Report on Lawful Uses of Race and Sex in Federal Contracting Programs

The Compelling Interest to Remedy the Effects of Discrimination in
Federal Contracting: A Survey of Recent Evidence
Table of Contents
Table of Contents ............................................................................................................................... 1
Introduction ....................................................................................................................................... 2
I. 	Legal Landscape .................................................................................................................... 4
A. 	Overview.............................................................................................................................. 4
B. 	Constitutional Challenges to Race- and Gender-Conscious Contracting Programs ........ 5
1. 	Challenges to the Small Business Act’s Section 8(a) Business Development
Program ................................................................................................................................. 6
2. 	Challenges to States’ Implementation of the United States Department of
Transportation Disadvantaged Business Enterprise Program ............................................8
3. 	Challenges to Race- and Gender-Conscious COVID-related Relief Efforts ............ 13
4. 	Challenges to State and Local Disadvantaged Business Enterprise Programs ....... 15
II. 	There are Identified Disparities in Government Contracting between Minority- and
Women-Owned Businesses and Their Non-Minority, Male-Owned Counterparts .................. 16
III. 	Discrimination Limits Access to Contracting Markets ...................................................... 21
A. 	Discrimination By Procurement Agencies and Prime Contractors Creates Obstacles for
Minority- and Women-Owned Businesses.............................................................................. 21
B. 	Exclusion From Business Networks Limits Opportunities .............................................24
C. 	Discrimination in Bonding and by Suppliers Burdens Disadvantaged Firms ............... 25
IV. 	There Are Significant Disparities in Business Formation and Success Between Minority-
and Women-Owned Businesses Relative to Their Non-Minority, Male-Owned Counterparts 26
V. 	Discrimination Limiting Access to Capital Affects the Formation and Development of
Businesses Owned by Women or People of Color ...................................................................... 27
A. 	The Wealth Gap Contributes to, and is Exacerbated By, Lack of Access to Capital.......28
B. 	Businesses Owned by Women and People of Color are Significantly More Likely to Be
Denied Access to Capital .......................................................................................................... 30
C. 	When Minority and Female Business Owners Do Obtain Loans, They Are Smaller and
on Less Favorable Terms and Conditions ............................................................................... 33
VI. 	COVID Has Had a Disproportionate Impact on Minority- and Women-Owned
Businesses .................................................................................................................................... 34
APPENDIX A ................................................................................................................................... 37
APPENDIX B ...................................................................................................................................40
APPENDIX C ................................................................................................................................... 56
1

Introduction
This report summarizes recent evidence required to justify the use of race- and
sex-conscious provisions in federal contracting programs. Federal programs that involve
racial classifications must meet the strict scrutiny standard of review to withstand
constitutional challenge.1 This is the most exacting standard of review, and it requires,
among other things, evidence supporting the conclusion that such measures are
necessary to further the compelling governmental interest in remedying the effects of
past and present discrimination. If a program contains affirmative measures based on
sex, those measures are subject to the somewhat lower standard of intermediate
scrutiny.2 That standard demands that any gender-based preference be substantially
related to an important governmental objective.3
In 2010, the Department of Justice submitted to Congress a report compiling and
summarizing evidence of discriminatory barriers that racial minorities and women face
that impede participation in government contracting.4 The 2010 report has been cited in
federal court as evidence that there is a compelling governmental interest in programs
that support the ability of businesses owned by women or people of color to compete on
an equal basis.5 The 2010 report updated and expanded upon a 1996 Department of
Justice report, which was published in the Federal Register.6
This report compiles and summarizes evidence accumulated and analyzed since
2010. A substantial body of evidence, both quantitative and qualitative, demonstrates
the continued pervasiveness of discriminatory barriers that impede the full and fair
participation of businesses owned by women or people of color in government
contracting. The nature and breadth of the evidence discussed in this report supports
the compelling interest in the continued use of federal programs that contain remedial
measures to eliminate discriminatory barriers to contracting opportunities for
businesses owned by women or people of color.
Section I of this report provides an overview of the legal landscape surrounding
constitutional challenges to affirmative action in contracting programs that are subject
to strict and intermediate scrutiny, including a discussion of some recent cases
challenging various federal and state contracting programs. Section II reviews a
1 Adarand Constructors, Inc. v. Peña, 515 U.S. 200, 227 (1995).
2 United States v. Virginia, 518 U.S. 515, 533 (1996).
3 Id.
4 Compelling Interest for Race- and Gender-Conscious Federal Contracting Programs: An Update to the
May 23, 1996 Review of Barriers for Minority- and Women-Owned Businesses (2010). This report
summarized 47 studies and reports and 75 disparity studies between 2000 and 2010, and 39
congressional hearings between 2006 and 2010. The report and associated studies were provided to
Congress as testimony. See Minority Contracting: Opportunities and Challenges for Current and Future
Minority-Owned Business: Hearing before Subcomm. on Gov’t Mgmt., Org. and Procurement of the
House Comm. on Oversight & Gov’t Reform, 111th Cong., 2d Sess. (2010) (testimony of David A. Hinson,
National Director, Minority Business Development Agency, U.S. Dep’t of Commerce).
5 Midwest Fence Corp. v. United States Dep’t of Transp., No. 10 C 5627, 2011 WL 2551179, at *12 (N.D. Ill.
June 27, 2011).
6 The Compelling Interest for Affirmative Action in Federal Procurement: A Preliminary Survey, 61 Fed.
Reg. 26,050 (May 23, 1996). This report summarized more than 50 documents and 30 congressional
hearings between 1980 and 1996.
2

substantial body of statistical evidence published in the last decade, which demonstrates
the existence of significant disparities in the amount of public contracting dollars going
to businesses owned by women or people of color as compared to their availability for
such contracts. Section III explores the various ways that discriminatory barriers can
limit access to contracting markets, resulting in the statistical disparities identified in
Section II. These include discrimination by procurement agencies and prime
contractors, whether overt or subtle; exclusion from business networks crucial to
making the connections necessary to learn about and compete effectively for contracting
opportunities; and discrimination by bonding companies and suppliers. Section IV
discusses stark disparities in the formation and success of businesses owned by women
or people of color as compared to other businesses. Section V addresses discriminatory
barriers that limit minority and female business owners’ access to capital. These barriers
impose a significant burden on minority- and women-owned businesses that affects
both the ability to form and grow businesses in the first instance as well as the ability to
compete effectively for contracts. Finally, Section VI addresses how the economic
downturn that began in 2020 as a result of the COVID-19 pandemic has
disproportionately affected businesses owned by women or minorities. Evidence
discussed in this report, or related to the issues discussed herein, is listed in the
appendices. Appendix A identifies congressional hearings from 2010-2021 that address
challenges facing business enterprises owned by women or people of color. Appendix B
identifies over 200 disparity studies published between 2010 and 2021. Appendix C
identifies additional studies and reports pertaining to the issues discussed herein.
This report is particularly timely in light of the January 20, 2021, Executive
Order On Advancing Racial Equity and Support for Underserved Communities Through
the Federal Government, which charges the federal government with “pursu[ing] a
comprehensive approach to advancing equity for all, including people of color and
others who have been historically underserved, marginalized, and adversely affected by
persistent poverty and inequality.”7 The Executive Order makes explicit that “[t]he
Federal Government’s goal in advancing equity is to provide everyone with the
opportunity to reach their full potential” and that “[c]onsistent with these aims, each
agency must assess whether, and to what extent, its programs and policies perpetuate
systemic barriers to opportunities and benefits for people of color and other
underserved groups” in order to “better equip agencies to develop policies and programs
that deliver resources and benefits equitably to all.”8 Of particular relevance to this
report, the Executive Order provides that “Government contracting and procurement
opportunities should be available on an equal basis to all eligible providers of goods and
services.”9 It is thus especially appropriate for the Department of Justice to take an
updated look at the barriers and challenges that businesses owned by women or people
of color face today.
The Executive Order also mandates that the federal government use every
available tool to ensure the equitable distribution of federal funds, including by
increasing access for, and promoting the diversity of, small businesses participating in
7 Exec. Order No. 13985, 86 Fed. Reg. 7009 (Jan. 20, 2021).
8 Id.
9 Id.
3

government contracting opportunities. To that end, federal agencies are empowered to
implement a broad range of programs to expand equity and diversity without triggering
a heightened standard of review. In the contracting realm, these programs include race-
and gender-neutral measures like the Historically Underutilized Business Zone
(“HUBZones”) Program and the Service-Disabled Veteran-Owned Small Business
(“SDVOSBs”) Program.10 Because these programs provide preferential access to
government contracting opportunities based on non-suspect classifications, if
challenged, they must only survive the lowest standard of scrutiny—rational basis.11 That
is to say, the programs will survive challenges so long as they bear a rational relation to
some legitimate end.12 Because they are not subject to heightened scrutiny, the
HUBZone program, the program for SDVOSBs, and other government programs that do
not include race- or gender-conscious classifications fall outside the scope of this report.
I. 	Legal Landscape
A. 	Overview
In Adarand Constructors, Inc. v. Peña, 515 U.S. 200, 227 (1995), the United
States Supreme Court held that federal race-conscious classifications are subject to strict
scrutiny, meaning they “are constitutional only if they are narrowly tailored measures
that further compelling governmental interests.” There is no doubt that remedying
discrimination and its lingering effects is a compelling governmental interest.13 That
compelling government interest includes a public entity’s attempt to remedy past
discrimination by rectifying its own actions.14 It also includes remedying a public
entity’s passive complicity in private sector discrimination, as the Supreme Court has
noted that “[it] is beyond dispute that any public entity . . . has a compelling interest in
assuring that public dollars drawn from the tax contributions of all citizens do not serve
to finance the evil of private prejudice.”15 In either case, the government must
demonstrate a “strong basis in evidence for its conclusion that remedial action was
necessary” to further that interest.16
A “strong basis in evidence” is that which “approach[es] a prima facie case of a
constitutional or statutory violation.”17 The Supreme Court held in City of Richmond v.
J.A. Croson Co., 488 U.S. 469, 500 (1989) (plurality opinion), that “[w]here there is a
10 Robert Jay Dilger, Cong. Rsch. Serv., R45576, An Overview of Small Business Contracting 17-18
(2021), https://fas.org/sgp/crs/misc/R45576.pdf.
11 The “mere awareness” or consideration of race in efforts to remedy discrimination and its effects does
not automatically equate to a racial classification. See Texas Dep’t of Hous. & Cmty. Affairs v. Inclusive
Communities Project, Inc., 576 U.S. 519, 545 (2015). Public entities can undertake efforts to eliminate
racial disparities through a variety of race-neutral means without triggering strict scrutiny. See Parents
Involved in Cmty. Schs. v. Seattle Sch. Dist. No. 1, 551 U.S. 701, 789 (2007) (Kennedy, J., concurring).
12 Romer v. Evans, 517 U.S. 620, 631 (1996).
13 Shaw v. Hunt, 517 U.S. 899, 909 (1996).
14 Parents Involved in Cmty. Schs. v. Seattle Sch. District No. 1, 551 U.S. 701, 741, (2007).
15 City of Richmond v. J.A. Croson Co., 488 U.S. 469, 492 (1989) (plurality opinion); Associated Gen.
Contractors of Ohio, Inc. v. Drabnik, 214 F.3d 730, 735 (6th Cir. 2000).
16 Croson, 488 U.S. at 500 (1989) (plurality opinion).
17 Id.
4

significant statistical disparity between the number of qualified minority contractors
willing and able to perform a particular service and the number of such contractors
actually engaged by the locality or the locality’s prime contractors, an inference of
discriminatory exclusion could arise.” The evidence of discrimination must have a
sufficient nexus with the proposed remedial action such that it involves more than
general societal discrimination.18 In recent decisions concerning race- and gender-
conscious COVID-related relief efforts, courts have conveyed that the policy cannot rest
on a “generalized assertion that there has been past discrimination in an entire
industry.”19 Consequently, courts in these cases have expected statistical evidence of
disparities presented in defense of race- or gender-conscious programs to describe the
appropriate marketplace with specificity and to tie evidence of current disparities to
discrimination in that marketplace. In cases where race- or gender-conscious
government contracting programs have been successfully defended from constitutional
challenges, courts have relied on disparity studies analyzing statistical and anecdotal
evidence of public and private discrimination in the appropriate contracting arena.
Disparity studies examine the utilization of minority-owned firms as compared to their
availability in the relevant market area. These state and local disparity studies also
include qualitative evidence describing discriminatory barriers that minority- and
women-owned businesses face not only in participating in contracting markets, but also
in forming and developing businesses in the first place.
In addition to being supported by a compelling interest, federal programs must
be narrowly tailored to accomplish that interest. Courts consider several factors to
determine whether a program is narrowly tailored, including: (1) the necessity for the
race-conscious remedy; (2) the duration of the remedy; (3) the relationship of the
numerical target of the program to the relevant labor market; (4) the flexibility of the
program, including the availability of waiver provisions; (5) over-inclusiveness or
under-inclusiveness of the program; and (6) the effect of the remedy on innocent third
parties.20
B. 	Constitutional Challenges to Race- and Gender-Conscious
Contracting Programs
Over the past 10 years, courts have evaluated numerous constitutional challenges
to federal, state, and local contracting programs that contain race- and gender-
conscious provisions. Courts have rejected facial challenges that assert such programs
are per se unconstitutional. Courts have, however, found that the administration of
some programs did not meet strict scrutiny standards. This is typically because the
available evidence did not support the application of the program to particular
government contracting industries. In addition, several recent constitutional challenges
18 Parents Involved, 551 U.S. 701 (holding that remedying racially identifiable housing patterns did not
justify race-conscious criteria for school assignments).
19 Holman v. Vilsack, No. 1:21-cv-1085 (W.D. Tenn. Jul, 8, 2021) (citing Vitolo, 2021 WL 2172181 at *2,
*8-9). As of August 2021, these cases are still in litigation, and the Department of Justice is continuing to
defend the constitutionality of the programs at issue.
20 United States v. Paradise, 480 U.S. 149, 171 (1987) (plurality and concurring opinions); Croson, 488
U.S. at 508 (plurality opinion).
5

outside of the contracting arena have been brought seeking to end the use of race- and
gender-conscious measures in programs established in the American Rescue Plan Act of
2021 to provide pandemic-related relief to businesses in the restaurant and agricultural
industries. While courts have granted temporary restraining orders and preliminary
injunctions in these cases, litigation on the merits is ongoing as of the date of this report.
1. 	Challenges to the Small Business Act’s Section 8(a) Business
Development Program
The Small Business Act establishes certain contracting preferences to aid small
businesses in competing for government contracts. Among these are several programs
that create contracting opportunities for certain small disadvantaged businesses. One
such program, known as the 8(a) program, allows the government to prioritize the
issuance of certain contracting opportunities to businesses owned by “socially and
economically disadvantaged” individuals.21 The statute defines socially disadvantaged
individuals as “those who have been subjected to racial or ethnic prejudice or cultural
bias because of their identity as a member of a group without regard to their individual
qualities.”22 The Small Business Administration (SBA), which administers the program,
has promulgated a regulation that provides that applicants to the 8(a) program who are
members of certain designated racial or ethnic groups are entitled to a rebuttable
presumption of social disadvantage.23 Because this regulation includes a race-conscious
classification, it has been subjected to strict scrutiny when faced with constitutional
challenge.
Unlike some federal programs that are limited to particular agencies, all federal
departments and major independent agencies participate in the 8(a) program. In Fiscal
Year 2019, the federal government awarded $30.4 billion to 8(a) firms, more funding
than any of the SBA’s other small disadvantaged business programs.24 Since the
Department of Justice’s 2010 report, the 8(a) program has survived two constitutional
challenges brought by businesses alleging that the program on its face violates the
guarantee of equal protection found in the Due Process Clause of the Fifth Amendment
to the Constitution, and it is currently facing a third.25 The courts in the two decided
cases found a strong basis in evidence that the program is necessary to further the
compelling governmental interest in remedying racial discrimination in the government
contracting arena. In addition, the courts found that the 8(a) program is narrowly
tailored to further that interest.
21 15 U.S.C. § 637(a).
22 Id. § 637(a)(5).
23 13 C.F.R. § 124.103(b)(1). This presumption may be rebutted with “credible evidence to the contrary.”
Id. § 124.103(b)(3).
24 Robert Jay Dilger, Cong. Rsch. Serv., R45576, An Overview of Small Business Contracting 16 (2021),
https://fas.org/sgp/crs/misc/R45576.pdf.
25 See Ultima Servs. Corp. v. U.S. Dep’t of Agric., 2:20-CV-00041-DCLC (E.D. Tenn. filed Mar. 4, 2020).
6

