action taken where

appropriate.

4.18.050 Utilization requirements, general. A.

In order to meet the utilization goals established in

accordance with this chapter, efforts including but not

limited to the following shall be made:

1. Under the auspices of the director,

department of executive administration, a technical

assistance and outreach program shall be established.

2. Prior to entering into any contract, the

contract awarding authority shall:

a. Make affirmative efforts to solicit

proposals from minority/women’s businesses;

b. Examine alternatives for arrang-

ing contracts by size and type of work so as to

enhance the possibility of participation by minority/

women’s businesses.

3. Prior to submitting any bid, proposal,

or other response to a solicitation for which subcon-

tractors may be used, responding parties shall make

good faith affirmative efforts to contact, solicit bids

and proposals from, and use minority/women’s

businesses.

101

4. The following shall be included in the

body of the contract document in any and all con-

tracts signed between a contract awarding authority

and a contractor:

a. A provision indicating that this

chapter is incorporated by reference into any and all

King County contracts and failure to comply with any

of the requirements of the chapter by a contractor

will be considered a breach of contract.

b. A requirement that during the

term of the contract the contractor shall comply with,

as to tasks and proportionate dollar amounts through-

out the term of the contract, all plans made in their

proposal for the use of minority/women’s businesses.

In the absence of a waiver, minority/women’s busi-

nesses for which any reason no longer remain

associated with the contract or the contractor shall be

replaced with other certified minority/women’s

businesses.

c. A_ provision prohibiting any

agreements between a responding party and a

minority/women’s business in which the minority/

women’s business promises not to provide subcontrac-

ting quotations to other responding or potential

responding parties.

d. The requirement of maintenance

of relevant records, and information necessary to

document compliance with this chapter and shall

102

include the right of the county to inspect such

records.

e. A provision requiring the

payment of specific liquidated damages in the event

a contractor fails to perform a commercially-useful!

function and/or operates as a broker, front, conduit or

pass-through, with the amount of liquidated damages

established in advance by the department of executive

administration based on the type of contract involved.

The provision should include the following language:

The purpose of King County’s minority/women’s

business ordinance is to provide a prompt remedy for

the effects of past discrimination. The county in

general, and this program in particular, are damaged

when a contract, or portion of a contract, to be

performed by a minority/women’s business is not

actually performed by a minority/women’s business

enterprise in compliance with this chapter. Because

the actual amount of such damage is not reasonably

calculable, the parties agree and stipulate that

liquidated damages of $ fairly

estimate the amount required to compensate the

county for resulting delays in carrving out the

purpose of the program, the costs of meeting utiliza-

tion goals through additional contracts, the adminis-

trative costs of investigation and enforcement and

other damages and costs caused by the violation.

4.18.060 Utilization requirements, specific. A. [pn

order to expedite achieving of the utilization goals

established in accordance with this chapter, the

103

following utilization requirements shall apply to all

competitive bids and other responses to solicitation:

- 1. For all purchasing, service, and

concession contracts and construction contracts under

ten thousand dollars, the following percentage factor

shall be used in determining which responding party

is the lowest responsible bidder:

a. Where a contract does not require

and/or responding parties do not plan to use subcon-

tractors, suppliers or other business in similar assisting

roles, responding parties whose bids are within five

percent of the bid made by the lowest responsive

bidder shall be ranked as follows:

First, Minority/women’s businesses.

Second, Non-minority/non-women’s

businesses.

b. Where a contract requires the use

of subcontractors, suppliers or other businesses in

similar assisting roles, responding parties whose bids

are within five percent of the bid made by the lowest

bidder shall be ranked in the following order:

First, minority/women’s businesses which use

minority/women’s businesses as subcontractors,

suppliers or in similar assisting roles.

104

Second, minority/women’s businesses or joint

ventures where minority/women’s business partici-

pation is at least twenty-five percent of the dollar

value of a contract and do not use minority/women’s

businesses as subcontractors, suppliers, or in similar

assisting roles;

Third, non-minority/non-women’s — businesses

which use minority/women’s businesses as subcontrac-

tors, suppliers, or in similar assisting roles.

Fourth, non-minority/non-women’s businesses

which do not use minority/women’s businesses as

contractors, suppliers, or in similar assisting roles.

c. Where a contract could require

the use of subcontractors, suppliers or other busi-

nesses in similar assisting roles and some responding

parties make use of such and others do not, respond-

ing parties whose bids are within five percent of that

made by the lowest bidder shall be ranked as set

forth in subsection b., of this Section 4.18.060 A. 1.,

except that the highest ranking shall be given equally

to minority/women’s businesses without subcontrac-

tors and such businesses which use only minority/

women’s businesses as subcontractors and such busi-

nesses which use only minority/women’s businesses as

subcontractors, suppliers or in similar assisting roles.

