Cone Corp. v. Florida Department of Transportation

921 F.2d 1190
CourtCourt of Appeals for the Eleventh Circuit
DecidedJanuary 8, 1991
DocketNo. 89-3694
StatusPublished
Cited by4 cases

This text of 921 F.2d 1190 (Cone Corp. v. Florida Department of Transportation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cone Corp. v. Florida Department of Transportation, 921 F.2d 1190 (11th Cir. 1991).

Opinion

TJOFLAT, Chief Judge:

This is an appeal from an order of the district court declaring unconstitutional on fourteenth amendment equal protection grounds a Florida statute, Fla.Stat. § 339.0805 (1989), and the regulations promulgated thereunder, Fla.Admin. Code Ann. ch. 14-78 (1989), that created a set-aside and minority business participation program for contracts awarded by Florida’s Secretary of Transportation (the Secretary), the head of the Florida Department of Transportation (FDOT).1 In its order, the district court2 noted that this statute and the regulations had been modeled after a nearly identical federal statute, the Surface Transportation and Uniform Relocation Assistance Act of 1987 (STURAA), Pub.L. No. 100-17, § 106(c), 101 Stat. 132, 145, and the regulations promulgated thereunder, 49 C.F.R. §§ 23.61-69 (1989), which require a state to have a set-aside and minority business participation program if it wants to receive federal funds for highway construction projects, and that the federal statute contained no equal protection infirmity under the fifth amendment. Concluding that the Florida statute and regulations are “the end result of, and thus necessarily a part of,” a valid federal program, the court upheld the Florida stat[1192]*1192ute to the extent that it serves as a vehicle for obtaining- federal highway construction funds. In sum, the district court concluded that Fla.Stat. § 339.0805 and the regulations promulgated thereunder are, at once, both constitutional and unconstitutional on their face — depending on the source of the funds that the Secretary may be using to implement the program created by the statute and regulations.

We vacate the district court’s order and direct the district court, on receipt of our mandate, to dismiss the case without prejudice.3 We do so without reaching the merits because the plaintiffs, all of whom are engaged in the highway construction business in Florida, lack standing to pursue their claims.

We organize the opinion as follows. In part I, we summarize in subpart A the provisions of the federal set-aside and minority business participation program and, in subpart B, its Florida counterpart. In part II, we set forth the plaintiffs’ claims, as presented in their amended complaint, and the district court’s dispositive order. In part III, we determine that the plaintiffs lack standing.

I.

A.

Congress authorized the appropriation of federal funds to aid states in highway construction under STURAA.4 STURAA and the federal regulations thereunder direct that states that want to receive federal funds for highway construction must have set-aside and minority business participation programs to ensure that minority businesses have the maximum opportunity to compete for the contracts involving federal funds. Section 106(c)(1) of STURAA provides:

Except to the extent that the Secretary determines otherwise, not less than 10 per centum of the amounts authorized to be appropriated under [STURAA and the prior highway aid appropriations act, the Surface Transportation Assistance Act of 1982] after the date of the enactment of this Act shall be expended with small businesses owned and controlled by socially and economically disadvantaged individuals.

Pub.L. No. 100-17, § 106(c)(1), 101 Stat. at 145 (emphasis added).5

A small business owned and controlled by a socially and economically disadvantaged individual, or a disadvantaged business enterprise (DBE),6 49 C.F.R. § 23.62, is, almost invariably, a small business owned or controlled by a member of a minority group or a woman. Women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, and Asian-Indian Americans are presumptively socially and economically disadvantaged. Id.7

[1193]*1193This statute and the regulations thereunder impose three requirements on states that want to receive federal highway funds. First, each state must set and meet an annual goal, which the Federal Highway Administration (FHWA) of the United States Department of Transportation (US-DOT) must approve, for DBE participation in highway construction projects funded with federal grants. Id. §§ 23.61, .64, .66.8 The FHWA always approves a goal of ten percent or more. Id. § 23.66(a). It may approve a goal of less than ten percent if the state justifies the goal by showing that the state is making all appropriate efforts to increase DBE participation in federal aid contracts, and, despite these efforts, a goal of less than ten percent represents a reasonable expectation for DBE participation given the availability of DBEs in the state. Id. § 23.66(b).9 Florida each year has set and met a DBE goal of ten percent.

Second, each state that wants to receive federal highway funds must agree not to discriminate on the basis of race, sex, color, or national origin in the award of federally assisted contracts, id. §§ 23.-7, -41(a), .43(a)(2), while at the same time making every reasonable and necessary effort to insure that minority businesses have the maximum opportunity to compete for and perform contracts, id. §§ 23.-1(a), .41(a), .43(a)(1). These requirements become part of every initial financial assistance agreement between the state and the federal government under which the state receives federal funds and every subsequent contract between the state and any contractor that involves the expenditure of federal funds. Id. § 23.43(a).

Third, each state that wants to receive federal highway funds must develop a minority business enterprise (MBE)10 program, which the FHWA must approve before it will grant any highway aid funds, and which becomes part of every financial assistance agreement between the state and the FHWA. Id. §§ 23.41(a)(3)(i), .41(b)-(c), .43(b). To receive FHWA approval, the state’s MBE program must include, among [1194]*1194other features,11 a set-aside procedure that limits competition for certain contracts to MBE and DBE prime contractors, id. § 23.45(k), and a minority business participation procedure under which the state requires each prime contractor that enters into a contract involving federal funds to meet (or demonstrate a good faith effort to meet) a goal, set by the state, for DBE subcontractor participation in that contract, id. § 23.45(g)(ii).12

A state that fails to comply with any of these three requirements may lose all or part of its federal highway funds. Id. § 23.68(b), (e)(1); id. § 23.43(b)-(c); 23 C.F.R. § 1.36 (1990). Two provisions of the federal regulations, however, allow states to escape certain of these requirements and still receive federal funds.

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Related

Ridgeway v. Sullivan
804 F. Supp. 1536 (N.D. Georgia, 1992)
Cone Corp. v. Hillsborough County
777 F. Supp. 1558 (M.D. Florida, 1991)
Michigan Road Builders Ass'n, Inc. v. Blanchard
761 F. Supp. 1303 (W.D. Michigan, 1991)

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Bluebook (online)
921 F.2d 1190, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cone-corp-v-florida-department-of-transportation-ca11-1991.