Diverse Participation in Public Contracting: Legal and Administrative Policy in the United States
Creating economic participation for marginalized groups is a global problem. For three decades, governments in the United States have used various forms of affirmative action to increase shares of public contracting for businesses owned by members of disadvantaged groups (African-Americans, Hispanic-Americans, Asian-Americans, Native-Americans and sometimes women). These programs are controversial regarding the selection of preferred groups, the amount of the preferences, the duration of the programs, and which firms are actually benefited. After initial approval, the federal judiciary has applied the strict scrutiny standard to these programs by requiring that preferences only be used to remedy identified discrimination. These rulings have created a disparity study industry which has resulted in about 200 such studies at a cost of more than $100 million. Generally, after judicial review, the studies have been found to be inadequate. Consequently, more attention is being given to race and gender neutral programs (small business programs, smaller contracts, reduction of bonding and pre-qualification requirements, improved communication about contracting opportunities, and mentoring programs, etc.) This paper will discuss the evolution of the process to increase contracting participation for minority groups in the United States and consider options other countries have employed.
Keywords: Affirmative Action, Public Contracting, Economic Participation
Dr. George R. La Noue
Professor of Political Science and Public Policy, Departments of Political Science and Public Policy, University of Maryland Graduate School Baltimore