\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Since it started at the federal level in 1987, Disadvantaged Business Enterprise (\u201cDBE\u201d) programs have played a significant role in the award of most state, county and municipal public procurements.\u00a0 Good faith efforts \u2013 often in the eye of the beholder \u2013 could make or break a contractor\u2019s bid.\u00a0 Then, the United States Supreme Court issued its decision in Students for Fair Admissions Inc. v. President and Fellows of Harvard College<\/em>, 600 U.S. 181 (2023) that determined DBE-type programs violate the 14th<\/sup> Amendment of the United States Constitution.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 On May 28, 2026, the Metropolitan Council (\u201cMet Council\u201d) issued a bid protest rejection letter stating that the United States Supreme Court\u2019s decision in Students for Fair Admissions<\/em> and the Equal Protection Clause of the 14th Amendment does not apply to Met Council\u2019s Metropolitan Council Underutilized Business (\u201cMCUB\u201d) contract requirements.\u00a0 The rational offered by Met Council for its decision to reject a lower bid at a cost to taxpayers of $197,383.00?\u00a0 The MCUB is a state funded program and not federally funded.\u00a0 Although low-bidder New Look Contracting, Inc. (\u201cNew Look Contracting\u201d) decided not to further challenge its bid protest, this case study provides insight into the still-lingering efforts to resurrect unconstitutional race-based programs that are not narrowly tailored to a compelling government interest at taxpayer expense.<\/p>\n <\/p>\n Old DBE Programs are Unconstitutional.<\/strong><\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Before 2023, courts relied on Adarand Constructors, Inc. v. Pe\u00f1a<\/em>, where the United States Supreme Court assumed racial classifications were unconstitutional. 515 U.S. 200, 227 (1995). The case did not determine whether DBE programs met that rigorous standard. Id<\/em>. The Court only noted that the government \u201cis not disqualified\u201d from responding to racial discrimination. Id<\/em>. at 237. Courts understood this case to require careful analysis of DBE programs but not to ban them. Sherbrooke Turf, Inc. v. Minnesota Dep’t of Transp.<\/em>, 345 F.3d 964, 969 (8th Cir. 2003). Then, a few years ago, the Supreme Court clarified its rule on racial discrimination.<\/p>\n \u00a0<\/strong><\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 In 2023, the United States Supreme Court issued the Students for Fair Admissions Inc. v. President and Fellows of Harvard College <\/em>(\u201cSFFA v. Harvard<\/em>\u201d) opinion. In that case, the Court held Harvard\u2019s race-based admission program was unconstitutional under the Fourteenth Amendment, but that ruling applies beyond college admissions. Students for Fair Admissions Inc. v. President and Fellows of Harvard College<\/em>, 600 U.S. 181 (2023). Through a robust illustration of past decisions, \u201c[The Supreme Court] recognized [] repeatedly [that the] \u2018clear and central purpose of the Fourteenth Amendment was to eliminate all official state sources of invidious racial discrimination in the States.\u2019\u201d Id<\/em>. at 206. (quoting Loving v. Virginia<\/em>, 388 U.S. 1, 10 (1967)). In other words, the Court held that the Fourteenth Amendment applies to states and protects all races from discrimination.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 After SFFA v. Harvard<\/em>, contractors questioned the legality of DBE requirements in government contract procurement. In the case of Mid-America Milling Company, LLC v. United States Department of Transportation<\/em> the federal district court held that the ruling in SFFA v. Harvard <\/em>applied to DBE programs, so the race and gender presumptions were unconstitutional. No. 3:23-CV-00072-GFVT, 2024 WL 4267183, at *10 (E.D. Ky. Sept. 23, 2024), opinion clarified, No. 3:23-CV-00072-GFVT, 2024 WL 4635430 (E.D. Ky. Oct. 31, 2024), and order dissolved, No. 3:23-CV-00072-GFVT, 2026 WL 777407 (E.D. Ky. Mar. 19, 2026). The court stopped the DOT from requiring race and gender requirements in its contracts that Mid-America bid. Id<\/em>. at *13.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 The decision in Mid-America Milling<\/em> was a wake-up call for the Federal Government. The DOT responded by issuing an Interim Final Rule (\u201cIFR\u201d) in October of 2025. The IFR \u201cremoves race- and sex-based presumptions of social and economic disadvantage\u201d from DBE programs because those presumptions violate the Fourteenth Amendment. 