i. 	DynaLantic Corporation v. United States Department of
Defense, 885 F. Supp. 2d 237 (D.D.C. 2012).
DynaLantic is a small business that manufactures aircrafts, submarines, ships,
and training equipment. When the Navy awarded a contract to develop a flight
simulator for the Huey helicopter through the 8(a) program, DynaLantic sued the
Department of Defense (DOD), alleging that the 8(a) program was unconstitutional
both on its face and as applied in the military simulation and training industry.
The court rejected the facial challenge, concluding that the government had
articulated a compelling interest in the program and presented a strong basis in
evidence to support its conclusion that race-conscious remedial action was necessary to
further that interest. The court considered the evidence before Congress at the time the
8(a) program was enacted, as well as post-enactment evidence that supports the
continued need for the program.26 The evidence fell into “three broad categories: (1)
evidence of barriers to the formation of qualified minority contractors due to
discrimination, (2) evidence of discriminatory barriers to fair competition between
minority and non-minority contractors, and (3) evidence of discrimination in state and
local disparity studies.”27 In reviewing the evidence, the court noted that it was not
necessary to examine “the vast amount of statistical evidence” presented by the
government in detail because the burden was on DynaLantic to show “no set of
circumstances exist under which the Act would be valid” in order to succeed in its facial
challenge to the program’s constitutionality.28 In addition, in response to DynaLantic’s
arguments that there were flaws in some of the evidence, the court found that any flaws
did not rise to the level of the “credible, particularized evidence” necessary to rebut the
government’s initial showing of a compelling interest.29 The court explained that the
government can establish a strong basis in evidence with evidence “approaching a
prima facie case of a constitutional or statutory violation” and that it is not required to
present “irrefutable or definitive proof of discrimination.”30
In addition to finding that the government articulated a compelling interest, the
court considered several factors in determining that the program is narrowly tailored,
including that: (1) Congress attempted to use race-neutral measures to assist minority-
owned businesses for at least 25 years before incorporating a race-conscious component
into the 8(a) program; (2) the program is sufficiently flexible in that it contains only
aspirational goals with no penalties for failing to meet them, the presumption of social
disadvantage available to certain racial and ethnic groups is rebuttable and applicants
who are not presumptively disadvantaged may still demonstrate social disadvantage,
and all applicants must meet the same economic disadvantage requirements; (3) the
program is not over-inclusive as the government presented sufficient evidence of
discrimination to justify granting the rebuttable presumption to the five groups
26 DynaLantic Corp. v. U.S. Dep’t of Def., 885 F. Supp. 2d 237, 253-58 (D.D.C. 2012).
27 Id. at 258.
28 Id. at 265 (quoting United States v. Salerno, 481 U.S. 739, 745 (1987)).
29 Id. at 271 (quoting Adarand Constructors, Inc. v. Slater, 228 F.3d 1147, 1175 (10th Cir. 2000)).
30 Id. at 276 (quoting Concrete Works of Colo., Inc. v. City and Cnty. of Denver, 321 F.3d 950, 971 (10th
Cir. 2003) (internal quotation omitted)).
7

identified in the regulation; (4) there are time limits on participation in the program,
and participants graduate from the program earlier if they meet certain business
development goals; (5) the goal for participation in the program is reasonably tied to the
pool of available minority-owned businesses, taking into account that the availability of
minority-owned businesses reflects discrimination that has prevented minorities from
forming and developing businesses; and (6) the program includes several provisions
that minimize the burden on non-minority businesses, including a waiver provision to
ensure that an award will not be accepted for the program if there would be an adverse
impact on small businesses operating outside the 8(a) program.31
But in evaluating the as-applied challenge, the court determined that the
government failed to demonstrate a compelling interest in utilizing the 8(a) program in
DOD’s award of contracts for military simulators, as the government conceded that it
did not have evidence of discrimination in that industry.32
ii. 	Rothe Development, Inc. v. United States Department of
Defense, 836 F.3d 57 (D.C. Cir. 2016).
Just a few years after the DynaLantic decision, the United States District Court
for the District of Columbia again upheld the constitutionality of the 8(a) program,
rejecting a facial challenge brought by Rothe Development, Inc., a small business that
bids on DOD contracts.33 The Rothe district court decision relied on much of the same
reasoning as the court in the DynaLantic opinion. On appeal, the D.C. Circuit upheld
the constitutionality of the 8(a) program, concluding that the statute itself does not
contain a racial classification that would subject the program to strict scrutiny.34
Because Rothe challenged only the statutory provisions and not the SBA regulation, the
court applied rational basis review, which requires only that the statute “bear[] a
rational relation to some legitimate end,” and determined that the statute “readily
survives” such review.35
2. Challenges to States’ Implementation of the United States
Department of Transportation Disadvantaged Business
Enterprise Program
For more than 30 years, the United States Department of Transportation
(USDOT) has implemented variations of a program wherein states that receive federal
funds for highway planning and construction must implement a state-designed,
federally-approved Disadvantaged Business Enterprise (DBE) program.36 In the
following cases, courts examined whether a state’s implementation of the federal DOT
DBE program withstands strict scrutiny.
31 Id. at 283-91.
32 Id. at 280.
33 Rothe Dev., Inc. v. Dep’t of Def., 107 F. Supp. 3d 183 (D.D.C. 2015).
34 Rothe Dev., Inc. v. Dep’t of Def., 836 F.3d 57, 68 (D.C. Cir. 2016).
35 Id. at 63, 72-73.
36 See e.g., Safe, Accountable, Flexible, Efficient Transportation Equity Act, 49 C.F.R. § 26.1 (2005).
8

When reviewing the constitutionality of the program as applied by a particular
state, courts do not require the state to demonstrate an independent compelling interest
for its DBE program; instead, states may rely on the compelling nationwide interest
identified by Congress in adopting the program.37 Courts differ as to how they articulate
the precise standard for evaluating the constitutionality of a state’s DBE program, but
ultimately, whether such a program can withstand heightened scrutiny depends
primarily on whether there is sufficient evidence of discrimination in the relevant
contracting market to support the specific race- or gender-conscious goals set by the
program.
i. 	Mountain West Holding Co. v. Montana, 691 F. App’x 326 (9th
Cir. 2017) (Memorandum opinion).
The plaintiff, a subcontractor who competes to win subcontracts from prime
contractors who have contracted with the Montana DOT, was denied a contract despite
offering the lowest bid on the project. As a result, the plaintiff raised an as-applied
challenge to Montana’s DBE program under the Equal Protection Clause and also under
Title VI of the Civil Rights Act, alleging that it unlawfully required prime contractors to
give preference to minority- or female-owned companies.38 Relying on statistical and
anecdotal evidence from a Montana disparity study, the district court concluded that the
program was narrowly tailored to further the compelling government interest identified
by Congress when it passed the DOT DBE legislation.39 The district court accordingly
granted summary judgment in favor of the defendants.
On appeal, because Montana had discontinued using race- and sex-conscious
goals, the Ninth Circuit dismissed the plaintiff’s claim for injunctive and declaratory
relief as moot.40 However, as to the plaintiff’s claims for damages under Title VI, the
Ninth Circuit reversed the district court’s grant of summary judgment in favor of
Montana. The court first noted that in an as-applied challenge to a state’s DBE
contracting program, Ninth Circuit precedent established in Western States Paving Co.
v. Washington State Department of Transportation, 407 F.3d 983 (9th Cir. 2005),
holds that “(1) the state must establish the presence of discrimination within its
transportation contracting industry, and (2) the remedial program must be ‘limited to
those minority groups that have actually suffered discrimination.’”41 The court then
concluded that the district court erred in granting summary judgment, finding genuine
issues of material fact based on issues that the plaintiff’s expert raised as to the validity
of the defendants’ disparity study.42 The court also concluded that without this
statistical evidence, the state could not rely on anecdotal evidence of discrimination
37 See, e.g., W. States Paving Co. v. Wash. State Dep’t of Transp., 407 F.3d 983, 997 (9th Cir. 2005);
Sherbrooke Turf, Inc. v. Minn. Dep’t of Transp., 345 F.3d 964, 970 (8th Cir. 2003).
38 Mountain W. Holding Co. v. Montana, 691 F. App'x 326, 328 (9th Cir. 2017).
39 Mountain W. Holding Co. v. Montana, No. CV 13-49-BLG-DLC, 2014 WL 6686734 (D. Mont. Nov. 26,
2014), aff’d in part, rev. in part, dismissed in part by Mountain W. Holding Co. v. Montana, 691 F. App’x
326 (9th Cir. 2017).
40 Mountain W. Holding Co. v. Montana, 691 F. App'x 326, 328 (9th Cir. 2017).
41 Id. at 329-30 (quoting W. States Paving, 407 F.3d at 997-99).
42 Id. at 330.
9

alone.43 Finally, the court determined that it was improper for the district court to rely
on the decrease in DBE participation after the state halted use of race- and gender-based
preferences, concluding that such a decrease in participation is not necessarily evidence
of discrimination against DBEs.44
ii. 	Midwest Fence Corporation v. Department of Transportation,
840 F.3d 932 (7th Cir. 2016).
Midwest Fence, a fencing and guardrail contractor, filed an 18-count complaint
against the USDOT, the Illinois DOT (IDOT), and the Illinois State Tollway Highway
Authority (Tollway) challenging the constitutionality of the federal DBE program, the
application of the program by IDOT, and Tollway’s analogous DBE program. The
Seventh Circuit affirmed the district court’s ruling upholding the constitutionality of the
federal, IDOT, and Tollway programs.45 The plaintiff did not challenge whether a
compelling interest justified the federal program, and the Seventh Circuit joined the
Eighth, Ninth, and Tenth Circuits in concluding that the federal program is narrowly
tailored and thus constitutional on its face.46 Because not all of IDOT’s contracts are
federally funded, and the Tollway’s DBE program did not make use of federal funds,
they could not rely on the federal compelling interest in establishing the programs; thus,
the court considered whether IDOT and the Tollway established a strong basis in
evidence to support their programs.47 Based on a review of studies presenting statistical
evidence of disparities between the availability and utilization of DBEs in the relevant
market areas, the court found that both IDOT and the Tollway had a strong basis in
evidence to adopt their programs.48 The court also concluded that all three programs are
narrowly tailored, including because they use race- and gender-neutral alternatives, and
because they include waivers from provisions that require specific goals when a
contractor has made good faith efforts to comply with a DBE goal.49
iii. 	Dunnet Bay Construction Co. v. Borggren, 799 F.3d 676 (7th
Cir. 2015).
Dunnet Bay, a corporation specializing in general highway construction, was
owned and operated by White males. After its bid proposal for the Eisenhower Highway
construction project was rejected for failing to meet IDOT’s DBE goal, despite being the
lowest bid, it filed a claim challenging the constitutionality of IDOT’s DBE program. The
court held that Dunnet Bay lacked standing to raise an equal protection claim because it
could not show that it was excluded from competing for contracts because of race-based
measures.50 Rather, IDOT did not award the contract on which Dunnet Bay bid to
anyone and re-bid the project because Dunnet Bay’s low bid substantially exceeded the
43 Id. at 331.
44 Id.
45 Midwest Fence Corp. v. Dep’t of Transp., 840 F.3d 932, 941, 935-36 (7th Cir. 2016).
46 Id. at 942.
47 Id. at 948.
48 Id. at 949-51.
49 Id. at 942-43, 954.
50 Dunnet Bay Constr. Co v. Borggren, 799 F.3d 676, 690 (7th Cir. 2015).
10

program’s estimated budget.51 When Dunnet Bay bid on one of the rebid projects, it was
not awarded the contract because it was not the lowest bid.52 In addition, the court
found that even if Dunnet Bay could establish that it was disadvantaged in competing
for contracts as compared to DBEs, the reason was not because of race, but was equally
attributable to the fact that Dunnet Bay exceeded the business size standard established
to qualify as a DBE.53
The court then determined that even if Dunnet Bay had standing, IDOT was still
entitled to summary judgment. Relying on Northern Contracting, Inc. v. Illinois, 473
F.3d 715, 720–21 (7th Cir. 2007), the court first noted that IDOT could rely on “the
federal government’s compelling interest in remedying the effects of past discrimination
in the national construction market,” and then stated that a “state is insulated from [a
constitutional challenge as to whether its program is narrowly tailored to achieve this
compelling interest], absent a showing that the state exceeded its federal authority.”54
The court held that IDOT did not exceed its authority in establishing its DBE program
and accordingly affirmed the district court’s grant of summary judgment in favor of
IDOT.
iv. 	Associated General Contractors of America, San Diego
Chapter, Inc. v. California Department of Transportation, 713
F.3d 1187 (9th Cir. 2013).
An association of general contractors challenged the California Department of
Transportation’s (Caltrans) DBE program on constitutional grounds because it provided
race- and gender-based preferences on certain transportation contracts. After the
United States District Court for the Eastern District of California upheld the
constitutionality of the program, the association appealed. The Ninth Circuit dismissed
the appeal for lack of jurisdiction on the grounds that the plaintiff association did not
have standing to bring the suit because it did not identify a single member of its
association who had suffered or would suffer harm under Caltrans’s program.55 The
court also found that even if the plaintiff did have standing, the program survived strict
scrutiny.56 Relying on Western States, the Court first explained that Caltrans could rely
on the compelling nationwide interest identified by Congress when passing the federal
statute and did not need to demonstrate an independent compelling interest for the
program.57 The court then applied the two-prong narrow-tailoring test set forth in
Western States.58 First, the court found that a 2007 disparity study commissioned by
Caltrans contained “substantial statistical and anecdotal evidence of discrimination in
51 Id. at 692.
52 Id. at 687.
53 Id. at 692-93.
54 Id. at 697 (quoting N. Contracting, 473 F.3d at 720, 721).
55 Assoc. Gen. Contractors of Am., San Diego Chapter, Inc. v. Cal. Dep’t of Transp., 713 F.3d 1187, 1194-
95 (9th Cir. 2013).
56 Id. at 1195.
57 Id. at 1195-96 (citing Western States, 407 F.3d at 995-1002).
58 Id. at 1196.
11

