Our Focus Areas Affirmative Action Contracting Letter Urging That Discriminatory Set-Asides Be Strictly Limited | Letter Urging That Discriminatory Set-Asides Be Strictly Limited |
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| Friday, 28 March 2008 | |
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Dear Mr. Preston: By this letter, the undersigned urge the SBA to stand its ground regarding the proposed WOSB rule, "Women-Owned Small Business Federal Contract Assistance Procedures," which was published on Dec. 27, 2007. We are aware that, in recent months, there has been intense pressure from Congress to impose a blanket 5% set aside for all WOSBs regardless of any finding of gender discrimination. One Representative actually proposed an 8% blanket set-aside (fortunately, his amendment was defeated). In promulgating this rule, the SBA has conformed its proposed WOSB rule to extant constitutional case law, including a definitive series of rulings by the U.S. Supreme Court, which make clear that gender- or race-based set-asides must (1) be designed to correct actual discrimination rather than simply addressing “underrepresentation” of selected groups; (2) be implemented only after race- and gender-neutral alternatives have been considered; and (3) otherwise be carefully tailored (e.g., they should be time-limited and should be periodically reassessed based upon solid research). If anything, the SBA goes too far in authorizing set-asides at all, since it is doubtful that any existing sex discrimination can be addressed only by set-asides. The Rand Corporation, with which SBA contracted to conduct the disparity study relating to WOSBs in federal contracting, made clear in its report that mere underrepresentation of a particular group does not, in and of itself, prove that illegal discrimination is the reason for such underrepresentation. Likewise, in its public statements regarding this rule, the SBA also has noted that it will aggressively support numerous race- and gender-neutral alternatives which, taken in the aggregate, have already helped and will continue to ensure that "ready, willing and able" WOSBs (as well as all other groups) can attain contracting success with the federal government. For example, the SBA will continue to support Small Business Development Centers (SBDCs), Women’s Business Centers (WBCs), Service Corps of Retired Executives (SCORE), Procurement Technical Access Centers (PTACs), and Office of Small Disadvantaged Business Utilization (OSDBU) centers within each federal agency. Various advocacy groups from the left side of the aisle have expressed unjustified outrage that your proposed rule does not simply grant an entitlement of 5% of all federal contracts to businesses owned by women, even absent any finding of gender discrimination. We feel their arguments in this regard are absolutely without merit—not only as a constitutional matter, but also as a matter of policy. The taxpayers should not have to foot the steeper bill that inevitably results when a contract is awarded to someone other than the lowest bidder. Nor, most fundamentally, should any American be treated as a second-class citizen simply because of his sex or some other immutable characteristic. Sincerely, |
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Links to Contracting Cases
Adarand v. Slater (10th Cir. 2000)
Adarand v. Mineta (Dismissal of case) (2001) (PDF)
Rothe Development Corp. v. United States Department of Defense, No. 00-1171, Fed. Cir., August 20, 2001
From the opinion: This federal contract case concerns the constitutionality of § 1207 of the National Defense Authorization Act of 1987 ("the 1207 program"), Pub. L. No. 99-661, 100 Stat. 3859, 3973 (1986) (as amended), codified at 10 U.S.C. § 2323 (1994), which permits the United States Department of Defense ("DOD") to preferentially select bids submitted by small businesses owned by socially and economically disadvantaged individuals ("SDBs").
McGarry v. Pitkin County, No. 97-1239, 10th Cir.
Associated General Contractors of Ohio v. Drabik, No. 98-4393, 6th Cir. June 1, 2000
From the opinion: Associated General Contractors of Ohio, and Associated General Contractors of Northwest Ohio ("Plaintiffs-Appellees"), representing Ohio building contractors, sued to stop the award of a construction contract for the Toledo Correctional Facility to a minority-owned business ("MBE"), in a bidding process from which non-minority-owned firms were statutorily excluded under Ohio's Minority Business Enterprise Act ("MBEA"). Plaintiffs-Appellees claimed the MBEA is unconstitutional, in that it violates the Fourteenth Amendment's Equal Protection Clause.
S.J. Groves & Sons Inc. v. Fulton County, 920 F.2d 752 (11th Cir.)
H.K. Porter Co. v. Metropolitan Dade County, 975 F.2d 762 (11th Cir. 1992)
Groves v. Fulton County, Dist. Ct. N.D. of Georgia Atlanta Division 1:82-CV-1895-JOF
Sherbrooke Turf v. Minn Department of Transportation Dist. Ct. Dist of Minnesota 00-CV-1026 (JMR.RLE)
Associated General Contractors of Ohio v. Drabik
Dist Ct. S.D. Ohio Eastern Div. No. C2-98-943, May 20, 1999
Contractors Association of Eastern Penn v. Philadelphia
Nos. 92-1880 and 92-1887, (3rd Cir) Oct. 7, 1993
Associated General Contractors, San Diego Chapter v. San Diego
Case No. 93-1152 K
Sept. 30, 1993
U.S. Dist Ct. S.D. of California
Associated General Contractors of California v. San Francisco
619 F. Supp. 334
United States Dist. Ct. N.D. Cal.
Aug. 7, 1985
Lamprecht v. FCC
D.C. Cir.
