Full opinion text
MEMORANDUM AND ORDER BECHTLE, Chief Judge. Presently before the court are cross-motions for summary judgment on the question of whether the city of Philadelphia’s minority, female and handicapped set-aside program is valid in light of the decision of the United States Supreme Court in City of Richmond v. J.A. Croson Co., 488 U.S. 469, 109 S.Ct. 706, 102 L.Ed.2d 854 (1989). I. INTRODUCTION On April 14,1989, nine incorporated associations of construction contractors that have participated as general contractors or subcontractors on city of Philadelphia construction projects instituted this action against the city of Philadelphia, Elizabeth Reveal, Director of Finance for the city of Philadelphia, and Curtis Jones, Jr., Director of the Minority Business Enterprise Council to have Chapter 17-500 of the Philadelphia Code (hereinafter “the Ordinance”) and the Minority Business Enterprise Council (hereinafter “MBEC”) regulations declared invalid. The United Minority Enterprise Associates, Inc. intervened in this litigation as a defendant. For the reasons discussed below, the court finds that the Ordinance violates the Equal Protection Clause of the Fourteenth Amendment of the Constitution of the United States, and will accordingly grant plaintiff’s cross-motion for summary judgment. In the amended complaint the plaintiffs allege that the Ordinance imposes upon covered city contracts classifications based on race, ethnicity, gender and handicap in violation of the Equal Protection Clause of the Fourteenth Amendment of the United States Constitution (Count I); title 42 U.S.C. § 1983 (Count II); title 42 U.S.C. § 1981 (Count III); article I, § 26 of the Pennsylvania Constitution (Count IV); article I, § 28 of the Pennsylvania Constitution (Count V). Plaintiffs claim that these classifications based on race and ethnicity do not withstand the strict scrutiny test announced by the Supreme Court in City of Richmond v. J.A. Croson Co., supra, and that the gender- and handicap-based classifications violate the lesser standards of review articulated by the Supreme Court. Plaintiffs also allege that the Ordinance violates title 73 P.S. § 1622 of the Pennsylvania Code, which requires the city to accept the lowest responsible bid in city contract awards, as the Ordinance requires the rejection of a bid submitted by the lowest responsible bidder on a covered contract exceeding $50,000.00 for the construction, reconstruction, alteration or repair of any public building, public work or other public improvement for noncompliance with the requirements of the Ordinance and the MBEC regulations (Count VI). Finally, Count VII alleges that the Ordinance violates § 8-200 of the Philadelphia Home Rule Charter, insofar as it requires the rejection of a bid submitted by the lowest responsible bidder on a covered contract exceeding $2,000 for noncompliance with the requirements of the Ordinance. Defendants respond that the plaintiff contractors’ associations lack standing to pursue their federal equal protection and civil rights claims (Counts I through III) and that they fail to allege facts sufficient to establish that the Ordinance deprived them of their constitutional rights. To resolve the issues presented in the parties’ cross-motions this opinion will recount the stipulated facts (part I), set forth the standard for summary judgment (part II, section A), address the standing issue (part II, section B), discuss the standard with which affirmative action programs must comply as set forth in Croson (part II, section C), and analyze the merits of plaintiffs’ claims by examining whether the Philadelphia city council has met its burden under Croson (part II, section D). II. UNDISPUTED FACTS The parties submit that the .material facts that form the basis for this litigation are not in dispute. The undisputed facts are as follows. On May 13, 1982, the Philadelphia city council passed over Mayor Green’s veto Bill No. 1174-A (“an ordinance amending Title 17 of the Philadelphia Code by adding Chapter 17-400, establishing goals for the participation of Minority and Female Owned Businesses [hereinafter “MBE” and “FBE”] in the awarding of city contracts including but not limited to supplies and services, equipment, materials and public works construction; establishing a Minority Business Enterprise Council; providing procedures and penalties to monitor and enforce compliance”). As stated in the preamble, one of the goals of the Ordinance, is “to encourage participation in the awarding of city contracts for supplies and services, equipment, materials and public works construction regardless of race, col- or, sex, religion, national origin, or ancestry.” The preamble also states that the most important intent and purpose of the Ordinance is “the Economic Development of the minority and female owned business community through a ‘sheltered market’ process.” Among the stated reasons for the Ordinance is “[a] pattern of past and present racial, sexual and economic discrimination” in the awarding of contracts with the city of Philadelphia. Preamble, Bill No. 1174-A. The Ordinance provided that it “shall be applied to all City Contracts and all City ... Departments, Agencies, Authorities, Commissions and Councils.” § 17-402. The Ordinance established the following MBE and FBE participation goals: (a) Fifteen percent (15%) City Contract participation for [MBEs]; and (b) Ten percent (10%) City Contract participation for [FBEs]. The above stated percentages relate to the total dollar amount of City Contracts during each of the City of Philadelphia’s Fiscal Years. § 17-403. The Ordinance defines “MBE” as: (a) A sole proprietorship where the sole proprietor is a minority person; or (b) A business corporation where 51% of the interest in such corporation are beneficially owned by minority person(s) and minorities occupy the majority of management and Board positions and control all decisions concerning the corporation; or (c) A partnership where 51% of the partnership interest in such partnership are beneficially owned by minority person^) and minorities occupy the majority of management and partnership positions and control all decisions concerning the partnership; or (d) Any other business or professional entity where 51% of the interest are beneficially owned by minority person(s) and minorities occupy the majority of management and Board positions and control all decisions concerning the entity. § 17-401(1). Under the Ordinance, the term “minority person” includes “Black Americans; Hispanic Americans; Native Americans (American Indians, Eskimos, Aleuts, or Native Hawaiians); Asian Pacific Americans ...” § 17-401(5). The definition of “FBE” is the same as that of “MBE”, except that it replaces all references to minority person^) or minorities with woman or women. § 17-401(2). The Ordinance also created a Minority Business Enterprise Council (MBEC) to help implement, monitor and enforce its goals. Under the Ordinance, the MBEC is, inter alia, required to devise a certification procedure to assure that businesses taking advantage of the Ordinance are legitimate MBEs or FBEs. § 17-404(a). The MBEC was also given the responsibility of ascertaining the total number of MBEs and FBEs in the Philadelphia area. § 17-404(b). In addition, the MBEC was also required to devise policies, regulations and procedures for assuring the participation