As Pittsburgh works to undo past racial discrimination and improve conditions for Black residents, legal scrutiny of programs that pursue those goals is growing. The recent U.S. Supreme Court decision to ban race-based affirmative action in higher education has other sectors on notice.
While the controversy over race simmers nationally, Pittsburgh has taken tentative steps to shield its programs from legal attacks. The city is preparing to fund a disparity study to determine when it can legally consider race in contracting and other areas. This rigorous analysis has become a mainstay of courtroom defenses of race-conscious public policies.
The stakes are evident just three blocks from city hall.
The Lower Hill District, previously a center of Black life brimming with jazz clubs, churches and barbershops, was razed in the 1950s as part of a federal slum-clearance campaign known as “urban renewal.”
At the behest of local leaders, 1,300 buildings were bulldozed, expelling more than 8,000 residents and displacing more than 400 businesses. The now-demolished Civic Arena and a luxury apartment building rose in their wake.
Seven decades later, developers are turning this concrete island into 28 acres of offices, mixed income housing, park space and an indoor music venue. For nearby residents and public officials, it’s an opportunity to repair some of the damage perpetrated against the community that once teemed here — but only if contracts and benefits are distributed based in part on race.
“When they demolished the Lower Hill District, that was the beginning of the economic devastation of Black Pittsburgh,” Pittsburgh City Councilor Daniel Lavelle, whose district includes the neighborhood, said from his Downtown office.
“My intent through the redevelopment of the Lower Hill was to economically begin to really lift and rebuild the Hill District community,” the four-term councilor said. “And so most of my work, the policies, the advocacy work, has been around using this development to economically advance the Black community.”
Accordingly, the site’s developer, Buccini/Pollin Group [BPG], has said it aims to award 30% of total contracting dollars to minority-owned firms – a notably higher figure than a citywide target of 18%.
Three key takeaways from this story:
- Mayor Ed Gainey was elected after promising to promote racial equity in Pittsburgh. Designing government programs to accomplish that is legally and practically tricky.
- Pittsburgh is attempting to undo past racial discrimination while initiatives like affirmative action are under increased legal scrutiny nationwide. A coming study may be key.
- Race-focused goals continue to inform city government development policy even after Gainey pulled back from a pilot income program amid legal saber-rattling.
Courts, however, view any use of race in setting policy with deep suspicion. Governments usually must first compile extensive evidence through a data-heavy disparity study to establish a link between race-conscious measures and a relatively recent history of discrimination.
Attorneys agree that this research should be updated roughly every five years, but city records indicate Pittsburgh’s last study took place in 1988.
“We are working to move forward the disparity study as quickly and efficiently as we can,” Pittsburgh Mayor Ed Gainey wrote in response to PublicSource’s questions. “We don’t have a firm timeline at this point as to when it will be completed.”
Continuing, Gainey said his administration is “confident that our city is on firm legal grounds in terms of our business diversity efforts, and we have dedicated staff in the law department guiding us as we examine city practices.”
But with the disparity study unfinished, there are doubts about the legality of local equity initiatives.
“This seems to be a moment in which actors in many different fields are catching their breath and reconsidering the consistency of what they’re doing with actual law,” said Dan Morenoff, who leads the conservative American Civil Rights Project in Texas, referring to the Supreme Court’s affirmative action decision. While that ruling applied only to higher education, Morenoff said it could foreshadow changes in other settings.
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“I would expect that [reevaluation] to also carry over particularly to the government contracting space, which is expressly governed by the same statute and the same constitutional provision at issue in [the college admissions case].”
‘Invest in the least among us’ — and risk a lawsuit
Soon after Gainey took office as Pittsburgh’s first Black mayor, he canceled a nascent initiative from former Mayor Bill Peduto’s administration that was specifically aimed at uplifting Black residents.
A guaranteed basic income [GBI] pilot program, announced in 2021, would have fused federal COVID relief funds and outside grants to give $500 per month to two groups: 100 households of any race in low-income ZIP codes, and 100 households led by low-income Black women.
