Race, Sex, and Business Enterprise: Evidence from Denver, Colorado

The Situation

Like many local governments, the City and County of Denver, Colorado has long been committed to including minority-owned, women-owned, and disadvantaged business enterprises (M/W/DBEs) in its contracting activities. The courts have made it clear, however, that in order to implement a race- and gender-based program that is effective, enforceable, and legally defensible, Denver must meet the judicial test of constitutional "strict scrutiny" to determine the legality of such initiatives. Strict scrutiny requires current "strong evidence" of the persistence of discrimination, and "narrowly tailored" measures to remedy that discrimination. To assist in this assessment, Denver commissioned a team, led by NERA Senior Vice President Dr. Jon Wainwright, to examine the past and current status of M/W/DBEs in Denver's geographic and product markets for construction, construction-related professional services, and concessions-related goods and services.

NERA's Role

Dr. Wainwright and his team found both statistical and anecdotal evidence of business discrimination against M/W/DBEs in virtually all the major procurement categories and data sources that they examined. Their examination included an analysis of Denver's own public sector contracting behavior as well as that of its prime contractors and consultants. They also analyzed the statistical record for evidence of disparate impact in the private sector of the relevant markets. Furthermore, the team surveyed the contracting experiences and credit access experiences of M/W/DBEs and non-M/W/DBEs in the relevant markets and conducted a series of in-depth personal interviews with local business enterprises, both M/W/DBE and non-M/W/DBE.

The Result

The team's report provides an important part of the record necessary to implement new and revised M/W/DBE policies that comply with the requirements of the courts and to assess the extent to which previous and current policies have assisted M/W/DBEs in participating in Denver's contracting and procurement activity.