2 DOT also uses the subcontractor compensation mechanism in implementing the Surface Transportation and Uniform Relocation Assistance Act of 1987 ("STURAA"), Pub. L. No. 100-17, § 106(c)(1), 101 Stat. 145, and its successor, the Intermodal Surface Transportation Efficiency Act of 1991 ("ISTEA"), Pub. L. No. 102-240, § 1003(b), 105 Stat. 1919-22. Both laws provide that "not less than 10 percent" of funds appropriated thereunder "shall be expended with small business concerns owned and controlled by socially and economically disadvantaged individuals." STURAA and ISTEA adopt the Small Business Act's definition of "socially and economically disadvantaged individual," including the applicable race-based presumptions. Adarand, 63 U.S.L.W. at 4525.
3 Justice O'Connor (along with three other Justices) had dissented in Metro Broadcasting and urged the adoption of strict scrutiny as the standard of review for federal affirmative action measures.
4 A classification reviewed under intermediate scrutiny need only (i) serve an "important" governmental interest and (ii) be "substantially related" to the achievement of that objective. Metro Broadcasting, 497 U.S. at 564-65.
5 See, e.g., McLaughlin v. Florida, 379 U.S. 184, 192 (1964) (racial and ethnic classifications that single out minorities for disfavored treatment are in almost all circumstances "irrelevant to any constitutionally acceptable legislative purpose") (internal quotations omitted); Loving v. Virginia, 388 U.S. 1, 11 (1967) ("There is patently no legitimate overriding purpose independent of invidious racial discrimination which justifies" state law that prohibited interracial marriages).
6 In his Croson concurrence, Justice Scalia said that he believes that "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." 488 U.S. at 524 (Scalia, J., concurring in the judgment). For Justice Scalia, "[t]his distinction explains [the Supreme Court's] school desegregation cases, in which [it has] made plain that States and localities sometimes have an obligation to adopt race-conscious remedies. Id. The school desegregation cases are generally not thought of as affirmative action cases, however. Outside of that context, Justice Scalia indicated that he believes that "[a]t least where state or local action is at issue, only a social emergency rising to the level of imminent danger to life and limb . . . can justify an exception to the principle embodied in the Fourteenth Amendment that our Constitution is color-blind." Id. at 521.
7 See Local 28, Sheet Metal Workers' Int'l Ass'n v. EEOC, 478 U.S. 421, 482 (1986); Wygant v. Jackson Bd. of Educ., 476 U.S. 267, 277-78 (1986) (plurality opinion); id. at 287 (O'Connor, J., concurring).
8 Justice Stevens wrote a dissenting opinion that was joined by Justice Ginsburg. Justice Souter wrote a dissenting opinion that was joined by Justices Ginsburg and Breyer. And Justice Ginsburg wrote a dissenting opinion that was joined by Justice Breyer.
9 By voluntary affirmative action, we mean racial or ethnic classifications that the federal government adopts on its own initiative, through legislation, regulations, or internal agency procedures. This should be contrasted with affirmative action that is undertaken pursuant to a court-ordered remedial directive in a race discrimination lawsuit against the government, or pursuant to a court-approved consent decree settling such a suit. Prior to Croson, the Supreme Court had not definitely resolved the standard of review for court-ordered or court-approved affirmative action. See United States v. Paradise, 480 U.S. 149 (1987) (court order); Local 93, Int'l Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501 (1986) (consent decree). The Court has not revisited the issue since Croson was decided. Lower courts have applied strict scrutiny to affirmative action measures in consent decrees. See, e.g., Stuart v. Roache, 951 F.2d 446, 449 (1st Cir. 1991) (Breyer, J.).
10 Title VII of the 1964 Civil Rights Act is the principal federal employment discrimination statute. The federal government is subject to its strictures. See 42 U.S.C. § 2000e-17. The Supreme Court has held that the Title VII restrictions on affirmative action in the workplace are somewhat more lenient than the constitutional limitations. See Johnson v. Transportation Agency, 480 U.S. 616, 627-28 n.6 (1987). But see id. at 649 (O'Connor, J., concurring in the judgment) (expressing view that Title VII standards for affirmative action should be "no different" from constitutional standards).
