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Long Beach Terminates Electric Bus Contract

BYD ebusElectric bus manufacturer BYD Motors and the Long Beach Transportation (LBT) terminated a contract for 10 electric buses on a technicality. BYD said the Federal Transit Administration (FTA) withdrew funding when the company failed to direct a percentage of the contract to minority-owned businesses, as part of a federal mandate.

LBT announced that BYD won the competition for the contract on March 24, 2013. Based on the contract award, BYD then submitted a percentage goal for purchases from disadvantaged businesses in June 2013. The FTA said that BYD should not have certified to compliance prior to submitting a goal.

“It is surprising that the FTA waited nine months to withdraw funding from this contract-after BYD spent millions of dollars-due to what can only fairly be described as a technical error that in no way casts doubt on our deep commitment to purchase from disadvantaged businesses,” the company said in a statement.

Both the FTA and the LBT attorneys agree that BYD is now eligible to participate in any future contract funded by the FTA as a result of its June 2013 program goal submission.

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One thought on “Long Beach Terminates Electric Bus Contract

  1. Why do race, ethnicity, and sex need to be considered at all in deciding who gets awarded a contract? It’s good to make sure contracting programs are open to all, that bidding opportunities are widely publicized beforehand, and that no one gets discriminated against because of skin color, national origin, or sex. But that means no preferences because of skin color, etc. either–whether it’s labeled a “set-aside,” a “quota,” or a “goal,” since they all end up amounting to the same thing. Such discrimination is unfair and divisive; it breeds corruption and otherwise costs the taxpayers and businesses money to award a contract to someone other than the lowest bidder; and it’s almost always illegal—indeed, unconstitutional—to boot (see 42 U.S.C. section 1981 and this model brief: http://www.pacificlegal.org/document.doc?id=454 ). Those who insist on engaging in such discrimination deserve to be sued, and they will lose. (There’s no reason to use race or sex as a proxy for disadvantage, by the way, since there are disadvantaged people of all colors and both sexes, and advantaged people of all colors and both sexes.)

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