Civil Disobedience

Don't want to play by the city's rules? No problem, if you're Dayton Hudson

If there's a special hell reserved for lawyers, it's probably located somewhere in the lightless catacombs of Minneapolis's bruise-colored City Hall. For proof, look no further than the increasingly convoluted string of arguments city attorneys have mustered to maneuver Mayor Sharon Sayles Belton's dream of a downtown Target store around the city's civil rights laws.

Last week, city attorneys Mike Norton and James Moore asked the City Council to take away the Minneapolis Civil Rights Commission's authority to bar companies from doing business with Minneapolis. The request, they told the council's Ways and Means Committee October 13, wasn't an 11th-hour attempt to remove the latest legal obstacle to the city's plan to subsidize a Target retail store and office tower. No, they said, the changes were intended to strengthen the civil rights ordinance, putting the full weight of the City Council behind the decisions of the Civil Rights Commission. It was a matter of democracy, Norton told the committee: "We believe this returns the power to its rightful place--an elected body."

Few of the angry residents who packed the meeting appeared to buy it. Former commission member Ron Edwards warned that the change would set a dangerous precedent. "There's a perception that the city attorney is leading the charge to dismantle the civil rights ordinance," Edwards said.

Commission Chair Lisa Albrecht concurred, angrily noting that none of the body's 21 appointed members had been consulted about the proposed revisions--not even after they specifically asked to be included. "What message are we sending?" Albrecht asked. "I believe the message is clear: Politicians can overrule the judicial process if the price is right." After more than two hours of listening to critics, the Ways and Means Committee adjourned without voting on the city attorney's proposal. It promised to take up the issue again at its meeting next week--when, perhaps, protesters won't again pack the room.

Created in 1948, when Hubert Humphrey was mayor, Minneapolis's civil rights ordinance was once hailed as a national model. The measure outlawed race and gender discrimination and created a city Department of Civil Rights to investigate complaints. In 1968 the Civil Rights Commission was established as a courtlike body with the power to hold hearings and assess fines.

And in 1980, the department and the commission got an additional tool to encourage employers' compliance with the law: The city would give major contracts only to companies that demonstrated a good-faith effort at hiring and promoting women and minorities. Essentially, that involved filing a document known as an affirmative action plan.

A common monitoring tool among employers, such a plan typically includes a company ban on discrimination and harassment as well as a snapshot of the racial and gender makeup of its workforce, often by job category and managerial hierarchy; the documents also often detail the race and gender of job applicants, as well as of workers chosen for promotion. The most elaborate include information on pay rates for different workers, and on minority recruiting efforts.

The documents don't commit a company to hiring or promoting anyone, although they do suggest numeric targets. Affirmative action officers say that during the process of compiling or updating the plans, employers often realize how they can improve their practices. In the past 18 years, every firm getting more than $50,000 worth of contracts or subsidies from the city has filed a plan--except one.

In 1984 Dayton's Commercial Interiors wanted to sell the city some office furniture. It didn't have an affirmative action policy. The Civil Rights Department asked the company and its parent, Dayton Hudson Corp., to create one. Two months went by, Dayton Hudson demurred, and the Civil Rights Commission voted to ban--or "debar"--the company from city business.

The matter didn't come up again for more than a decade. But in late 1996, mayor Sayles Belton announced that she wanted to add a more affordable option to downtown's retail palette. Target Stores--which was then shopping for a new office tower for its headquarters--said it would be happy to oblige, but that it found building downtown too expensive compared to its typical suburban locations. The city volunteered to subsidize the project and provide some prime downtown land for both Target's new offices and a store. At no point during the negotiations, city officials now say, did it occur to anyone that Minneapolis couldn't fund the complex because Target was owned by Dayton Hudson.

