dissenting:
I must dissent because the result reached in this case is incorrect. While I certainly agree with the majority that a governmental agency may be empowered to implement affirmative action requirements (see, e.g., Fullilove v. Klutznick (1980), 448 U.S.---, 65 L. Ed. 2d 902, 100 S. Ct. 2758), the agency must do so in a proper and legally cognizable way. It cannot simply impose an ad hoc canvassing formula on public contractors without the benefit of clear legislative authority and the formal adoption of a resolution by the agency. The majority has granted a governmental agency the unchecked power to set down arbitrary guidelines without need of direction from the legislature or publication by the agency. While I recognize that Nielsen did not raise the issue of the failure of the Commission to pass a resolution (81 Ill. 2d at 294), that does not prevent this court from inquiring into whether any authority existed for the Commission to act.
Recently this court decided Craddock v. Board of Education (1980), 81 Ill. 2d 28. In that case a teacher was suspended by a school board because he cursed at a student. The school board argued that it derived its authority to suspend the teacher from the rulemaking authority granted to school boards in section 10 — 20.5 of the School Code (Ill. Rev. Stat. 1975, ch. 122, par. 10 — 20.5). The school board never adopted any such rule, however. We stated in Craddock that since the school board did not exercise its rulemaking authority to adopt a rule suspending teachers for specified infractions, it lacked the authority to suspend the teacher. (81 Ill. 2d 28, 31.) The same principle applies here. An agency cannot excuse its ad hoc actions by stating that it could have passed a rule, resolution or regulation prospectively authorizing the particular action. To do so opens the way for any number of ex post facto acts by governmental agencies, a prospect that is ominous to say the least. Such a prospect was repudiated in Craddock, yet it has gained acceptance by the majority in the instant case.
Furthermore, one need only look to the United States Supreme Court’s recent decision in Fullilove v. Klutznick to observe the invalidity of the Commission’s action in this case. At issue in Fullilove was the constitutional and statutory validity of section 103(f)(2) of the Public Works Employment Act of 1977 (42 U.S.C. sec. 6705(f)(2) (1977 Supp. I)). That section provides:
“Except to the extent that the Secretary determines otherwise, no grant shall be made under this Act for any local public works project unless the applicant gives satisfactory assurance to the Secretary that at least 10 per centum of the amount of each grant shall be expended for minority business enterprises. For purposes of this paragraph, the term ‘minority business enterprise’ means a business at least 50 per centum of which is owned by minority group members or, in case of a publicly owned business, at least 51 per centum of the stock of which is owned by minority group members. For the purposes of the preceding sentence, minority group members are citizens of the United States who are Negroes, Spanish-speaking, Orientals, Indians, Eskimos, and Aleuts.” (Public Works Employment Act sec. 103(f)(2), (42 U.S.C. sec. 6705(f)(2) (1977 Supp I).)
As required by the Public Works Employment Act of 1977, the Secretary of Commerce promulgated extensive regulations. (13 C.F.R. part 317 (1978).) “Where competitive bidding is employed, the regulations echo the statute’s requirement that contracts are to be awarded on the basis of the ‘lowest responsive bid submitted by a bidder meeting established criteria of responsibility,’ and they also restate the MBE [minority business enterprise] requirement.” (448 U.S.---,---, 65 L. Ed. 2d 902, 918, 100 S. Ct. 2758, 2769-70.) (I note parenthetically that a responsive bid is different from a responsible bid. Responsive, presumably, means in accord with the minority business enterprise requirements contained in the applicable regulations; the meaning of responsible as construed in this State will be hereinafter discussed.) The court, in upholding the validity of section 103(f)(2) of the 1977 act, noted that the regulations provided that the lowest responsive bid requirement could be waived where minority business enterprises submitted a bid which was higher than other bids, but where the higher bid was attributable “to the minority firm’s attempt to cover costs inflated by the present effects of disadvantage or discrimination.” (448 U.S.---,---, 65 L. Ed. 2d 902, 919, 100 S. Ct. 2758, 2771.) Only then was the court satisfied that the legislative authority, accompanied by “administrative scrutiny” and “surveillance” of the minority business contracting program, was lawful and constitutional. 448 U.S.---,---, 65 L. Ed. 2d 902, 930-31, 100 S. Ct. 2758, 2779-80.
While no constitutional issues were raised in this case, I think Fullilove is supportive of the general proposition that a governmental agency must act within clearly established and narrowly defined administrative bounds where imposing contracting conditions based on race. As the court stated in Fullilove:
“The history of governmental tolerance of practices using racial or ethnic criteria for the purpose or with the effect of imposing an invidious discrimination must alert us to the deleterious effects of even benign racial or ethnic classifications when they stray from narrow remedial justifications. Even in the context of a facial challenge such as is presented in this case, the MBE provision cannot pass muster unless, with due account for its administrative program, it provides a reasonable assurance that application of racial or ethnic criteria will be limited to accomplishing the remedial objectives of Congress and that misapplications of the program will be promptly and adequately remedied administratively.” (448 U.S. ---,---, 65 L. Ed. 2d 902, 929-30, 100 S. Ct. 2758, 2779.)