of MBEs and FBEs in various city contracts. § 17-404(e). On November 4, 1982, Mayor Green approved Bill No. 1477 (an Ordinance amending Chapter 17-400 by renumbering it to Chapter 17-500 et seq., and by making certain additions and deletions). The amended Ordinance set forth a revised definition of “minority persons”: “A person who is a citizen or. lawful permanent resident of the United States and who is: (a) Black (a person having origins in any of the black racial groups in Africa); (b) Hispanic (a person of Spanish or Portuguese culture with origins in Mexico, South or Central America, or the Caribbean Islands, regardless of race); (c) Asian American (a person having origins in any of the original peoples of the Far East, Southeast Asia, the Indian Subcontinent or the Pacific Islands); or (d) American Indian or Alaskan Native (a person having origins in any of the original peoples of North America.)” § 17-501(1). The definitions for “MBE” and “FBE” in Bill 1477 were textually similar to those provided in the May 1982 Ordinance except for replacing “minority persons” for “minority person(s)” or "minorities” and “female” for “women” and “woman”. § 17-501(3) and (4). In addition, the amendments created a “sheltered market,” defined as a city-wide procurement system whereby certain contracts are selected and specifically set aside for MBEs or FBEs, or both, on a competitive bid or negotiated basis. § 17-501(5). The amended Ordinance also provided that the goals announced in § 17-503(1) are not to be construed as absolute upper limits on the amount of city contracts in which MBEs and FBEs are able to participate, and stated that the goals are applicable to all types of city contracts. In addition, the amended Ordinance added subsection (2) to § 17-503 (formerly § 17-403), which described under what circumstances the total dollar amount of a subcontract, contract up to a million dollars, or contract over a million dollars shall be counted towards MBE or FBE participation for purposes of calculating the fifteen and ten percent figures in § 17-503(1). The amendments also gave the MBEC the authority to recommend that an entire class of contracts established pursuant to § 17-503 be exempt from MBE and FBE city contracting goals when there has been a written determination based on the best information available that there is an insufficient number of qualified MBEs or FBEs in the Philadelphia area to ensure adequate competition and an expectation of reasonable prices on bids or proposals within that class. § 17-505(2)(a). The MBEC also has authority under § 17-505(3) to grant a waiver to a contractor who was unable to comply with the established goals for MBE or FBE participation but has demonstrated that there has been a good faith effort to comply. Section 14-504(e) authorizes the MBEC by regulation to define the specifics of the sheltered market program. On May 20, 1987, the Mayor approved Bill No. 1260, an ordinance amending Chapter 17-500. The 1987 Ordinance was refocused to provide for increased participation in city contracting of “Disadvantaged Business Enterprises” [hereinafter “DBEs”] rather than for MBEs or FBEs. However, the 1987 Ordinance maintained the same percentage participation goals for MBEs and the FBEs as specified in the 1982 Ordinance. § 17-503(1). The 1987 Ordinance amended the definition of “minority person” to substitute “Native American” for “American Indian or Alaskan Native”. It also added the following definitions: (a) Small business shall mean a business which is independently owned and operated and which is not dominant in its field of operation as further defined in 13 Code of Federal Regulations, Part 121.3, incorporated herein, and made a part by reference ... (b) Disadvantaged business enterprise or “DBE” shall mean any small business; (a) Which is at least fifty-one percent (51%) owned by one or more socially and economically disadvantaged individuals or (b) In the case of any publicly owned business, one in which at least fifty-one percent (51%) of the stock is owned by one or more socially and economically disadvantaged individuals. Where a business has received more than Five Million Dollars ($5,000,000) of contract work with the City under this Chapter, the [MBEC] shall make a rebuttable presumption that the concern is not a disadvantaged business enterprise, and any previous certification as a [DBE] shall be re-evaluated pursuant to regulations to be promulgated by the MBEC. (11) Socially and economically disadvantaged individuals shall mean those individuals who have been subjected to racial, sexual or ethnic prejudice because of their identity as a member of a group without regard to their individual qualities, and whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same business who are not socially disadvantaged. (a) In determining who are socially and economically disadvantaged individuals, the [MBEC] may make a rebuttable presumption that all minority persons and all women shall be so classified. (b) The [MBEC] in making said determination, shall also consider, among other things, the extent of the liquid assets and net worth of such socially disadvantaged individuals. Finally, on October 26, 1988, the Mayor approved Bill No. 108, an Ordinance amending Chapter 17-500 of the Philadelphia Code by establishing city contract participation goals for handicapped persons. The 1988 amendments revised the definition of “sociallyand economically disadvantaged individuals” in § 17-501(11) to read: Socially and economically disadvantaged individuals shall mean those individuals who have either been subjected to racial, sexual or ethnic prejudice because of their identity as a member of a group or differential treatment because of their handicap ... § 17-501(11). The Ordinance added a definition of “handicapped person”, to wit: ... a person who has a physical or mental impairment which substantially limits one or more of his or her major life activities or has a record of such an impairment. Major life activities shall mean functions, such as caring for oneself, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning and working. § 17-501(12). The Ordinance also added a definition of “Handicapped-Owned Business” [hereinafter “HBE”] equivalent to that for MBEs and FBEs, except that it replaced references to “minority persons” or “female” with “handicapped persons(s)”. § 17-501(13). Lastly, the Ordinance amended the section to read, in pertinent part: The goals shall be: (c) Two percent (2%) City contract participation for Handicapped Owned Businesses. § 17-503(1). III. DISCUSSION A. Summary Judgment Standard The function of a motion for summary judgment is to avoid a trial in cases where it is unnecessary and would only cause delay and expense. Goodman v. Mead Johnson & Co., 534 F.2d 566, 573 (3d Cir. 1976), cert. denied, 429 U.S. 1038, 97 S.Ct. 732, 50 L.Ed.2d 748 (1977). In evaluating a motion for summary judgment, the court may examine the pleadings and other materials offered by the parties for the purpose of determining if there is a genuine issue of material fact to be tried. Fed.R.Civ.P. 56(c). Sims v. Mack Truck Corp., 488 F.Supp. 592, 597 (E.D.Pa.1980). The United States Supreme Court has directed that summary judgment “shall be rendered forthwith” if it appears from an application of substantive law to the uncontroverted facts that the movant is entitled to judgment as a matter of law. Id. See also Celotex Corp v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265 (1986). In considering a motion for summary judgment, the court must determine whether the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show there is no genuine issue of material fact, and whether the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). Chipollini v. Spencer Gifts, Inc., 814 F.2d 893, 896 (3d Cir.1987) (en banc); Arnold Pontiac-GMC, Inc. v. General Motors Corp., 786 F.2d 564, 568 (3d Cir.1986). “As to materiality, the substantive law will identify which facts are material.