As business and legal communities assess the potential reach of the Supreme Court of the United States’ landmark ruling striking down the use of race in college admissions processes, AGG partner and Government Contracts practice leader, Tenley Carp, was quoted in an article published in The Business Journals on August 9, 2023, discussing the potential impact the ruling could have on federal contracting.
Each year, the federal government allocates a specified amount of contract spending to small businesses, including set asides for small, disadvantaged businesses owned by people who have “been subjected to racial or ethnic prejudice or cultural bias within American society because of their identities as members of groups and without regard to their individual qualities.” With the Supreme Court striking down the use of race in college admissions, there is speculation that such set-asides under the SBA’s 8(a) business development program might not clear potential challenges to the Supreme Court as currently constituted.
“The 8(a) program, which has been challenged more than once, is probably going to be challenged,” Tenley said. “It all depends on how disadvantaged persons is defined. But in the regulations, one could argue it’s based on race.”
Tenley added that the recent Supreme Court decision opens the door to this kind of challenge, as the purpose of the 8(a) program is to remedy the effects of bias or prejudice that’ve traditionally impeded groups from participating in contracting. Based on this, white business owners could challenge the constitutionality of a rule that doesn’t let them participate in these set-aside contracts. This type of challenge could be brought either through administrative channels or through a federal district court — and would likely end up at the Supreme Court.
To read the full article, please click here.