11 We do not believe that Adarand calls into question federal assistance to historically-black colleges and universities.
12 See, e.g., Peightal v. Metropolitan Dade County, 26 F.3d 1545, 1557-58 (11th Cir. 1994); Billish v. City of Chicago, 962 F.2d 1269, 1290 (7th Cir. 1992), vacated on other grounds, 989 F.2d 890 (7th Cir.) (en banc), cert. denied, 114 S. Ct. 290 (1993); Coral Constr. Co. v. King County, 941 F.2d 910, 923 (9th Cir. 1991), cert. denied, 502 U.S. 1033 (1992).
13 Outreach and recruitment efforts conceivably could be viewed as race-based decisionmaking of the type subject to Adarand if such efforts work to create a "minorities-only" pool of applicants or bidders, or if they are so focused on minorities that nonminorities are placed at a significant competitive disadvantage with respect to access to contracts, grants, or jobs.
14 The lone gender-based affirmative action case that the Supreme Court has decided is Johnson v. Transportation Agency, 480 U.S. 616 (1987). But Johnson only involved a Title VII challenge to the use of gender classifications -- no constitutional claim was brought. Id. at 620 n.2. And as indicated above (see supra note 10), the Court in Johnson held that the Title VII parameters of affirmative action are not coextensive with those of the Constitution.
15 See, e.g., Ensley Branch, NAACP v. Seibels, 31 F.3d 1548, 1579-80 (11th Cir. 1994); Contractors Ass'n v. City of Philadelphia, 6 F.3d 990, 1009-10 (3d Cir. 1993); Lamprecht v. FCC, 958 F.2d 382, 391 (D.C. Cir. 1992) (Thomas, J.); Coral Constr. Co. v. King County, 941 F.2d at 930-31; Associated Gen. Contractors v. City and County of San Francisco, 813 F.2d 922, 939 (9th Cir. 1987).
16 See Conlin v. Blanchard, 890 F.2d 811, 816 (6th Cir. 1989); see also Brunet v. City of Columbus, 1 F.3d 390, 404 (6th Cir. 1993), cert. denied, 114 S. Ct. 1190 (1994).
17 See, e.g., Ensley Branch, NAACP v. Seibels, 31 F.3d at 1580.
18 Croson was decided by a six-three vote. Five of the Justices in the majority (Chief Justice Rehnquist, and Justices White, O'Connor, Scalia, and Kennedy) concluded that strict scrutiny was the applicable standard of review. Justice Stevens concurred in part and concurred in the judgment, but consistent with his long-standing views, declined to "engag[e] in a debate over the proper standard of review to apply in affirmative-action litigation." 488 U.S. at 514 (Stevens, concurring in part and concurring in the judgment).
19 Justice O'Connor's opinion was for a majority of the Court in some parts, and for a plurality in others.
20 Lower courts have consistently said that Croson requires remedial affirmative action measures to be supported by a "strong basis in evidence" that such action is warranted. See, e.g., Peightal v. Metropolitan Dade County, 26 F.3d 1545, 1553 (11th Cir. 1994); Concrete Works v. City and County of Denver, 36 F.3d 1513, 1521 (10th Cir. 1994), cert. denied, 115 S. Ct. 1315 (1995); Donaghy v. City of Omaha, 933 F.2d 1448, 1458 (8th Cir.), cert. denied, 502 U.S. 1059 (1991). Some courts have said that this evidence should rise to the level of prima facie case of discrimination against minorities. See, e.g., O'Donnell Constr. Co. v. District of Columbia, 963 F.2d 420, 424 (D.C. Cir. 1992); Stuart v. Roache, 951 F.2d 446, 450 (1st Cir. 1991) (Breyer, J.); Cone Corp. v. Hillsborough County, 908 F.2d 908, 915 (11th Cir.), cert. denied, 498 U.S. 983 (1990).
21 The measures at issue in Paradise were intended to remedy discrimination by the Alabama Department of Public Safety, which had not hired a black trooper at any rank for four decades, 480 U.S. at 168 (plurality opinion), and then when blacks finally entered the department, had consistently refused to promote blacks to the upper ranks. Id. at 169-71.