Since the formula herein is imposed on an ad hoc basis, without any administrative guidelines, standards or restrictions, I dissent from the majority’s blanket approbation of it.
A second flaw in the majority opinion is that it reads section 20 of the Public Building Commission Act (Ill. Rev. Stat. 1979, ch. 85, par. 1050) and section 4 of the Fair Employment Practices Act (Ill. Rev. Stat. 1979, ch. 48, par. 854) in pari materia based solely on the majority’s vision of social betterment. What is ignored by the majority is that the two statutes involved deal with different but equally important and valuable goals, as enunciated by the General Assembly. It is beyond the purview of this court to decide that one statute is more valuable than the other. Yet that is precisely what has occurred here. Section 20 requires that a party who receives a contract must have submitted the lowest bid during competitive bidding and that the party must be financially capable of performing its obligations under the contract. Two important legislative goals are thereby furthered: first, public revenues are not squandered; and second the State obtains reasonable assurance that it will not need to sue the contractor for the breach of its duty to perform under the contract. As the majority points out, these laudable goals are well entrenched in our law. (See People ex rel. Peterson v. Omen (1919), 290 Ill. 59; Hallen v. City of Elgin (1912), 254 Ill. 343 People ex rel. Assyrian Asphalt Co. v. Kent (1896), 160 Ill. 655.) For some inexplicable reason, however, the majority has now added the vague requirement to section 20 that a bidder be “socially” responsible, and has thus, in one fell swoop, erased 84 years of law in this State. What bewilders me is why this drastic action was necessary. The clear import of section 4 of the Fair Employment Practices Act requires that any person who contracts with the State or any of its political subdivisions or any municipal corporation “take affirmative action to insure that no unfair employment practice is committed.” (Ill. Rev. Stat. 1979, ch. 48, par. 854). Therefore, the valuable goal sought to be furthered by the legislature of encouraging minority representation in companies which obtain public contracts is clearly provided for in section 4. There is no need to superimpose that requirement on section 20 of the Public Building Commission Act.
Another serious discrepancy in this case is that the majority relies on the new Illinois Human Rights Act, which the majority concedes was not in effect when this case arose. It should be emphasized that the significant addition to existing law is the following excerpt from the new act:
“(A) Public Contracts. Every party to a public contract shall:
***
(2) Comply with the procedures and requirements of the Department’s regulations concerning equal employment and affirmative action; ***.” (Ill. Rev. Stat., 1979 Supp., ch. 68, par. 2 — 105(A)(2).)
The new act obviously contemplates the adoption of regulations governing the letting of public contracts, an essential requirement apparently overlooked by the Commission and the majority. Thus, it is a source of amazement to me that the majority could approve the instant program which operates without any regulations.
The approach which is most consistent with both existing law and logic is for the Commission, first, to establish which is the lowest responsible bid. Section 20 is mandatory in its terms and may be objectively applied. Either a contractor submits the lowest bid and establishes financial solvency or he does not. No discretion need be involved. Next, the Commission may decide, by means of formally adopted, published standards, a range of acceptable levels of minority representation. These standards could, as in Fullilove v. Klutznick (1980), 448 U.S.---, ---, 65 L. Ed. 2d 902, 919, 100 S. Ct. 2758, 2771, take into account exceptional circumstances warranting more or less minority representation, waivers, exemptions and so forth. The point is that first the lowest-responsible-bidder requirement must be met and then the precondition of assuring that the employer-contractor had undertaken affirmative action must be fulfilled. In that way, both statutes will be followed and all of the pertinent legislative goals will be furthered, instead of one statute being followed to the neglect or misinterpretation of another.
Applying the foregoing approach, Nielsen should have received the contract in the instant case. Nielsen submitted the lowest bid; Nielsen’s affirmative action plan proposed that 3.5% of its apprentices and journeymen would be minority members, whereas 50% of its laborers would be minority workers. Webb proposed that 50% of its apprentices, journeymen and laborers would be minority members. Thus, it could hardly be said that Nielsen’s bid was unfair, or that it differed greatly from Webb’s. Also, there is no indication and no claim has been made by Webb but that Nielsen was in full compliance with section 4 of the Fair Employment Practices Act. Thus, Nielsen was the only bidder which complied with all of the statutory requirements. Therefore, Nielsen has been erroneously deprived of the contract.
In conclusion, the majority has approved the unguided use of power of a governmental agency in violation of one of our own decisions and the Supreme Court’s decision in Fullilove v. Klutznick. Furthermore, the majority has, by a strained interpretation, altered the meaning of section 20 of the Public Building Commission Act. The end result is that a party which met all the statutory requirements has been denied a public contract while a party which met only one requirement has received the contract. I believe this decision is a departure from sound judicial interpretation and an exercise in legislating which is wholly unwarranted. I therefore dissent.
UNDERWOOD and RYAN, JJ., join in this dissent.