The lowest ranking shall be given to non-minority/

non-women’s businesses that do not use minority/

women’s businesses as subcontractors, suppliers or in

similar assisting roles.

105

d. All responding parties within

each particular ranking shall be grouped according to

the amount of their bid, with low bidders receiving

the highest priority. The lowest bidder within the

highest ranking category shall be awarded the

contract in question. In the event two or more

responding parties qualify for award of the contract

in question, they shall be notified and allowed the

opportunity to resubmit their bids. The lowest bidder

shal! then be awarded the contract.

2. For every construction, architectural

and engineering, and consultant contracts the

following set aside requirements shall be met:

a. Contracts for construction,

consultant and architectural/engineering services, the

estimated cost of which exceeds ten thousand dollars,

shall require responding parties to include in their

responses to solicitation both minority and women’s

business participation in the contract in a percentage

which equals or exceeds the percentages determined

for the contract by the director of the department of

executive administration. The director shall determine

the percentages for each contract based on the extent

of subcontracting opportunities presented by the

contract and the availability of minority and women’s

business enterprises qualified to perform such sub-

~ contracting work. Such percentages may be higher or

lower than the annual goals for the type of contract

involved.

106

b. Where a contract is awarded to a

minority or women’s business, the set aside require-

ments of these subsections shall not apply.

c. As part of the bid package, all

responding parties shall identify the dollar amount of

minority/women’s business participation. All

responding parties shall also identify the particular

minority/women’s businesses to be used in performing

the contract, specifying for each the dollar value of

the participation, the type of work to be performed,

and other information as may reasonably be required

to determine the responsiveness of the bid or

proposal; provided that, for bids on construction

contracts, this information shall be submitted no later

than the close of the first King County business day

after bid opening.

d. During the term of the contract,

any failure to comply with the percentages of

minority/women’s business participation identified in

the bid or proposal shall be considered a material

breach of contract. The dollar value of the total

contract used for the calculation of the set-aside shall

be increased or decreased to reflect executed change

orders unless:

(1) a waiver is obtained in

accordance with K.C.C. 4.18.070A. after consultation

among the contract awarding authority, the director

107

of the department of executive administration, and

the contractor; or

(2) the department obtains a

reduction in the amount of the set aside according to

the procedure in K.C.C. 4.18.060B., except that the

reduction request for change orders need not be

submitted prior to solicitation of bids or proposals.

B. Departments may request a reduction in the

amount of the set aside for either or both minority

business enterprises or women’s business enterprises,

by submitting the reasons therefor in writing to the

director, department of executive administration, prior

to solicitation of bids or proposals.

1. The director may grant such a

reduction upon determination that:

a. The reasonable and necessary

requirements of the contract render subcontracting or

other participation of businesses other than the bidder

or proposer infeasible at the adopted goal levels; or

b. Qualified minority and women’s

business enterprises capable of providing the goods or

services required by the contract, are unavailable in

the market area of the project, despite every feasible

attempt to locate appropriate minority and women’s

business enterprises to meet adopted goals.

108

c. The available minority and/or

women’s businesses have given price quotes which

are unreasonably high in that they exceed competitive

levels beyond amounts which can be attributed to

cover costs inflated by the present effects of

discrimination.

2. Any reductions in set aside amount

granted by the director shall specify the amount to

which the set aside has been reduced.

C. Where this Section 4.18.060 specifies that a

set aside or a percentage factor shall be used for a

particular type of contract, the method specified is the

preferred method for achieving the utilization goals.

A department may use the other method in its solici-

tation documents for a specific contract if it deter-

mines that a method other tha» the one established

by this Section 4.18.060 will be a more feasible

method of achieving the annual utilization goal. In

the event that a department chooses to use a method

other than the one specified in this Section 4.18.060, it

shall include in its annual report to the executive as

required by Section 4.18.080 D. of this chapter, docu-

ments demonstrating that a method other than the

one established by this Section 4.18.060 is a more

feasible method of achieving the annual utilization

goal.

D. All solicitation documents shall include the

applicable requirements of Sections 4.18.050 and

4.18.060. In addition, documents shall include a pro-

109

vision prohibiting any agreement between a respond-

ing party and a minority/women’s business in which

the minority/women’s business promises not to pro-

vide subcontracting quotations to other responding or

potential responding parties. Bids, proposals, and

other responses which fail to meet the requirements

of this Section 4.18.060 shall, within the limitations of

federal and state law, be deemed non-responsive

unless a waiver has been granted pursuant to Section

4.18.070 of this chapter.