22 See, e.g., Contractors Ass'n v. City of Philadelphia, 6 F.3d 990, 1008 (3d Cir. 1993); O'Donnell Constr. Co. v. District of Columbia, 963 F.2d 420, 427 (D.C. Cir. 1992); cf. Associated Gen. Contractors v. Coalition for Economic Equity, 950 F.2d 1401, 1415 (9th Cir. 1991) (government had evidence that an "old boy network" in the local construction industry had precluded minority businesses from breaking into the mainstream of "qualified" public contractors).
23 See, e.g., Contractors Ass'n v. City of Philadelphia, 6 F.3d at 1002-03 (while anecdotal evidence of discrimination alone rarely will satisfy the Croson requirements, it can place important gloss on statistical evidence of discrimination); Coral Constr Co. v. King County, 941 F.2d at 919 ("[t]he combination of convincing anecdotal and statistical evidence is potent;" anecdotal evidence can bring "cold numbers to life"); Cone Corp. v. Hillsborough County, 908 F.2d at 916 (testimonial evidence adduced by county in developing MBE program, combined with gross statistical disparities in minority participation in public contracting, provided "more than enough evidence on the question of prior discrimination and need for racial classification").
24 See also Wygant, 476 U.S. at 293 (O'Connor, J., concurring in part and concurring in the judgment) (when the government "introduces its statistical proof as evidence of its remedial purpose, thereby supplying the court with the means for determining that the [government] had a firm basis for concluding that remedial action was appropriate, it is incumbent upon the [challengers] to prove their case; they continue to bear the ultimate burden of persuading the court that the [government's] evidence did not support an inference of prior discrimination and thus a remedial purpose, or that the plan instituted on the basis of this evidence was not sufficiently `narrowly tailored'").
25 See, e.g., Concrete Works v. City and County of Denver, 36 F.3d at 1521-22; Contractors Ass'n v. City of Philadelphia, 6 F.3d at 1005; Cone Corp. v. Hillsborough County, 908 F.2d at 916.
26 See Concrete Works v. City & County of Denver, 36 F.3d at 1521; Contractors Ass'n v. City of Philadelphia, 6 F.3d at 1004); Coral Constr. Co. v. King County, 941 F.2d at 920. As the Second Circuit put it when permitting a state government to rely on post-enactment evidence to defend a race-based contracting measure, "[t]he law is plain that the constitutional sufficiency of . . . proffered reasons necessitating an affirmative action plan should be assessed on whatever evidence is presented, whether prior to or subsequent to the program's enactment." Harrison & Burrowes Bridge Constructors, Inc. v. Cuomo, 981 F.2d 50, 60 (2d Cir. 1992).
27 See Concrete Works v. City and County of Denver, 36 F.3d at 1521 ("Absent any preenactment evidence of discrimination, a municipality would be unable to satisfy Croson. However, we do not read Croson's evidentiary requirement as foreclosing the consideration of post-enactment evidence."); Coral Constr. Co. v. King County, 941 F.2d at 920 (requirement that municipality have "some evidence" of discrimination before engaging in race-conscious action "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, whether such evidence was adduced before or after enactment of the [program]."). One court has observed that the "risk of insincerity associated with post-enactment evidence . . . is minimized" where the evidence "consists essentially of an evaluation and re-ordering of [the] pre-enactment evidence" on which a government expressly relied in formulating its program. Contractors Ass'n v. City of Philadelphia, 6 F.3d at 1004. Application of the post-enactment evidence rule in that case essentially gave the government a period of transition in which to build an evidentiary foundation for an affirmative action program that was adopted before Croson, and thus without reference to the Croson requirements. In Coral Construction, the Ninth Circuit permitted the government to introduce post-enactment evidence to provide further factual support for a program that had been adopted after Croson, with the Croson standards in mind. See Coral Constr. Co. v. King County, 941 F.2d at 914-15, 919-20.