the California transportation contracting industry.”59 Second, the court found that
Caltrans’s program was limited only to those groups actually identified in the disparity
study as having experienced discrimination: African Americans, Native Americans,
Asian Pacific Americans, and women.60 Accordingly, the court concluded that the
program was narrowly tailored to benefit only those groups that had actually suffered
discrimination in the relevant contracting market.
v. 	Geyer Signal, Inc. v. Minnesota Department of Transportation,
No. 11-321 (JRT/LIB), 2014 WL 1309092 (D. Minn. Mar. 31,
2014).
Geyer Signal, a White male-owned signage contractor in Minnesota, filed a
complaint challenging the constitutionality of the state’s DBE program. The complaint
also challenged the constitutionality of the USDOT regulations regarding DBE programs
as Minnesota’s DBE program follows those regulations.61 The United States intervened
in order to defend the USDOT regulations.62 The court granted summary judgment in
favor of both the United States and Minnesota. In June 2014, plaintiffs abandoned a
pending appeal in the Seventh Circuit.
vi. 	Geod Corporation v. New Jersey Transit Corporation, 678 F.
Supp. 2d 276 (D.N.J. 2009), and 746 F. Supp. 2d 642 (D.N.J.
2010).
GEOD, a White male-owned corporation that specializes in surveying,
topographic mapping, and photogrammetry, challenged the New Jersey Transit
Corporation’s (NJT) DBE program on constitutional grounds. In ruling on the parties’
cross-motions for summary judgment, the district court followed numerous other courts
in determining that NJT did not need to independently establish a compelling interest
because states inherit the federal government’s compelling interest in enacting the
legislation.63 The parties disputed the appropriate standard for determining whether the
program was narrowly tailored. Plaintiff relied on the Ninth Circuit’s decision in
Western States to assert that its as-applied challenge to the constitutionality of the DBE
program required NJT to demonstrate that the program is narrowly tailored.64
Defendants relied on the Seventh Circuit’s decision in Northern Contracting to contend
that the program was narrowly tailored as long as it complied with the requirements of
the federal program.65 While the parties presented these two approaches as a circuit
split, the court seemingly disagreed, stating that each case involved “considerably the
same analysis,” because determining whether a state’s DBE program complies with the
federal program requirements involves much the same considerations as the narrow
59 Id.
60 Id. at 1198-99.
61 Geyer Signal, Inc. v. Minn. Dep’t of Transp., No. 11-321 (JRT/LIB), 2014 WL 1309092 (D. Minn. Mar.
31, 2014).
62 Id.
63 Geod Corp. v. N.J. Transit Corp., 678 F. Supp. 2d 276, 282 (D.N.J. 2009).
64 Id.
65 Id.
12

tailoring analysis.66 Ultimately, the court found that a genuine issue of material fact
remained concerning whether the method NJT used to determine its DBE goal was
sufficiently narrowly tailored.67
Following a bench trial, the court upheld the constitutionality of the program.
The court first clarified that it agreed with the Seventh Circuit’s holding in Northern
Contracting that “a challenge to a state’s application of a federally mandated program
must be limited to the question of whether the state exceeded its authority.”68 After
reviewing the steps NJT undertook to set its DBE goals, the court ruled that NJT’s DBE
program was sufficiently narrowly tailored because it did not exceed the authority
granted by the federal statute.69 The court also found that even under the as-applied
narrow tailoring test set forth in Western States, the program was still constitutional as
it was narrowly tailored to further a compelling governmental interest.70
3. Challenges to Race- and Gender-Conscious COVID-related
Relief Efforts
In early 2021, Congress enacted the American Rescue Plan Act of 2021 (“ARPA”),
which included several race- and gender-conscious relief plans to assist minority-,
female-, and veteran-owned businesses in the restaurant and agricultural industries.
Some of the programs prioritize socially and economically disadvantaged individuals for
certain pandemic relief, in some cases adopting the SBA’s definition of social and
economic disadvantage.71 A number of constitutional challenges to the race- and gender-
conscious provisions in the ARPA followed. These lawsuits fall into two main groups:
those challenging a debt relief program for socially disadvantaged farmers and
ranchers,72 and those challenging an emergency grant fund’s 21-day prioritization of
restaurants owned by socially and economically disadvantaged individuals.73
66 Id. at 282-83.
67 Id. at 284.
68 Geod Corp. v. N.J. Transit Corp., 746 F. Supp. 2d 642, 652 (D.N.J. 2010).
69 Id. at 954-55.
70 Id. at 656-57.
71 American Rescue Plan Act of 2021, Pub. L. No. 117-2, § 5003(c)(3)(A) (adopting the Small Business
Act’s definition of social and economic disadvantage for the purpose of prioritizing applications for
restaurant relief grants); see also, ARPA § 1005(a) (providing debt relief for socially disadvantaged
farmers and ranchers); § 1006(b)(1)-(2), (5) (establishing educational training and providing grants,
loans, and financial assistance to socially disadvantaged farmers); § 3206(c)(2) (prioritizing a portion of a
homeowner assistance fund for socially disadvantaged individuals); § 3301(b), (d), (f) (distributing funds
to the states to help small businesses owned and controlled by socially and economically disadvantaged
individuals).
72 APRA § 1005(a). See, e.g., Miller v. Vilsack, No. 4:21-cv-595 (N.D. Tex. filed Apr. 26, 2021); Faust v.
Vilsack, No. 1:21-cv-548 (E.D. Wis. filed Apr. 29, 2021); Wynn v. Vilsack, No. 3:21-cv-514 (M.D. Fla. filed
May 18, 2021); Carpenter v. Vilsack, No. 0:21-cv-103 (D. Wyo. filed May 24, 2021); Holman v. Vilsack,
No. 1:21-cv-1085 (W.D. Tenn. filed June 2, 2021).
73 ARPA § 5003(c)(3)(A). See Vitolo v. Guzman, 999 F.3d 353 (6th Cir. 2021); Blessed Cajuns v. Guzman,
No. 21-cv-00677-O (N.D. Tex. filed May 23, 2021).
13

One challenge to the emergency relief fund for restaurants, Vitolo v. Guzman,
999 F.3d 353, 357 (6th Cir. 2021), was filed by a bar and grill equally co-owned by
Antonio Vitolo, who is White, and his wife, who is Hispanic. Their restaurant struggled
during the COVID-19 pandemic, and they applied for relief from the Restaurant
Revitalization Fund (“RRF”) the first day the SBA accepted applications.74 Congress
directed the SBA to process applications and distribute the funds on a first come, first
served basis, with the exception of a 21-day priority applicant period for restaurants that
are at least 51 percent owned and controlled by women, veterans, or the “socially and
economically disadvantaged,” as defined by the SBA.75 Non-priority restaurants would
not receive a grant until the 21-day period ended, if any funds remained.76 Vitolo and his
restaurant sued the SBA, claiming that the race- and sex-based preferences in the RRF’s
21-day priority period violated his constitutional rights under the Equal Protection
Clause, and requested a temporary restraining order and a preliminary injunction.77
While the United States District Court for the Eastern District of Tennessee
denied the plaintiff’s motion for a temporary restraining order and a preliminary
injunction,78 the Sixth Circuit granted an emergency motion for an injunction pending
appeal, enjoining the SBA from relying on the regulatory presumption that certain racial
and ethnic groups are socially disadvantaged and from using any race-based criteria to
evaluate social disadvantage in the distribution of RRF grants.79 It directed the SBA to
“fund the plaintiffs’ grant application, if approved, before all after-filed applications,
without regard to processing time or the applicants’ race or sex.”80 The court held that
Vitolo had standing even though he might not otherwise qualify for priority
consideration without the use of race-conscious preferences and that even though the
21-day period had expired, the claim was not moot because the SBA had not yet paid out
any funds.81
The court held that the government likely failed to demonstrate a compelling
interest in targeting restaurants owned by socially and economically disadvantaged
individuals for relief assistance because: (1) the government pointed only to societal
discrimination against business owners, not to any specific instances of discrimination;
(2) the government’s statistical evidence of past discrimination against the groups
protected by the presumption was “not nearly enough” to support an inference of
intentional discrimination; and (3) a congressional hearing identifying a “theme” that
minority-owned businesses required targeted relief assistance because prior pandemic
74 Vitolo, 999 F.3d at 357. The $28.6 billion RRF was created by the ARPA to help small, private
restaurant owners meet payroll and other expenses. ARPA, Pub. L. No. 117-2, § 5003(b)(2)(A).
75 ARPA §§ 5003(c)(1)-(3)(A).
76 Id. See Vitolo, 999 F.3d at 357.
77 Vitolo, 999 F.3d at 358.
78 Vitolo v. Guzman, No. 3:21-cv-176, 2021 WL 2132106 (E.D. Tenn. May 25, 2021).
79 Vitolo, 999 F.3d at 365.
80 Id. at 366.
81 Id. at 358-59.
14

programs failed to reach them was not enough to show that the government participated
in the discrimination it sought to remedy.82
Even if the government had shown a compelling interest, the court held that the
RRF likely was not narrowly tailored because: (1) there were a number of race-neutral
alternatives relying on economic rather than racial indicators; (2) the vastly different
evidentiary burdens on those who are eligible for the racial presumption and those who
are not render the program underinclusive; and (3) the regulation’s “racial
gerrymandering”—presuming that some ethnicities are socially disadvantaged, and not
others—makes the program overbroad.83
The court also held that the RRF’s prioritization of women-owned businesses did
not survive intermediate scrutiny because the government failed to show that (1) the
sex-based classification serves an important governmental objective, and (2) the
classification is substantially related to that objective.84 The government’s statistics were
insufficient to show actual evidence of discrimination, and the RRF prioritized all
women-owned restaurants, not just those who were economically disadvantaged.85
The USDA loan forgiveness program for socially and economically disadvantaged
farmers has received a similar reception in a number of federal court cases. For
example, a Wisconsin district court issued a temporary restraining order halting the
program’s implementation, finding that the program “purportedly intended to provide
economic relief to disadvantaged individuals without actually considering the financial
circumstances of the applicant.”86 Subsequently, a Florida district court issued a
nationwide preliminary injunction, temporarily halting enforcement of the program.87
These and other equal protection challenges to the race-conscious aspects of the USDA’s
loan forgiveness program remain pending as of the publication of this report, and the
government is continuing to defend the program on the merits.
4. Challenges to State and Local Disadvantaged Business
Enterprise Programs
Some states have implemented programs to promote the use of DBEs, minority
business enterprises (MBEs), and/or women’s business enterprises (WBEs) in state-
funded contracts. Since these contracts are not federally funded, states are not required
to adhere to the federal government’s mandate requiring states to implement a DBE
program. Thus, even though a state program may mirror the federal DBE program, the
state does not inherit the federal government’s compelling interest. Instead, the state
must prove that it has its own compelling interest in remedying discrimination in
contracting within the state.
82 Id. at 361-62.
83 Id. at 362-64.
84 Id. at 364-65.
85 Id. at 365. As of July 19, 2021, the case remains pending in district court.
86 Faust v. Vilsack, 519 F. Supp. 3d 470, 476 (E.D. Wis. 2021).
87 Wynn v. Vilsack, --- F. Supp. 2d ---, 2021 WL 2580678 (M.D. Fla June 23, 2021).
15

In a recent circuit court decision involving such a challenge, the plaintiff, a prime
contractor in North Carolina who was denied a contract on a state-funded construction
project for failing to demonstrate “good faith efforts” to satisfy participation goals for
minority- and women-owned subcontractors, alleged that North Carolina’s participation
goals violated its equal protection rights.88 After the district court found the program
constitutional both on its face and as applied, the plaintiff appealed. Since North
Carolina DOT’s DBE program applied to state-funded, not federally funded, contracts,
the state did not inherit the government’s compelling interest.89 North Carolina had
commissioned a consulting firm to conduct a disparity study every few years regarding
the state’s transportation construction industry. Relying heavily on these studies, the
Fourth Circuit concluded that there was a strong basis in evidence of discrimination in
North Carolina against Black and Native American subcontractors, and finding the
program narrowly tailored, it upheld it both on its face and as applied to these two
groups.90 However, the Court found that the evidence did not justify application of the
program to female, Asian American, and Hispanic subcontractors, and thus held that
the statute was unconstitutional as applied to those groups.91
II. 	There are Identified Disparities in Government Contracting between
Minority- and Women-Owned Businesses and Their Non-Minority,
Male-Owned Counterparts
Following the Croson decision, in which the Supreme Court articulated the type
of evidence necessary to support the use of race-conscious measures in contracting
programs, state and local governments began commissioning disparity studies to
determine whether evidence of racial and gender discrimination existed in their
contracting markets sufficient to justify race- and gender-conscious remedial action.
While disparity studies vary in approach, the central component of most disparity
studies is a comparison between the availability of minority- and women-owned
businesses as a percentage of businesses operating in distinct categories of a particular
contracting market and the utilization of such businesses by the spending authority as
defined by the percentage of dollars that goes to those firms. Simply put, dividing
utilization percentage by availability percentage results in a disparity index. A disparity
index of 100 indicates that the utilization of a particular category of businesses is
equivalent to the availability of those businesses in the relevant market. For example, if
25% of the construction firms in a particular geographic area were women-owned, and
25% of the spending authority’s construction contracting was spent with women-owned
businesses, that would yield a disparity index of 100. As a general rule of thumb, a
88 H.B. Rowe Co. v. Tippett, 615 F.3d 233 (4th Cir. 2010).
89 Id.
90 Id. at 257.
91 Id. at 245, 258 (noting that the study found that female subcontractors were overutilized during the
study period and that underutilization of Hispanic American and Asian American subcontractors was not
statistically significant).
16

disparity index of less than .80, or 80 for those studies that multiply the disparity index
by 100, indicates a substantial disparity.92
The Department of Justice’s 2010 report reviewed approximately 70 disparity
studies, which showed that “‘minority-owned businesses and women-owned businesses
throughout the nation continue to face large disparities in almost every aspect of
business enterprise activity that can be quantified’ in a pattern of discriminatory
barriers that is repeated across the nation.”93 Since then, over 200 disparity studies have
been published. A review of these studies shows that the “needle has not moved.”94
Disparity studies continue to identify substantial disparities between the availability of
minority- and women-owned businesses and the utilization of such businesses in state
and local government procurement. Overwhelmingly, the studies also present evidence
linking such disparities to discriminatory factors. A list of 189 of these recent studies
from state and local jurisdictions in 34 different states and the District of Columbia is
attached as Appendix B.
In a 2016 report, the U.S. Department of Commerce’s Minority Business
Development Agency conducted a comprehensive review of 100 publicly available
disparity studies, summaries, and reports, focusing on studies conducted in the prior
ten years (hereinafter, “2016 MBDA Report”).95 The 2016 MBDA Report found that the
studies “indicated significant contracting disparities for minority business enterprises
(MBEs), pervasive across different ethnic and racial groups, industries, and
geographies.”96 Over 78% of the observed disparity ratios fell below the 80% threshold
signifying a “substantial” disparity. The median value for the observed disparities was
just 19%, indicating that minority businesses were being utilized at less than one-fifth of
their availability in a given marketplace. The report concluded that “these results
indicate that contracting disparities for MBEs are pervasive.”97
Disparity studies published since the 2016 MBDA Report continue to show
substantial and pervasive disparities. For example, a 2019 disparity study commissioned
by the City of Indianapolis and Marion County found that the participation of minority-
and women-owned businesses in contracts the city awarded from 2014-2018 was
substantially lower than what one would expect based on the availability of those
businesses for that work, with a disparity index of 76.98 This means that “minority- and
woman-owned businesses received approximately $0.76 for every dollar that they might
92 Uniform Guidelines on Employee Selection Procedures, 29 C.F.R. § 1607.4 (D); Connecticut v. Teal,
457 U.S. 440, 443 n.4 (1982).
93 Compelling Interest for Race- and Gender-Conscious Federal Contracting Programs: An Update to
the May 23, 1996 Review of Barriers for Minority- and Women-Owned Businesses 10 (2010) (quoting
The Department of Transportation’s Disadvantaged Business Enterprise Program: Hearing Before the
H. Comm. on Transp. and Infrastructure, 111th Cong. 326 (2009) (statement of Jon Wainwright, Vice
President, NERA Economic Consulting)).
94 U.S. Dep’t of Com., Minority Bus. Dev. Agency, Contracting Barriers and Factors Affecting Minority
Business Enterprises: A Review of Existing Disparity Studies (2016) (hereinafter, “2016 MBDA Report”).
95 2016 MBDA Report, at 70.
96 Id. at 69.
97 Id. at vi.
98 BBC Rsch. & Consulting, City of Indianapolis and Marion County Disparity Study 15 (2019).
17