Lavelle noted that evidence from other cities shows that such funds have lifted people out of poverty, “so I believe those sorts of initiatives can absolutely be defended.”
“I think if government says that we need to invest in the least among us, which I believe we do in the City of Pittsburgh, that means … you will invest across all races,” he said, adding that economic realities dictate that some of that investment will inevitably go to single women of color.
The program would not have made Pittsburgh unique. A national organization that Peduto joined — Mayors for a Guaranteed Income — lists pilot or permanent programs in cities across the country, including Minneapolis, San Diego, Denver and Baltimore.
Pittsburgh Deputy Chief of Staff Felicity Williams said the city ultimately backed out of GBI in April 2022 because the administration believed the pilot wouldn’t comply with federal guidelines for the use of American Rescue Plan Act [ARPA] funds, which would have provided most of the financing.
Numerous other cities, though, have used ARPA dollars for similar programs.
Not long after GBI’s demise in Pittsburgh, the Texas-based American Civil Rights Project took credit for helping to do away with the program. In a press release issued weeks after the city’s announcement, the group claimed the city’s decision was really made “under pressure from the ACR Project” because the program’s race-consciousness made it illegal.
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The organization later sued Starbucks Corp. over its plan to diversify its workforce, suppliers, and advertisers. In another lawsuit, it accuses California agencies and institutions of administering discriminatory guaranteed income programs.
Williams said in July, though, that the Gainey administration’s issue with the program was not that it focused too much on Black women, but that it would not be sustainable beyond a relatively small pilot program.
She said the city is instead convening a group of Black women and intends to “work with them to have them identify what their priorities are” and develop a wellness index to measure the city’s progress.
Grant Ervin, the city’s chief resilience officer under Peduto, said the pilot program was meant to lead to a permanent and scalable effort.
“This is why pilots are really important for this,” Ervin said. “Is there a duration, is there continuity, your funding sources? Those are all things that come through in the pilot discovery phase.”
‘Level the playing field’ — but be careful
Shortly after Gainey’s decision to kill the guaranteed income pilot, legal scholars across the ideological spectrum agreed that the plan to set aside half of the cash for households led by Black women could have amounted to an unconstitutional racial quota.
“The 14th Amendment says that the government must treat everybody equally: It can’t impose burdens or hand out benefits to people based on race, unless there is a compelling interest and [the methods are] narrowly tailored to achieve that compelling interest,” said Erin Wilcox, an attorney at the conservative Pacific Legal Foundation.
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The Supreme Court recognizes very few such compelling interests. In 2005, it concluded that safety could justify the temporary racial segregation of incarcerated people during a prison race riot. Its June decision seems to have reversed prior rulings that the educational benefits of student body diversity were a compelling interest. It now appears, legal experts say, that the only other compelling interest that remains intact is the remediation of past illegal discrimination.
But even then, Wilcox noted, “Programs have to address actual discrimination, specific discrimination — they can’t be used to just address society’s [general] harms and ills towards certain groups.”
Governments that use race-conscious measures, therefore, must prove those policies address specific instances of discrimination that those entities played a sufficient role in perpetuating — and they may consider race only when necessary to redress such wrongs.
This standard, Wilcox said, dates back at least to 1989, when the Supreme Court invalidated a government contracting rule in Richmond, Va., that required companies that had won city construction contracts to subcontract at least 30% of project work to minority-owned businesses. The justices faulted Richmond for failing to prove that qualified minority enterprises had been passed over for contracting opportunities, let alone that its 30% quota was a fitting response.
“The burden of proof is very high on a government. It’s the highest burden of proof,” said Atlanta attorney Keith Wiener, who advises local and state governments on programs that seek to boost the participation of minority businesses in public contracts.
The Supreme Court’s intense skepticism of these programs has roots in the panel’s lurch late in the 20th Century to a doctrine of “colorblindness.” Chief Justice John Roberts’ famously summed up the basic ethos in a 2007 case: “The way to stop discrimination on the basis of race is to stop discriminating on the basis of race.”