28 Given the nation's history of discrimination, virtually all affirmative action can be considered remedial in a broad sense. But as Croson makes plain, that history, on its own, cannot properly form the basis of a remedial affirmative action measure under strict scrutiny.
29 Although Justice Powell wrote for himself in Bakke, his opinion was the controlling one in the case.
30 Although it apparently has not been tested to any significant degree in the courts, Justice Powell's thesis may carry over to the selection of university faculty: the greater the racial and ethnic diversity of the professors, the greater the array of perspectives to which the students would be exposed.
31 See Winter Park Communications, Inc. v. FCC, 873 F.2d 347, 353-54 (D.C. Cir. 1989), aff'd sub. nom. Metro Broadcasting, Inc. v. FCC, 497 U.S. 547 (1990); Winter Park, 873 F.2d at 357 (Williams, J., concurring in part and dissenting in part); Shurberg Broadcasting, Inc. v. FCC, 876 F.2d 902, 942 (D.C. Cir. 1989) (Wald, C.J., dissenting), aff'd sub. nom. Metro Broadcasting, Inc. v. FCC, 497 U.S. 547 (1990). In Davis v. Halpern, 768 F. Supp. 968 (S.D.N.Y. 1991), the court reviewed the law of affirmative action in the wake of Croson and Metro Broadcasting, and, citing Justice Powell's opinion in Bakke, said that a university has a compelling interest in seeking to increase the diversity of its student body. Id. at 981. See also United States v. Board of Educ. Township of Piscataway, 832 F. Supp. 836, 847-48 (D.N.J. 1993) (under constitutional standards for affirmative action, diversity in higher education is a compelling governmental interest) (citing Bakke and Croson).
32 The Court has consistently rejected "racial balancing" as a goal of affirmative action. See Croson, 488 U.S. at 507; Johnson, 480 U.S. at 639; Local 28 Sheet Metal Workers' Int'l Ass'n v. EEOC, 478 U.S. 421, 475 (1986) (plurality opinion); Bakke, 438 U.S. at 307 (opinion of Powell, J.).
33 See also Detroit Police Officers' Ass'n v. Young, 608 F.2d 671, 696 (6th Cir. 1979), cert. denied, 452 U.S. 938 (1981) ("The argument that police need more minority officers is not simply that blacks communicate better with blacks or that a police department should cater to the public's desires. Rather, it is that effective crime prevention and solution depend heavily on the public support and cooperation which result only from public respect and confidence in the police.").
34 Aside from the proffered justification in Bakke, the government may have other reasons for seeking to increase the number of minority health professionals.
35 Justice Powell cited literature on this subject in support of his opinion in Bakke. See 438 U.S. at 312-13 n.48, 315 n.50.
36 See Hayes v. North State Law Enforcement Officers Ass'n, 10 F.3d 207, 215 (4th Cir. 1993) (although the use of racial classifications to foster diversity of police department could be a constitutionally permissible objective, city failed to show a link between effective law enforcement and greater diversity in the department's ranks).
37 See Bakke, 438 U.S. at 311 (opinion of Powell, J.) (noting lack of empirical data to support medical school's claim that minority doctors will be more likely to practice in a disadvantaged community).
38 See Coral Constr. King County, 941 F.2d at 923 ("[W]hile strict scrutiny requires serious, good faith consideration of race-neutral alternatives, strict scrutiny does not require exhaustion of every such possible alternative.").
39 Cf. Billish v. City of Chicago, 989 F.2d 890, 894 (7th Cir.) (en banc) (Posner, J.) (in reviewing affirmative action measures, courts must be "sensitiv[e] to the importance of avoiding racial criteria . . . whenever it is possible to do so, [as] Croson requires"), cert. denied, 114 S. Ct. 290 (1993).
40 See Contractors Ass'n v. City of Philadelphia, 6 F.3d at 1009 n.18.
41 See also Ensley Branch, NAACP v. Seibels, 31 F.3d 1548, 1571 (11th Cir. 1994) (city should have implemented race-neutral alternative of establishing non-discriminatory selection procedures in police and fire departments instead of adopting race-based procedures; "continued use of discriminatory tests. . . compounded the very evil that [race-based measures] were designed to eliminate"); Aiken v. City of Memphis, 37 F.3d 1155, 1164 (6th Cir. 1994) (remanding to lower court, in part, because evidence suggested that the city should have used obvious set of race-neutral alternatives before resorting to race-conscious measures).
