CopyPublished | Court of Appeals for the Eleventh Circuit
TJOFLAT, Chief Judge: This is an appeal from an order of the district court declaring unconstitutional on fourteenth amendment equal protection grounds a Florida statute, Fla.Stat. § 339.0805 (1989), and the regulations promulgated thereunder, Fla.Admin....
...Concluding that the Florida statute and regulations are “the end result of, and thus necessarily a part of,” a valid federal program, the court upheld the Florida stat *1192 ute to the extent that it serves as a vehicle for obtaining- federal highway construction funds. In sum, the district court concluded that Fla.Stat. § 339.0805 and the regulations promulgated thereunder are, at once, both constitutional and unconstitutional on their face — depending on the source of the funds that the Secretary may be using to implement the program created by the statute and regulations....
...million, from a total FDOT highway construction award of $436.2 million. In fiscal year 1988-89, as of March 28, 1989, the Secretary awarded $293.5 million in federal aid in a total award of $377.6 million. B. The Florida statute modeled on STU-RAA, section 339.0805, reads: (l)(a) Except to the extent that the [Secretary] determines otherwise, not less than 10 percent of the amounts expended from the State Transportation Trust Fund shall be expended with small business concerns owned and control...
...ides for competitive bidding and contracting only by, between, and among those firms which are certified by the department as socially and economically disadvantaged business enterprises and which are prequalified as may be appropriate.... Fla.Stat. § 339.0805 (emphasis added)....
...This statute governs FDOT highway construction contracts because the Secretary, through the FDOT, is authorized to expend funds from the State Transportation Trust Fund 14 to construct and maintain state highway systems and to match any federal funds granted to state highway systems. Id. § 339.08....
...ure from the fund among many authorized by the statute, as the fund covers all aspects of the state transportation system. 15 Pursuant to the authority granted to him in Fla.Stat. §
334.044(2), the Secretary has promulgated regulations to implement section
339.0805 in Fla.Admin.Code Ann....
...18 The Secretary’s overall goal for the past several years has been to achieve ten percent DBE participation, although presumably he could set a lower goal under the “except to the extent that the [Secretary] determines otherwise” language of section 339.0805....
...Key Haven,
427 So.2d at 157-58 ; State Dep’t of Transp. v. Hendry Corp.,
500 So.2d 218, 221 (Fla.Dist.Ct.App.1986). Only one exception to this exhaustion requirement exists: if the prime contractor opts to bypass the administrative procedure, it may challenge the facial constitutionality of section
339.0805 in a Florida court without exhausting administrative remedies....
...the statute is facially unconstitutional on judicial appeal from agency action. Id.; Hendry Corp.,
500 So.2d at 221 (a contractor that had already completed a protest and filed an appeal therefrom could not challenge the facial constitutionality of section
339.0805 in a Florida trial court, but was limited to raising the claim in an appeal from the agency decision)....
...The plaintiffs in this case are eight prime contractors 33 and one specialty subcontractor 34 engaged in the business of highway construction in the State of Florida. All are owned by white males. In their complaint, the plaintiffs alleged that the Secretary of Transportation 35 has been implementing the section 339.0805 DBE program in a manner that discriminates against them on account of their race, in violation of the equal protection clause of the fourteenth amendment; 36 as a result, they have been deprived of FDOT highway construction work and,...
...After the parties joined issue, the plaintiffs moved for summary judgment; they also renewed their application for a preliminary injunction. The court denied their application, but granted them summary judgment. 38 In its dispositive order, the court declared that, on their face, section 339.0805 and the regulations promulgated thereunder denied the plaintiffs the equal protection of the laws guaranteed them by the fourteenth amendment with respect to FDOT contracts funded solely by the State of Florida....
...448 ,
100 S.Ct. 2758 ,
65 L.Ed.2d 902 (1980), the court concluded that when implemented with federal funds, the Florida program was constitutional. The plaintiffs now challenge this decision. They contend that the district court erred in upholding section
339.0805 and the regulations with respect to FDOT contracts funded by the federal government....
...The plaintiffs’ allegations of future injury suffered the same infirmity; the plaintiffs merely concluded that, because of the Secretary’s DBE requirements, “they will be injured in their business or property.” This concluso-ry statement was the sole support for their prayer that the district court declare section 339.0805 and the regulations thereunder unconstitutional on their face and enjoin the Secretary from' enforcing them....