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). An issue is “genuine” only if the evidence is such that a reasonable jury could find for the non-moving party. Id. The burden to demonstrate absence of material fact issues remains with the moving party regardless of which party would have the burden of persuasion at trial. If, however, the non-movant will bear the burden of persuasion at trial, the party moving for summary judgment may meet its burden by showing that the evidentiary materials of record, if reduced to admissible evidence, would be insufficient to carry the non-movant’s burden of proof at trial. Fed.R.Civ.P. 56(e); Celotex Corp. v. Catrett, 477 U.S. at 327, 106 S.Ct. at 2554. A party resisting a Fed.R.Civ.P. 56 motion cannot expect to rely upon bare assertions, conclusory allegations, or a mere cataloguing of affirmative defenses to defeat summary judgment. Celotex, supra, 477 U.S. at 323-24, 106 S.Ct. at 2552-53; Gans v. Mundy, 762 F.2d 338 (3d Cir.1985). Once the moving party has presented evidence which would require a directed verdict a trial, the burden shifts to the opposing party to respond with specific facts showing that a genuine issue for trial exists. If the non-moving party does not so respond, summary judgment, if appropriate, shall be entered against them. Fed.R. Civ.P. 56(e); Anderson v. Liberty Lobby, Inc., supra, 477 U.S. at 247-48, 106 S.Ct. at 2509-10. B. Plaintiffs’ Standing Defendants claim that the plaintiff contractors’ associations do not have standing to challenge the constitutionality of the Ordinance. The plaintiffs allege no injury to the associations themselves, but rather claim that individual members of the associations have been harmed by the Ordinance. Thus, the court must inquire whether the nine contractors’ associations may proceed solely as representatives of those of its members that have been injured by the Ordinance. The United States Supreme Court has addressed the issue of when an association may have standing on behalf of its members. It is well-settled that “[e]ven in the absence of injury to itself, an association may have standing solely as the representative of its members.” International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, et al. v. Brock, 477 U.S. 274, 281, 106 S.Ct. 2523, 2528, 91 L.Ed.2d 228 (1986); Warth v. Seldin, 422 U.S. 490, 511, 95 S.Ct. 2197, 2211, 45 L.Ed.2d 343 (1975). The Court has ruled that such representational standing, while it “does not eliminate or attenuate the constitutional requirement of a case or controversy” id., is permissible under Article III under certain circumstances. International Union, 477 U.S. at 281, 106 S.Ct. at 2528. In Warth, the Supreme Court described the circumstances in which an association may litigate in federal court on behalf of its members: The association must allege that its members, or any one of them are suffering immediate or threatened injury as a result of the challenged action of the sort that would make out a justiciable case had the members themselves brought suit____ So long as this can be established, and so long as the nature of the claim and of the relief sought does not make the individual participation of each injured party dispensable to proper resolution of the cause, the association may be an appropriate representative of its members, entitled to invoke the court’s jurisdiction. Warth, 422 U.S. at 511, 95 S.Ct. at 2211. The Supreme Court later expressed this doctrine in a three-part test: [A]n association has standing to bring suit on behalf of its members when: (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. Hunt v. Washington State Apple Advertising Comm’n, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977). To determine whether the plaintiff associations in this case have met the requirements enunciated in Hunt, this court will examine each of the three components. Preliminarily, the court notes that in ruling on a motion for summary judgment for want of standing, the court must accept as true all material allegations of the amended complaint, and must construe them in favor of the complaining party. Warth, 422 U.S. at 502, 95 S.Ct. at 2207. 1. Standing of Members under Article III of the United States Constitution The associations must show that their members would otherwise have standing to sue in their own right by demonstrating that they meet the requirements of Article III of the United States Constitution (hereinafter “Article III”). To do so, the members must assert a personal stake in the outcome of the controversy demonstrating that they have sustained an injury in fact, see Warth, 422 U.S. at 498-99, 95 S.Ct. at 2204-05, and show that their injury was caused by the putatively illegal action of the defendant, Gladstone Realtors v. Village of Bellwood, 441 U.S. 91, 99, 99 S.Ct. 1601, 1607, 60 L.Ed.2d 66 (1979) such that the injury “fairly can be traced to the challenged action of the defendant.” Simon v. Eastern Kentucky Welfare Rights Organization, 426 U.S. 26, 41, 96 S.Ct. 1917, 1925, 48 L.Ed.2d 450 (1976). The injury in fact requirement is designed to ensure that the dispute will be put in the hands of those who have a direct stake in the outcome. Sierra Club v. Morton, 405 U.S. 727, 740, 92 S.Ct. 1361, 1369, 31 L.Ed.2d 636 (1972). It provides the court with “that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for the illumination of difficult constitutional questions.” Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 703, 7 L.Ed.2d 663 (1962). In this context, the Warth court specified that where the plaintiff is an association, it “must allege that its members, or any one of them, are suffering immediate or threatened injury as a result of the challenged action.” Warth, 422 U.S. at 511, 95 S.Ct. at 2211. The plaintiffs have shown that they represent associations of construction contractors, all of whom have members who have participated either as general contractors or subcontractors on city of Philadelphia construction projects. They have also shown that the Ordinance requires those bidders on covered contracts that are not MBEs, FBEs or HBEs to commit to subcontract at least 15% of their contract amount to MBEs, at least 10% to FBEs and at least 2% to HBEs. In addition they have shown that there is a certain number of contracts set aside for bidding only by MBEs and FBEs (“sheltered market”). They have also alleged that the Procurement Department and the MBEC must reject any bid on a covered contract that fails to commit to the percentage participation requirements, regardless of whether that bid is submitted by the lowest responsible bidder. Plaintiffs claim that as a result of the Ordinance their members have been excluded from bidding on sheltered market contracts; have been required to