E. The percentage factor and set aside require-

ments of this Section 4.18.060 shall not apply to

contracts awarded for the remainder of any calendar

year in which the contracts awarded for the

remainder of any calendar year in which the contract

awarding authority is determined by the director,

department of executive administration, to have met

the applicable county utilization goals as established

by this chapter. The percentage factor and set aside

provisions of this Section 4.18.060 shall again apply in

each succeeding calendar year until the annual

utilization goals for that year have been met by the

contract awarding authority.

F. For the Kingdome food and _ beverage

concession contract, the set aside method of achieving

utilization goals shall apply.

G. The requirements of this Section 4.18.060

shall cease to apply to contracts awarded by King

110

County and its departments on December 31, 1992,

unless reenacted by the King County council.

4.18.070 Waivers. Contract awarding authorities,

along with or on behalf of responding parties and

contractors, may apply for waiver of one or more

requirements of this chapter as they apply to a

particular contract or contracts.

A. Waivers may be granted by the director,

department of executive administration, in any of the

following circumstances:

1. When the needed goods and services

are readily available from only one source, in which

case the contacting awarding authority shall, in

addition to the requirements contained in Ordinance

No. 4551, K.C.C. 4.16.030, submit a written justification

of the need for sole source treatment to the director,

department of executive administration, who shal!

grant or deny the request for waiver within three

business days;

2. Emergencies, in which case emergency

contracting shall be handled in accordance with the

requirements of Ordinance No. 4551, K.C.C. 4.16.050.

3. | Contracts for which neither a minority

nor a women’s business is available to provide

needed goods or services, in which case a waiver may

be applied for in accordance with procedures to be

developed by the director, department of executive

111

administration. Prior to granting a waiver, the

director, department of executive administration, shall

certify that a minority/women’s business is in fact not

available to provide the needed goods and/or services.

4. Contracts awarded to _ non-profit

organizations, governments and governmental

organizations other than King County, including but

not limited to municipal corporations, consortiums

and association of governmental agencies or officials

and agencies created by interlocal agreement, per

R.C.W. 39.34, or by operation of state or federal law;

where because of a responding party’s non-profit

status, ownership of the corporation or other entity

cannot be determined. However, solely with the

exception of contracts between King County and cities

and towns where King County is the grantee for

federal or state funds passed through to such

jurisdictions, the waiver shall not apply to those

profit-making contractors which contract with the

referenced responding parties.

5. When available minority and/or

women’s businesses have given price quotes which

are unreasonably high in that they exceed competitive

levels beyond amounts which can be attributed to

cover costs inflated by the present effects of

discrimination. }

B. Where the executive determines that the

reasonabie and necessary requirements of a contract

render subcontracting or other participation of

“939

businesses other than a responding party unfeasible,

he/she may grant a waiver from the set aside

provisions of this chapter; PROVIDED THAT, the

waiver shall not be granted after the solicitation

request has been publicly released by the contract

awarding authority; PROVIDED FURTHER THAT,

the solicitation specifications shall state that the

waiver has been authorized and that solicitations

received, proposing subcontracting or other

participation of business other than the responding

party, shall be rejected as non-responsive; PROVIDED

FURTHER THAT, following award of the contract,

should subcontracting or participation of businesses

other than the responding party become necessary,

the previously authorized waiver shall be null and

void. The contractor (original responding party) shall

solicit both minority and women business participa-

tion in a percentage which equals the contract

awarding authority’s annual goal.

C. Where the executive determines that

compliance with the requirements of this chapter

would impose an unwarranted economic burden on,

or risk to, King County as compared with the degree

to which the purposes and policies af this chapter

would be further by requiring compliance he/she may

reduce or waive the utilization requirements of this

ordinance;

PROVIDED THAT upon taking such action, the

King County executive shall notify the members of

the King County council in writing and FURTHER

113

PROVIDED, upon receipt of the notice, if the King

County council determines that the waiver does not

meet the standards of this section, the King County

council may by motion, within ten working days of

the receipt of the notice determine the waiver to be

null and void.

4.18.080 Monitoring, reporting, and enforcement.

A. The county executive, through the director,

department of executive administration, shall have the

responsibility for monitoring implementation of the

requirements of this chapter and shall have the power

to request from departments, responding parties

and/or contractors any relevant records, information

and documents.

