Mark Flatten

Sky Harbor study on need for racial preferences two years overdue

Posted on May 05, 2010 | Type: Investigative Report | Author: Mark Flatten
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The Goldwater Institute Watchdog Report is a periodic publication intended to identify government corruption and waste and to hold politicians and public agencies accountable to taxpayers.

The study to determine whether Phoenix should maintain a racial preference program in awarding concession contracts at Sky Harbor International Airport is still unfinished almost two years after the original deadline.

The analysis to determine whether discrimination is an ongoing problem in airport contracting, known as a disparity study, is required if the city is to use any race-based criteria when it awards contracts for food and retail vendors at the airport. Phoenix hired Exstare Federal Services Group of Virginia to conduct a disparity study at Sky Harbor in May 2007. The study was supposed to be finished by May 2008 and cost no more than $349,500. But the deadline has been repeatedly delayed by the City Council, first to May 2009 and again to December 2009. The cost also has jumped to $609,500.

City officials now say the study should be done by June.

“The cost for the ADCBE Disparity Study has not increased,” David Ramirez, a city spokesman said in an email to the Goldwater Institute. “The study was anticipated to be complete in December 2009, however it was delayed due to several logistical problems, such as extreme weather conditions on the East Coast, power outages resulting in computer issues and significant personnel illness.”

Neither Ramirez nor other airport officials would return phone calls for an interview. His email did not explain the issues he referred to. Julie Rodriguez, another airport public information officer, said questions could be submitted in writing, but also has yet to explain the delay in detail.

Last October, the Goldwater Institute found in “High Fliers: How Political insiders Gained an Edge in Sky Harbor Concessions” that the preference program at the airport had been used to enrich a small group of political insiders with close ties to City Hall. Among the beneficiaries is Maricopa County Supervisor Mary Rose Wilcox. Wilcox was brought in as a partner in a Chili’s restaurant concession to meet requirements for minority participation but was not required to take an active role in running the business, which is a violation of federal rules, according to city records.

The city suspended its use of race-based preferences in awarding airport concession contracts in 2006 in response to a ruling by a federal appeals court. Since then, the city has extended old contracts that were issued using race as a factor as an interim measure until the new study is finished.

The Ninth Circuit Court of Appeals ruled in 2005 that to maintain racial preferences, airport operators needed to show specific evidence of past discrimination within a local market, in a particular contracting program and against each minority group receiving a preference. Disparity studies such as the one being conducted at Sky Harbor must show discrimination can only be remedied by setting minimum participation requirements for businesses owned by women and minorities if race is to be used as a factor in awarding airport concession contracts.

Companies owned by minorities and women certified as “disadvantaged” account for about 28 percent of all concession sales at Sky Harbor, according to a February 2010 report to the council.

Delays in completing disparity studies often mean the researchers are having trouble providing the data politicians want to justify the continued use of racial preferences, said Roger Clegg, president and general counsel of the Center for Equal Opportunity, a think tank  that focuses exclusively on issues of race and ethnicity and opposes using racial preferences in government contracting.

“Most of the time when they are commissioned, the people commissioning them have already made up their minds what the people doing the study need to conclude,” said Clegg. “I suspect the study will continue for as long as it takes to reach the right answer, the right answer being the answer that the people who want quotas insist on in order to justify those quotas as a legal matter.”

Mark Flatten is an investigative reporter for the Goldwater Institute.

Learn More:

Goldwater Institute: High Fliers: How Political Insiders Gained an Edge in Sky Harbor Concessions

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