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The results will affect how the state issues contracts to minority-owned companies for road construction projects.
"We need to determine the level and extent that discrimination is absent or present in highway work in Alaska," said Jon Dunham, DOT civil rights office manager.
The request for proposals seeking a firm to conduct the study is due out later this month.
The study will focus on contractors certified through the state-administered disadvantaged business enterprise program. DBE certifications are awarded to small, minority-owned businesses that meet certain financial and ownership specifications laid out in federal regulation.
Small-business owners who are of a minority race or are women are generally considered socially and economically disadvantaged, and so get preferences in contract awards.
Nearly 300 contractors are currently in the state's DBE directory.
Government agencies set goals dictating that a certain percentage of total dollars spent on each project will go toward contracts or for subcontracting minority-owned businesses. These are referred to as "race-conscious" programs.
Alaska DOT used follow race-conscious guidelines. In January, the department adopted a "race-neutral" policy, where instead of setting goals for each project, it has one goal for the entire highway program.
The statewide study will determine the number of potential businesses that could participate in the program, decide if those contractors are capable of doing work and if they are being sufficiently employed.
It will also determine if there is any discrimination in letting contracts.
DOT set aside $600,000 in the Statewide Transportation Improvement Program budget to pay for the effort. Some 28 communities and organizations, including the municipality of Anchorage, the city and borough of Juneau, the Fairbanks Borough and the Alaska Railroad Corp., will follow the recommendations of the final results.
The study is in response to a 9th Circuit Appeals Court decision in a discrimination case filed against the Washington state transportation department. Western States Paving Co., which is owned by a white male, filed suit claiming that minority-owned DBE-certified businesses were unfairly given contracts in at least two instances where Western had the lowest bid.
The court said that DBE programs in general were constitutional, but Washington state had not sufficiently shown the need for a "race-conscious" program. DBE programs certify businesses that are socially and economically disadvantaged, but do not show specific evidence of discrimination, the court said.
The court cited an 8th Circuit Court decision, where the transportation departments in Minnesota and Nebraska had hired outside consulting firms to conduct statistical analyses of the availability and capacity of DBEs in their local markets.
With the court's decision, states within the 9th Court's district - the Western states, including Alaska and Hawaii - must conduct their own studies.
For this study, DOT wants to contract with a group that has a history of doing social and economic research on a statewide basis, and one that knows how to support findings in court.
"That's where we expect to go with this," Dunham said. "The study will put us on firmer ground as far as contracts, but we expect it to be challenged at some point."
Dunham said his office already has received inquiries from the Pacific Legal Foundation, a California-based nonprofit public interest legal organization, asking for copies of the state program and it's goals.
Since the state has adopted its "race-neutral" policy, however, Dunham said he's already seeing some detrimental effects to contracting to minorities. The department this year anticipated that 4 percent of all highway money spent - a total of 65 contracts paying an estimated $500 million - would go toward minority contractors. Minority-owned businesses have received only 1 percent of the nearly $110 million that has been awarded in 30 contracts so far this year.
"That will have a detrimental effect on the disparity study," he said. "It may show there is discrimination."
Washington state used to have a DBE goal of 12 percent for minority contracts. Once the state dropped to race neutral, awards dropped to 3 percent. Results from Washington's study came back with a recommendation to set a goal of 20 percent, Dunham said.
If there is no discrimination found in Alaska's study, the state would not have to set project goals, but could keep its overall race neutral program.
If disparities are found, the state would have to set project goals. But that policy could create new issues.
In the study, the state must narrowly define areas of discrimination, to individual gender and individual race.
The study, for example, could show that no discrimination exists toward Alaska Native-owned companies, so no specific goals would be set for that group. But there may be evidence of discrimination toward Asian-female-owned companies, and goals would be set just for that group.
"It would not be an easy program to administer," Dunham said.
While he couldn't go into details about specific cases because of confidentiality issues, Dunham said he believes there some areas where discrimination occurs in Alaska business, notably in women-owned operations.
There doesn't seem to be racial discrimination, he said, though that may be difficult to determine. Contractors may grumble in back rooms, but often don't file an official complaint because they fear it may jeopardize future work.
The study is expected to be completed in May 2007.
Melissa Campbell can be reached at
melissa.campbell@alaskajournal.com.
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