Duncan Proposes Changes to MFD Purchasing Program, in Response to Court Ruling

SS/mfd.pr 97-227 Contact: Marc Hansen, 301-217-2600
Beatrice Tignor, 301-217-7312

DUNCAN PROPOSES CHANGES TO
MFD PURCHASING PROGRAM,
IN RESPONSE TO COURT RULING For Immediate Release: July 10, 1997

Responding to a landmark U.S. Supreme Court decision which established local
government standards for the operation of minority-owned business procurement programs,
Montgomery County Executive Douglas M. Duncan this week called for significant changes
to the County's existing Minority/Female/Disabled (MFD) purchasing program.
In transmitting the proposed legislative and regulatory modifications to the County
Council, Duncan said the changes would continue to allow the County to remedy, "to the
fullest extent allowed by law, the effects of discrimination," but would do so "within the
stringent legal parameters set by the U.S. Supreme Court."
"I remain committed to eradicating discrimination based on such pernicious categories
as race, ethnicity, gender and disability," noted Duncan, in his transmittal memo.
Since 1982, the County has set a goal of awarding a certain percentage of its
procurement dollars to MFD-owned businesses. Each year, the County has met or exceeded
its MFD goals. But, according to the County Attorney's Office, the very success of the
program -- in light of several court rulings, including that of the U.S. Supreme Court --
presents significant legal challenges to continuing the present program.
The U.S. Supreme Court, in its 1989 landmark decision of Richmond v. J.A. Croson
Co., established the standards that a local government must meet in order to operate a
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DUNCAN PROPOSES MINORITY PURCHASING PROGRAM CHANGES 2-2-2

minority-owned business procurement program. The Croson decision prohibits a local
government from using a race or ethnic conscious procurement program, such as that of
Montgomery County, unless several conditions are met.
These conditions include:
firm evidence of past or present discrimination which justifies the extraordinary
remedy of racial preference;
narrowly drawn parameters for the minority business procurement program
which remedy the wrongs demonstrated by the evidence of discrimination,
without unduly burdening groups that are not included in the program; and
clear demonstration by the local jurisdiction that "race neutral" remedies are
insufficient to remedy past or present discrimination.
A recent study on minority/female/disabled disparity prepared for Montgomery County
by A.D. Jackson Consultants, Inc. indicates that the County has significantly underutilized
certain groups of MFD-owned businesses in certain purchasing categories, while over-utilizing
other groups of MFD businesses.
"In order to put the County's MFD Purchasing Program on a sound legal footing and
continue to address the effects of discrimination," Duncan noted, "I am proposing to modify
the program to set a separate goal for each minority gorup in each purchasing category." At
the same time, Duncan said the County must enhance efforts to ensure that MFD-owned
businesses are included within the County's procurement activities, regardless of whether they
are entitled to a preference.
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