American Indian group files to join lawsuit against Milwaukee

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The American Indian Chamber of Commerce of Wisconsin Inc. is suing Milwaukee in U.S. District Court to end an ordinance that sets race-based preferences and goals for city construction contracts.

The chamber filed June 6 to intervene as a co-plaintiff in a lawsuit originally filed by the Hispanic Chamber of Commerce of Wisconsin on May 1 in Milwaukee County Circuit Court. The U.S. District Court has to approve the American Indian chamber’s request to join the Hispanic chamber as a co-plaintiff before the suit against Milwaukee can proceed, said Brian Pierson, an attorney with Milwaukee-based Godfrey & Kahn SC who is representing the American Indian chamber.

“We feel very confident we’ll get approval from the court within the next few weeks,” he said, “and move forward with the lawsuit.”

Maria Monreal-Cameron, the Hispanic Chamber’s president and CEO, declined to comment on the lawsuit and referred all questions to her attorney, Paul Benson.

Benson, an attorney with Michael Best & Friedrich LLP, did not immediately respond to calls for comment.

The lawsuit stems from preferences that fall under city ordinance 370, which took effect Jan. 3 after Milwaukee hired D. Wilson Consulting Group LLC, of Jacksonville, Fla., to conduct a disparity study.

The study examined closed construction contracts between 2005 and 2008 between the city and minority- and women-owned businesses. According to the study, Hispanics and Native Americans obtained the highest percentage of set-aside money on projects, so the city adjusted set-aside percentages in the ordinance.

Before ordinance 370, there was no separation between any minority group; they were all eligible for the same 25 percent set aside.

Ordinance 370 established specific set-aside percentages: 12.05 percent for companies certified as small-business enterprises, 7.31 percent for companies certified as women-owned, 5.57 percent for companies certified as African-American owned and 0.07 percent for those owned by Asian Americans.

As a result of the ordinance, Hispanic and Native American contractors only can bid as SBEs and do not get an additional set-aside percentage on top of that, as other minority groups do. That limits American Indian participation with city contracts, said Craig Anderson, board president of the American Indian chamber.

“This ordinance took away work from contractors who did good work in Milwaukee,” he said. “But more importantly, it took away all competition.”

The lawsuit claims the disparity study the city used failed to prove racial discrimination and instances of discrimination in city contracts; contains flaws in methodology, data, calculations, statistics and interpretation; and contains inconsistent definitions of relevant geographical markets to determine the appropriate pool of available businesses.

Deirdre Kyle, principal at D. Wilson Consulting, declined Tuesday to comment on the study.

The two chambers decided to move the suit from Milwaukee County to U.S. District Court as part of the American Indian chamber’s request to join the suit, Pierson said, because the ordinance is in violation of the Fourteenth Amendment, which means the state can’t treat different groups unequally.

By treating minority contractors differently, Pierson said, the city is clearly violating the Constitution.

The city believes the ordinance is constitutionally sound, said Assistant City Attorney Margaret Daun. She declined to comment further.

The lawsuit asks the U.S. District Court to find ordinance 370 unconstitutional and rule it invalid, Pierson said. It also asks for the court to issue a permanent injunction to prevent the city from enforcing ordinance 370 again, he said.

The American Indian chamber needs to win this lawsuit, Anderson said, because businesses are losing money.

“I don’t understand this ordinance,” Anderson said. “It’s definitely biased, which is why we had no choice but to do this.”