subcontract work or enter into joint ventures with MBEs and FBEs at greater expense than they would have incurred had they performed the work with their own forces or subcontracted the work to the lowest responsible bidding subcontractor; and have been disqualified from participating on covered contracts despite having submitted the lowest responsible bid. Defendants argue that despite these allegations plaintiff associations have failed to satisfy the injury in fact requirement because they have not shown the existence of any injury to its members of sufficient immediacy and ripeness to warrant judicial intervention. Specifically, defendants point to the associations’ failure to allege any of the following: a specific member’s loss of an opportunity to bid on a specific city contract; a specific member’s loss of an award of a specific city contract on which that member bid; the precise extra expenses incurred by a specific member in the performance of a specific city contract; or specific city contracts on which identified members incurred greater expense by subcontracting the work to comply with the DBE participation requirements rather than by performing the work themselves. Although the court could infer from the information provided in the complaint that the members have been injured by the operation of the Ordinance, the court agrees with defendants that to meet the injury in fact requirement the associations must show the injury suffered by their members with some specificity. To this end, members of six of the nine contractors associations have submitted affidavits detailing the nature of their injury under the Ordinance. The affidavits submitted by members of four of these associations provide information on the injury suffered with sufficient particularity to persuade the court that they meet the Article III requirement of injury in fact. These statements indicate to the court that members of these four plaintiff associations have been injured, and the court finds that their injuries provide the court with the best possible facts to “illumin[ate] ... [the] difficult constitutional questions” before it. Baker v. Carr, 369 U.S. at 204, 82 S.Ct. at 703. Of the five other associations, members of the ÑECA and RSMCA also submitted affidavits. These affidavits essentially stated that the members of the associations were notified of the litigation and did not object to it. The members also provided requests for bids on city projects and stated that they generally bid on these types of projects. These affidavits do not provide sufficient details of the injury suffered to meet the Article III requirement. The court acknowledges that members of ÑECA and RSMCA may have suffered injuries similar to those documented in the affidavits submitted by members of CAEP, GBCA, EBA and SADV, see supra n. 4, however such a supposition is too speculative to meet the injury in fact requirement. The court simply cannot infer that plaintiffs have met this requirement; nor will it fill gaps to enable plaintiff to do so. Thus, the court finds that, on the record before it, ÑECA and RSMCA do not have standing to challenge the constitutionality of Chapter 17-500. Finally, because members of MCAEP, IFCA and AMPD did not submit affidavits detailing their injury and since the allegations in the complaint fail to specify the injury with sufficient particularity, these three associations do not have standing to litigate the constitutionality of the Ordinance. Thus, the court will proceed in the analysis of the issues presented by this litigation with CAEP, GBCA, EBA and SADV as named-plaintiffs. Hereinafter, the term “plaintiffs” or “plaintiff associations” will refer only to these four contractor associations. The court notes that the declaratory relief provided by the court will apply to the five associations that are no longer named plaintiffs in this action. In addition, this determination that NECA, RSMCA, AMPD, IFCA and MCAEP do not have standing on this record does not prevent these associations from demonstrating at a later date the necessary injury in fact to attain standing. The court also finds that the plaintiffs have met the causation requirement of Article III. Again, members of plaintiff associations have shown that despite having submitted the lowest responsible bid, the bids were rejected as a result of the members’ inability to meet the requirements of the Ordinance. Other eases in this district have found that an allegation such as this meets the causation prong of the Article III test. See Main Line Paving Co. v. Bd. of Educ., School Dist. of Philadelphia, 725 F.Supp. 1349, 1353 (E.D. Pa.1989). Taken together, the allegations in the amended complaint and the affidavits show that plaintiffs’ members have standing in their own right. As did another district court in this circuit when examining similar facts, the court finds that the alleged effect this Ordinance has had on contractors doing business on city of Philadelphia projects are “real and sufficient to assure a concrete controversy and aggressive presentation of the constitutional question.” See Contractors Association of Western Pennsylvania v. Kreps, 441 F.Supp. 936, 946 (W.D.Pa.1977). The Third Circuit has acknowledged that such contractors are “those most likely to have suffered injury” by the operation of a set-aside Ordinance like the one at issue here. Rocks v. City of Philadelphia, 868 F.2d 644, 648 (3d Cir. 1989). Finally, the court does not find that the first prong of the Hunt test requires that each and every member of a plaintiff association show injury in fact. Supreme Court cases construing Hunt have made it clear that it is sufficient if some of the members have shown that they have been injured by the putatively illegal conduct. In International Union, et al. v. Brock, 477 U.S. 274, 106 S.Ct. 2523, 91 L.Ed.2d 228 (1986) the Supreme Court ruled that the plaintiff Union had standing because “at least some members of the UAW would have had standing to bring this suit in their own right.” Id. at 288, 106 S.Ct. at 2532. 2. Germaneness The second Hunt requirement does not appear to be at issue, and there is little question that the interests plaintiff associations seek to protect in this lawsuit are “germane to the organization^’] purpose.” Hunt, 432 U.S. at 343, 97 S.Ct. at 2441. The following goals constitute the stated purpose of the plaintiff associations: ... establishing and maintaining high standards of performance in the construction business and establishing its members in the public mind as contractors who fulfill obligations in good faith and with consummate skills; promoting relations between its members and purchasers of their services including the City of Philadelphia; representing the interests of its members respecting issues of significance to them as contractors; and eliminating waste and reducing the cost of construction. Amended Complaint at 5. The interests sought to be protected by this lawsuit are the prevention of unlawful discrimination in the letting of city of Philadelphia contracts. Members of the associations have alleged that this discrimination has caused an increase in the cost of compliance with bidding specifications and has raised the cost of construction to the city. These purposes seem to this court to be squarely in line with the Associations’ stated goals. A lawsuit challenging a set-aside requirement of the Public Works Employment Act was found to be germane to the purpose of a contractors association in R.I. Chapter, Assoc. General Contractors v. Kreps, 450 F.Supp. 338, 347 n. 10 (D.R.I.1978). 