49 C.F.R. pts. 23, 24 (2025). The IFR requires states to recertify DBEs through individualized evidence and decertify those who do not meet the new requirement. Id<\/em>. Until the recertification process is complete, the IFR halts DBE goals. Id<\/em>. This is the political setting where contractors and subcontractors find themselves today: the government has put DBE programs on hold nationwide.<\/p>\n <\/p>\n Minnesota\u2019s Metropolitan Council has Kept the Old DBE Program in its Bidding Process.<\/strong><\/p>\n \u00a0<\/strong><\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Some local government entities have not entirely removed DBE reliance in bidding, despite its unconstitutionality. Met Council requires private contractors who bid on their projects to meet the Metropolitan Council Underutilized Business program participation goal or show a good faith effort to do so. \u00a0As a member of the Minnesota Unified Certification Program (\u201cMNUCP\u201d) and a government entity, Met Council cannot set DBE goals until MNUCP completes the reevaluation process under the IFR. MNUCP, About the DBE Program<\/em>, https:\/\/mnucp.org\/about\/about-the-dbe-program\/ (last visited June 23, 2026). However, Met Council relies on DBE certification as one of the four ways a contractor can qualify as an MCUB. Regardless of whether Met Council receives federal funding for its projects, the government entity is bound by Minnesota law, the Fourteenth Amendment, the United States Supreme Court, and federal constitutional law.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Met Council is only partway through its reevaluation plan, with twenty-seven decisions left mid-way through June of 2026. Sean Skibbie, DBE Program Update at the Minnesota State Bar Association 2026 Construction Law Forum (June 16, 2026). By relying on obsolete DBE classifications, Met Council ignores the program\u2019s unconstitutionality. By using outdated DBE classifications, Met Council misapplies the law and restricts responsive, responsible, and cost-effective bidders from receiving awards.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 New Look Contracting lost an award of a Met Council contract as the low bidder because of Met Council illegally applied its MCUB program that violates the 14th Amendment of the Constitution.\u00a0 At bid time, New Look Contracting did not submit evidence of a good faith effort to meet the MCUB program because it understood that all DBE-type programs were on hold and MNUCP agencies could not set DBE goals on projects \u201csolicited on or after October 3, 2025.\u201d MNUCP, DBE\/ACDBE Reevaluation Process FAQs<\/em>, 1, 1 (2026), https:\/\/mnucp.org\/media\/5ndjyjwe\/mnucp-dbe-acdbe-reevaluation-process-faqs.pdf<\/a>. Since Met Council received bids for this project April 30, 2026, the goals should not have included DBE classifications.<\/p>\n Bid Protest Relied on Abrogated Case Law.<\/strong><\/p>\n \u00a0<\/strong><\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 On May 13, 2026, New Look Contracting, as the low, responsible, and responsive bidder, issued a bid protest to Met Council after it lost the award of a contract for failing to demonstrate so-called good faith efforts to secure MCUB participation. In its rejection of the bid protest, Met Council states that because Minnesota statutes allowed the creation of its MCUB program, the holding in SFFA v. Harvard<\/em> did not apply.\u00a0<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 The decision in SFFA v. Harvard<\/em> identified several fundamental flaws in many DBE-type programs.\u00a0 First, any compelling interest underlying these programs must be subjected to meaningful judicial review that allow the courts to measure the goals and know when the goals have been reached.\u00a0 600 U.S. at 214.\u00a0 Second, the DBE-type programs must have a \u201clogical end point\u201d to satisfy the Equal Protections Clause of the 14th Amendment.\u00a0 Id.<\/em> at 221.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Rather than justify its MCUB program based on the requirements set forth in SFFA v. Harvard<\/em>, Met Council relied upon the thirty-year-old decision in Adarand Constructors, Inc. v. Pena<\/em>, 515 U.S. 200 (1995) to claim the program remained legal.\u00a0 Moreover, Met Council stated that because SFFA v. Harvard <\/em>\u00a0did not directly overrule Adarand<\/em>, it would not consider SFFA v. Harvard<\/em> binding precedent.\u00a0\u00a0 Further, Met Council stated that the case in Mid-America Milling<\/em> did not apply to Minnesota to argue that its bid procurement process was lawful. By combining the two, Met Council implied the Supreme Court approved of previous DBE program (\u201cAdarand <\/em>ultimately ruled<\/u> that the DBE Program satisfied [the Supreme Court\u2019s analysis requirement].