Federal support for minority setasides is declining rapidly, based on recent action both from the White house and on Capitol Hill.
A panel in the House of Representatives voted March 8 to end all federal preferences for minority and underrepresented companies, sending the legislation on for further action. That same week, a U.S. Justice Department official said the administration plans to impose a three-year moratorium on setasides in federal programs.
Top elected Black leaders reacted negatively to both developments. “We’re going to try to change the president’s point of view,” a spokesman for Rep. John Conyers (D-MI), ranking Democrat on the House Judiciary Committee and dean of the Congressional Black Caucus, told Black Issues. Conyers is leading opposition to the legislation under consideration in the House.
The administration would reconsider the moratorium after three years but would set detailed criteria for their return, a Justice Department official told Black Issues. The White House, however, would give agencies some leeway to award additional points to minority for female-owned firms, the report said.
Meanwhile, the House went on record opposing not only minority setasides but also any type of preferential treatment for minority and women-owned businesses. The House Judiciary Committee’s constitution subcommittee, by an 8 to 5 vote, approved these changes in H.R. 2128.
“The Clinton administration is not doing all that our bill would do,” a House GOP aide said.
Conyers criticized the bill, saying it would “end 30 years of civil rights policies and reverse a number of Supreme Court decisions that have tried to diversify America’s work force. Minorities and women will suffer severe economic consequences if this legislation becomes law.”
It is unclear how many setaside programs still in operation would be affected by any action from the White House or Congress. The Clinton administration already has dropped a small setaside program for minority businesses at the Department of Defense (DoD), a congressional aide said.
This signals a major change from the late 1980s, when DoD setasides targeted Black colleges and minority schools. At that time, these institutions could receive up to 5 percent of defense dollars awarded in higher education.
Nonetheless, aides from both parties said the legislation likely would not affect at least one remaining setaside program offered by the U.S. Small Business Administration.
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