A federal judge this week ruled against a Biden-Harris administration program that allocated around $37 billion in federal road contracts for businesses owned by women and racial minorities, raising questions about the future of a decades-old affirmative action program.
Since the 1980s, the Disadvantaged Business Enterprise (DBE) Program has required around 10% of federal dollars allocated for road construction contracts to go to women and certain racial minorities. The Infrastructure Investment and Jobs Act, which Biden signed in 2021, reauthorized the DBE and set aside $37 billion for eligible recipients.
This year, two small businesses sued the Transportation Department, saying that the DBE program caused them to lose out on business. On Monday, Judge Gregory Van Tatenhove ruled that the Biden-Harris administration could not enforce the DBE’s affirmative action quotas against the businesses.
“The Court is keenly aware of the past discrimination that certain groups of people have faced in this country,” Tatenhove wrote. “And the Court is sure that the federal government has nothing but good intentions in trying to remedy past wrongs. But remedying those wrongs must still pass constitutional muster. The federal government cannot classify people in such a manner that violates the principles of equal protection.”
This is the latest caste that builds off the Supreme Court’s June 2023 ruling that affirmative action was unconstitutional. One federal judge ruled that the Minority Business Development Agency needed to be open to working with business owners of all races, while another judge said that the Small Business Administration could not distribute contracts based on the claim that certain races are inherently disadvantaged.
The Wisconsin Institute for Law and Liberty (WILL) filed the lawsuit on behalf of Mid-America Milling and Bagshaw Trucking. The businesses, which are owned in part by white males and operate in Kentucky and Indiana, routinely bid on federal contracts. Mid-America says it has lost out on 82 contracts in Indiana since January 2022 because of the DBE program.
In his decision, Van Tatenhove wrote that both companies have “previously lost out on federally funded contracts to DBE firms, even when Plaintiffs’ bids were lower.”
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WILL lawyer Daniel Lennington told The Daily Wire that the decision was a major blow for the Biden-Harris administration’s “equity agenda,” which pushes race-based programs throughout the federal government.
Lennington noted that after a period of discovery, WILL would ask for a final decision from the judge that would block any business from being subject to the DBE program.
“The DBE program is really baked into the DNA of road building in America and companies all across America just assume that this program is never going to go anywhere,” he said. “We believe that’s unconstitutional and it hurts real people that have real businesses every day.”