3. No need for individual participation The defendants contend that the plaintiff associations cannot meet the third Hunt requirement because they have MBE, FBE and/or HBE members that presumably benefit from the Ordinance. Defendants argue that because some members of plaintiff associations would be harmed if the set-aside program is dismantled, the very goal of this litigation, there is an inherent conflict of interest that defeats standing. The last of the Hunt requirements is designed to insure that the association itself can invoke the court’s remedial powers, and that participation of individual association members is not necessary. The Supreme Court has denied standing for failure to meet this requirement in cases where the damages sought are not common to the entire membership, the damages are not shared by all in an equal degree, or where the fact and extent of differing injury would require individualized proof. Warth, 422 U.S. at 515, 95 S.Ct. at 2213. The plaintiff associations before this court do not suffer from the same defects present in Warth. Plaintiffs seek a judgment declaring invalid Philadelphia’s minority, female and handicapped business set-aside program. The matter of the Ordinance’s constitutionality in light of Croson is a pure question of law, and thus similar to the matter before the Supreme Court in Brock. There the court considered whether the United Auto Workers had standing to bring suit against the Department of Labor challenging the Department’s policy of not permitting weeks in which employees draw nonregular wages to be considered a week of employment for purpose of determining eligibility for trade readjustment allowance benefits. The Court in Brock ruled that the UAW 0had satisfied the third Hunt requirement, finding that “[n]either th[e] claims nor the relief sought required the District Court to consider the individual circumstances of any aggrieved UAW member____ The suit raises a pure question of law: whether the Secretary properly interpreted the Trade Act’s TRA eligibility provisions.” Brock, 477 U.S. at 287, 106 S.Ct. at 2531. The question of whether the Ordinance violates the Equal Protection Clause of the Fourteenth Amendment can be adjudicated without reference to the particular circumstances of members of the plaintiff associations. Typically, an association will be denied standing where the evidence required to prove liability or define the appropriate remedy is peculiar to each member injured by the challenged conduct. Warth, 422 U.S. at 515, 95 S.Ct. at 2213. Generally, this arises where monetary damages are claimed that may differ from member to member. However, where proof peculiar to a particular member is not required on the liability or remedy issues, an association properly may maintain the action on behalf of one or more of its injured members. Id. Plaintiff associations have sought declaratory relief not damages, and thus there is no need for participation by individual members. See R.I. Chapter, 450 F.Supp. at 347, n. 3. The fact that some of the members may have suffered more actual damages than other members is not a bar to standing because the court can decide the constitutionality of the Ordinance without regard to proof of damages. Furthermore, the outcome of this suit by the associations has the same effect on any MBE, FBE or HBE member as would any facial attack brought by a single contractor on his or her own behalf. Finally, the membership in plaintiffs associations of MBEs, FBEs or HBEs that may not be harmed by the Ordinance does not defeat the standing of the associations. As stated above, the issue before the court does not mandate an inquiry into damages sustained by individual members. In addition, the courts that have addressed this question of whether a potential conflict of interest among members of a plaintiff association over the subject of the litigation will defeat that association’s organizational standing have indicated it does not, unless a majority openly opposes the association's position. In NCAA v. Califano, 622 F.2d 1382, 1391 (10th Cir.1980), the Tenth Circuit stated that if more members openly oppose the association’s position in the litigation than openly favor it, then associational standing is lost. However, in that case many members of the plaintiff association (the NCAA) were also members of a women’s intercollegiate sports association that was on the other side of the litigation. The conflict alleged in the case before this court does not approach that existing in NCAA. Moreover, information provided to the court concerning the four plaintiff associations indicates that of a total of 535 members, only 29 are registered MBEs, FBEs or HBEs. Such a small percentage of potentially-unharmed members was found not to destroy the standing of a contractors association to challenge the constitutionality of a set-aside ordinance in R.I. Chapter, 450 F.Supp. at 347, n. 3. In addition, both parties acknowledge that each of the plaintiff associations has obtained authorization to commence this action. Finally, the case cited by the defendants for the proposition that a conflict of interest among the members of an association prevents that association from having standing, AGC v. Otter Tail Power, 611 F.2d 684 (8th Cir.1979), does not support defendants’ argument. In that case, the Eighth Circuit did find an “obvious” conflict of interest among the members’ status and interest, however, the court denied organizational standing because it also found that the interests were so diverse that individual representation was required. Many of the cases denying organizational standing where there is a substantiated claim of a conflict of interest among members do so where proof of individual claims would be required to obtain the sought after relief. See Harris v. McRae, 448 U.S. 297, 100 S.Ct. 2671, 65 L.Ed.2d 784 (1979). As discussed above, no such individual representation is required in this case. Although it is true that there are DBE members of plaintiff associations that may arguably be benefitted by the Ordinance, the court finds that the conflict created by their presence is too allusive to defeat standing. First, the court will not presume that the DBE members of plaintiff associations will be harmed by the possible invalidation of the Ordinance. There was testimony before the city council expressing concern over the growth of fraudulent MDBEs and F-DBEs. See Transcript of Hearing before the Council of the City of Philadelphia, April 29, 1987, at 581 [hereinafter “Transcript”]. These businesses use a minority or woman owner as a front to enable non-minority and non-female DBEs to bid for covered contracts. If such fraudulent businesses are truly a problem as the city suggests, then the court will not assume that every DBE stands to be harmed by the dismemberment of the set-aside program. For all of the reasons stated above, this court finds that plaintiffs CAEP, GBCA, EBA and SADV have demonstrated that they meet the three requirements for organizational standing set out by the Supreme Court in Hunt, and they accordingly have standing to litigate this law suit on behalf of their members. C. Croson Standard In the past decade, the United States Supreme Court has struggled with the question of the appropriateness and validity of government-sponsored affirmative action programs in three cases: Regents of the University of California v. Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750 (1978), Fullilove v. Klutznick, 448 U.S. 448, 100 S.Ct. 2758, 65 L.Ed.2d 902 (1980) and Wygant v. Jackson Board of Education, 476 U.S. 267, 106 S.Ct. 1842, 90 L.Ed.2d 260 (1986). However, in each of these cases the Court did not reach a majority consensus about the standard of review applicable to racial classifications, the purpose and evidence necessary to support such classifications, or the permissible scope of affirmative action plans. Milwaukee County Pavers Ass’n v. Fiedler, 707 F.Supp. 1016, 1021-22, modified, 710 F.Supp. 1532 (W.D.Wisc.1989). While the Philadelphia Ordinance presently before this court was in effect, the Supreme Court decided Croson, supra. Although the Croson decision resolves only some of these issues, it forms the basis for the analysis of plaintiffs’ claims against the Philadelphia Ordinance. As will become evident, the parallels between the Croson case and this case are notable. The court will conduct a brief review of the Supreme Court’s earlier affirmative action decisions to show the state of the law prior to Croson. The court will then discuss the Croson decision in greater detail, as the Philadelphia Ordinance will be held to the standard articulated in that case. 1. Pre-Croson Decisions The District of Columbia Circuit cogently summarized the pre-Croson cases in Shurberg Broadcasting of Hartford, Inc. v. F.C.C., 876 F.2d 902, 910-12 (D.C.Cir.1989), and the following is extracted therefrom. Bakke struck down a university admissions policy that set aside a fixed percentage of each class for minority candidates. Justice Powell’s was the only opinion in the majority reaching the constitutional issue. He rejected the justification that a racial classification could be based on a mere desire to assure that the student body contain specific percentages of particular racial and ethnic groups. 438 U.S. at 307, 98 S.Ct. at 2757. He also rejected the use of a preference as a remedy for past discrimination, because the university had not made any such findings, and was not competent to do so. Id. at 307-09, 98 S.Ct. at 2757-58. However, Justice Powell did acknowledge that an academic institution has a compelling interest in promoting a diverse educational environment. Id. at 311-14, 98 S.Ct. at 2759-60. He stated that racial diversity is only one part of the “genuine diversity” that is a compelling state interest. Id. at 315, 98 S.Ct. at 2761. Thus, the university could have used race as one factor in a multi-factor admissions decision. Simply employing a racial set-aside was inconsistent with the goal of “genuine diversity,” which requires consideration of factors other than race. See id. at 315-18, 98 S.Ct. at 2761-62. In Fullilove the Court considered a facial challenge to the constitutionality of a set-aside provision in an Act of Congress authorizing funding for public works construction. In his plurality opinion, Chief Justice Burger stressed Congress’ unique constitutional authority under the Fourteenth Amendment to enact measures designed to remedy past discrimination. See 448 U.S. at 472-78, 100 S.Ct. at 2771-74. Justice Powell’s concurrence stressed that Congress had made the finding of past discrimination in the public procurement process and had selected the particular remedy. See id. at 503-06, 100 S.Ct. at 2787-89. The Court discussed features of the legislative history and the implemented program, determined that the set-aside was narrowly tailored to its remedial purpose, and upheld the program. Significantly, the Court found that the program was designed by Congress to assure that preference would be awarded only to disadvantaged minority enterprises who continue to suffer effects of past discrimination. The court also emphasized that the set-aside was likely to impose only a slight burden on nonminorities since it touched merely a small proportion of the total funds expended in the construction industry and because the effects were not concentrated on particular individuals. See id. at 484, n. 72, 100 S.Ct. at 2778, n. 72. (Powell, J., concurring). Finally, in Wygant, the Court held unconstitutional a school layoff policy that accorded minority teachers a preference over nonminorities with seniority. The Court found that the school board had failed to establish evidence of past discrimination to justify remedial action. See 476 U.S. at 277-78, 106 S.Ct. at 1848-49. However, the Court relaxed its previous requirement that the governmental body make “findings” of discrimination, and instead authorized preferences to be predicated on “substantial evidence of discrimination.” Id. at 289-92, 106 S.Ct. at 1854-56. The Court did reject flatly as a justification for the preferences the school’s asserted need to provide minority role models because it had “no logical stopping point.” Id. at 275-76, 106 S.Ct. at 1847-48. The Court held that the layoff provision was not narrowly tailored to achieve its remedial purpose because the hiring goal was calculated as a ratio of black teachers to black students, rather than as a ratio of black teachers to qualified minority teachers within the relevant labor pool. Id. at 294, 106 S.Ct. at 1857. 2. Croson Decision In Croson, the Supreme Court addressed the applicability of its prior decision in Wygant v. Jackson Board of Education, 476 U.S. 267, 106 S.Ct. 1842, 90 L.Ed.2d 260 (1986) to a minority set-aside program adopted by the city of Richmond. Part I of the Croson decision outlined the background of the Richmond set-aside program. In 1983 the Richmond city council adopted the Minority Business Utilization Plan [hereinafter “the Plan”], that required prime contractors on city construction contracts to subcontract at least 30% of the dollar amount of the contract to one or more MBEs. This set-aside did not apply to minority-owned prime contractors. The Plan was structurally similar to the Ordinance under attack in this litigation. It defined an MBE as “[a] business at least fifty-one (51) percent of which is owned and controlled ... by minority group members.” Croson, 109 S.Ct. at 713. Minority group members were defined as “citizens of the United States who are Blacks, Spanish-speaking, Orientals, Indians, Eskimos, or Aleuts.” Id. Richmond’s set-aside was open to qualified MBEs from anywhere in the United States. The Plan claimed it was remedial in nature and enacted “for the purpose of promoting wider participation by minority business enterprises in the construction of public projects.” Id. Richmond’s plan contained a waiver provision. The Director of the Department of General Services was directed to promulgate rules allowing waivers where a contractor can prove that despite every feasible attempt to comply with the Plan, the requirements could not be achieved. The Richmond city council enacted the Plan after a public hearing at which five members of the public testified against the ordinance and two in favor. Supporters of the Plan relied on a study indicating that, while the general population of Richmond was 50% black, only .67% of the city’s prime construction contracts had been awarded to MBEs from 1978 to 1983. The proponents of the