It did occur to a former Target exec who was suing Dayton Hudson for discrimination. Leon Rice pointed the matter out to Opus Corp., according to Doug Kelley, an attorney who was representing the developer in a suit against the city. Opus owned much of the Nicollet Mall site on which the tower and store were to be built, and for some time had been trying to put together a development deal without any public subsidy. The city had condemned Opus's property and was turning it over to Ryan Corp., the developer it had selected for the Target project.

In its lawsuit in Hennepin County District Court, Opus raised a number of complaints about the Target project, including Dayton Hudson's debarment. If Minneapolis couldn't buy swivel chairs from Dayton's back in '84, Opus argued, it couldn't give Target $53.2 million in taxpayer subsidies now. According to court documents, city attorneys countered that the 1984 debarment had never been legal in the first place. A close look at the ordinance would show that only the City Council had the authority to issue such a sweeping ban, they said.

Nonsense, countered Judge Steven Lange. In 1983, the ordinance had been rewritten specifically to allow the commission to make such decisions following a hearing. The city should remember that, Lange noted, because that's what it argued in 1984 when Dayton Hudson unsuccessfully appealed its debarment.

Next, the city argued that the debarment didn't apply because Minneapolis was practically begging Dayton Hudson to take its money. "It's my opinion--and it has been my opinion for some time--that there should be nothing that prevents the city of Minneapolis from pursuing our objectives to bring a Target onto the Nicollet Mall," Sayles Belton testified during the Opus suit. "The issue of debarment, real or perceived, should not prevent us from meeting that objective."

In January 1998, Judge Lange threw out most of Opus's complaints about the project, but agreed that the city couldn't ignore Dayton Hudson's debarment. Still, since the deal with Dayton Hudson had yet to be inked, Lange said he couldn't stop the city from taking Opus's land.

By the time the issue made it to the City Council Ways and Means Committee last week, the attorneys had formulated a new argument: Not only should the City Council reserve veto power over debarments, they said, Minneapolis also should quit demanding an affirmative action plan for an entire corporation, rather than just the divisions with which it wants to do business. "As a practical matter, the city wants to have as broad an impact as possible," city attorney Norton told the council members. "But I think you've reached both the practical and the legal limits of your authority."

Council member Steve Minn challenged the attorneys, noting that cities throughout the nation stopped doing business with South Africa during the Apartheid era. "If you don't comply outside our boundaries," he said, "we won't provide aid within our boundaries." And while Dayton Hudson has argued that creating a company-wide affirmative action plan would cost it millions, critics note that other large corporations--such as telecommunications giant AT&T, which recently filed its national plan with the city--seem to have no such misgivings.

Dayton Hudson officials have argued that the company's record shows that it doesn't need a formal affirmative action plan to achieve results. "One-third of our employees nationwide are minorities," notes Dayton Hudson senior vice president Jim Hale. "Even in the Twin Cities market, with its low minority population, more than 13 percent of our workforce are people of color. As a company, we do not tolerate discrimination." Hall says Dayton Hudson is planning to file an affirmative action plan for the downtown store once it actually signs a development agreement with the city and Ryan. (At the Ways and Means Committee hearing, council members and city attorneys said the debarment issue never came up in connection with Target's three existing Minneapolis locations, and that at least one of those stores rents space from a city-subsidized development.)

Meanwhile, the City Council is continuing to search for a face-saving way out of its legal tangle. Acknowledging that the situation was politically uncomfortable, council members at last week's meeting suggested that the Civil Rights Commission could continue deciding debarments, while the council could either "ratify" the findings or serve as an appeals board. The practical implications may be minimal, given that the Dayton Hudson debarment is the only one the city has issued in 18 years. But as a matter of principle, says council member Brian Herron, discussions on the future of the civil rights code should be separated from deliberations on the Target impasse. "This is bigger than Dayton Hudson," he told fellow committee members. "To me it's troubling at best to spend public money on a corporation that has trouble coming in and filing an affirmative action plan."

News intern Dan Gearino contributed to this story.

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