be expected to receive based on their availability for the relevant prime contracts and
subcontracts that the City awarded during the study period.”99 A 2018 disparity study
prepared for the City of New York found even greater disparities. Analysis of disparities
across all procurement categories revealed a disparity index of 20.43% for minority- and
women-owned businesses.100 The study further found that this “quantitatively
significant disparity” was corroborated by qualitative evidence of “barriers that
M/WBEs face in participating in the City’s procurement process.”101
A 2021 disparity study report prepared for the California Department of
Transportation (“Caltrans”) found that women- and minority-owned businesses were
substantially underutilized, receiving only 20.3 percent of Caltrans contracts despite
being available to perform 27.6 percent of the construction and professional services
contracts funded by USDOT.102 This disparity persists despite the fact that all Caltrans
construction and professional services contracts funded by USDOT are subject to race-
and gender-conscious subcontracting programs. In contrast, Caltrans’ state-funded
projects do not use race- or gender-conscious measures. In those projects, women- and
minority-owned business participation lags at a meager 10.8 percent despite an
availability of 23.4 percent.103 The resulting disparity index is 46, meaning that
W/MBEs received $.46 of every dollar they should have expected to receive based on
their availability to perform state-funded construction and professional services
contracts.104 The systemic barriers to the marketplace that cause these disparities are
rooted in discriminatory systems. By way of example, the report cited that the average
business loan approved for W/MBEs in the Pacific region was $289,131, whereas, for
non-Hispanic White men it was $455,636.105
Similarly, the Commonwealth of Virginia’s 2020 disparity study found that the
overall availability of minority- and women-owned businesses in construction,
professional services, and goods and other services was 32.8 percent.106 However,
minority- and women-owned businesses received only 13.4 percent of the relevant
contract and procurement dollars that the Commonwealth awarded during the study
period (2014-2019).107 As a result, the disparity index was 41, representing a significant
underutilization of minority- and women-owned businesses.108
These findings comport with other comprehensive reviews of disparity studies
and related statistical materials. For example, in a 2013 expert report prepared for
99 Id.
100 MGT Consulting Grp., City of New York Disparity Study 4-12 (May 2018).
101 Id. at 6-3.
102 BBC Rsch. & Consulting, California Department of Transportation Availability and Disparity Study
Report, ES 3 & 5 (2021).
103 Ibid.
104 Id. at ES-8
105 Id. at App’x C, Fig. C-16.
106 BBC Rsch & Consulting, Commonwealth of Virginia 2020 Disparity Study, ES-3 (2020).
107 Id. at ES-6.
108 Id. at ES-8.
18

litigation, Dr. Jon Wainwright, Senior Vice President of NERA Economic Consulting,
reviewed 107 disparity studies conducted since 2000 covering 142 public contracting
entities in 35 states encompassing 89% of the national population. Dr. Wainwright
concluded that “these materials contain significant evidence of large and adverse
disparities facing minority business enterprises.”109 Dr. Wainwright further concluded
that the observed disparities “are consistent with the presence of discrimination and its
lingering effects in the small business contracting environment.”110
While the evidence indicates that the barriers that have impeded the growth and
success of minority- and women-owned businesses continue to exist, the evidence also
shows that government contracting preference programs ameliorate the effects of public
and private discrimination. For example, a 2017 disparity study prepared for the Los
Angeles County Metropolitan Transportation Authority compared the participation of
minority- and women-owned business on contracts that contained goals to encourage
utilization of minority- and women-owned businesses as opposed to contracts that did
not contain such goals.111 The results showed that on contracts without goals, minority-
and women-owned firms earned only 53 cents on the dollar, but on contracts with goals,
such firms earned 96 cents on the dollar—almost what would be expected given the
availability of such firms in the marketplace.112
The presence of substantial disparities does not in itself indicate that
discrimination is the cause of the observed disparities. Researchers use both
quantitative and qualitative methods to examine the causes of disparities in public
contracting. One method includes testing the results for statistical significance, which
helps to determine whether the observed disparities could be due to random chance
alone. The 2016 MBDA Report found that the majority of substantial disparities
observed were “statistically significant at high levels, such that disparity study
consultants could reject chance as a prime driver of contracting disparities.”113
Another quantitative method used to identify the underlying causes of the
observed disparities is regression analysis. Regression analysis is a statistical technique
that allows for the “comparison between certain business outcomes, such as business
formation, business earnings, or loan denials, and minority status, while holding other,
potentially non-discriminatory factors, such as geographic location, industry affiliation,
109 Jon Wainwright, Report of Defendant’s Expert, submitted in Rothe Dev., Inc. v. Dep’t of Def., No. 12-
CV-744 (D.D.C.) (2013), at 1 (“Wainwright Report”).
110 Id. at 21, 25-35 (Table 5), 36-54.
111 BBC Rsch. & Consulting, 2017 LA Metro Disparity Study 7-7 (2018).
112 See also BBC Rsch. & Consulting, Pennsylvania Department of Transportation Disparity Study, ES-8-
9 (2018) (noting that PennDOT’s use of DBE contract goals during the study period applied most directly
to MWBE participation in subcontracts rather than on prime contracts and found that MWBEs showed a
substantial disparity for prime contracts (75) but not for subcontracts); BBC Rsch. & Consulting, City of
Charlotte Disparity Study, ES-5 (2017) (MWBEs, considered together, showed higher participation in
goals contracts—18.3%—than in no-goals contracts—11.3%); BBC Rsch.& Consulting, Illinois Department
of Transportation Disparity Study, ES-8 (2017) (MWBEs considered together showed a substantial
disparity of 34 for prime contracts, which do not include goals, but do not show a disparity for
subcontracts, which do use goals).
113 2016 MBDA Report, at 69.
19

education, age, or balance sheets, constant.”114 This allows researchers to investigate
various factors in private-sector marketplace discrimination, such as disparities in
business formation, business earnings, and access to capital, and whether these
contribute to observed contracting disparities.115 The 2016 MBDA report determined
through these regression analyses that “the majority of the studies in the set that utilized
quantitative data on marketplace discrimination found that minorities and minority
business enterprises: “[e]arned significantly lower wages than similarly situated non-
minority male counterparts in relevant markets; [h]ad significantly lower business
earnings than similarly situated non-MBEs in relevant markets; [h]ad lower rates of
business formation than non-minority males; [w]ere more likely to be denied
commercial or personal loans than similarly situated non-minority males or non-MBEs;
and [h]ad lower revenues and market shares than similarly situated non-MBEs.”116
Analyses of such private-sector disparities is important because the Supreme Court has
found that governments have a compelling interest in not being a passive participant in
private discrimination.117
Disparity studies also analyze qualitative evidence to identify and explain what
factors lead to the contracting disparities observed through statistical evidence.
Certainly, there are some challenges that all businesses face regardless of the identity of
the business owner. Yet the 2016 MBDA Report also identifies discriminatory factors
that lead to the observed disparities, including overt prejudicial treatment and exclusion
based on race and systemic discrimination in the public and private marketplace. Key
discriminatory barriers identified include “[a]gency and prime contractors employing
capability stereotypes, double or higher standards, and manipulating bid processes
based on prejudicial factors unrelated to business performance; also systemic
discrimination against MBEs related to key market-based issues including access to
capital.”118 Each of these will be discussed in more detail below.
In addition to the substantial body of evidence showing disparities in state and
local contracting, the evidence shows that substantial disparities are also present in
federal contracting. In 2017, just 9.8% of federal spending on contracts went to
minority-owned businesses.119 The same year, woman-owned businesses received only
5% of federal prime contract awards.120 In a 2012 expert report prepared for litigation,
Dr. Robert N. Rubinovitz, the Deputy Chief Economist in the Economics and Statistics
Administration at the Department of Commerce, conducted regression analyses
comparing the likelihood of minority-owned businesses winning federal prime contracts
114 Wainwright Report, at 64 n. 69.
115 2016 MBDA Report at vii.
116 Id. at 44-45.
117 Croson, 488 U.S. at 492.
118 Id. at 69.
119 Megan Janetsky, Ctr. for Responsive Politics, Women- and minority-owned businesses receive only a
small fraction of federal contracts, Apr. 13, 2018, https://www.opensecrets.org/news/2018/04/women-
owned-biz-receive-fraction-of-fed-contracts/.
120 Strengthening the Entrepreneurial Ecosystem for Women: Hearing Before the S. Comm. on Small
Business and Entrepreneurship, 115th Cong. 29 (2017) (opening statement from Sen. Shaheen).
20

when compared to majority-owned businesses of similar size in the same industry.121 Dr.
Rubinovitz analyzed data on government contracts for small businesses for Fiscal Year
2012 and found consistent, statistically significant underutilization of small, minority-
owned businesses in federal prime contracting. Dr. Rubinovitz conducted regression
analyses to control for factors other than race that might contribute to differences in the
success of minority-owned firms in winning contracts compared to non-minority-owned
firms. Specifically, Dr. Rubinovitz’s regression analyses controlled for the industry in
which the firm did business, business age, business size (both in terms of average
number of employees and annual receipts), business form, and security clearance, and
compared the likelihood of minority-owned businesses receiving a federal contract
versus similar businesses.122 The analysis showed that in the vast majority of industries,
minority-owned businesses remained less likely to win a federal contract, usually to a
statistically significant degree.123
III. 	Discrimination Limits Access to Contracting Markets
The statistical evidence discussed in the prior section is bolstered by qualitative
evidence that shows the various ways discrimination hinders the ability of minority- and
women-owned businesses to compete equitably for government contracts. While this
discrimination can take many forms, three primary obstacles are: (1) discrimination by
procurement agencies and prime contractors, (2) exclusion from business networks, and
(3) discrimination by bonding companies and suppliers.
A. 	Discrimination By Procurement Agencies and Prime
Contractors Creates Obstacles for Minority- and Women-Owned
Businesses
As the 2016 MBDA Report found, “[t]he most obvious barriers arising due to
discrimination lie in actions by procurement agencies and non-MBE prime contractors
(when considering MBE subcontractors) to purposely exclude or hinder MBE
participation.”124 The report identified these barriers as including “outright prejudicial
treatment, attitudes, stereotypes, implementing higher and double standards for MBEs,
or manipulating the bid process.”125
Unfortunately, recent studies and reports show that the prejudicial treatment and
discriminatory attitudes discussed in the Department of Justice’s 1996 and 2010 reports
persist. The 2016 MBDA Report found that “instances of outright discrimination
permeated” the reviewed disparity studies across industries, geographic areas, and all
ethnic, racial, and gender groups.126 Studies published since the 2016 MBDA Report
show the same. In a 2018 disparity study commissioned by the City of New Orleans, a
121 Robert N. Rubinovitz, Report of Defendants’ Expert, submitted in Rothe Dev., Inc. v. Dep’t of Def., No.
12-cv-0744 (KBJ) (2012) (“Rubinovitz Report”).
122 Id. at 10-11.
123 Id. at 11-12.
124 2016 MBDA Report, at 54.
125 Id.
126 Id. at 63-64.
21

business owner reported an instance of a federal agency revoking his contract once it
was discovered he was a minority, directly saying to him that they did not want an “‘n-
word’ to have the job.”127 The same study noted that “[o]ther interviewees reported
hearing racial slurs and gender-based insults used against minority and female business
owners.”128 In a 2015 study conducted in Arizona, a Black business owner explained: “I
have seen everything from looks to gestures, hearing the ‘n-word’ and different things
from Hispanics to whites. . . . Getting your truck sprayed, different things like tearing
checks open [to] see what you make, or you are blocked off a job because you are the
only woman or African American out there.’”129 In Nevada, an Asian-American female
representing a woman-focused organization said, “It is still very difficult for women
business owners to get contracts, especially in construction. I don’t want to say it is a
man’s world, but it is here [in Las Vegas]. When I go out and do site visits for our
WBE’s, they are still having difficulty accessing the contract that they need. Not so much
with the smaller contracts like $25,000 or under, but beyond that, they still struggle.”
She shared an experience from a WBE who believes she lost the bid on an
environmental project in her county to an out-of-state contractor because she was a
woman-owned business.”130
Some minority and female business owners report dealing with assumptions by
prime contractors that they are a worker and not the business owner of a subcontracting
firm. This evidence could demonstrate that the under-utilization of minority and
women-owned subcontracting firms in a particular market place was due to
discrimination. For example, “[t]he vice president of a DBE‐certified Black American
engineering firm said that he was on a job where they had to go inside a sewer and he
saw a worker point at him and overheard him say, ‘Send that boy down there.’”131 In
another study, the vice president, non-owner of a minority-owned contracting business
stated that “it is often assumed that the business owner (a minority) works for him (a
non-minority).”132 A minority business owner even went so far as to change his company
name and to hire a non-Hispanic White engineer to be his employee manager, and he
noticed that “we started to get quite a few prime jobs in the rural areas. . . . So that tell[s]
me something.”133
127 Keen Indep. Rsch. LLC, City of New Orleans Disparity Study Appendix J-37 (2018).
128 Id.
129 Keen Indep. Rsch. LLC, Arizona Department of Transportation Disparity Study Report Appendix J-
66 (2015).
130 BBC Rsch. & Consulting, 2017 Nevada Transportation Consortium Disparity Study Appendix D-54
(2017).
131 BBC Rsch. & Consulting, 2014 Imperial County, CA Transportation Disparity Study Appendix D-54
Appendix J-69 (2014). In the same study, a Hispanic female who is part-owner of a towing company
reports not only her own issues with proving she is a business owner, but also that her husband faces the
same issues, explaining, “nobody believes him, that he’s an owner. . . . They just say, ‘You’re just a driver
[or] you’re just a worker.’” Id.
132 Keen Indep. Rsch., LLC, Arizona Department of Transportation Disparity Study Report Appendix J-
65 (2015).
133 BBC Rsch. & Consulting, Caltrans 2016 Disparity Study Appendix D-128 (2016).
22