set-aside provision also relied on evidence that many Richmond contractors’ associations had virtually no MBEs as members, and testimony that there was widespread exclusion on the basis of race in the Richmond area, in the state, and around the nation. Id. at 714. The Richmond city council heard no direct evidence that the city had discriminated on the basis of race in letting contracts or that the city’s prime contractors had discriminated against minority-owned subcontractors. Part II examined the scope of the city’s power to adopt legislation designed to remedy past discrimination. The Court rejected both Croson’s argument that the Court’s holding in Wygant v. Jackson Board of Education, 476 U.S. 267, 106 S.Ct. 1842, 90 L.Ed.2d 260 (1986) required Richmond to limit any race-based remedial efforts to eliminating the effects of its own discrimination, and Richmond’s argument that the decision in Fullilove v. Klutznick, 448 U.S. 448, 100 S.Ct. 2758, 65 L.Ed.2d 902 (1980) controls and gives Richmond the power to define and attack the effects of prior discrimination in its local industry. Justice O’Connor distinguished the Fullilove decision from the facts surrounding the Richmond Plan. Justice O’Connor rejected Richmond’s argument that its remedial powers were as broad as those of Congress, stating that appellant ignored the fact that Congress, unlike any State or political subdivision, has a specific constitutional mandate to enforce the dictates of the Fourteenth Amendment. That power to “enforce” may at times also include the power to define situations which Congress determines threaten principles of equality and to adopt prophylactic rules to deal with those situations. Croson, 109 S.Ct. at 719. In a section of Part II that is particularly relevant to the case before this court, Justice O’Connor further contrasted the broad remedial powers granted to Congress in this area from the rather narrow ones granted to the States and local governments: That Congress may identify and redress the effects of society-wide discrimination does not mean that, a fortiori, the States and their political subdivision are free to decide that such remedies are appropriate. Section 1 of the Fourteenth Amendment is an explicit constraint on state power, and the States must undertake any remedial efforts in accordance with that provision. To hold otherwise would be to cede control over the content of the Equal Protection Clause to the 50 state legislatures and their myriad political subdivision. The mere recitation of a benign or compensatory purpose of the use of a racial classification would essentially entitle the States to exercise the full power of Congress under § 5 of the Fourteenth Amendment and insulate any racial classification from judicial scrutiny under § 1. We believe that such a result would be contrary to the intentions of the Framers of the Fourteenth Amendment, who desired to place clear limits on the States’ use of race as a criterion for legislative action, and to have the federal courts enforce those limitations. Id. However, Justice O’Connor also relied on the Court’s decision in Wygant for the proposition that “a state or local subdivision (if delegated the authority from the State) has the authority to eradicate the effects of private discrimination within the constraints of § 1 of the Fourteenth Amendment. Id. 109 S.Ct. at 720. Thus, under Wygant, if Richmond could show that it had essentially become a “passive participant” in a system of racial exclusion practiced by elements of the local construction industry, it could take affirmative steps to dismantle such a system. The Court stated that, as long as a public entity could identify the discrimination with the particularity required by the Fourteenth Amendment, it has a compelling interest in assuring that public dollars do not serve to finance the evil of private prejudice. Id. In Part IIIA the Court observed that the Fourteenth Amendment provides that “[N]o State ... shall deny to any person within its jurisdiction the equal protection of the laws,” and found that the Richmond Plan denied certain citizens the opportunity to compete for a fixed percentage of public contracts based solely upon their race. According to Justice O’Connor, regardless of the racial group to which the effected persons belonged, any classification based on race must be subject to the test of strict scrutiny. The purpose of strict scrutiny is to “smoke out” illegitimate uses of race by assuring that the legislative body is proposing a goal important enough to warrant use of a highly suspect tool. The test also ensures that the means chosen “fit” this compelling goal so closely that there is little or no possibility that the motive for the classification was illegitimate racial prejudice or stereotype. Id. at 721. Croson reaffirmed the view expressed by the plurality of the Court in Wygant that the application of the strict scrutiny test is not dependant on the race of those burdened or benefitted by the classification. Justice O’Connor further justified the use of heightened scrutiny because of the concern that a political majority may act to the disadvantage of a minority, pointing out that 50% of the population of Richmond is black and five of nine city council seats are held by blacks. Justice O’Connor compared the Court’s decision in University of California Regents v. Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750 (1978), where the Court applied heightened scrutiny to a University of California racial quota that reserved 16 out of 100 seats in its entering class for certain minority groups. In Bakke, Justice Powell’s plurality opinion rejected as the quota’s justifications both a desire to have more black medical students and doctors and an effort to counter the effects of societal discrimination. Id. at 307, 98 S.Ct. at 2757. Justice Powell indicated that a government only has a compelling interest in favoring one race over another when there have been judicial, legislative or administrative findings of constitutional or statutory violations. Croson reaffirmed the position taken by a plurality of the Court in Bakke and Wygant that the government’s goal of remedying discrimination by imposing a racial classification must be focused on wrongs worked by specific instances of racial discrimination, id. at 308-09, 98 S.Ct. at 2757-58, rather than a more amorphous societal discrimination. Part IIIA of the opinion discussed the inadequate justification for the race-based system of employee lay-offs ultimately invalidated by the Court in Wygant. The justification focused on the perceived need for role models to alleviate the effects of prior societal discrimination. The Wygant Court rejected the role model theory for two reasons: first, the statistical disparity between students and teachers was not probative of employment discrimination; and secondly, the theory had no relation to a satisfactory basis for believing discrimination had occurred and thus potentially could justify race-based decisionmaking “essentially limitless in scope.” Croson, 109 S.Ct. at 723, citing, Wygant, 476 U.S. at 276, 106 S.Ct. at 1848. In Part IIIB the Court applied the strict scrutiny standard to the Richmond Plan and found that evidence offered in support of it suffered from the same defects identified as fatal in Wygant. The city had argued that it was attempting to remedy various