The opinion of the court was delivered by: Wigenton, District Judge
Before the Court is Plaintiffs', GEOD Corporation ( "GEOD"), Christopher Emilius, John F. Emilius, Paul J. Emilius, Jr. and Stanley Palinski, complaint against the remaining defendant, New Jersey Transit Corporation ("NJ Transit"), alleging violations of the Fourteenth Amendment of the United States Constitution. This Court has jurisdiction pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 1343, 28 U.S.C. § 2201, and 28 U.S.C. § 1367. Venue is proper pursuant to 28 U.S.C. § 1391(b). This Court held a bench trial from March 8, 2010 through March 12, 2010, and on March 22, 2010, March 24, 2010, March 25, 2010, and March 26, 2010. For the reasons detailed below, this Court finds in favor of Defendant.
The individual plaintiffs in this matter, who are the owners of GEOD, are white males. (Am. Compl. ¶ 4, Oct. 6, 2004.) GEOD is a closely held corporation with its principal place of business in Newfoundland, New Jersey. (Am. Compl. ¶¶ 4, 6.) More than 51 percent of the issued and outstanding shares of the corporation are owned by white male members of the Emilius Family and the remaining 10 percent of shares are owned by Stanley Palinski. (Am. Compl. ¶¶ 9-12.) Generally, GEOD provides services conducting aerial photography, topographic mapping, surveying, and photogrammetric services to prime contractors and subcontractors working on projects for NJ Transit. (Trial Tr. vol. 1, 50-52, 69-70, Mar. 8, 2010.) GEOD's main competitors, who also provide the same services for contractors, are certified Disadvantaged Business Enterprises, owned by sub-continent Asian companies. (Trial Tr. vol. 1, 52.) GEOD has worked on projects for the New Jersey Department of Transportation, agencies of the State of New Jersey, and the Port Authority of New York and New Jersey. (Trial Tr. vol. 1, 77.) GEOD has performed professional services for NJ Transit as a sub-contractor or sub-consultant. (Trial Tr. vol. 1, 50-51, Mar. 8, 2010.)
This action arises from allegations by Plaintiffs of discriminatory practices by Defendant in designing and implementing an affirmative action program that uses race, ethnicity, national origin and sex as criteria in selecting subcontractors and consultants for its construction projects in New Jersey. (Am. Compl. ¶ 21.) Plaintiffs filed a complaint on May 25, 2004. Plaintiffs then filed an amended complaint on October 6, 2004. Plaintiffs allege discrimination by NJ Transit based on Plaintiffs' race, national origin, ethnicity and sex. (Am. Compl. ¶1.)
In their amended complaint, Plaintiffs allege that the NJ Transit Disadvantaged Business Enterprise ("DBE") Program violates the Fifth and Fourteenth Amendments of the United States Constitution, 42 U.S.C. § 1981, Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000(d), Article 1, ¶¶ 1 and 5 of the Constitution of the State of New Jersey, and the New Jersey Law Against Discrimination, N.J.S.A. 10:2-1, et seq. and 10:5-32, et seq. (Am. Compl. ¶ 1.)After motions to dismiss and for summary judgment were decided, this Court dismissed the complaint against all Defendants except for NJ Transit and concluded that a genuine issue of material fact existed only as to whether the method used by NJ Transit to determine its DBE goals during 2010 were sufficiently narrowly tailored, and thus constitutional. (Trial Tr. vol. 1, 16.)
FEDERAL STATUTES AND REGULATIONS
In order to reach its stated objective of "ensur[ing] nondiscrimination in the award and administration of [Department of Transportation]-assisted contracts," the United States Department of Transportation ("USDOT" or "DOT") requires that recipients of USDOT funds awarding prime contracts exceeding $250,000 in funds allocated under the Transportation Equity Act for the Twenty First Century ("TEA-21") establish a disadvantaged business enterprise program. SAFETEA-LU, Pub. L. No. 109-59, 119 Stat. 1144 (2005) (SAFTEA-LU is the successor to TEA-21)*fn1 ; TEA-21, Pub. L. No. 105-178, 112 Stat. 107 (1998); 49 C.F.R. § 26.21. This requirement was extended by the successor to TEA-21, the Safe, Flexible, Efficient Transportation Equity Act: A Legacy for Users ("SAFETEA-LU"). Pub. L. No. 109-59, 119 Stat. 1144 (2005); see also H.I.R.E. Act, Pub. L. No. 111-147, 124 Stat. 71 (2010) (extending SAFETEA-LU). TEA-21 requires that "not less than 10 percent of the amounts made available for any program under Titles I, III, and V of this Act shall be expended with small business concerns owned and controlled by socially and economically disadvantaged individuals." Pub. L. No. 105-178, 112 Stat. 107 (1998). The 10 percent goal is aspirational and the regulations do not authorize or require that recipients of USDOT funds reach any particular goal. 49 C.F.R. § 26.41(b).