42 Most lower courts have not construed Croson in that fashion. See, e.g., Billish v City of Chicago, 962 F.2d 1269, 1292-94 (7th Cir. 1992), rev'd on other grounds, 989 F.2d 890 (7th Cir.) (en banc), cert. denied, 114 S. Ct. 290 (1993); Coral Constr. Co. v. King County, 941 F.2d at 925-26 n.15; Cunico v. Pueblo School Dist. No. 60, 917 F.2d 431, 437 (10th Cir. 1990). But see Winter Park v. FCC, 873 F.2d 347, 367-68 (D.C. Cir. 1989) (Williams, J., concurring in part and dissenting in part) (interpreting Croson as requiring that racial classifications be limited "to victims of prior discrimination"); Main Line Paving Co. v. Board of Educ., 725 F. Supp. 1347, 1362 (E.D. Pa. 1989) (MBE program not narrowly tailored, in part, because it "containe[d] no provision to identify those who were victims of past discrimination and to limit the program's benefits to them").
43 See O'Donnell Constr. Co. v. District of Columbia, 963 F.2d at 427 (MBE program was not narrowly tailored because of "random inclusion of racial groups for which there was no evidence of past discrimination").
44 Compare Associated Gen. Contractors v. Coalition for Economic Equity, 950 F.2d at 1418 (MBE program intended to remedy discrimination against minorities in county construction industry was narrowly tailored, in part, because scope of beneficiaries was limited to minorities within the county) with Podberesky v. Kirwan, 38 F.3d 147, 159 (4th Cir.) (scholarship program intended to remedy discrimination against African-Americans in Maryland was not narrowly tailored, in part, because African-Americans from outside Maryland were eligible for the program), cert. denied, 115 S. Ct. 2001 (1995).
45 See Milwaukee County Pavers Ass'n v. Fiedler, 922 F.2d 419, 425 (7th Cir.) (noting that administrative waiver mechanism enabled state to exclude from scope of beneficiaries of affirmative action plan in public contracting "two wealthy black football players" who apparently could compete effectively outside the plan), cert. denied, 500 U.S. 954 (1991); Concrete General, Inc. v. Washington Suburban Sanitary Comm'n, 779 F. Supp. 370, 381 (D. Md. 1991) (MBE program not narrowly tailored, in part, because it had "no provision to 'graduate' from the program those contracting firms which have demonstrated the ability to effectively compete with non-MBE's in a competitive bidding process"); see also Shurberg Broadcasting, Inc. v. FCC, 876 F.2d at 916 (opinion of Silberman, J.) ("There must be some opportunity to exclude those individuals for whom affirmative action is just another business opportunity.").
46 The factor that we labeled above as "scope of beneficiaries/administrative waivers" is sometimes considered by courts under the heading of "flexibility", along with a consideration of the manner in which race is used. For the sake of clarity we have divided them into two separate components of the narrow tailoring test.
47 The distress sale program was upheld under intermediate scrutiny in Metro Broadcasting.
48 There is a plausible distinction between college scholarships that are reserved for minorities and admissions quotas that reserve places at a college for minorities. In Podberesky v. Kirwan, 38 F.3d 147 (4th Cir 1994), cert. denied, 115 S. Ct. 2001 (1995), the Fourth Circuit held that a college scholarship program for African Americans was unconstitutional under Croson. The Fourth Circuit's decision, however, did not equate the scholarship program with the admissions quota struck down in Bakke, and it did not turn on the fact that race was a requirement of eligibility for the program.