The 2016 MBDA Report also found that the studies reviewed “support the
presence of double or higher standards for minority-owned businesses.”134 In one study,
a minority male business owner reported that “[s]ome City managers will require me as
a minority-owned business to do work that was not required of others doing similar
work. . . . I have seen other jobs where the work was not nearly as professional as mine
but they did not have to redo it.”135 In a 2018 study conducted in Maryland, a business
owner stated that “we’ve seen situations where a majority contractor or a White firm
would do the same thing, and a lot of times what happens, it’s an accident. With a
minority firm . . . it happened because you didn’t manage it properly, you didn’t look far
enough ahead, you didn’t anticipate.”136
Other barriers occur through manipulation of bid processes, such as bid shopping
and held bids, or “bait and switch” practices. Some of these practices can affect all
businesses to some extent, but the 2016 MBDA Report found a “strong discriminatory
pattern” associated with certain process-related barriers.137
The Department of Justice’s 2010 report described the practice known as “bait
and switch,” in which a prime contractor commits to using a minority- or woman-owned
business to meet a race- or gender-conscious goal for subcontractors, but never gives the
minority- or woman-owned business the promised work. Recent disparity studies have
documented that this practice continues. For example, in a 2018 study conducted in
Pennsylvania, a Black female owner of a professional services firm stated: “I have been
approached and included on contracts and never gotten an order. . . . There have been
several times when I have been put on the contract as a subcontractor and never heard
another word.”138 Similarly, a 2019 study in Florida reported that an “African American
professional services firm stated there is no accountability for primes utilizing MWBE
firms. Primes get work and submit names of MWBE subs but do not use the subs named
in their proposals.”139
Bid shopping is another practice frequently cited in disparity studies as
presenting barriers to minority- and woman-owned businesses. Bid shopping occurs
when a prime contractor solicits a bid from a minority- or woman-owned business, but
instead of selecting them as a subcontractor, the prime uses the bid to get lower bids
from non-minority- and male-owned firms. For example, a minority business owner in
134 2016 MBDA Report, at 65.
135 Id. at 66 (quoting Mason Tillman Assoc., Ltd., City of Cincinnati Disparity Study 10-6 (2015)).
136 NERA Econ. Consulting, Disadvantaged Business Enterprise Disparity Study: Volume I (prepared for
the Maryland Department of Transportation) 275 (2018).
137 2016 MBDA Report, at 60.
138 BBC Rsch. & Consulting, Commonwealth of Pennsylvania Department of General Services 2018
Disparity Study Appendix D-100 (2018).
139 MGT Consulting Group, City of Tallahassee, Leon County, and Blueprint 2019 Disparity Study 7-10
(2019); see also Keen Indep. Rsch. LLC, Arizona Department of Transportation 2020 Disparity Study J-
59 (2020) (listing examples of minority-owned firms being used in “bait and switch” bidding and
contracting processes).
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Indiana noted that after faxing in his bids, the prime contractor would “use our bid with
another contractor to get a lower bid.”140
B. 	Exclusion From Business Networks Limits Opportunities
Often referred to as the “good ol’ boy” network, the lack of access to business
networks is a barrier identified in almost all disparity studies. The 2016 MBDA Report
identified networking barriers as the most frequently cited barrier, with 86% of
minority- and women-owned businesses identifying exclusionary networks as a barrier
to obtaining contracts. In one recent study, the Black owner of a construction firm
reported that “general contractors would tell him that his subcontracting bid was too
high but then he would later find out that the winning subcontracting bid was even
higher than his bid, but was accepted because ‘[t]hey knew the guy. [The general
contractor] had a working relationship with them.’”141
Exclusionary networks also can result in a lack of transparency, precluding some
businesses from even hearing about opportunities. In a recent study conducted in North
Carolina, the Black male owner of a minority-owned and veteran‐certified professional
services firm stated, “It is [a barrier]. No notification. If you’re not a part of the good old
boy network, you’ll never know about it. It’s not open and transparent.”142 Some
treatment is more blatantly discriminatory. In a 2017 disparity study conducted for
Palm Beach County, a female business owner noted: “My industry is the good old boys. I
am called ‘Girlie,’ even though I’m over 60. The construction industry is a male-
dominated White industry. If you are not in the club, you are ignored.”143
To be sure, some exclusion of minorities and women from business networks may
not be due to overt discrimination, but to the reality that people are comfortable
working with people who they know or already have experience working with. But
considering many of these longstanding business and social connections have developed
in environments that have historically excluded minorities and women, it is difficult to
ignore the discriminatory foundation for such networks. As a female owner of a
disadvantaged business-certified engineering and consulting firm noted when asked if
there is a good ol’ boy network: “It is huge—it definitely exists,” and she knows that she
is not going to get jobs that are discussed “while golfing at the country club or in the
locker room at the gym.”144 The Black co-owner of a professional services firm
commented that he is from the generation that “sat at the back of the bus” and that
some of his White peers are in charge now and still have that old mentality.145 The
140 Mason Tillman Assoc., Ltd., City of St. Louis Disparity Study Volume 1 8-6 (2015).
141 Keen Indep. Rsch. LLC, City of Baton Rouge, Parish of East Baton Rouge Disparity Study 4-15 (2019).
142 BBC Rsch. & Consulting, 2018 Disparity Study City of Asheville, North Carolina Appendix D-70
(2018).
143 Mason Tillman Assoc., Ltd., Palm Beach County Disparity Study Final Report 10-12 (2017).
144 Keen Indep. Rsch. LLC, 2016 Availability and Disparity Study (prepared for the Montana Department
of Transportation) 5-18 (2016).
145 Keen Indep. Rsch. LLC, Missouri Department of Transportation 2019 DBE Availability Study Final
Report Appendix F-47 (2019).
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existence of exclusionary networks supports the use of measures that encourage
agencies and businesses to go outside of their usual networks to expand opportunities.
C. 	Discrimination in Bonding and by Suppliers Burdens
Disadvantaged Firms
Most public contracting projects require a contractor to obtain a surety bond,
which financially guarantees the performance of the agreed upon work. Inability to meet
bonding requirements can be a challenge for any small business trying to break into the
marketplace, but numerous studies show that bonding requirements burden minority-
and women-owned businesses to an even greater degree. Barriers to meeting bonding
requirements not only inhibit the successful formation and growth of businesses, but
also place such businesses at a disadvantage in competing for contracts.
Both quantitative and qualitative evidence shows that bonding requirements
disproportionately affect businesses owned by women or people of color. The 2016
MBDA Report noted that 83% of minority- and women-owned businesses identified
bonding requirements as a specific barrier to the ability to obtain contracts.146 A number
of recent studies show that minority-owned firms are significantly more likely to face
difficulties in obtaining required bonds compared with majority-owned firms.147 In
some circumstances, minority- and women-owned businesses may even face double
standards related to bonding requirements. A Black specialty contractor relayed a
situation in which he was the low bidder for a contract and was required to provide
bonding. While he was acquiring a bond, he learned that another contractor received the
contract and was not required to have bonding on the project.148
Discriminatory barriers in the bonding market are closely related to the access to
capital issues discussed below in Section V. Not only do the same factors affect both
access to capital and access to bonding, but the inability to obtain adequate capital
contributes to a business’s ability to obtain bonding. In this way, even if contracts are
146 2016 MBDA Report, at 55.
147 BBC Rsch. & Consulting, City of Indianapolis and Marion County Disparity Study 9-4 (2019)
(concluding that minority- and women-owned businesses do not have the same access to certain business
inputs, including bonding, as businesses owned by non-Hispanic White men); Keen Indep. Rsch. LLC,
City of Baton Rouge, Parish of East Baton Rouge Disparity Study 4-10 (2019) (finding that among
construction firms that had tried to obtain a bond for a project, 31% of minority-owned firms had
difficulty obtaining the required bond compared with only 4% of majority-owned firms); Keen Indep.
Rsch. LLC, City of New Orleans Disparity Study 9 (2018) (reporting that minority-owned businesses
(42%) and women-owned businesses (21%) were much more likely than majority-owned firms (7%) to
indicate they had experienced difficulties trying to obtain a bond); BBC Rsch. & Consulting, Illinois
Department of Transportation Disparity Study 8-4 (2017) (finding that minority‐ and woman‐owned
businesses in Illinois do not have the same access to bonding and other business inputs as businesses
owned by non‐Hispanic White men); NERA Econ. Consulting, Business Disparities in the DCAMM
Construction and Design Market Area (prepared for the Commonwealth of Massachusetts Division of
Capital Asset Management and Maintenance) 15 (2017) (reporting that bonding requirements were
statistically significantly more difficult for minority- and women-owned business even when holding
constant factors such as business size and other characteristics related to business capacity).
148 MGT of America, Inc., Comprehensive Disparity Study for the City of Pensacola 7-12 (2012).
25

otherwise awarded on a race-and gender-neutral basis, public entities may still become
passive participants in private sector discrimination.
The Department of Justice’s 2010 report concluded that discrimination by
suppliers also limited minority- and women-owned businesses’ ability to compete. That
remains the case. For example, a recent disparity study commissioned by New Orleans
found that one-third of minority- and women-owned businesses reported experiencing
competitive disadvantages due to supplier pricing compared to only 15% of majority-
owned firms.149 In another study, a minority female owner of an architecture and
engineering company reported that “it’s very well-known that suppliers have two to
three tiers of pricing structures based on relationships where certain contractors get
preferred pricing with our supplier. We can’t be competitive on bids if someone else can
rent the same equipment for $50 a day and I get charged $75 a day.”150 Discriminatory
pricing by suppliers creates a significant barrier for minority- and women-owned
businesses because they have to include those prices in their bid, resulting in a less
competitive bid.
IV. 	There Are Significant Disparities in Business Formation and Success
Between Minority- and Women-Owned Businesses Relative to Their
Non-Minority, Male-Owned Counterparts
As was discussed in the Department of Justice’s 2010 report, minority- and
women-owned businesses make up a disproportionately small share of small businesses.
Unfortunately, this remains true a decade later. Even though people of color constitute
40% of the U.S. population, they make up only 20% of the nation’s business owners.151
This disparity is even more stark for some racial and ethnic groups. The business
ownership rate among non-Latino Whites is 11%, but for Black Americans it is only 3%
and approximately 7% for Latinos.152 While 12.7% of White men own businesses, the
same is true of only 8.3% of Asian American women, 7.3% of White women, 6.9% of
Hispanic women, and 3.5% of Black women.153 Women-owned businesses represent
about 38% of all firms.154
It is not merely that minority- and women-owned businesses are less common
than businesses owned by White men; they are also less profitable. In 2012, the average
149 Keen Indep. Rsch. LLC, City of New Orleans Disparity Study Appendix H, 42 (2018).
150 Mason Tillman Assoc., Ltd., City of St. Louis Disparity Study Volume 1 8-4 (2015).
151 Promoting Inclusive Lending During the Pandemic: Community Development, Financial Institutions,
and Minority Depository Institutions, Hearing Before the H. Comm. on Financial Services, 116th Cong.
(2020).
152 Robert W. Fairlie, Latino Business Ownership: Contributions and Barriers for U.S.-born and
Immigrant Latino Entrepreneurs, produced under contract with the SBA, Office of Advocacy 6, 27
(2018).
153 Strengthening the Entrepreneurial Ecosystem for Minority Women: Hearing Before the S. Comm. on
Small Business and Entrepreneurship, 113th Cong. 105 (2013) (report by Robert W. Fairlie, Wealth
Inequality, Business Success, and Minority Women).
154 Strengthening the Entrepreneurial Ecosystem for Women: Hearing Before the S. Comm. on Small
Business and Entrepreneurship, 115th Cong. 16 (2017) (statement of Michelle Richards, Executive
Director, Great Lakes Women’s Business Council).
26

minority-owned firm generated gross receipts of $173,552, roughly one-third of the
average non-minority-owned firm gross receipts of $550,472.155 Certain minority groups
fare even worse. A Black-owned firm averages about $58,000 in sales per firm, while a
Hispanic-owned firm generates two and a half times this amount; an Asian American-
owned firm, six times as much; and a White-owned firm, over nine times this amount.156
Although African Americans own 9.5% of businesses, these businesses only account for
1.3% of sales.157 Hispanic-owned firms are 12.2% of businesses but only 4.0% of sales.158
Women-owned businesses earn less than male-owned firms, as they employ only 8% of
the nation’s private workforce and produce 4% of business revenues.159
The 2018 Small Business Credit Survey, an annual survey of over 6,000
businesses with fewer than 500 employees, found that:
 	Smaller shares of Asian American- (51%) and Black-owned businesses (46%)
were profitable at the end of 2017 compared to White-owned firms (55%).
 	A larger share of White-owned firms reported revenue growth (58%)
compared to Black-owned firms (49%).
 	A larger share of White-owned firms reported growth in the number of
employees (37%) compared to Black-owned firms (31%).
 	Minority-owned firms more frequently reported financial challenges. Seventy-
eight percent of Black-owned firms, and 69% of Asian American- and
Hispanic-owned firms did so, compared to 62% of White-owned
businesses.160
These disparities in sales, growth, and profitability make minority- and women-
owned businesses less stable and less able to withstand challenges. This has been made
even more apparent with the economic effects of the COVID-19 pandemic
disproportionately affecting minority- and women-owned businesses, as discussed
below in Section VI.
V. 	Discrimination Limiting Access to Capital Affects the Formation and
Development of Businesses Owned by Women or People of Color
Businesses owned by women or people of color have far less access to capital than
White male business owners, and this significantly limits their ability to establish and
grow their businesses and compete equally in the marketplace. Both statistical and
155 U.S. Dep’t of Com., Minority Bus. Dev. Agency, The State of Minority Business Enterprises, An
Overview of the 2012 Survey of Business Owners 2 (2018).
156 Id. at 10.
157 Id. at 17.
158 Id. at 18.
159 Strengthening the Entrepreneurial Ecosystem for Women: Hearing Before the S. Comm. on Small
Business and Entrepreneurship, 115th Cong. 2 (2017) (opening statement of Sen. Shaheen).
160 Fed. Rsrv. Bank of Atlanta, Small Business Credit Survey: Report on Minority-Owned Firms (Dec.
2019).
27

qualitative evidence show that minority and female business owners not only are denied
loans at a higher rate than White males, but when they are successful in obtaining loans,
they are for lower amounts and at less favorable terms and conditions. Because
minority- and women-owned businesses cannot access capital at the same cost as firms
owned by White males in the same marketplaces, they are at a competitive disadvantage
when bidding on government contracts where they must include these higher costs in
the price of their bid.161
A. 	The Wealth Gap Contributes to, and is Exacerbated By, Lack of
Access to Capital
One factor contributing to the lack of access to capital is the vast wealth gap
between Whites and minorities. The average wealth of White families in 2016 was seven
times the wealth of Black families and five times the wealth of Latino families (at the
median, White families have 10 times the wealth of Black families and eight times the
wealth of Latino families).162 This disparity has grown over time. In 1963, White families
had $121,000 more in wealth than Black families, on average; by 2016, they had over
$700,000 more.163 The disparity also grows with age. On average, White people in their
30s have $147,000 more in wealth than their Black counterparts. But by the time they
are in their 60s, White people have $1.1 million more in wealth than Black people, on
average.164 This wealth gap has grown in the last few decades. A 2019 McKinsey study
found that even adjusting for inflation the overall racial wealth gap between Black and
White families widened from about $100,000 in 1992 to $154,000 in 2016.165
Researchers at the Center for Global Policy Solutions suggested that in the recovery
period after the 2008 housing crisis, African Americans (45%), Asian Americans (48%)
and Latinos (58%) lost nearly half or more than half of their wealth compared to a 21%
loss among Whites.166 In 2017, Prosperity NOW and the Institute for Policy Studies
reported that 51% of households of color live in liquid asset poverty compared to 28% of
White households.167 Similar to minorities, “‘[w]omen start with less capital then
men.’”168 Minority women in particular have low levels of wealth relative to White men
161 See Rubinovitz Report, supra at 11 (showing a consistent, statistically significant underutilization of
small, minority-owned businesses in federal prime contracting); see also Robert Rubinovitz, Utilization of
Women-Owned Businesses in Federal Prime Contracting, Department of Commerce (Dec. 31, 2015)
(finding that the odds of winning a contract for Woman-Owned Businesses (WOBs) are estimated to be
roughly 21 percent lower relative to the odds of winning contracts by otherwise similar firms that were not
identified as WOBs).
162 Examining the Racial and Gender Wealth Gap in America: Hearing Before Subcomm. on Diversity
and Inclusion of the H. Comm. on Financial Services, 116th Cong. (2019) (testimony of Kilolo Kijakazi,
PhD, Urban Institute).
163 Id.
164 Id.
165 Id.
166 Id.
167 Id. “Liquid asset poverty” is defined as a status of a four-person household that maintains less than
three months’ worth of savings at any given time.
168 Strengthening the Entrepreneurial Ecosystem for Minority Women: Hearing Before the S. Comm. on
Small Business and Entrepreneurship, 113th Cong. 46 (2013) (quoting Women-Owned Businesses in the
21st Century, U.S. Department of Commerce Economics and Statistics Administration, for the White
28

