Hi-Voltage Wire Works, Inc. v. City of San Jose

• Decision Date: 30 November 2000
• Docket Number: No. S080318.,S080318.
• Citation: 24 Cal.4th 537,12 P.3d 1068,101 Cal.Rptr.2d 653
• Court: California Supreme Court
• Parties: HI-VOLTAGE WIRE WORKS, INC., et al., Plaintiffs and Respondents, v. CITY OF SAN JOSE et al., Defendants and Appellants.

101 Cal.Rptr.2d 653

24 Cal.4th 537

12 P.3d 1068

HI-VOLTAGE WIRE WORKS, INC., et al., Plaintiffs and Respondents, v. CITY OF SAN JOSE et al., Defendants and Appellants.

No. S080318.

Supreme Court of California.

November 30, 2000.

Richard Doyle, City Attorney, George Rios, Assistant City Attorney, Glenn D. Schwarzbach and Robert Fabela, Deputy City Attorneys; and Joan R. Gallo for Defendants and Appellants.

Bill Lann Lee, Acting Assistant Attorney General, Stuart J. Ishimaru, Deputy Assistant Attorney General, Mark L. Gross and Lisa W. Edwards, Dist. of Columbia, for United States as Amicus Curiae on behalf of Defendants and Appellants.

Bill Lockyer, Attorney General, Richard M. Frank, Chief Assistant Attorney General, Louis Verdugo, Jr., Assistant Attorney General, and Marjorie Cox, Deputy Attorney General, for State of California as Amicus Curiae on behalf of Defendants and Appellants.

Louise H. Renne, City Attorney, Randy Riddle, Mara E. Rosales, Ellen M. Forman and Teresa L. Strieker, Deputy City Attorneys; Moscone, Emblidge & Quadra and G. Scott Emblidge for City and County of San Francisco, County of Alameda, County of Marin, County of Sacramento, City of Albany, City of Berkeley, City of Hayward, City of Los Angeles, City of Oakland, City of Redlands, City of Sacramento, City of San Pablo and the East Bay Municipal Utility District as Amici Curiae on behalf of Defendants and Appellants.

Morrison & Foerster, Alan Cope Johnston, Su W. Hwang, Cynthia L. Lopez, Katherine A. Zonana, Sharyn K. Funamura, Palo Alto, and Lia B. Epperson, for United Minority Business Entrepreneurs, Santa Clara County Black Chamber of Commerce, Coalition for Economic Equity and Tradeswomen, Inc., as Amici Curiae on behalf of Defendants and Appellants.

Beth H. Parker; Eva J. Peterson and Oren Sellstrom, Woodland, for Dr. Mary Frances Berry, Cruz Reynoso, Christopher J. Edley, Jr., Elsie Meeks and Yvonne Y. Lee, Commissioners for the U.S. Commission on Civil Rights, Equal Rights Advocates, Lawyers' Committee for Civil Rights of the San Francisco Bay Area, American Civil Liberties Union Foundation of Northern California, American Civil Liberties Union Foundation of Southern California, Employment Law Center, Mexican American Legal Defense and Educational Fund and California Minority Counsel Program as Amici Curiae on behalf of Defendants and Appellants.

Elaine R. Jones, Washington, DC, Theodore M. Shaw, Norman J. Chachkin, Melissa Woods, Erica J. Teasley; and Pamela S. Karlan for NAACP Legal Defense and Educational Fund, Inc., as Amicus Curiae on behalf of Defendants and Appellants.

Lora Jo Foo, Khin Mai Aung, San Francisco; Karen K. Narasaki, Aryani Ong; Crowell & Moring, J. Michael Klise, Andy Liu, Miguel Del Toro, Washington, DC; Stewart Kwoh, Los Angeles, Julie A. Su; Sin Yen Ling and Ken Kimerling for National Asian Pacific American Legal Consortium, Asian Law Caucus and Asian American Contractors Association as Amici Curiae on behalf of Defendants and Appellants.

Horvitz & Levy, David S. Ettinger, Encino, and Jon B. Eisenberg, Oakland, for Mission Hiring Hall, Visitation Valley Jobs Education and Training, Asian Neighborhood Design, Chinese for Affirmative Action, Ella Hill Hutch Community Center and Young Community Developers as Amici Curiae on behalf of Defendants and Appellants.

Edward Chen for American Civil Liberties Union Foundation for Northern California as Amicus Curiae on behalf of Defendants and Appellants.

William McNeill III and Julian Gross, San Francisco, for Employment Law Center as Amicus Curiae on behalf of Defendants and Appellants.

Pacific Legal Foundation, John H. Findley, Sharon L. Browne, Sacramento, Deborah J. La Fetra, Stephen R. McCutcheon, Jr., and Mark T. Gallagher, Sacramento, for Plaintiffs and Respondents.

Kevin T. Snider, Gary G. Kreep, Escondido, and William G. Gillespie for United States Justice Foundation as Amicus Curiae on behalf of Plaintiffs and Respondents.

Losch & Ehrlich and Ronald K. Losch, San Francisco, for HSQ Technology as Amicus Curiae on behalf of Plaintiffs and Respondents.