49 The statutes and regulations under which DOT has established the contracting program at issue in Adarand are different. Racial and ethnic classifications are used in the form of a presumption that members of minority groups are "socially disadvantaged." However, that presumption is rebuttable, and members of nonminority groups are eligible for the program "on the basis of clear and convincing evidence" that they are socially disadvantaged. Adarand, 63 U.S.L.W. at 4524. See id. at 4540 (Stevens, J., dissenting) (arguing that the relevant statutes and regulations in Adarand are better tailored than the Fullilove legislation, because they "do not make race the sole criterion of eligibility for participation in the program." Members of racial and ethnic are presumed to be disadvantaged, but the presumption is rebuttable, and even if it does not get the presumption, "a small business may qualify [for the program] by showing that it is both socially and economically disadvantaged").
50 Bakke is the only Supreme Court affirmative action case that ultimately turned on the "quota" issue. In Croson, the Court referred disparagingly to the thirty percent minority subcontracting requirement at issue in the case as a "quota," but that was not in itself the basis for the Court's decision.
51 Although Johnson was a Title VII gender classification case, its reasoning as to the distinction between quotas and goals is instructive with respect to the constitutional analysis of racial and ethnic classifications.
52 Compare Aiken v. City of Memphis, 37 F.3d at 1165 (remanding to lower court, in part, because race-based promotion goals in consent decree were tied to "undifferentiated" labor force statistics; instructing district court on remand to determine whether racial composition of city labor force "differs materially from that of the qualified labor pool for the positions" in question) with Edwards v. City of Houston, 37 F.3d 1097, 1114 (5th Cir. 1994) (race-based promotion goals in city police department were narrowly tailored, in part, because the goals were tied to the number of minorities with the skills for the positions in question), reh'g granted, 49 F.3d 1048 (5th Cir. 1995).
53 See Paradise, 480 U.S. at 178 (plurality opinion) (race-based promotion requirement was narrowly tailored, in part, because it was "ephemeral," and would "endure only until" non-discriminatory promotion procedures were implemented); Sheet Metal Workers, 478 U.S. at 487 (Powell, J., concurring) (race-based hiring goal was narrowly tailored, in part, because it "was not imposed as a permanent requirement, but [was] of limited duration"); Fullilove, 448 U.S. at 513 (Powell, J., concurring) (race-based classification in public works legislation was narrowly tailored, in part, because it was "not a permanent part of federal contracting requirements"); O'Donnell Constr. Co. v. District of Columbia, 963 F.2d at 428 (ordinance setting aside a percentage of city contracts for minority businesses was not narrowly tailored, in part, because it contained no "sunset provision" and no "end [was] in sight").
54 Adarand, 63 U.S.L.W. at 4531 (citing Croson).
55 Johnson, 480 U.S. at 638.
56 Sheet Metal Workers, 478 U.S. at 488 (Powell, J., concurring).
57 A comprehensive review of voluntary affirmative action in public employment at the state and local level after Croson is beyond the scope of this memorandum. We note that a number of the programs have involved remedial racial and ethnic classifications in connection with hiring and promotion decisions in police and fire departments. Some of the programs have been upheld, and others struck down. Compare Peightal v. Metropolitan Dade County, 26 F.3d 1545 (11th Cir. 1994) (upholding race-based hiring goal in county fire department under Croson) with Long v. City of Saginaw, 911 F.2d 1192 (6th Cir. 1990) (striking down race-based hiring goal in city police department under Croson and Wygant).
58 That has been true in Richmond. It is our understanding that the city conducted a post-Croson disparity study and enacted a new MBE program that establishes a bidding preference of "20 points" for prime contractors who pledge to meet a goal of subcontracting sixteen percent of the dollar value of a city contract to MBEs. The program works at the "prequalification" stage, when the city is determining its pool of eligible bidders on a project. Once the pool is selected, the low bidder is awarded the contract.
59 See Associated Gen. Contractors v. Coalition for Economic Equity, 950 F.2d 1401 (9th Cir. 1991).
60 Associated Gen. Contractors v. City of New Haven, 791 F. Supp. 941 (D. Conn. 1992), vacated on mootness grounds, 41 F.3d 62 (2d Cir. 1994).
61 Coral Constr. Co. v. King County, 941 F.2d 910 (9th Cir. 1991), cert. denied, 502 U.S. 1033 (1992); Concrete Works v. City and County of Denver, 36 F.3d 1513 (10th Cir. 1994), cert. denied, 115 S. Ct. 1315 (1995). The courts in these two cases commented favorably on aspects of the programs at issue and the disparity studies by which they are justified.
