South Florida Chapter of the Associated General Contractors of America, Inc. v. Metropolitan Dade County, Fla.

• Decision Date: 27 January 1984
• Docket Number: No. 83-5001,83-5001
• Citation: 723 F.2d 846
• Parties: 33 Empl. Prac. Dec. P 34,122 SOUTH FLORIDA CHAPTER OF the ASSOCIATED GENERAL CONTRACTORS OF AMERICA, INC., et al., Plaintiffs-Appellees, Cross-Appellants, v. METROPOLITAN DADE COUNTY, FLORIDA, et al., Defendants-Appellants, Cross- Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 846

723 F.2d 846

33 Empl. Prac. Dec. P 34,122

SOUTH FLORIDA CHAPTER OF the ASSOCIATED GENERAL CONTRACTORS

OF AMERICA, INC., et al., Plaintiffs-Appellees, Cross-Appellants, v. METROPOLITAN DADE COUNTY, FLORIDA, et al.,

Defendants-Appellants, Cross- Appellees.

No. 83-5001.

United States Court of Appeals, Eleventh Circuit.

Jan. 27, 1984.

Rehearing and Rehearing En Banc Denied March 22, 1984.

Robert A. Ginsburg, Dade County Atty., Robert A. Cuevas, Jr., Asst. County Atty., Miami, Fla., for Metropolitan Dade County.

Muller, Mintz, Kornreich, Caldwell, Casey, Crosland & Bramnick, P.A., Gordon Dean Rogers, David V. Kornreich, Miami, Fla., for South Florida.

John W. Caven, Jr., Jacksonville, Fla., for amicus curiae Northeastern Chapter, Associated General Contractors of America.

G. Stephen Parker, Atlanta, Ga., for amicus curiae Southeastern Legal Foundation, Inc., and Justin J. Finger, New York City, for amicus curiae Anti-Defamation League of B'Nai B'Rith.

Appeals from the United States District Court for the Southern District of Florida.

Before KRAVITCH, HENDERSON and ANDERSON, Circuit Judges.

KRAVITCH, Circuit Judge:

This case involves the constitutionality of a Metropolitan Dade County ordinance and resolution granting preferential treatment to blacks in its contract bidding process. The ordinance allows the County to "set aside" contracts for bidding solely among black contractors ¹ and contains a "goals" The district court held that the set-aside provision violated the Equal Protection Clause of the Fourteenth Amendment and granted a permanent injunction. The court, however, upheld the constitutionality of the goals provision. South Florida Chapter of the Associated General Contractors of America, Inc. v. Metropolitan Dade County, 552 F.Supp. 909 (S.D.Fla.1982) [hereinafter cited as Metro Dade ]. Both sides have appealed from the decision.

provision by which the county can require that a certain percentage of a contract's value be subcontracted to black contractors. The plaintiffs, non-profit corporations and trade associations, brought suit challenging the ordinance both facially and as applied to the county construction contract for the Earlington Heights Metrorail Station.

I.

The district court made extensive factual findings of the events leading up to the present controversy. ² The court found that the May 1980 disturbances in Liberty City had prompted the county to investigate the economic and social opportunities of blacks living in the area. The resulting studies concluded that race relations would continue to deteriorate unless steps were taken to enhance the business opportunities of the black community.

On November 3, 1981, the Dade County Commission in response to these findings adopted Resolution No. R-1672-81. ³ The resolution recognized that past discrimination had "to some degree" impaired the competitive position of black-owned businesses, resulting in a "statistically significant disparity" between the black population, the number of black businesses, and the number of county contracts awarded to black-owned enterprises. The resolution proceeded to announce a "policy of developing programs and measures to alleviate the problem ..., including specific race conscious measures."

On July 20, 1982, the Dade County Commission adopted Ordinance No. 82-67 ⁴ as a measure designed to implement its policy of fostering black business growth. The Commission premised the ordinance on a finding that:

Dade County has a compelling interest in stimulating the Black business community, a sector of the County sorely in need of economic stimulus but which, on the basis of past experience, is not expected to benefit significantly in the absence of specific race-conscious measures to increase its participation in County contracts.

