In a decision that could reverberate statewide, a state appeals court on Tuesday told the Sacramento Municipal Utility District that it must scrap a program giving financial breaks to some minority contractors. The ruling is the first to interpret a key exception to Proposition 209, the 1996 initiative that banned government affirmative action programs. SMUD had argued that because its own studies showed a past pattern of discrimination against some minority contractors, it was required under federal law to solve the problem by giving the affected groups a special edge. Proposition 209 does allow race or gender preferences when needed to maintain eligibility for federally funded programs, and that was the language SMUD relied on in designing its minority contracting program. [more
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