62 We are aware of at least one such program that survived a motion for summary judgment and apparently is still in effect today. See Cone Corp. v. Hillsborough County, 908 F.2d 908 (11th Cir.), cert. denied, 498 U.S. 983 (1990). Others have been invalidated. See, e.g., O'Donnell Constr. Co. v. District of Columbia, 963 F.2d 420 (D.C. Cir. 1992); Contractors' Assoc. v. City of Philadelphia, WL 11900 (E.D. Pa. Jan. 11, 1995); Arrow Office Supply Co. v. City of Detroit, 826 F. Supp. 1072 (E.D. Mich. 1993); F. Buddie Constr. Co. v. City of Elyria, 773 F. Supp. 1018 (N.D. Ohio 1991); Main Line Paving Co. v. Board of Educ., 725 F. Supp. 1349 (E.D. Pa. 1989).
63 Section 1 of the Fourteenth Amendment prohibits states and municipalities from denying persons the equal protection of the laws. Section 5 gives Congress the power to enforce that prohibition. Because Section 1 of the Fourteenth Amendment only applies to states and municipalities, see United States v. Guest, 383 U.S. 745, 755 (1966), it is uncertain whether Congress may act under Section 5 of that amendment to remedy discrimination by purely private actors. See Adarand, 63 U.S.L.W. at 4538 n.10 (Stevens, J., dissenting) ("Because Congress has acted with respect to the States in enacting STURAA, we need not revisit today the difficult question of § 5's applicability to pure regulation of private individuals."); Metro Broadcasting, 497 U.S. at 605 (O'Connor, J., dissenting) ("Section 5 empowers Congress to act respecting the States, and of course this case concerns only the administration of federal programs by federal officials."). Nevertheless, remedial legislation adopted under Section 5 of the Fourteenth Amendment does not necessarily have to act on the states directly. Indeed, when Congress seeks to remedy discrimination by private parties, it may be indirectly remedying discrimination of the states; for in some cases, private discrimination was tolerated or expressly sanctioned by the states. Private discrimination, moreover, often can be remedied under the enforcement provisions of the Thirteenth Amendment. Section 1 of that amendment prohibits slavery and involuntary servitude. Section 2 gives Congress the power to enforce that prohibition by passing remedial legislation designed to eliminate "the badges and incidents of slavery in the United States." Jones v. Alfred Mayer Co., 392 U.S. 409, 439 (1968). The Supreme Court has held that such legislation may be directed at remedying the discrimination of private actors, as well as that of the states. Id. at 438. See also Runyon v. McCrary, 427 U.S. 160, 179 (1976). In Fullilove, the plurality opinion concluded that the Commerce Clause provided an additional source of power under which Congress could adopt race-based legislation intended to remedy the discriminatory conduct of private actors. See Fullilove, 448 U.S. at 475 (plurality opinion).
64 Justices Kennedy and Scalia declined to join that part of Justice O'Connor's opinion in Croson that drew a distinction between the respective powers of Congress and state or local governments in the area of affirmative action.
65 Patterns and practices of bank lending to minorities, may, however, reflect a significant "secondary effect" of discrimination in particular sectors and industries, i.e., because of that discrimination, minorities cannot accumulate the necessary capital and achieve the community standing necessary to qualify for loans.
66 See Milwaukee County Pavers Ass'n v. Fiedler, 710 F. Supp. 1532, 1540 n.3 (W.D. Wisc. 1989) (noting that for purposes of judicial review of affirmative action measures, there is a distinction between congressionally mandated measures and those that are "independently established" by a federal agency), aff'd, 922 F.2d 419 (7th Cir.), cert. denied, 500 U.S. 954 (1991); cf. Bakke, 438 U.S. at 309 (opinion of Powell, J.) (public universities, like many "isolated segments of our vast governmental structure are not competent to make [findings of national discrimination], at least in the absence of legislative mandates and legislatively determined criteria")