                           @ffice of tip Zlttornep @enera
                                        &ate of lltexae
DAN MORALES
 ATTORNEI
       GENERAL                              June 9,1993


     Honorable John W. Segre-st                 Qpiion No. DM-226
     Criminal District Attorney
     McLennan County                            Re: ‘Ihhcther section 381.004 of the Local
     219 North 6th Street, Suite 200            Government Code creates an exemption to
     Waco, Texas 76701                          competitive bidding requirements and related
                                                questions (RQ-498)

     Dear Mr. segrest:

             On behalf of McLennan County, you ask several questions which relate to a
     proposed policy entitled “Minority/Women-Owned Business Involvement Policy” which is
     aurently under consideration by the McLennan County Commissioners Comt.

              The proposed policy has three major facets. Fi, in an effort to increase minority
     and women-owned business participation, it would establish a directory of such businesses
     and procedures to inform such businesses of contra&g oppotttmities. Second, it would
     attempt to increase the use of minority and women-owned businesses by prime contractors
     by (i) incorporating a notice in bid packets that di saimination against such businesses is
     prohibited, (ii) requiting bidders to state how they intend to use such businesses; and
     (iii) requesting bidders to supply information regarding their past use of such businesses.
     The proposed policy states that “[nlothing in this section [regarding the competitive
     bidding process] shall be construed to constitute a restriction on who the wntractor may
     hire or wntract with in the performance of the contract. Nor does this provision seek to
     establish a quota.” Third, with respect to purchases under S10.000.00 which are not
     subject to competitive bidding, the proposed policy would set a goal that one third of the
     wunty’s wntracts for such purchases be awarded to minority and women-owned
     businesses.

             Pii you note that in Attorney General Opinion DM-113 (1992). we considered
     whether the Dallas Independent School District (“DISD”) was authorized to consider such
     factors as a bidder’s location, compliance with DISD’s Minority and Women Business
     Enterprise Contracting and Purchasing Program, and involvement with DISD, when
     evaluating the bidder’s “responsibility.” We concluded:
                    The wurts conclude that the legislature, in enacting competitive
               bidding statutes, has determined that the government’s interest in
               obtaining the best work or product at the lowest practicable price is
               secured by requiring maximum competition for government



                                           p.    1176
Honorable John W. Segrest - Page 2      (DM-226)




          wntracts. . . . A governmental body subject to a wmpetitive bidding
          statute muat act to promote the umnistakable legislative policy
          favoring unmstricted competition. . . On& lhe legislature mq wy
          this policy by enacting exceptitms to competitive biding. . . . A
          govemmental body therefore may not adopt policies or issue bid
          sokitations or qkfkations         that restrict wmpetition unless such
          policies, solicitations, or specitications have a definite and objective
          relationship to matters of quality and wmpetence or me &@ed
          jntrsuant lo clear legidiw     ottihori~.

Attom      Gwerai Opinion DM-113 at 7 (1992) (emphasis added) (citing Tw Highwq
Cmmn’n v. TextasAsh of Steel Importers, Inc.. 372 S.W.Zd 525 (‘Rx. 1963); Attorney
General Opiion JM-712 (1987)). You fkrther note that unlike DISD which is not
statutorily authorized to deviate from strict wmpetitive bidding criteria, the county is
subject to section 381.004 of the Local Govemmeot Code.’ You suggest, however, that
the extent to which section 381.004 authorizes wunties “to implement policies requiring
bidders to submit evidence of socially responsible w&acting practices.. . is uncleor..”
You ask whether section 381.004 creates an exception to competitive bidding
te&mmds       and whether the proposed policy is “legal.”




                      ....