Both TEA-21 and SAFETEA-LU incorporate the Small Business Act ("SBA") definitions for "small business concern" and "socially and economically disadvantaged individuals. Pub. L. No. 109-59, 119 Stat. 1144; Pub. L. No. 105-178, 112 Stat. 107. A small business concern "shall be deemed to be one which is independently owned and operated and which is not dominant in its field of operation" and which has annual receipts and a number of employees below a certain threshold established by SBA regulations. 15 U.S.C. § 632; 49 C.F.R. § 26.65. "Socially disadvantaged individuals are those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities." 15 U.S.C. § 637(a)(5). "Economically disadvantaged individuals are those socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same business area who are not socially disadvantaged." 15 U.S.C. § 637(a)(6)(A). A "'small business concern owned and controlled by socially and economically disadvantaged individuals' shall mean a small business concern . . . 'which is at least 51 per centum owned by one or more socially and economically disadvantaged individuals'" and "whose management and daily business operations are controlled by one or more of such individuals." 15 U.S.C. § 637(d)(3)(C).
The regulations require that agencies receiving funds ("recipients") make a rebuttable presumption that "women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian Americans, or other minorities found to be disadvantaged by the SBA, are socially and economically disadvantaged individuals."*fn2 49 C.F.R. § 26.67 (a)(1). However, recipients of funds may make case-by-case determinations that "[f]irms controlled by individuals who are not presumed to be socially and economically disadvantaged" still qualify for DBE certification. 49 C.F.R. § 26.67(d). Also, the socially and economically disadvantaged individual cannot have a net worth in excess of $750,000, excluding "an individual's ownership interest in the applicant firm," and the equity in his or her primary residence. 49 C.F.R. § 26.67(a)(2).
Federal regulations also set the procedure for determining the goals for DBE participation. 49 C.F.R. § 26.45. Recipients must base their overall goal on the "relative availability of DBEs" that is "demonstrable evidence of the availability of ready, willing and able DBEs relative to all businesses ready, willing and able to participate on [the recipient's] DOT-assisted contracts." 49 C.F.R. § 26.45(b). Although the regulations require the creation of goals for DBE participation, recipients cannot be penalized if their DBE participation falls short of their overall goal as long as their program has been administered in good faith. 49 C.F.R. § 26.47(a).
Recipients must first begin their "goal setting process by determining a base figure for the relative availability of DBEs." 49 C.F.R. § 26.45(c). Several methods or a combination of methods may be used to determine the base figure. 49 C.F.R. § 26.45(c). These include, but are not limited to: use of DBE directories and Census Bureau data; use of a bidders list; use of data from a disparity study; use of goals of another DOT recipient; and/or alternative methods "based on demonstrable evidence of local market conditions and  designed to ultimately attain a goal that is rationally related to the relative availability of DBEs in [the recipient's] market." 49 C.F.R. § 26.45(c)(1-4) (this regulation specifies that the "examples are not intended as an exhaustive list").
Next, the recipient "must examine all of the evidence available in [their] jurisdiction to determine what adjustment, if any, is needed to the base figure in order to arrive at [the] overall goal." 49 C.F.R. § 26.45(d). In adjusting the base figure, the recipient must consider "many types of evidence" including:
(1) The current capacity of DBEs to perform work in your DOT-assisted contracting program, as measured by the volume of work DBEs have performed in recent years;
(2) Evidence from disparity studies conducted anywhere within your jurisdiction, to the extent it is not already accounted for in your base figure; and
(3) If your base figure is the goal of another recipient, you must adjust it for differences in your local market and your contracting program.
[49 C.F.R. § 26.45(d)(1).]
Also, available "evidence from related fields that affect the opportunities for DBEs to form, grow and compete" must be considered. 49 C.F.R. § 26.45(d)(2). These include, but are not limited to:
(1) Statistical disparities in the ability of DBEs to get the financing, bonding and insurance required to participate in your program;
(2) Data on employment, self-employment, education, training and union apprenticeship programs, to the extent you can relate it to the ...