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Prior to the 1980s, the Supreme Court sometimes ruled in favor of race-conscious measures “that are intended to help level the playing field,” said University of Pittsburgh constitutional law professor William Carter. That view, he said, aligns with the original purpose of the 14th Amendment, which was ratified after the Civil War by leaders who “explicitly noted that they were designing laws and policies that referred explicitly to race and as a method to try to remediate the condition of the formerly enslaved population.”
But a century and half later, that line of reasoning holds little sway with the majority of justices.
‘The private market isn’t coming’ — without a push
As the city continues to mull an updated disparity study, a patchwork of local initiatives aims to promote racial equity.
In June, the city’s Urban Redevelopment Authority [URA] released its first round of funding to businesses in seven mostly Black neighborhoods as part of the $7 million ARPA-funded Avenues of Hope program.
According to the URA’s website, targeted businesses will be “Black-owned,” in “centers of Black arts and culture” and “mixed-use, transit-oriented, and pedestrian-friendly built environments.”
The URA didn’t respond to requests for comment on race-focused programs such as Avenues of Hope.
Lavelle, who sits on the URA board, said the program is a way to invest in “these communities that don’t have Main Street corridors or thriving Main Street corridors and [say] let’s intensely invest in those communities.”
After receiving 45 applications, the URA selected 20 organizations across all seven neighborhoods to receive grants totaling more than $2.4 million, with the Hill District’s Centre Avenue receiving the most funding.
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A second cycle of Avenues of Hope proposals closed July 31, with two more rounds to come.
Lavelle said programs like these are needed to jumpstart local economies.
“Unfortunately, the way our city has structured itself and the way our corporate structure has been, is: those communities don’t get loans,” he said. “Government has to lead to change that because the private market isn’t coming. The private markets are not showing up in our most deprived neighborhoods, wherever they may be.”
Government investment, he said, could convince the private market that “oh, there’s something happening here. And then they want to show up.”
Only 7% of employer businesses in the Pittsburgh metro area have non-white owners, according to one recent study. The Brookings Institution reports that just 1% of area firms have Black owners while fewer than 1% are Latino- or Hispanic-led. One part of the URA’s program aims to nurture such businesses.
Avenues of Hope offers credit to small contractors — prioritizing those owned by minority members, women or disabled individuals — taking on projects within the seven corridors.
At right, Wade Lipscomb, a 31-year-old bi-racial owner of Triple 3 Construction, walks by the FNB Tower, on Tuesday, Aug. 29, 2023, in the Lower Hill. Lipscomb is providing project management services for interior work as a subcontractor on PPG Paints Arena’s new private boxes and FNB Tower’s construction and receives help through the Avenues of Hope program. At left, Wade stands for a portrait in the private suites in PPG Paints Arena where his team worked on the ceilings and drywall. (Photo by Stephanie Strasburg/PublicSource)
Wade Lipscomb, a 31-year-old bi-racial owner of Triple 3 Construction, is providing project management services for interior work as a subcontractor on FNB Tower’s construction in the Lower Hill District. His firm has received a $100,000 line of credit through the program.
“The construction industry, it’s really difficult for minority companies to get started in commercial construction because of cash flow,” Lipscomb said. “You do a project, but you might not get paid for 30 or 60 days, which is really, really difficult when you’re trying to get underrepresented populations. We don’t have a lot of money sitting around where we can just throw cash and pay carpenters or pay electricians.”
Without the line of credit, Lipscomb said, “there’s just no way” he could pay workers while waiting 60 days for a first check.
He said that being a minority-owned company has helped Triple 3 to tap into resources the firm wouldn’t otherwise be able to access.
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“Some of the goals for minority participation create an opportunity for us,” Lipscomb said, noting that the firm’s small size and relative newness sometimes keep it from being the lowest bidder for jobs.
Lipscomb said his goal for Triple 3 is to eventually become a prime contractor working on one of the new developments planned for the Lower Hill District.
