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Milwaukee approves settlement in minority lawsuit

By: Beth Kevit, [email protected]//June 11, 2013//

Milwaukee approves settlement in minority lawsuit

By: Beth Kevit, [email protected]//June 11, 2013//

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Milwaukee’s decision Tuesday to repeal the minority hiring requirements that had sparked a lawsuit might land the city back in court.

The Hispanic Chamber of Commerce of Wisconsin Inc. and the American Indian Chamber of Commerce of Milwaukee Inc., both of Milwaukee, sued the city in May 2012 over an ordinance that carved out for specific groups percentages of contract money set aside for minority businesses. The ordinance went into effect Jan. 1, 2012.

The chambers claimed the ordinance was based on data that showed their members won contracts more often than they should, suggesting they were not disadvantaged. That data, the chambers argued, was flawed.

The city abolished those new percentages Tuesday through a unanimous Common Council vote and Mayor Tom Barrett’s signature.

But John Robinson, president and CEO of New York City-based The National Minority Business Council Inc., said the city has opened itself to additional legal challenges by backing away from the disparity study it used to craft the ordinance.

“They could have lawsuits coming from all groups,” he said, “the people who are going to lose.”

Alderman Bob Donovan said Robinson’s prediction rings true.

“Nothing,” Donovan said, “would surprise me.”

He said the disparity study was “garbage,” and the lawsuit was a “fiasco.” He said it was a “tragedy” that the mayor’s administration tried to mislead the Common Council by assuring aldermen the study was accurate and justifiable. Donovan said the city attorney’s office, by recommending the settlement, has told the council the study is not sound.

“I think some people,” he said, “ought to lose their jobs on the whole damn thing.”

Jodie Tabak, Mayor Tom Barrett’s spokeswoman, referred questions to Assistant City Attorney Margaret Daun, who declined to comment.

Before Jan. 1, 2012, all minority businesses competed for the same set-aside pool of money, which for construction projects was 25 percent of contract money spent every year. The city changed that method to set aside 7.31 percent of construction contract money for businesses owned by women, 5.57 percent for those owned by African-Americans and 0.07 percent for those owned by Asian Americans.

That meant Hispanic- and American Indian-owned businesses only could compete for the remaining 12.05 percent of the yearly set aside, and they had to compete with all other minority businesses.

The city based those changes on a disparity study commissioned from Jacksonville, Fla.-based D. Wilson Consulting Group LLC. The chambers named D. Wilson and its insurer in the lawsuit, and the city’s proposed settlement would require D. Wilson pay $290,000 to cover court costs for the chambers and city.

Numbers listed for D. Wilson were not in service, and D. Wilson’s attorney did not immediately respond to a request for comment Tuesday afternoon.

Robinson said he would not be surprised if groups representing the business owners who had benefited from the new percentages sued the city over losing that advantage. Repealing those percentages, he said, leaves the remainder of the program open to scrutiny.

Representatives from the Wisconsin Black Chamber of Commerce Inc., the African American Chamber of Commerce and the Wisconsin Women’s Business Initiative Corp., all of Milwaukee, did not immediately respond to requests for comment.

Charles Vang, president of the Hmong Wisconsin Chamber of Commerce, Milwaukee, said he was aware of the lawsuit but had not followed it closely and could not comment on how his group might react to the settlement.

The settlement does not bar the city from conducting another disparity study, but all data and analysis from the D. Wilson report is off limits.

Maria Monreal-Cameron, president and CEO of the Hispanic chamber, said she would welcome another study if the city involves her group.

“It shouldn’t come from somebody studying us,” she said. “Ask us. We’re here.”

At this point, Robinson said, Milwaukee should keep the percentages equal for all minority businesses or temporarily suspend the program while developing a new formula.

“The city has to have the courage to do that,” he said, “and say, ‘We’ve got to go back to the drawing board.’”

— Follow Beth on Twitter

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