The ordinance required that all proposed county contracts be reviewed to determine whether race-conscious measures would foster participation by black contractors and subcontractors. Bid credits, set-asides, minority participation goals and other devices were to be considered. The district court summarized the administrative procedures mandated by the ordinance as follows:

a. Each department is charged with the responsibility of submitting its recommendations concerning Black set-asides and goals on each construction project under its jurisdiction;

b. A three member contract review committee comprised of county officials is charged with the responsibility of reviewing the Departmental recommendations and submitting a final recommendation on Black set-asides and goals to the county commission for final action;

c. Black subcontractors goals are to be based on "the greatest potential for Black subcontractor participation" and ... "shall relate to the potential availability d. Availability of Black subcontractors should include "all Black-owned firms with places of business within the Dade County geographic area";

of Black-owned firms in the required field of expertise";

e. Black set-asides shall be considered where there exists at least three Black prime contractors with the capabilities consistent with the contract requirements;

f. A Black prime contractor can be under contract for up to three set-asides within any one year period, but no more than one set-aside at a time;

g. Prior to implementation of a Black set-aside, the county commission is to make findings that the Black set-aside is "in the best interest of the County in order to waive formal bid procedures"; and

h. Bid procedures limiting bids to Black prime contractors would be implemented. ⁵

Metro Dade, 552 F.Supp. at 922.

On July 21, 1982, the day following the passage of Ordinance No. 82-67, the county received and opened bid proposals for the Earlington Heights Station, part of a billion dollar rapid-rail transit system financed with federal, state and local funds. A non-black prime contractor, Peter Kiewit Sons' Company, submitted the lowest bid. The next lowest bid was tendered by Thacker Construction Company, a black prime contractor. These bids were rejected for two reasons: (1) both exceeded the County Engineer's estimate of what the project should cost, and (2) the amounts of the bids had become public, rendering it impossible to conduct competitive bid negotiations under applicable federal regulations. The County Manager then proposed, and the Commission agreed, that the Earlington Heights contract be reviewed under the newly enacted ordinance.

After reviewing departmental recommendations, the Contract Review Committee proposed that the Commission waive the use of formal competitive bids, setting aside the Earlington Heights contract for competitive bidding exclusively among black contractors. In accordance with the administrative procedure provided by the ordinance, the Contract Review Committee found that there were a sufficient number of licensed black contractors in Dade County that possessed the requisite financial and technical capabilities to ensure competition for the contract. Additionally, the Committee suggested the inclusion of a subcontractor goal requiring that fifty percent of the contract's dollar value be awarded to black subcontractors. When combined with the general requirement that the prime contractor personally perform twenty-five percent of the contract, this meant that seventy-five percent of the Earlington Heights contract was being set aside solely for black contractors.

On October 5, 1982, the Dade County Commission passed Resolution No. R-1350-82 ⁶ adopting the Committee's recommendations. The County issued notice that the contract was open for bidding subject to the one hundred percent set-aside and the fifty percent subcontractor goal. The closing date for submission and the opening of bids was set for November 17, 1982.

The plaintiff-appellees filed a complaint in the Southern District of Florida on November 12, 1982, seeking declaratory and injunctive relief. Jurisdiction was premised upon 28 U.S.C. Sec. 1343 as an action seeking relief pursuant to 42 U.S.C. Secs. 1981 and 1983 and 28 U.S.C. Secs. 2201 and 2202. Two related state-law claims were asserted under the district court's pendent jurisdiction. On November 16, 1982, after both sides presented evidence at a hearing, the district court granted the plaintiffs' motion for a temporary restraining order. On December 16, 1982, the court issued its memorandum opinion, declaring the one hundred percent set-aside unconstitutional, but upholding the use of the fifty percent subcontractor goal.

II.

Because resolution of appellees' pendent claims might render discussion of the federal constitutional claims unnecessary, we address those claims first. Hagans v. Levine, 415 U.S. 528, 94 S.Ct. 1372, 39 L.Ed.2d 577 (1974). The plaintiff-appellees first contend that the County's preferential treatment policy violates the Dade County Home Rule Charter. The district court concluded that the Commission, pursuant to section 4.03(D) of the Charter, may waive competitive bidding when it determines waiver to be in the County's best interests. Metro Dade, 552 F.Supp. at 927-28. We agree with this conclusion and discuss the relevant Charter provisions more completely infra at 851 - 852.

Plaintiff-appellees also argue that the challenged policies contravene the Florida Constitution's due process and equal protection guarantees. The Florida courts have held that these provisions confer the same protection as their federal counterparts. See Florida Canners Association v. Department of Citrus, 371 So.2d 503, 513 (Fla.2d Dist.Ct.App.1979), aff'd, 406 So.2d 1079 (Fla.1981); Florida Real Estate Commission v. McGregor, 336 So.2d 1156 (Fla.1976). Determination of this pendent claim, therefore, is necessarily dependent upon the disposition of the federal constitutional issue.

III.

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