Simpson, Aherne & Garrity, San Mateo, and Pamela A. Lewis for J. Jack Bras and doing business as J. Jack Bras & Associates as Amici Curiae on behalf of Plaintiffs and Respondents.

Roger Clegg and David A. DeGroot, Austin, TX, for Glynn Custred and Thomas E. Wood as Amici Curiae on behalf of Plaintiffs and Respondents.

Patrick J. Manshardt; Law Offices of Manuel S. Klausner and Manuel S. Klausner, Los Angeles, for American Civil Rights Institute, Ward Connerly and Governor Pete Wilson as Amici Curiae on behalf of Plaintiffs and Respondents.

BROWN, J.

"In the history of this Court and this country, few questions have been more divisive than those arising from governmental action taken on the basis of race." (Fullilove v. Klutznick (1980) 448 U.S. 448, 516, 100 S.Ct. 2758, 65 L.Ed.2d 902 (cone, opn. of Powell, J.); see also DeFunis v. Odegaard (1974) 416 U.S. 312, 350, 94 S.Ct. 1704, 40 L.Ed.2d 164 (dis. opn. of Brennan, J.).) In November 1996, the California voters added yet another chapter to the long and tortuous history of this question when they approved Proposition 209, which amended our Constitution to prohibit the state and its political subdivisions from "discriminating] against, or granting] preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting." (Cal. Const., art. I, § 31.) Subsequent to the approval of Proposition 209, the City of San Jose adopted a program that requires contractors bidding on city projects to utilize a specified percentage of minority and women subcontractors or to document efforts to include minority and women subcontractors in their bids.

The question before the court is whether this program contravenes article I, section 31 of the California Constitution. Although the precise issue is a narrow one, the electorate did not approve Proposition 209 in a vacuum. Quite the contrary. Thus, while it may be possible to resolve the matter, as do the Chief Justice and Justice Kennard, simply by relying on differences between Proposition 209 and title VII of the Civil Rights Act of 1964 or on the plain meaning of the initiative's language, we can discern and thereby effectuate the voters' intention only by interpreting this language in its historical context. Viewing the provisions of article I, section 31 from this perspective, it is clear the voters intended to adopt the original construction of the Civil Rights Act and prohibit the kind of preferential treatment accorded by this program.

FACTUAL AND PROCEDURAL BACKGROUND

The salient facts, which are not in dispute, are drawn from the opinion of the Court of Appeal. In 1983, the City of San Jose (City) established a program to encourage public works projects participation by minority business enterprises (MBE's) and women business enterprises (WBE's).¹ For each contract, the City set a "participation goal" based on the "availability and ability of the MBE and WBE to do the work to be contracted." To qualify as a "responsible bidder," a contractor had to meet or exceed this goal or demonstrate "reasonable efforts" to obtain MBE/WBE participation. "Reasonable efforts" entailed documenting written notice to at least four MBE's/WBE's soliciting them for the project, follow-up contact to determine their interest in bidding, and written reasons justifying rejection of an MBE's or WBE's low bid.

In 1989, the United States Supreme Court held in City of Richmond v. J.A Croson Co. (1989) 488 U.S. 469, 498-507, 109 S.Ct. 706, 102 L.Ed.2d 854 (Croson),

that a state government could not implement a program designed to remedy past discrimination absent a factual predicate substantiating an inference of prior discriminatory exclusion. Following Croson, in 1990 the City suspended its MBE/WBE program and commissioned a study to identify any statistically significant disparity in the number and dollar value of contracts and subcontracts awarded to MBE's and WBE's. The resulting report established such a disparity as to the amount of contract dollars awarded MBE subcontractors. In response, the City adopted the "MBE/WBE Construction Program" to encourage nondiscriminatory subcontracting. Like its predecessor, the new program included participation goals and required documentation of good faith efforts to meet them.

After the passage of Proposition 209, the City's Office of Affirmative Action/Contract Compliance became the Office of Equality Assurance. The City also adopted the Nondiscrimination/Nonpreferential Treatment Program Applicable to Construction Contracts in Excess of $50,000 (Program) at issue here. The Program reaffirms the findings of the 1990 disparity study and attempts to clarify the City's policy of nondiscrimination and nonpreference in the subcontracting of its construction projects to "ensure that the historical discrimination does not continue."²

As with the 1983 version, the Program requires contractors bidding on City projects to fulfill either an outreach or a participation component. The "Documentation of Outreach" option entails maintaining records of written notice, or "solicitation letters," to four certified MBE's/ WBE's for each trade area identified for the project. Copies of the notice or letters must accompany the bid. The contractor must document at least three attempts to contact the MBE/WBE firms to determine their interest in participating in the project. If any MBE's/WBE's express interest, the contractor must negotiate in good faith. It may not unjustifiably reject any bids prepared by MBE's/WBE's and must specify the reasons for doing so.³ With respect to the "Documentation of Participation" option, the City determines for each project the number of MBE/WBE subcontractors that would be expected in the absence of discrimination. If a contractor lists a...