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          imwseparlicipationhymiwrityandwomal-ownedkuincarcrinpuhuc
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Gabsauy.couatiw~subjec(towmpo6uvehiddingrrq’            ’ setfoxtt1m1dawztion262.0230ftk
Local Gcmmnmt Code. Section 381.004 of tk W       Gxemmmt code was adnptcd hy the flsl
Le&lata as !kwtc Bill 24. Ads 1989.7111Lq., ch. 1060,5 3, at 4307. Saute Bill 24 alse Mvnded
section 262.024 oftk Laud Govummentcode which sets folib limited exempIionsto the comtivc
bi6dingm&ema1&ofrcftion262.023as follm:




                                       p.   1177
Honorable John W. Segreat - Page 3 On-226)




       We have reviewed the proposed policy you submitted with your opinion request
and see no reason to wnaider the effect of section 381.004 on wmpetitive bidding
~~~becawreitisnotapparenttousthatthepropossdpolicyisinconsistwtwith
wmpetitive bidding. Unlike the DISD policy we considered in Attorney General Opiion
DM-113, the proposed policy% provisions regarding the wmpetitive bidding process do
notappeartosetforthanycritaiawhichthecountywillconsidainsel~bids.                We
note, however, that the determmati on whether a particular wtmty policy is “leg# is
beyond the purview of the opinion process. See Attorney General Opiion DM-121
(1992) at 1.

         You also ask whether section 381.004 violates the equal protection clause of the
fourteenth amendment of the United States Constitution. U.S. Const. amend. XIV, 8 1.
The United States Supreme Court considered the wnstitutionahty of a “minority business
utilktion plan” adopted by the Cii of Richmond, Viia             in City of Richmond v.
Crawm, 488 U.S. 469 (1989). That plan rewired prime wntractors awarded city
contracts to subcontract at least thirty percent of the dollar amomt of each wntract to
“minoxity owned business enterprises.” A construction company challenged the phut,
alleging that it was unwnstitutional under the fourteenth amendment’s equal protection
clause. The court affirmed the judgment of a lower court that the plan violated the
fbmteentb amendment.

       Although   the justices Were far gem uniform in their appro*       a majority of
&tiWS appears to have agreed that a plan of a govermnental body to apportion
opportunitks on the basis of raw is subject to strict acmtiny. See Crown, 488 U.S. at
498-508. Tberefore, the g ovemmental body must have a wmpelling state interest in
eMdiag the plan, and the plan muat be narrowly tailored to achieve that it&rest. Id A
majority of the court concluded that the Cii of Richmond had failed to demonstrate a
Wm~stattintaestbecauseithadEailedtoshowthatithadenaaedtheplanto
remedy past di&mination. Id.

         Section 381.004 of the Local Government Code does not apportion wunty
wntmcting opportunities on the baais of raw. It merely authorizes wunties to establish
programs “designed to reasonably increase participation by minority and women-owned
businesses in public wntract awards by the county by establishing a wntract percentage
goal for those businesses.” Local Goti Code 5 381.004(d). Theregore, we do not believe
that section 381.004 violates the fourteenth amendment. The determination whether a
particular county program authorized by section 381.004 violates the fourteenth
amendment would require the resolution of factual matters, such as determinations
regarding tbe wunty’s reasons for adopting the program and the verity of those reasons,
that are not amenable to the opinion process. Attorney General Opiion DM-121 at l-2.




                                      p.   1178
Honorable John W. Segrest - Page 4    (DM-226)




                                  SUMMARY
               Thedaamhationwhetherapatticularcountypolicyis”legal”is
          beyond tbe purview of the opinion process. Section 381.004 of the
          IAIcalciovemment Codedocsnotviohtethecqualprotectionclause
          of the fhrknth    amendment of the United States Constitution. The
          detamination whether a partiah        county program violates the
          fourteenth amauimutt’s equal protection clause would require the
          resohion of factual matters, such as debmhations        regarding the
          wunty% reasons for adopting the program and the verity of those
          reaso~thatarenot8menabletotheopinionprocesa.




                                                    DAN      MORALES
                                                    Attorney General of Texas

WILL PRYOR
F~&istantAttomeyGcneml

MARYKELLER
DeputyAttomcyGcnemfhrLitigation

RENBAHICKS
State Solicitor

MADELEINE B. JOHNSON
Chair, Opiion Committee

PrepandbyMaryRC-
Assistant Attorney General




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