Los Angeles judge strikes down Metropolitan Transportation Authority set aside policy

Jet, August 28, 1995

A Los Angeles judge has struck down a Metropolitan Transportation Authority (MTA) policy of setting aside millions of dollars in contracts for minority-and women-owned firms.

In declaring the policy unconstitutional, Superior Court Judge Dzintra I. Janavs cited the U.S. Supreme Court's ruling in June that government may not use "racial classifications" to award funds except to remedy proven past discrimination.

The ruling came in a lawsuit filed by a San Diego engineer who was denied a piece of the $5.8-billion subway project because of the MTA policy. The transit agency had a goal of awarding 29 percent of contracts to "disadvantaged" businesses.

The judge found that the MTA failed to justify the 29 percent figure--three times the federal goal. He also found that the MTA failed to demonstrate, under the "strict scrutiny" standard required by recent Supreme Court rulings, that its affirmative action program was a response to a statistically proven pattern of past discrimination.

Additionally, it was found there was no basis for an MTA policy allowing a disadvantaged business to bid up to 10 percent higher than the lowest qualified bidder and still win the contract.

If the ruling is upheld, it is likely to have a broad impact in restructuring or dismantling the program altogether, according to Michael Gagan, editor of MTA Report.