The URA’s Minority Business Growth Loan Fund explicitly aids small, minority-owned businesses, offering them below-market-rate financing of as much as $100,000.
Another program, URA Ventures, launched in March 2022 as a “diversity-focused fund” for Pittsburgh companies — especially those owned by women or people of color — according to the URA’s website.
“The private markets are not showing up in our most deprived neighborhoods, wherever they may be.”
City agencies further bolster underrepresented enterprises by setting goals for their participation in public contracts. For example, the URA states that for projects expected to cost over $250,000, 18% of contracting dollars should go to minority firms. The joint Pittsburgh and Allegheny County Sports & Exhibition Authority [SEA], meanwhile, has set a higher target of 25%.
The 30% goal for the redevelopment of the Lower Hill resulted from agreements reached between the SEA, URA and the Pittsburgh Penguins’ chosen developer, BPG. The SEA and URA own parts of the site, for which the Penguins’ real estate arm received development rights.
Unlike rigid (and typically unconstitutional) quota systems, these goal-based plans include safety valves for companies that fall short of the mark: If they can persuade a contracting agency that they made a good-faith effort to fulfill minority participation targets, they will not automatically lose a contract.
Stale to the point of unconstitutional?
If it’s ever compelled to defend such programs in court, the city will need evidence.
Over the last 15 years, Sameer Bawa has helped scores of public entities set minority contracting goals. As managing director at Denver-based BBC Research & Consulting, he leads disparity studies that help states, cities and government agencies to formulate procurement plans. Just this spring, BBC launched a disparity study for Pennsylvania’s Department of General Services.
To complete this research, Bawa’s team leads extensive statistical analyses to determine how often a government body hires minority contractors relative to those contractors’ availability in a given marketplace. When minority firms are substantially under-utilized, courts are usually willing to infer that discrimination is to blame.
Disparity studies should take place approximately every five years, Bawa said, to avoid relying on outdated statistics.
Pittsburgh officials seemed to allude to this concern when they hired a Maryland law firm in May 2022 to assess the city’s disparity study needs. In its contract with Tydings and Rosenberg, officials noted that Pittsburgh’s last known disparity study occurred in 1988.
“The original study is so stale at this point,” the city’s contract with Tydings says, “it is somewhat dubious that it may provide a factual foundation regarding previously identified barriers to [minority and women business enterprise] formation, development, and utilization that need to be re-examined” decades later.
In his statement to PublicSource, Gainey said the “crucial” study would be “informed by decades of progress in that area of business and legal practice since the city’s last study was conducted. … We absolutely need to have current, well-documented, and legally-sound documentation providing a basis for our program goals in an increasingly hostile legal environment.”
Wiliams said the mayor’s office has allotted $250,000 to fund the forthcoming disparity study and has begun to convene “sister agencies,” including the URA, SEA and city housing authority, so that they can also take part in the research.
But the delay in launching the study is “deeply problematic,” said Morenoff, the American Civil Rights Project attorney. When the Supreme Court issued its June decision slapping down race-based affirmative action in higher education, Morenoff noted, the majority stressed that efforts to rectify past discrimination must be time-bound, effectively saying, “You will do it until you fix the harm you’ve done, and then you will stop.”
Carter, the University of Pittsburgh law professor, urged city officials to commission a new disparity study as soon as possible.
“I think the Supreme Court cases are wrong. They are also the law. And we don’t get to ignore it just because it might be inconvenient,” he said. “But,” he added, “it’s also not written on stone tablets: This is an invention of a certain judicial philosophy, and that philosophy can change as the court’s composition changes.”
An-Li Herring is a freelance writer based in Pittsburgh and can be reached via LinkedIn or on Twitter @anliherring.
Eric Jankiewicz is PublicSource’s economic development reporter, and can be reached at ericj@publicsource.org or on Twitter @ericjankiewicz.
Charlie Wolfson is PublicSource’s local government reporter and a Report for America corps member. He can be reached at charlie@publicsource.org.
This story was fact-checked by Lucas Dufalla.
WESA contributed research and reporting to this story.