and women.169 White men have a median net worth of $137,775, but the median net
worth is lower for all groups of women—$125,700 for White women, $106,084 for Asian
American women, $8,902 for Hispanic women, and $7,645 for Black women.170 While
32% of White men have startup capital of at least $10,000 when starting a business, the
same is true of only 17% of White women, 15% of Hispanic women, and 11% of Black
women.171
This wealth gap has a dramatic effect on the ability of minorities and women to
start their own businesses. Underrepresentation of Black business owners can be
attributed in large part to Black people having less of their own money to invest in firms
and less collateral to put toward a loan due to job, housing, and financing
discrimination. Black-owned businesses start with approximately a third less capital
than their White peers and have difficulties raising private investments from
mainstream investment systems.172 The situation for minority women, particularly Black
and Hispanic women, is especially dire, given that they have low levels of wealth relative
to White women and men. This results in less access to startup capital, lower levels of
business ownership, and smaller businesses when they are created.173
This wealth gap is the product, at least in part, of discrimination. Congress has
received testimony that Black wealth accumulation has undergone a sustained process
of asset underdevelopment “via an array of American programs and practices.”174 These
include:
 	federally sanctioned redlining, which reduced the credit available for Black
households, in turn limiting their ability to buy homes;
 	discriminatory access to homeownership subsidies in the New Deal
legislation;
 	denial of the benefits of the G.I. Bill to Black veterans, while White
households were able to rely on the G.I. Bill to build wealth;
 	racial zoning practices and tax policies; and
House Council on Women and Girls, October 2010); see also Disparities in Access to Capital: What the
Federal Government is Doing to Increase Support for Minority Owned Firms, Field Hearing Before the
H. Comm. on Small Business, 115th Cong. (2018); BBC Rsch. & Consulting, Illinois Department of
Transportation 2017 Disparity Study 3-6 (2017) (“Women have also faced consistent wage and income
gaps relative to men. Nationally, the median hourly wage of women is still only 84 percent the median
hourly wage of men.”).
169 Id. at 101 (report by Robert W. Fairlie, Wealth Inequality, Business Success, and Minority Women).
170 Id. at 102.
171 Id. at 104.
172 Andre Perry, Jonathan Rothwell, and David Harshbarger, Five-star reviews, one-star profits: The
devaluation of businesses in Black communities, Metropolitan Policy Program at Brookings (Feb. 2020).
173 Strengthening the Entrepreneurial Ecosystem for Minority Women: Hearing Before the S. Comm. on
Small Business and Entrepreneurship, 113th Cong. (2013).
174 How Invidious Discrimination Works and Hurts: An Examination of Lending Discrimination and Its
Long-term Economic Impacts on Borrowers of Color, Hearing before Subcomm. on Oversight and
Investigations of the H. Comm. on Financial Services, 117th Cong. (2021) (testimony of William Darity
Jr., Samuel DuBois Cook Professor of Public Policy, Duke University) (citations omitted).
29

 	the long-term effects of Jim Crow era state tax policies.175
B. 	Businesses Owned by Women and People of Color are
Significantly More Likely to Be Denied Access to Capital
Given that women and people of color who own businesses have less of their own
personal capital to contribute toward their small businesses, loans are especially critical
for them. Unfortunately, these business owners are also less likely than White male
business owners to be able to obtain loans. The wealth gap is a contributing factor to the
challenges that minority and female business owners face in obtaining capital. The
Director of Outreach at Goldman Sachs testified that women and minorities have lower
credit, which inhibits their ability to obtain capital, not because they lack moral
character or intend to default on loans, but rather for three other reasons: (1) customers
are late to pay them, (2) they lack accumulated assets/wealth, and (3) they have debt.176
The impact is significant: due to the historic barriers and private discrimination that has
limited the ability of minority business owners to accumulate assets and wealth,
minority-owned businesses are two to three times more likely to be denied credit, more
likely to avoid applying for loans based on the belief they will be turned down, and more
likely to receive smaller loans and pay higher interest rates on the loans they do
receive.177 Along the same lines, only 30% of businesses owned by women were able to
get bank loans in the first part of 2016, and women founders get only 7% of the venture
capital in this country.178 Women receive only 16% of conventional small business loans,
and only 4.4% of the total dollar value of loans from all sources.179
Disparity studies are replete with statistical evidence of disparities in access to
capital.180 For example, a 2017 disparity study conducted in Massachusetts concluded
175 Id.
176 Strengthening Access to Capital for Minority-Owned Small Business: Field Hearing Before the S.
Committee on Small Business and Entrepreneurship, 115th Cong. 58 (2018) (statement of Will Holmes,
Director of Outreach, Goldman Sachs).
177 Id.
178 Strengthening the Entrepreneurial Ecosystem for Women: Hearing Before the S. Comm. on Small
Business and Entrepreneurship, 115th Cong. 3-4 (2017) (statement of Elizabeth Gore).
179 Id. at 15 (statement of Michelle Richards, Executive Director, Great Lakes Women’s Business Council).
180 Keen Indep. Rsch. LLC, Arizona Department of Transportation Disparity Study Report 407 (2015)
(“There are statistically significant disparities in loan approval rates for African American-owned small
businesses compared with similarly-situated non-Hispanic white-owned firms.”); NERA Econ.
Consulting, Business Disparities in the San Antonio, Texas Market Area 9 (2015) (“When minority-
owned firms applied for a loan, their loan requests were substantially more likely to be denied than non-
minorities, even after accounting for differences in firm size and credit history.”); NERA Econ.
Consulting, Business Disparities in the Travis County, Texas Market Area 119 (2016) (“When minority-
owned firms applied for a loan, their loan requests were substantially more likely to be denied than non-
minorities, even after accounting for differences in firm size and credit history.”); id. at 135 (“African
American-owned firms are 24 percentage points more likely than nonminority male-owned firms to have
their loan application denied . . . .”); MGT of America, Inc., City of Hampton and Hampton Schools
Historical M/WBE Utilization Disparity Study E-10 (2014) (“About 1.3 percent of non-M/WBE loan
applicants reported being denied commercial bank loans, as compared to 36.3 percent of African
American applicants and 4.5 percent of nonminority woman applicants.”); MGT of America, Inc.,
Comprehensive Disparity Study for the City of Pensacola 8-5, 8-6 (2012) (“About 3.7 percent of non-
30

“that there is evidence of discrimination against M/WBEs in the DCAMM market area
in the small business credit market” and that “[t]his discrimination is particularly acute
for African American-owned small businesses where, even after adjusting for differences
in assets, liabilities, and creditworthiness, the loan denial rates remain substantially
higher than for nonminority male-owned small businesses.”181 Another study, conducted
in Washington State, analyzed data in the National Survey of Small Business Finance
(NSSBF) and found that “African American businesses were much more likely to be
denied loans than comparable businesses owned by nonminority males.”182 In fact, only
2.7% of non-M/WBE loan applicants reported being denied commercial bank loans, as
compared to 50% of African American loan applicants.183 Another study found that
“[m]inorities have a significantly lower probability of obtaining a business loan than
Caucasian males in all industries.”184 Similarly, a 2011 Virginia study found that “[a]bout
20.5 percent of non-M/WBEs reported being denied commercial bank loans, as
compared to 52.4 percent of African American-owned firms, 35.3 percent of Hispanic
American-owned firms.”185 Of the minority-owned firms that did not apply for
financing, 28% of the Hispanic-owned firms, 27% of the Black-owned firms, and 24% of
the Asian American-owned firms explained that they did not apply because of a belief
M/WBE loan applicants reported being denied commercial bank loans, as compared to 52.6 percent of
African American-owned firms and 22.2 percent of Nonminority Woman-owned firms.”); NERA Econ.
Consulting, The State of Minority- and Women-Owned Business Enterprise: Evidence from Cleveland 7
(2012) (“When minority-owned firms did apply for a loan, their loan requests were substantially more
likely to be denied than non-minorities, even after accounting for differences like firm size and credit
history.”); id. at 8 (“[F]or African American-owned small businesses where, even after adjusting for
differences in assets, liabilities, and creditworthiness, the loan denial rate ranges from 8 to 22 percentage
points higher than for nonminority male-owned small businesses.”); Colette Holt & Assoc., Texas
Department of Transportation Disparity Study 156 (2019) (“Minority-owned firms are less likely to
receive loans than non-minority-owned firms regardless of firm size.”); Native 8(a) Contracting:
Emerging Issues, Hearing Before the H. Comm. on Small Business, 116th Cong. (2019) (“Native
Hawaiians have less access to capital because they have a higher loan denial rate for mortgages due to
poor credit history.”); Colette Holt & Assoc., Washington State Airports Disparity Study 121 (2019)
(“[L]oan denial rates for minority firms were about three times higher, at 42 percent, compared to those
of non-minority-owned firms, at 16 percent.”); BBC Rsch. & Consulting, 2013 Sound Transit Disparity
Study 4-10 (2013) (32% of MBEs reported difficulties obtaining lines of credit or loans, compared with
14% of majority-owned businesses); BBC Rsch. & Consulting, 2017 Disparity Study: City of Charlotte 3-9
(2017) (“Researchers have shown that Black American‐owned businesses and Hispanic American‐owned
businesses are more likely to forego submitting business loan applications and are more likely to be
denied business credit when they do seek loans, even after accounting for various race‐neutral and
gender‐neutral factors.”); BBC Rsch. & Consulting, City of Indianapolis and Marion County Disparity
Study 9-4 (2019) (“Qualitative information collected through public meetings, telephone surveys, and in-
depth interviews with local businesses also indicated that minority- and woman-owned businesses often
have difficulties obtaining business loans and credit.” ).
181 NERA Econ. Consulting, Business Disparities in the DCAMM Construction and Design Market Area 9
(2017).
182 MGT of America, Inc., 2015 Disparity Study for the Washington Suburban Sanitary Commission ES-9
(2016).
183 Id.
184 Mason Tillman Assoc., LTD, Shelby County (Tennessee) Disparity Study Final Report 10-31 (2016).
185 MGT of America, Inc., A Disparity Study for the Commonwealth of Virginia 7-16 (2011).
31

that they would not be approved, compared to only 13% of White-owned firms who
reported the same.186
While these results were reported across the board, individual stories from
minority and female business owners supported them. Consistent with the data on the
challenges that minority business owners face in obtaining financing, several business
owners of color reported how difficult it was to access the financing that their businesses
needed.
 	“The Hispanic male co-owner of a construction company reported that one
major issue he faces is financing. He said that the Contractor’s Licensing
Board sets limits on the size of job a contractor can bid on. In order to meet
these requirements, they borrowed some money and had friends help them
put $20,000 in the business account. He said that his firm is licensed up to
$200,000 per job, making it ineligible to do jobs over $200,000. He said that
he would love to take on larger jobs but there’s no one who will back them
financially without wanting a part of their company.”187
 	“The African American director of a minority development agency reported
that one of the biggest challenges a minority-owned business faces is access to
capital and the banks are not making loans to minority businesses. He said
that the lack of financing is impacting the ability to obtain bonding.”188
 	“An African American owner of a DBE-and MBE-certified specialty
contracting firm, when asked about challenges starting the business, reported
that money was a challenge, saying ‘Finding people that would give you
money to make your payroll without [abusing] you, that’s the hardest
part.’”189
Numerous minority business owners reported on the practical fallout for their
businesses resulting from their difficulty in accessing capital. For example:
A Black American male owner of a MBE‐certified landscaping firm said
that the biggest disadvantage or challenge he faces as a small or
disadvantaged business is not being able to obtain capital to buy the
equipment he feels the firm needs. He said, “What we would like to do is
set up a line of credit and be able to get trucks and stuff, tractors, and
Bobcats. We had a chance that one time this guy was going out of business.
He was cutting grass, and he was [going to] set us up real good, but we
didn’t have the financing to get the equipment.” He said that he believes
186 Fed. Rsrv. Bank of Atlanta, Small Business Credit Survey: Report on Minority-Owned Firms 6 (Dec.
2019).
187 Keen Indep. Rsch. LLC, Nevada Department of Transportation Disparity Study Final Report
Appendix J-39 (2013).
188 Id. at Appendix J-53.
189 Keen Indep. Rsch. LLC, Oregon Department of Transportation 2016 Availability and Disparity Study
Appendix J-18 (2016).
32

the key to success in his industry is being able to get the financing to be
able to grow. He added, “We don’t have the financing to get the type of
equipment that we would like to get to go out and expand.”190
Similarly, “[a] minority male owner of a professional services company reported that he
has been unable to receive any financial assistance for his small business: ‘We had a very
difficult time getting financing. It obviously has put a strain on my business. We had to
make business decisions to not seek certain work. The banks perceived my minority
company as a business risk even though we had a great business plan that indicated that
we were a minimal risk.’”191
C. 	When Minority and Female Business Owners Do Obtain Loans,
They Are Smaller and on Less Favorable Terms and Conditions
Minority- and women-owned firms receive smaller loans at higher interest rates
than firms owned by White males, and they also get smaller equity investments.192
While 49% of White-owned business applicants were approved for all of the financing
for which they applied, the same was true for only 31% of Black-owned firms, 35% of
Hispanic-owned firms, and 39% of Asian American-owned firms.193 Thirty-eight percent
of Black-owned business applicants and 33% of Hispanic-owned business applicants
receive none of the financing they applied for, compared to 20% of White-owned
business applicants and 24% of Asian American-owned business applicants.194 At a
congressional hearing on disparities in access to capital, Rep. Al Lawson noted that
“minority-firms, including women, are more likely than other businesses to be denied
traditional financing compared to other businesses. In fact, the average African-
American owner raises about $500 in equity in the first year, compared to $18,000 for
the average White business start-up.”195
Evidence from disparity studies also shows that the loans obtained by minority
and female business owners were smaller than those obtained by White male business
owners. A 2015 Arizona study found that “[t]he mean value of approved loans for
minority- and female-owned businesses in the Mountain region was less than one-half
that for non-Hispanic white male-owned firms.”196 Additionally, numerous studies
found that minority and female business owners pay higher interest rates than White
business owners.197
190 BBC Rsch. & Consulting, 2015-16 Ohio Public Authorities Disparity Study Appendix E-29 (2016).
191 Mason Tillman Assoc., LTD, Palm Beach County Disparity Study Final Report 10-13 (2017).
192 Empowering America to Reach its Full Economic Potential: Closing the Wealth Gap, Hearing Before
the S. Comm. on Small Business and Entrepreneurship, 113th Cong. (2013).
193 Fed. Rsrv. Bank of Atlanta, Small Business Credit Survey: Report on Minority-Owned Firms 6 (Dec.
2019).
194 Id.
195 Disparities in Access to Capital: What the Federal Government is Doing to Increase Support for
Minority Owned Firms: Field Hearing Before the H. Comm. on Small Business, 115th Cong. (2018).
196 Keen Indep. Rsch. LLC, Arizona Department of Transportation Disparity Study 4-7 (2015).
197 See Colette Holt & Assoc., Texas Department of Transportation Disparity Study 156 (2019)
(“Minority-owned firms paid an average of 7.8 percent in interest rates for loans compared to 6.4 percent
33

