Facts
- Adarand Constructors, Inc., a Colorado guardrail subcontractor, submitted the lowest bid on a federal highway project subcontract.
- The prime contract provided additional compensation to the prime contractor if it hired subcontractors certified as small businesses controlled by “socially and economically disadvantaged individuals.”
- Federal regulations directed the prime contractor to presume that certain racial minorities were “socially and economically disadvantaged” for certification purposes.
- The subcontract was awarded to Gonzales Construction Company, which held the relevant certification, despite Adarand’s lower bid.
- The prime contractor stated it would have accepted Adarand’s bid but for the financial incentive tied to hiring the certified subcontractor.
- Adarand sued federal officials, alleging unconstitutional race-based discrimination under the equal protection component of the Fifth Amendment’s Due Process Clause.
- Adarand also sought forward-looking relief, alleging it was likely to bid again on federal contracts using similar incentives.
Issues
- Whether Adarand had standing to seek prospective relief challenging the federal subcontracting incentive program.
- What level of constitutional scrutiny applies to federal governmental racial classifications under the Fifth Amendment.
- Whether federal race-based presumptions used to confer contracting advantages may be evaluated under a standard less demanding than strict scrutiny because they are characterized as remedial or “benign.”
Decision
- The Supreme Court held that Adarand had standing based on the loss of a specific subcontract and a credible likelihood of encountering the same program in future bidding.
- The Court ruled that all racial classifications imposed by any government actor—federal, state, or local—must be reviewed under strict scrutiny.
- The Court vacated the judgment applying a more deferential standard and remanded for application of strict scrutiny to the challenged program.
- The Court rejected the approach that “benign” federal racial classifications may receive intermediate scrutiny, displacing contrary precedent.
Legal Principles
- Governmental use of racial classifications triggers strict scrutiny: the measure must serve a compelling governmental interest and be narrowly tailored to further that interest.
- Equal protection constraints apply to the federal government through the Fifth Amendment’s Due Process Clause, and the analytical standard matches Fourteenth Amendment equal protection review.
- The standard of review does not depend on whether the racial classification burdens or benefits a particular racial group; remedial intent does not lower the level of scrutiny.
- Strict scrutiny is not necessarily dispositive against the government, but the government must justify race-conscious measures with a compelling aim and narrow tailoring.
- Programs genuinely based on disadvantage rather than race may be subject to less demanding review, but race used as a presumptive proxy for disadvantage is treated as a racial classification.
Conclusion
The Court required strict scrutiny for federal racial classifications, vacating and remanding because the lower courts applied a more deferential standard, and reaffirmed that the Fifth Amendment binds the federal government to the same equal protection analysis applied to the states.