forms of past discrimination that were alleged to be responsible for the small number of minority businesses in the local contracting industry. Croson, 109 S.Ct. at 723. Justice O’Connor found that none of the findings relied upon by the district court, which upheld the Plan, established “a prima facie case of a constitutional or statutory violation by anyone in the Richmond construction industry.” Croson, 109 S.Ct. at 724. The Court ruled that the following facts relied upon by the district court were an inadequate basis for the 30% quota and rejected them for the stated reasons: (1) The ordinance declares itself to be remedial. The Court said that the mere recitation of a “benign” or legitimate purpose for a racial classification is entitled to little or no weight. Id. at 724. (2) Several proponents of the measure stated their views that there had been past discrimination in the construction industry in this area, the State and around the nation. The Court found these statements to be “of little probative value in establishing identified discrimination in the Richmond construction industry. Id. (3) Minority businesses received .67% of prime contracts from the city while minorities constituted 50% of the city’s population. The plurality found that reliance on this disparity was misplaced because where special qualifications are required to fill particular jobs, comparisons to the general population have little probative value. Id. at 725. (4) There were very few minority contractors in local and state contractors’ associations. The Court stated that, standing alone, this fact is not probative of any discrimination in the local construction industry. Id. (5) In 1977, Congress made a determination that the effects of past discrimination had stifled minority participation in the construction industry nationally. Id. The plurality stated that this finding from Fullilove was of extremely limited probative value, reiterating the analysis from Part IIIA. The Court concluded that none of these findings, singly or together, provided Richmond with a “strong basis in evidence for its conclusion that remedial action was necessary.” Id., citing, Wygant, 476 U.S. at 277, 106 S.Ct. at 1848. Although Justice O’Connor stated that the States and their subdivisions may take remedial action when they possess evidence that their own spending practices are exacerbating a pattern of prior discrimination, she warned that “they must identify that discrimination, public or private, with some specificity before they may use race-conscious relief.” Croson, 109 S.Ct. at 727. Because the evidence offered by Richmond did not point to any identified discrimination in the local construction industry, the Court held that the city failed to demonstrate a compelling interest in apportioning public contracting opportunities on the basis of race. Justice O’Connor stated that the above analysis applies only to the inclusion of blacks within the Richmond set-aside program. The Court easily struck down the set-aside with regard to Spanish-speaking, Oriental, Indian, Eskimo, or Aleut persons because the city presented no evidence of past discrimination against such persons. In Part IV, Justice O’Connor stated that it was almost impossible to assess whether the Richmond Plan was narrowly tailored to remedy prior discrimination. First, the Court observed that it did not appear that Richmond gave any consideration to the use of race-neutral means to increase minority business participation in city contracting. The Court noted that many of the barriers to minority participation in the construction industry relied upon by the city appeared to be race neutral, and thus the city could have, for example, attempted a race-neutral program of city financing for small firms to help them meet bonding requirements. Second, Croson found that the 30% quota did not seem to be narrowly tailored to any goal, except perhaps “outright racial balancing,” and that the Plan appeared to rest on the unrealistic assumption that minorities will choose a particular trade “in lockstep proportion to their representation in the local population.” Id. at 728. The Court stated, as further evidence that the program was not narrowly tailored, that under the Richmond Plan a successful black, Hispanic, or Oriental entrepreneur from anywhere in the country enjoys an absolute preference over other citizens based solely on their race. Id. at 729. Part V of the opinion discussed the circumstances in which States and local governments may act to rectify the effects of identified discrimination within their jurisdiction. This advise was cogently capsulized in The Cone Corporation v. Hillsborough County, 723 F.Supp. 669 (M.D.Fla. 1989): (1) [Wjhere there is evidence of systematic exclusion of MBEs, the entity may take action to end the discriminatory exclusion. (2) [Wjhere there is significant statistical disparity between the number of qualified minority contractors willing and able to perform a particular service and the number of such contractors engaged by the locality or prime contractors, an inference of discriminatory exclusion could arise, and the entity could act to dismantle the closed business system by taking appropriate action against those who discriminate (in an “extreme” case, a narrowly tailored racial preference “might be necessary”). (3) [WJhere there are individual instances of racially motivated refusal to employ minorities, an entity would be justified in penalizing the discriminator and providing “appropriate relief” to the victim. (4) [If] supported by appropriate statistical proof, evidence of a pattern of individual discriminatory acts may lend support to a determination that broader remedial relief is justified ... (5) [I]n the absence of evidence of discrimination, the entity may employ an “array of race-neutral devices” to increase accessibility to contracting by small entrepreneurs of all races including: simplification of bidding procedures; relaxation of bonding requirements; training and financial aid for disadvantaged entrepreneurs; and prohibition of discrimination in provision of credit or bonding by local suppliers -and banks. Id. at 683-84. D. Merits of Plaintiffs’ Claims Plaintiff associations claim that the Philadelphia Ordinance is “essentially identical” to the Richmond Plan at issue in Croson and, like the Richmond Plan, fails to satisfy the strict scrutiny standard of equal protection review. This court agrees that the Ordinance must comply with the standard articulated in Croson. There is some suggestion in defendants’ brief that the Ordinance should not be subject to the Croson analysis because the Ordinance classifies the preferred party based on socially or economically disadvantaged status, rather than racial or ethnic characteristics. In support of this position, defendant relies on a Western District of Wisconsin case in which the court provisionally held on a motion for a preliminary injunction that plaintiffs had a reasonable likelihood of success on their federal equal protection claim challenging a Wisconsin “Disadvantaged Business Demonstration and Training Program.” See Milwaukee Co. Pavers, 707 F.Supp. 1016, modified, 710 F.Supp. 1532 (W.D.Wisc.1989). In pertinent part, the Wisconsin statute provided that the state reserve four million in construction contracts for socially and economically disadvantaged businesses. Un