The challenges of obtaining financing lead minority business owners to rely more
heavily on their personal funds. Twenty-eight percent of Black and Asian American
business owners and 29% of Hispanic owners relied on personal funds as the primary
funding source for their businesses, compared to only 16% of White business owners.198
But as already discussed, the wealth gap between White males and minorities and
women limits the personal wealth that minority and women owners have at their
disposal.199
The challenges that minority- and women-owned businesses face in accessing
capital affect their ability to get established in the first place, compete in the market, and
maintain thriving and successful businesses over time.
VI. 	COVID Has Had a Disproportionate Impact on Minority- and Women-
Owned Businesses
The 2020 economic downturn caused by the COVID-19 pandemic has had an
extremely disproportionate effect upon minority- and women-owned businesses.200 This
disparity exists for two critical reasons: (1) minority- and women-owned businesses
tend to face underlying challenges that make them harder to run and scale successfully,
and (2) they are more likely to be concentrated in the industries most immediately
affected by the pandemic, such as service industries.201 Distressed companies were three
times as likely to close because of a two-month revenue shock,202 and in April 2020, the
Federal Reserve Bank of New York reported that minority- and women-owned
businesses were twice as likely to be classified as “at risk” or “distressed” as their non-
for non-minority-owned firms.”); NERA Econ. Consulting, Business Disparities in the San Antonio, Texas
Market Area at 9 (2015) (“When minority-owned firms did receive a loan they were obligated to pay
higher interest rates on the loans than comparable nonminority-owned firms.”); Keen Indep. Rsch. LLC,
Arizona Department of Transportation Disparity Study 4-7 (2015) (“There is evidence that minority-
and women-owned small businesses in the Mountain region paid higher interest rates on their business
loans than non-minority male-owned small businesses.”); NERA Econ. Consulting, Business Disparities
in the Travis County, Texas Market Area 119 (2016) (“When minority-owned firms did receive a loan they
were obligated to pay higher interest rates on the loans than comparable nonminority-owned firms.”);
NERA Econ. Consulting, The State of Minority- and Women-Owned Business Enterprise: Evidence from
Cleveland 7 (2012) (“When minority-owned firms did receive a loan they were obligated to pay higher
interest rates on the loans than comparable nonminority-owned firms.”).
198 Fed. Rsrv. Bank of Atlanta, Small Business Credit Survey: Report on Minority-Owned Firms 5 (Dec.
2019).
199 A number of studies have demonstrated that lower start-up capital adversely affects prospects for those
businesses. See, e.g., Keen Indep. Rsch. LLC, 2017 Minnesota Joint Disparity Study (2017).
200 Capital Access for Minority Small Businesses: COVID-19 Resources for an Equitable and Sustainable
Recovery: Hearing Before S. Comm. on Small Business & Entrepreneurship, 116th Cong. (2020).
201 Andre Dua, Deepa Mahajan, Ingrid Millan, and Shelley Stewart, COVID-19’s effect on minority-owned
small businesses in the United States, McKinsey & Company (May 2020); see also Access Denied:
Challenges for Women- and Minority-Owned Businesses Accessing Capital and Financial Services,
Hearing Before Subcomm. on Diversity and Inclusion of the H. Comm. on Financial Services, 116th
Cong. (2020).
202 Id.
34

minority male-owned counterparts.203 The effects on minority- and women-owned
businesses were thus predictable and pronounced. According to a recent survey of
Latina and Black female business owners, 70% reported that COVID-19 has caused a
decrease or loss of revenue, and 90% reported that they are currently unable to pay
themselves a sustainable income.204 The number of active small business owners in the
United States dropped by 22% between February and April 2020, but this drop was even
greater for minority and women business owners—Black business owners dropped by
41%, Latino business owners dropped by 32%, Asian American business owners
dropped by 26%, and female-owned businesses dropped by 25%.205
Notwithstanding the federal government’s efforts to assist small businesses in the
wake of the economic crisis, this disparity persists. The Paycheck Protection Program
(PPP), administered by the Small Business Administration, oversaw the disbursement of
4.4 million private loans totaling over $511 billion as of May 26, 2020, to help small
businesses with employees stay afloat during the COVID-19 economic crisis. A PPP loan
is based on the applicant's average monthly payroll costs and could be partially or fully
forgiven if the business keeps its employee counts and employee wages stable. However,
businesses owned by women and people of color were more likely than White-male-
owned businesses to face challenges in taking advantage of the PPP program for several
reasons. First, businesses owned by people of color are likely to have fewer employees
and lower payroll and thus could not qualify for higher loan amounts. Second, pre-
existing disparities in access to capital, discussed in detail above in Section V, made it
less likely that business owners of color would have the commercial lending
relationships necessary to access the PPP program and discouraged many from
applying. Third, the SBA did not issue guidance to lenders about prioritizing borrowers
in rural, minority-owned, or women-owned markets and did not collect data that would
allow analysis of whether lenders served underserved and rural markets under the PPP
program. Fourth, PPP excluded potential loan recipients based on many forms of
criminal legal system involvement, including people who have been charged, but not
tried or convicted of a crime.206 Due to racial disparities in all aspects of the criminal
justice system, there is evidence that this provision had a negative impact on business
owners of color.207 These factors and others may have contributed to the fact that 70% of
Black firms affiliated with the U.S. Black Chambers, Inc. that applied for PPP loans were
denied, and 96% of U.S. Black Chambers, Inc. members who applied did not receive the
203 Access Denied: Challenges for Women- and Minority-Owned Businesses Accessing Capital and
Financial Services: Hearing Before Subcomm. On Diversity and Inclusion of the H. Comm. on Financial
Services, 116th Cong. (2020).
204 Access Denied: Challenges for Women- and Minority-Owned Businesses Accessing Capital and
Financial Services: Hearing Before Subcomm. On Diversity and Inclusion of the H. Comm. on Financial
Services, 116th Cong. (2020).
205 Robert W. Fairlie, The Impact of COVID-19 on Small Business Owners: Evidence of Early-Stage
Losses from the April 2020 Current Population Survey, National Bureau of Economic Research 1 (June
2020).
206 Business Loan Program Temporary Changes; Paycheck Protection Program, 85 Fed. Reg. 20,811 (Apr.
15, 2020) (to be codified at 13 C.F.R. pt. 120).
207 Ctr. for Responsible Lending, The Paycheck Protection Program Continues to be Disadvantageous to
Smaller Businesses, Especially Businesses Owned by People of Color and the Self-Employed (Apr. 2020).
35

PPP loan amount that they requested.208 Women of color similarly suffered. Since less
than 7% of businesses owned by women of color have employees, few were in a position
to benefit from the PPP despite facing revenue losses.209
The economic fallout of the COVID-19 pandemic is ongoing, and the long-term
effects remain to be seen. It is already apparent, however, that this crisis has revealed
and exacerbated the hardships that minority- and women-owned businesses continue to
face.
208 Capital Access for Minority Small Businesses: COVID-19 Resources for an Equitable and Sustainable
Recovery: Hearing Before S. Comm. on Small Business & Entrepreneurship, 116th Cong. (2020).
209 Closing the Women’s Wealth Gap Initiative, On the Margins: Economic Security for Women of Color
Through the Coronavirus Crisis and Beyond, Closing the Women’s Wealth Gap 17 (Apr. 2020).
36

APPENDIX A
Congressional Hearings from 2010 to 2021
Addressing Public Procurement and Challenges Facing Minority- and
Women-Owned Business Enterprises
 	How Invidious Discrimination Works and Hurts: An Examination of Lending
Discrimination and Its Long-term Economic Impacts on Borrowers of Color,
Hearing before Subcomm. on Oversight and Investigations of the H. Comm. on
Financial Services, 117th Cong. (2021).
 	Capital Access for Minority Small Businesses: COVID-19 Resources for an
Equitable and Sustainable Recovery, Hearing Before S. Comm. on Small
Business & Entrepreneurship, 116th Cong. (2020).
 	Small Business in Crisis: The 2020 Paycheck Protection Program and its Future
Before S. Comm. on Small Business and Entrepreneurship, 116th Cong. (2020).
 	Oversight Hearing on “From Languages to Homelands: Advancing Tribal Self-
Governance and Cultural Sovereignty for Future Generations,” Hearing Before
the S. Comm. on Indian Affairs, 116th Cong. (2020).
 	Holding Financial Regulators Accountable for Diversity and Inclusion:
Perspectives from the Office of Minority and Women Inclusion, Hearing Before
Subcomm. On Diversity and Inclusion of the H. Comm. on Financial Services,
116th Cong. (2020).
 	The Rent is Still Due: America’s Renter, COVID-19, and an Unprecedented
Eviction Crisis, Hearing Before the H. Comm. on Financial Services, 116th Cong.
(2020).
 	Access Denied: Challenges for Women- and Minority-Owned Businesses
Accessing Capital and Financial Services, Hearing Before Subcomm. On
Diversity and Inclusion of the H. Comm. on Financial Services, 116th Cong.
(2020).
 	Promoting Inclusive Lending During the Pandemic: Community Development,
Financial Institutions, and Minority Depository Institutions, Hearing Before the
H. Comm. on Financial Services, 116th Cong. (2020).
 	Transparency in Small Business Lending, Hearing Before the H. Comm. on
Small Business, 116th Cong. (2020).
 	Transportation’s Disadvantaged Business Enterprise Program, Hearing Before
the H. Comm. on Transportation and Infrastructure, 116th Cong. (2020).
37

 	Examining the Racial and Gender Wealth Gap in America, Hearing Before
Subcomm. On Diversity and Inclusion of the H. Comm. on Financial Services,
116th Cong. (2019).
 	Reauthorization of the SBA’s Contracting Programs, Hearing Before the S.
Comm. on Small Business and Entrepreneurship, 116th Cong. (2019).
 	Embracing Corporate Social Responsibility: Small Business Best Practices,
Hearing Before the H. Comm. on Small Business, 116th Cong. (2019).
 	Fostering the American Dream: How SBA Can Empower Immigrant Small
Business Owners, Field Hearing Before the H. Comm. on Small Business, 116th
Cong. (2019).
 	Native 8(a) Contracting: Emerging Issues, Hearing Before the H. Comm. on
Small Business, 116th Cong. (2019).
 	The Role of the SBA’s 8(a) Program in Enhancing Economic Opportunities,
Hearing Before the H. Comm. on Small Business, 116th Cong. (2019).
 	Lost Opportunities? SBA’s Engagement with Historically Black Colleges and
Universities, Hearing Before the H. Comm. on Small Business, 116th Cong.
(2019).
 	Strengthening Access to Capital for Minority-Owned Small Business, Field
Hearing Before the S. Committee on Small Business and Entrepreneurship,
115th Cong. (2018).
 	Opportunities and Challenges with the Small Business Administration’s Federal
Contracting Programs, Hearing Before the S. Comm. on Small Business and
Entrepreneurship, 115th Cong. (2018).
 	Disparities in Access to Capital: What the Federal Government is Doing to
Increase Support for Minority Owned Firms, Field Hearing Before the H.
Comm. on Small Business, 115th Cong. (2018).
 	Strengthening the Entrepreneurial Ecosystem for Women, Hearing Before the
S. Comm. on Small Business and Entrepreneurship, 115th Cong. (2017).
 	Minority Access to Capital, Field Hearing Before the S. Comm. on Small
Business and Entrepreneurship, 114th Cong. (2015).
 	Accessing Capital in Indian Country, Hearing Before the S. Committee on
Indian Affairs, 114th Cong. (2015).
 	Empowering America to Reach its Full Economic Potential: Closing the Wealth
Gap, Hearing Before the S. Comm. on Small Business and Entrepreneurship,
113th Cong. (2013).
38

 	Strengthening the Entrepreneurial Ecosystem for Minority Women, Hearing
Before the S. Comm. on Small Business and Entrepreneurship, 113th Cong.
(2013).
 	Closing the Gap: Exploring Minority Access to Capital and Contracting
Opportunities, Hearing Before the S. Comm. on Small Business and
Entrepreneurship, 112th Cong. (2011).
 	Small Business Participation in the Federal Procurement Marketplace, Hearing
Before the H. Comm. on Small Business, 111th Cong. (2010).
 	Minority Contracting: Opportunities and Challenges for Current and Future
Minority-Owned Businesses, Hearing Before the Subcommittee on Government
Management, Organization, and Procurement of the H. Comm. on Oversight
and Government Reform, 111th Cong. (2010).
39

APPENDIX B
State and Local Disparity Studies from 2010-2021
Alaska
Alaska Department of Transportation & Public Facilities Disadvantaged Business
Enterprise Study, Final Report, Prepared by the Alaska Department of Transportation
& Public Facilities Civil Rights Office (2020).
Alaska Department of Transportation & Public Facilities Disadvantaged Business
Enterprise Study, Final Appendices, Prepared by the Alaska Department of
Transportation & Public Facilities Civil Rights Office (2020).
Alaska Department of Transportation and Public Facilities Disparity Study, Prepared
by MGT of America, Inc. (2014).
Arizona
Arizona Department of Transportation Disparity Study, Final Report, Prepared by
Keen Independent Research (2020).
Arizona Department of Transportation Disparity Study Report, Prepared by Keen
Independent Research (2015).
California
Availability and Disparity Study, California Department of Transportation, Final
Report, Prepared by BBC Research & Consulting (2012).
BGPAA Disparity Study - Final Report, Burbank-Glendale-Pasadena Airport
Authority (CA), Prepared by BBC Research & Consulting (2012).
California Department of Transportation Availability and Disparity Study Report,
Prepared by BBC Research & Consulting (2021).
California High-Speed Rail Authority Business Market Availability and Disparity
Study, Prepared by Mason Tillman Associates, Ltd. (2014).
Caltrans 2014 Disparity Study for FTA Contracts, California DOT, Prepared by BBC
Research & Consulting (2014).
Caltrans Disparity Study, Prepared by BBC Research and Consulting for Caltrans
Department of Transportation (2016).
City of Oakland 2017 Race and Gender Disparity Study Draft, Prepared by Mason
Tillman Associates, Ltd. (2020).
40

City of San Diego 2020 Disparity Study, Prepared by BBC Research & Consulting
(2021).
Disadvantaged Business Enterprise (DBE) Program Disparity Study Update, Prepared
by Mason Tillman Associates, Ltd. for the Los Angeles County Metropolitan
Transportation Authority Disparity Study (2013).
2015 Disadvantaged Business Enterprise Disparity Study, John Wayne Airport,
County of Orange, California Final Report, Prepared by MGT of America, Inc. (2016).
Imperial County Transportation Commission Disparity Study, Prepared by BBC
Research & Consulting (2014).
LA Metro 2017 Disparity Study, Prepared by BBC Research & Consulting for the Los
Angeles County Metropolitan Transportation Authority (2018).
Metro Disparity Study Final Report, Los Angeles County Metropolitan Transportation
Authority, Prepared by BBC Research & Consulting (2010).
MTS Disparity Study Final Report, Prepared by BBC Research & Consulting for the San
Diego Metropolitan Transit System (2010).
OCTA Disparity Study Final Report, Orange County Transportation Authority,
Prepared by BBC Research & Consulting (2010).
SANDAG Disparity Study Final Report, Prepared by BBC Research & Consulting for the
San Diego Association of Governments (2010).
San Diego Association of Governments Disparity Study, Prepared by BBC Research &
Consulting (2014).
San Diego County Regional Airport Authority Disparity Study, Prepared by BBC
Research & Consulting (2010).
San Francisco Bay Area Rapid Transit District Disparity Study Volume I, Prepared by
Miller3 Consulting, Inc. (2017).
Disadvantaged Business Enterprise Availability, Utilization, and Disparity Study for
the San Francisco Municipal Transportation Agency, Prepared by Rosales Business
Partners LLC (2015).
Colorado
City and County of Denver Disparity Study, Prepared by BBC Research & Consulting
(2018).
City and County of Denver Minority/Women Owned/Disadvantaged Business
Enterprise Disparity Study, Prepared by MGT of America, Inc. (2013).
41