\u201d Emphasis added). The Supreme Court has made no such ruling, yet Met Council doubled down on its DBE position, arguing that \u201cunless and until Adarand<\/em> is reversed, the MCUB program remains valid.\u201d \u00a0That position is incorrect because the Supreme Court\u2019s Adarand <\/em>case did not approve DBE programs. \u00a0Nor does the 30-year-old case contradict SFFA v. Harvard<\/em>. \u00a0To the contrary, SFFA v. Harvard <\/em>cites Adarand <\/em>when establishing the level of analysis required under the law. 600 U.S. at 206. \u00a0SFFA v. Harvard <\/em>and the IFR are the current governing law, so the MCUB program should reflect their requirements.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Met Council cited another case called Sherbrooke Turf, Inc. v. Minnesota Dept of Transportation<\/em>. The court decided that case long before SFFA v. Harvard<\/em>, though, so it could not apply the current law. The federal government\u2019s response against DBE programs implies a different rule unaddressed by Sherbrooke Turf<\/em>. Even Sherbrooke Turf<\/em> contradicts Met Council, though, since the case requires the agency to act \u201cfor a proper purpose.\u201d 345 F.3d 964, 970 (8th Cir. 2003). Since the new IFR removes race and gender from the program, Minnesota\u2019s old DBE program no longer has a proper purpose.<\/p>\n <\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Met Council claimed in its response to the bid protest that \u201cDBE Statutes and Regulations do not apply to state-funded MCUB Projects.\u201d Under this argument, Met Council claims the DBE and MCUB programs are \u201centirely separate,\u201d while adopting the DBE program into the MCUB program. The result implies that Met Council, as a government entity, is somehow exempt from following the U.S. Constitution and federal law, but that is not the case. The Fourteenth Amendment and federal rules apply to all government entities, no matter where their funding originates.<\/p>\n <\/p>\n Conclusion<\/strong><\/p>\n \u00a0<\/strong><\/p>\n \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Contractors should not face punishment for obeying laws that a government entity disregards. \u00a0Following an unconstitutional program endangers contractor business and adds bidding restrictions inconsistent with the law.\u00a0 This is not a question of what system is \u201cright;\u201d it is a question of whether contractors should be punished for following controlling Constitutional law.<\/p>\n\n\n Announcements<\/u><\/strong><\/p>\n\n\n\n Fabyanske, Westra, Hart & Thomson, P.A. <\/strong>has been ranked as a Band 1 Construction Law Firm in Minnesota <\/strong>by the well-recognized Chambers <\/strong>professional rating service.<\/p>\n\n\n\n Dean Thomson<\/a> <\/strong>(Band 1 Construction Law)<\/p><\/li>\n\n\n\n Kyle Hart<\/a> (<\/strong>Band 1 Construction Law)<\/p><\/li>\n\n\n\n Mark Becker<\/a> <\/strong>(Band 1 Construction Law)<\/p><\/li>\n\n\n\n Julia Douglass<\/a> <\/strong>(Band 3 Construction Law)<\/p><\/li>\n\n\n\n Jesse Orman<\/a> <\/strong>(Band 3 Construction Law)<\/p><\/li>\n\n\n\n Rory Duggan<\/a> <\/strong>(Band 2 Real Estate Law)<\/p><\/li>\n<\/ul>\n\n\n\n Here\u2019s what Chambers has to say about FWHT: <\/strong>\u201cFabyanske, Westra, Hart & Thomson PA is esteemed for its dedicated construction group, which brings deep industry insight to disputes, contract negotiations, planning issues and arbitration matters. The group represents diverse participants from the public and private sectors, including design professionals, insurers and subcontractors. The firm frequently acts on large-scale regional and national projects. It has attorneys who are well known in the sector, having been appointed to leadership roles at a variety of industry bodies.\u201d<\/p>\n\n\n\n For more information click here.<\/a> <\/strong> <\/p>\n\n\n\n Fabyanske, Westra, Hart & Thomso<\/strong>n, P.A. is proud to announce that Mark Becker <\/a><\/strong>and Dean Thomson<\/a> <\/strong>have been named to Minnesota Lawyer\u2019s 2026 Minnesota Legal 250 Construction Law category.<\/p>\n\n\n\n Congratulations to Hugh Brown<\/a><\/strong>, the newly appointed Associate Editor of the Construction Lawyer, a quarterly publication of the American Bar Association Forum on Construction Law, is a scholarly journal that provides expert analysis on evolving policies, legislative developments, and risk management.<\/p>\n\n\n\n Click here<\/strong><\/a> for more information.<\/p>\n\n\n\n
Met Council\u2019s Rejection of New Look Contracting\u2019s <\/strong><\/p>\n\n
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