By Nick Goldstein, vice president of regulatory affairs & assistant general counsel, ARTBA

A federal appeals court Aug. 19 ruled that an Illinois highway contractor did not have the right to challenge the state transportation agency’s interpretation of the federal Disadvantaged Business Enterprise (DBE) rule.

In the case, Dunnet Bay v. Borggren, the 7th U.S. Circuit Court of Appeals in Chicago rejected a request to overturn a prior dismissal of the contractor’s complaint.  The firm, Dunnet Bay Construction Co., originally alleged the Illinois Department of Transportation (IDOT) misapplied federal DBE program regulations in awarding a bid for a large transportation construction project in 2010, and also argued the agency was under improper political pressure from the administration of then-Governor Pat Quinn (D) to do so.

ARTBA warned in an amicus brief that the lower court’s refusal to hear Dunnet Bay’s complaint set a dangerous precedent that could deny construction firms nationwide the chance to challenge applications of the DBE program they see as unjust.  Further, the association argued that the manner in which IDOT applied the DBE rule to Dunnet Bay’s bid submission effectively transformed the disadvantaged business program into an unconstitutional, quota-based system.

ARTBA thanks the Illinois Road & Transportation Builders Association (IRTBA) for its leadership in this litigation, as well as several other ARTBA chapters who provided financial support for ARTBA’s brief in the case.  The disturbing legal precedent that could be set by this appeals court decision underscores the need for ARTBA’s to continue DBE reform efforts through regulatory and legislative channels.

For further information on the decision, please contact me at ngoldstein@artba.org.