Feb. 19, 1992
Bilbo Freight Lines v. Dan Morales C.A. No. H-93-3808
Dist Ct. S. Dist of Texas Houston District
Feb 3, 1994
Arrow Office Supply V. Detroit
826 F. Supp. 1072
Dist Ct. E.D. Mich
July 7, 1993
Kline v. Parris Glendening
Civil Action No. MJG-95-3375
Dist Ct. for Dist. Of Md.
June 14, 1996
Associated General Contractors v. Columbus
Case No. C2-89-75
Dist. Ct. S.D. of Ohio Eastern Division
Aug. 26, 1996
Hershell Gill Consulting Engineers v. Metro Dade County
Case No. 98-2300
U.S. Dist Ct. S.D. of Florida, Miami Division
Oct. 2, 2000
Those who are thinking of challenging contracting preferences as illegal may want to look at some of the briefs that others have filed in these cases. Links to some of these briefs follow.
Contracting Briefs
Adarand v. Mineta, Brief of Federal Government, Respondent
Adarand v. Mineta (Amicus Brief of Atlantic Legal Foundation in support of Petitioner, Adarand)
Amicus Brief of Pacific Legal Foundation in support of Petitioner, Adarand
Amicus Brief of Claremont Institute in support of Petitioner, Adarand (PDF)
Related Contracting Items
- CDOT Comments
- Letter Urging That Discriminatory Set-Asides Be Strictly Limited
- Strong Support Announced for SBA Proposed Rule
- Comments With the California Department of Transportation (“Caltrans”)
- Chavez, Clegg, Connerly and others urge Governor Schwarzenegger to reverse Caltrans proposal
- Preferences Based on Race, Ethnicity, and Sex in Government Contracting
- Roger Clegg Testimony
Related Contracting Links
Project on Civil Rights and Public Contracting
Associated General Contractors of America
Links to Executive Branch
Small Business Administration (SBA)
DOT’s Office of Small and Disadvantaged Business Utilization (OSDBU)
DOT’s Disadvantaged Business Enterprise Program (DBE)
Challenges to illegal contracting preferences have been handled by a variety of lawyers, including lawyers with public-interest organizations that often agree to bring these cases on a pro bono basis. Links to some of the lawyers and law firms handling these cases are set out below.
Links to articles by Clegg, LaNoue, Sullivan, etc.
General Accounting Office Reports:
GAO Report: Problems Continue with SBA’s Minority Business development Program
GAO/RCED 93-145, Nov. 1993
GAO Report: Disadvantaged Business Enterprises: Critical Information Is Needed to Understand Program Impact, GAO-01-586), June 2001
(Link coming)
Roger Clegg, Racial Spoils in Fed Contracting, National Review Online, October 20, 2000
The Demographic Premises of Affirmative Action
George LaNoue
Population and Environment: A Journal of Interdisciplinary Studies
Vol. 14 No. 5 May 1993
Human Science Press
Gross Presumptions: Determining Group Eligibility for Federal Procurement Preferences
LeNoue & Sullivan
Santa Clara Law Review
Vol. 41 No. 1 2000
Presumptions for Preferences: The SBA’s Decisions on Groups Entitled to Affirmative Action
LaNoue & Sullivan
Journal of Policy History
Vol. 6 No. 4 1994
Penn State Univ Press
To the “Disadvantaged” go the Spoils
LaNoue
The Public Interest
Winter 2000
Race-Neutral Programs in Public Contracting
LaNoue & Sullivan
Public Administration Review July/August 1995
Vol. 55 No. 4
Standards for the Second Generation of Croson-Inspired Disparity Studies
LaNoue
The Urban Lawyer
Vol. 26 No. 3 Summer 1994
The Impact of Croson on Equal Protection Law and Policy
LaNoue
Albany Law Review
Vol. 61 No. 1 1997
The Economics of Discrimination: The Three Fallacies of Croson
Martin J. Katz
Yale Law Journal 100(6) Jan. 91 Pg. 1033
Links to Regulations
Small Business Administration
Small Business Size Regulations; 8(a) Business Development/Small Disadvantaged Business Status Determinations; Rules of Procedure Governing Cases Before the Office of Hearings and Appeals 63 Fed. Reg. 125, 35,726-35,767 (June 30, 1998)
Final Rule
(Link coming)
Department of Defense
Federal Acquisition Regulation; Reform of Affirmative Action in Federal Procurement
62 Fed. Reg. 90 29,547-29,621 (May 9, 1997)
Proposed Rule
(Link coming)
Department of Transportation
This notice proposes revisions of the Department of Transportation's regulations for its disadvantaged business enterprise (DBE) program.
62 Fed. Reg. 104 (May 30, 1997)
Supplemental notice of proposed rulemaking
(Link coming)
*13 CFR 124
Subpart B--Eligibility, Certification, and Protests Relating to Federal Small Disadvantaged Business Programs
13 CFR 124-8(A)
BUSINESS DEVELOPMENT/SMALL DISADVANTAGED BUSINESS STATUS DETERMINATIONS
*49 CFR 26.67(a)
PARTICIPATION BY DISADVANTAGED BUSINESS ENTERPRISES IN DEPARTMENT OF TRANSPORTATION FINANCIAL ASSISTANCE PROGRAMS:
What rules determine social and economic disadvantage?
Small Business Administration Final Rule, 63 Fed. Reg. 125, 35,767-35,780 (June 30, 1998)
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