...ow the Secretary would probably treat the plaintiffs in the future if he followed the law, *1207 and thus whether the plaintiffs were enti-tied to the relief they sought. To make its prediction, the court had to look first to the Florida statute. If section 339.0805 required the Secretary to institute set-asides and goals that were not lawful remedial responses to identified past or present racial discrimination in Florida, then the court could conclude that the plaintiffs might suffer a denial of equal protection — in a case where, but for the set-aside or goal, they would have been the successful bidder. If, to the contrary, section 339.0805 allowed the Secretary to use his discretion to institute set-asides and goals only where necessary to remedy identified racial discrimination, then the district court had to look elsewhere — to the Secretary’s regulations, or STURAA and its regulations — to predict the Secretary’s future conduct....
...s DBE program could be implemented in an unconstitutional manner, it was unconstitutional on its face (except when implemented with federal funds). Had the court undertaken the two-step inquiry described above, it would have concluded, first, that section 339.0805 does not mandate a denial of equal protection, and, second, that there is nothing in the Secretary’s regulations or the federal DBE program that would produce such a denial. 52 As we observe in our explanation of Florida’s DBE program, there is nothing in section 339.0805 that requires the Secretary to deny the plaintiffs the equal protection of the laws....
...t of racial discrimination the fourteenth amendment proscribes. On the contrary, his oath of office — which requires him to uphold the Constitution and laws of the United States, Fla.Stat. §
876.05 — requires him to avoid such unlawful conduct. Section
339.0805 accommodates his obligation to obey the Constitution by giving him a wide breadth of discretion. Id. §
339.0805 (setting a DBE goal of ten percent “except to the extent that the [Secretary] determines otherwise”). To argue that section
339.0805 requires the Secretary to discriminate in violation of the fourteenth amendment is to conclude that the first several words of the statute, giving the Secretary discretion, are meaningless....
...legation of legislative power to an administrative agency. Fla. Const, art. 2, § 3. 53 It is unlikely, however, *1208 that a Florida court considering this state law question would agree. 54 Indeed, one Florida court has found that the enactment of section 339.0805 was a lawful delegation of power....
...reasonable, and constitutional grant of discretion”). 55 The Secretary has exercised this lawfully delegated statutory discretion by promulgating regulations that allow him to administer the DBE program in a constitutional manner. To conclude that section 339.0805 will require the Secretary to injure the plaintiffs means that the fact that the regulations may allow the Secretary to avoid a fourteenth amendment violation is of no moment; the regulations are invalid....
...truction that it be dismissed without prejudice. IT IS SO ORDERED. . We originally heard the case as an interlocutory appeal by the plaintiffs from the district court’s order refusing to issue a preliminary injunction against the implementation of section 339.0805 and the regulations thereunder....
...If the state claims that it is forbidden by state law from including a particular provision in its program, but nonetheless should receive federal funds, it must cite the state law. Id. § 23.41(f). . The State Transportation Trust Fund, which is maintained by the Comptroller within the state Treasury, Fla.Stat. §
339.081(1), contains revenues from the Florida gas tax, id.; funds from the sale, lease, or conveyance of property by the FDOT, id. §
339.04; and other funds accruing to the FDOT that are not required by law to be maintained in a separate trust, id. §
339.081(1)....
...ay for public transportation systems within the state; to reimburse cities or counties for funds expended on the state highway system; to finance economic development transportation projects; to match any federal funds allocated for any purpose, id. § 339.08; to provide rodent control, relocation assistance, and moving costs to the extent required by federal law on federal-aid projects; and to provide relocation assistance and moving costs on projects not involving federal aid, id....
...Because the plaintiffs have not alleged, or presented, any facts indicating that such a pattern of behavior has existed independently of the statute or rules, we do not consider this request for relief as referring to a separate claim. We thus limit our consideration to the operation of section 339.0805 and the regulations promulgated thereunder....
...This opinion, accordingly, will refer to the Secretary as the sole defendant. . The plaintiffs immediately appealed this ruling. See supra note 1. . The parties in this case stipulated, and the district court found, that when the Florida legislature enacted section 339.0805 it made no formal studies or findings of discrimination in the highway construction industry in Florida but relied instead on the congressional findings of discrimination in the industry nationwide....
...Florida Welding & *1208 Erection Serv., Inc. v. American Mutual Ins. Co.,
285 So.2d 386, 388 (Fla.1973). . We note that the United States Supreme Court, in applying a federal constitutional principle akin to Florida’s, observed that a federal statute similar to Fla.Stat. §
339.0805 provided sufficient standards for a delegation of legislative power to an executive agency....