B. Contract awarding authorities, with the

assistance of the director, department of executive

administration, shall keep complete and detailed

records regarding compliance with this chapter. The

records shall include the dollar value and the subject

matter of each contract along with the name of the

contractor, the participation levels; (in dollars, number

of contracts awarded, and type of work), of minority/

women’s businesses where the contract award

provides for participation, and other information as

the director, department of executive administration

deems necessary.

C. The director, department of executive

administration, shall be responsible for gathering all

114

information concerning compliance with this chapter

and shall have access to all pertinent King County

records.

D. With the assistance of the director, depart-

ment of executive administration, each department

shall submit to the King County executive an annual

report on its performance in meeting the utilization

goals required by this chapter on or before February

15th of each year. This report shall include the

number and dollar amount of contracts awarded; the

number and dollar amount of contracts with minority/

women’s business participation; the number of

contracts which involved the use of subcontractors,

suppliers or similar assisting roles; the number of

minority/women’s businesses used in such roles; the

number, type, and dollar amount of contracts

awarded pursuant to the percentage factor and set

aside provisions of this chapter; and the basis on

which the department determined that a method

other than the one specified in Section 4.18.060 of the

chapter should be used. The report shall also identify

problems in meeting the requirements of this chapter,

if any, and suggestions for improvements.

E. Certification and Recognition Process.

1. Pursuant to chap. 328, Laws of 1987,

the Office of Minority and Women’s Businesses of the

State of Washington shall be solely responsible for

certifying and decertifying businesses. King County’s

minority and women’s business enterprise program is

115

only for minorities and minority business and

women’s businesses and combination businesses as

defined in K.C.C. 4.18.010; therefore the director,

department of executive administration, shall

recognize only those combination minority and

women’s business enterprises or minority business

enterprises certified by the State of Washington which

also meet the definitions of K.C.C. 4.18.010, according

to minority status information provided to King

County by the Office of Minority and Women’s

Businesses of the State of Washington. Businesses are

only eligible for King County’s programs so long as

they remain certified by the State of Washington.

2. It shall be considered a violation of

this chapter to obtain, or attempt to obtain, certifica-

tion or the benefits of any provision of this chapter,

on the basis of false or misleading information,

whether provided to King County or to the Office of

Minority and Women’s Businesses of the State of

Washington.

3. No contract requiring or proposing

minority/women’s business participation may be

entered into unless all minority/women’s businesses

identified to meet the utilization goals by a

responding party were, at the time the bid was

submitted, certified by the Office of Minority and

Women’s Businesses of the State of Washington and

recognized by the director, department of executive

administration, as eligible to participate in King

County’s minority/women’s business program and the

116

administration, as eligible to participate in King

County’s minority/women’s business program and the

director, department of executive administration,

determines all identified minority/women’s businesses

appear able to perform a commercially useful function

on that contract as proposed. Lists of certified and

recognized minority/women’s businesses shall be

provided to all departments and made available to the

public.

4. No business shall apply to King

County in order to participate in the programs

established by this chapter.

F. Upon receipt of a written and signed

allegation that any contractor, subcontractor, or

vendor has violated any provision of this chapter, or

if a violation is discovered from information gained

through compliance monitoring, or upon reason to

believe that a violation may be occurring, the director,

department of executive administration, or his or her

designee, shall order an investigation. If there is

probable cause to believe that a violation has

occurred, the director, department of executive

administration, or his/her designee will, upon ten

days’ written notice to the alleged violating party,

conduct a hearing to determine whether a violation

has occurred. The hearing shall be recorded and each

party shall have the right to call and examine

witnesses, and to be represented by anyone of his/her

choice lawfully permitted to do so. The parties shall

include the complainant, if any, the alleged violating

117

the investigation. The director, department of

executive administration, may suspend progress

payments on a contract pending the outcome of the

hearing. Unless otherwise agreed to by all parties,

the hearing shall be commenced no later than twenty-

one days after service of a written notice of violation.

G. After the hearing, the director, department

of executive administration, shall make written

findings and conclusions and shall order one or more

of the following:

1. Dismissal of the complaint when a

violation is found not to have occurred;

2. Suspension or cancellation of the

contract in part or in whole;

3. Disqualification and/or debarment of

the violator from participation in county contracts for

a period of up to five years;

4. Exclusion of the violator from future

contracts or vending until demonstration § of

compliance;

5. Enforcement of any provision of the

contract providing remedies, such as penalties or

liquidated damages for violation of contractual

provisions, or enforcement of any other remedy

available under the laws of King County. Upon

finding by the d

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