Colorado Disparity Study, Final Report, Prepared by Keen Independent Research
(2020).
Disparity Study for Denver Public Schools, Prepared by MGT of America, Inc. (2015).
Connecticut
Connecticut Disparity Study: Phase 1, Prepared by The Connecticut Academy of Science
and Engineering for the Connecticut General Assembly and the Government
Administration and Elections Commission (2013).
Connecticut Disparity Study: Phase 2, Prepared by The Connecticut Academy of
Science and Engineering for the Connecticut General Assembly and the Government
Administration and Elections Commission (2014).
Connecticut Disparity Study: Phase 3, Prepared by The Connecticut Academy of
Science and Engineering for the Connecticut General Assembly and the Government
Administration and Elections Commission (2016).
District of Columbia
2015 Disparity Study for Washington Suburban Sanitary Commission, Prepared by
MGT of America, Inc. (2016).
2010 Disparity Study for Washington Suburban Sanitary Commission, Prepared by
Mason Tillman Associates (2011).
Florida
Broward County Public Schools Disparity Study-Final Report, Prepared by Mason
Tillman Associates (2015).
Comprehensive Disparity Study for the City of Pensacola, Prepared by MGT of
America, Inc. (2012).
Disparity Study for Miami-Dade County Public Schools Phase I Report, Prepared by
MGT of America, Inc. (2014).
Hillsborough County Aviation Authority Disparity Study Update Final Report,
Prepared by MGT of America, Inc. (2015).
Jacksonville Multi-Jurisdictional Disparity Study Volume 1, Prepared by Mason
Tillman Associates (2013).
Miami-Dade County Comprehensive Disparity Study, Final Report, Prepared by
Mason Tillman Associates, Ltd. (2015).
42

Minority, Women, and Small Business Enterprise Disparity Study for the City of
Tallahassee, Leon County, Florida and Blueprint Intergovernmental Agency, Prepared
by MGT Consulting Group (2019).
Palm Beach County Disparity Study, Prepared by Mason Tillman Associates, Ltd.
(2017).
Solid Waste Authority of Palm Beach County, Florida Disparity Study, Prepared by
Mason Tillman Associates, Ltd. (2017).
Solid Waste Authority of Palm Beach County, Florida Disparity Study Appendix A,
Prepared by Mason Tillman Associates, Ltd. (2017).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Broward County, Prepared by NERA Economic Consulting for Broward County, Florida
(2010).
Georgia
Atlanta Housing Authority Disparity Study, Prepared by Keen Independent Research
(2017).
Atlanta Public Schools Disparity Study, Prepared by Keen Independent Research
(2017).
City of Atlanta Disparity Study Summary Report, Prepared by Keen Independent
Research LLC (2015).
Comprehensive Disparity Study City of Savannah, Georgia, Prepared by Griffin &
Strong, P.C. (2016).
Georgia Department of Transportation Disparity Study, Prepared by Griffin & Strong,
P.C. for the State of Georgia (2016).
Georgia Department of Transportation Disparity Study, Prepared by BBC Research &
Consulting for the State of Georgia (2012).
Hawaii
Hawaii Department of Transportation 2019 Availability and Disparity Study,
Prepared by Keen Independent Research (2020).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Hawai’i, Prepared by NERA Economic Consulting for the Hawai’i Department of
Transportation (2010).
43

Idaho
Idaho Transportation Department Disparity Study, Prepared by BBC Research &
Consulting (2017).
Illinois
Chicago Transit Authority Disparity Study, Prepared by Colette Holt & Associates
(2019).
City of Chicago Disparity Study for Construction Contracts, Prepared by Colette Holt &
Associates (2021).
Cook County, Illinois Disparity Study, Prepared by Colette Holt & Associates (2015).
Illinois Department of Transportation 2017 Disparity Study, Prepared by BBC
Research & Consulting (2018).
Illinois Department of Transportation/Illinois Tollway Disadvantaged Business
Enterprises Disparity Study, Volume 1: Illinois State Toll Highway Authority,
Prepared by Mason Tillman Associates, Ltd. (2011).
Illinois Department of Transportation/Illinois Tollway Disadvantaged Business
Enterprise Disparity Study, Volume 2: Illinois Department of Transportation,
Prepared by Mason Tillman Associates, Ltd. (2011).
Illinois State Toll Highway Authority Disparity Study Construction and Construction
Related Services, Prepared by Colette Holt & Associates (2015).
Metra Availability Study, Prepared by Colette Holt & Associates for the Northeast
Illinois Regional Commuter Railroad Corporation (2016).
Pace Suburban Bus Disparity Study, Prepared by Collette Holt & Associates (2015).
RTA Availability Study, Prepared by Colette Holt & Associates for the Regional
Transportation Authority of Illinois (2016).
The Metropolitan Water Reclamation District of Greater Chicago Disparity Study
2015, Prepared by Collette Holt & Associates, (2015).
The Status of Minority and Women Owned Business Enterprises Relevant to
Construction Activity in and around Cook County, Illinois, Prepared by Collette Holt &
Associates and NERA, 2010.
State of Illinois Department of Central Management Services Disparity Study,
Prepared by Colette Holt & Associates (2015).
44

Indiana
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Ball State University (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Indiana Department of Administration (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Indiana University (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Indiana State University (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Ivy Tech Community College (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Purdue University (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
University of Southern Indiana (2016).
2015-16 State of Indiana Disparity Study, Prepared by BBC Research & Consulting for
Vincennes University (2016).
City of Indianapolis and Marion County Disparity Study, Prepared by BBC Research &
Consulting (2019).
Indiana Disparity Study Final Report, Prepared by BBC Research & Consulting (2010).
Indiana Disparity Study Final Report Appendices, Prepared by BBC Research &
Consulting (2010).
State of Indiana 2020 Disparity Study, Prepared by BBC Research & Consulting
(2020).
Kentucky
Louisville & Jefferson County Metropolitan Sewer District Disparity Study, Prepared
by Mason Tillman Associates, Ltd. (2018).
Louisiana
City of Baton Rouge, Parish of East Baton Rouge Disparity Study, Prepared by Keen
Independent Research (2019).
City of New Orleans Disparity Study, Prepared by Keen Independent Research (2018).
45

Recreation and Park Commission for the Parish of East Baton Rouge Disparity Study,
Prepared by Keen Independent Research (2019).
Maryland
Business Disparities in the Maryland Market Area, Prepared by NERA Economic
Consulting for the State and Maryland and the Maryland Department of Transportation
(2017).
City of Frederick MD Disparity Study Report, Prepared by Griffin & Strong (2021).
Disadvantaged Business Enterprise Disparity Study: Volume I, Prepared by NERA
Economic Consulting for the Maryland Department of Transportation (2018).
Disadvantaged Business Enterprise Disparity Study: Volume II, Prepared by NERA
Economic Consulting for the Maryland Department of Transportation (2018).
Disadvantaged Business Enterprise Disparity Study: Volume III, Prepared by NERA
Economic Consulting for the Maryland Department of Transportation (2018).
Disadvantaged Business Enterprise Disparity Study: Volume I, Prepared for the
Maryland Department of Transportation by NERA Economic Consulting (2013).
Disparity Study Final Report, Baltimore County, MD, Prepared by Mason Tillman
Associates (2021).
MBE/WBE Disparity Study for the Baltimore City Public Schools, Prepared by NERA
Economic Consulting (2014).
Montgomery County Maryland Disparity Study Final Report, Prepared by Griffin &
Strong (2014).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Baltimore, Prepared by NERA Economic Consulting (2014).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Maryland, Prepared by NERA Economic Consulting for the Maryland Department of
Transportation (2011).
Massachusetts
Business Disparities in the DCAMM Construction and Design Market Area, Prepared
by NERA Economic Consulting for the Commonwealth of Massachusetts Division of
Capital Asset Management and Maintenance (2017).
City of Boston 2020 Disparity Study, Prepared by BBC Research & Consulting (2021).
46

Minnesota
2017 Minnesota Joint Disparity Study City of Minneapolis, Prepared by Keen
Independent Research (2018).
2017 Minnesota Joint Disparity Study City of Saint Paul, Prepared by Keen
Independent Research (2018).
2017 Minnesota Joint Disparity Study Hennepin County, Prepared by Keen
Independent Research (2018).
2017 Minnesota Joint Disparity Study Metropolitan Airports Commission, Prepared by
Keen Independent Research (2018).
2017 Minnesota Joint Disparity Study Metropolitan Council, Prepared by Keen
Independent Research (2018).
2017 Minnesota Joint Disparity Study Metropolitan Mosquito Control District,
Prepared by Keen Independent Research (2018).
2017 Minnesota Joint Disparity Study Minnesota Department of Administration,
Prepared by Keen Independent Research (2018).
2017 Minnesota Joint Disparity Study Minnesota Department of Transportation,
Prepared by Keen Independent Research (2018).
2017 Minnesota Joint Disparity Study Minnesota State Colleges and Universities,
Prepared by Keen Independent Research (2018).
State of Minnesota Joint Availability and Disparity Study, Final Report, Prepared by
MGT of America, Inc. for the Metropolitan Airports Commission (2010).
State of Minnesota Joint Availability and Disparity Study, Final Report, Prepared by
MGT of America, Inc. for the Metropolitan Council (2010).
State of Minnesota Joint Availability and Disparity Study, Final Report, Prepared by
MGT of America, Inc. for the Minnesota Department of Administration (2010).
State of Minnesota Joint Availability and Disparity Study, Final Report, Prepared by
MGT of America, Inc. for the Minnesota Department of Transportation (2010).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Minneapolis, Prepared by NERA Economic Consulting (2010).
Mississippi
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Mississippi, Prepared by NERA Economic Consulting for the Jackson Municipal Airport
Authority (2012).
47

Missouri
City of Kansas City Construction Workforce Disparity Study, Prepared by Keen
Independent Research (2019).
City of Kansas City, Missouri Disparity Study, Prepared by Colette Holt & Associates
(2016).
City of Kansas City, Missouri Public School System, Prepared by Colette Holt &
Associates (2017).
City of St. Louis Disparity Study Volume 1, Prepared by Mason Tillman Associates
(2015).
Jackson County, Missouri Disparity Study, Prepared by Colette Holt & Associates
(2017).
Kansas City Area Transportation Authority Disadvantaged Business Enterprise
Availability Study, Prepared by Colette Holt & Associates (2016).
Metropolitan St. Louis Sewer District Disparity Study Draft Report, Prepared by
Mason Tillman Associates, Ltd. (2012).
Missouri Department of Transportation DBE Availability Study, Prepared by Keen
Independent Research (2019).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Missouri, Prepared by NERA Economic Consulting for the Missouri Department of
Transportation (2012).
Saint Louis County Disparity Study, Prepared by Griffin & Strong P.C. (2017).
State of Missouri Office of Administration Disparity Study, Prepared by Colette Holt &
Associates (2014).
Montana
Availability and Disparity Study, Prepared by Keen Independent Research LLC for the
State of Montana Department of Transportation (2016).
Nevada
Nevada Transportation Consortium Disparity Study, Prepared by BBC Research &
Consulting for the Regional Transportation Commission of Southern Nevada (2017).
Nevada Department of Transportation Disparity Study Final Report, Prepared by
Keen Independent Research (2013).
48

New Jersey
NJ Transit Disparity Study Final Report Executive Summary, Prepared by The
University of Minnesota (2016).
NJ Transit Disparity Study Final Report Appendix, Prepared by The University of
Minnesota (2016).
Newark Public Schools Disparity Study 2017, Prepared by Collette Holt & Associates
(2017).
Purchasing Disparity Study (Draft), Prepared by MGT of America, Inc. for the City of
Jersey City (2011).
New York
City of New York Disparity Study, Prepared by MGT Consulting Group (2018).
State of New York 2016 MWBE Disparity Study Volume I, Prepared by Mason Tillman
Associates, Ltd. (2016).
State of New York 2016 MWBE Disparity Study Policy Review Final Report Volume II,
Prepared by Mason Tillman Associates, Ltd. (2017).
New Jersey and New York
The Port Authority of New York and New Jersey MWBE Disparity Analysis 2017
Volume I: Final Report, Prepared by Mason Tillman Associates, Ltd. (2018).
North Carolina
City of Asheville, North Carolina Disparity Study, Prepared by BBC Research &
Consulting (2018).
City of Charlotte Disparity Study, Prepared by BBC Research & Consulting (2017).
City of Winston-Salem 2019 Disparity Study, Prepared by MGT Consulting Group
(2019).
Disparity Study for Minority/Women Business Enterprise Program, Prepared by MGT
of America, Inc. for City of Greensboro, North Carolina (2012).
Durham County/City of Durham, North Carolina Multi-jurisdictional Disparity Study,
Prepared by Griffin & Strong, P.C. (2015).
Greensboro, North Carolina Disparity Study, Prepared by Griffin & Strong (2018).
Guilford County Schools 2015 Disparity Study, Prepared by MGT of America, Inc.
(2016).
49

Mecklenburg County, North Carolina Disparity Study Report, Prepared by Griffin &
Strong (2020).
North Carolina Department of Transportation, Prepared by Colette Holt & Associates
(2014).
State of North Carolina Department of Administration, Disparity Study Report:
Volume 1, State Agencies, Prepared by Griffin & Strong, P.C. (2020).
State of North Carolina Department of Administration, Disparity Study Report:
Volume 2, Community Colleges and Universities. Prepared by Griffin & Strong, P.C.
(2021).
The City of Charlotte Update Disparity Study, Final Report, Prepared by MGT of
America, Inc. (2011).
Ohio
Cuyahoga County Disparity Study Report, Prepared by Griffin & Strong P.C. (2020).
Cuyahoga County Disparity Study, Prepared by Griffin & Strong P.C. (2014).
2015-16 Ohio Public Authorities Disparity Study, Prepared by BBC Research &
Consulting for the Ohio Department of Transportation (2016).
City of Cincinnati Disparity Study, Prepared by Mason Tillman Associates, Ltd. (2015).
City of Columbus Disparity Study, Prepared by Mason Tillman Associates, Ltd. (2019).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Cleveland, Prepared by NERA Economic Consulting for the City of Cleveland (2012).
The State of Minority- and Women-Owned Business Enterprise: Evidence from
Northeast Ohio, Prepared by NERA Economic Consulting for the Northeast Ohio
Regional Sewer District (2010).
Third Generation Disparity Study, City of Dayton, Final Report, Prepared by MGT
Consulting Group (2019).
Oklahoma
City of Tulsa, Oklahoma Business Disparity Study Final Report, Prepared by MGT of
America, Inc. (2010).
A Study to Determine DBE Availability and Analyze Disparity in the Transportation
Contracting Industry in Oklahoma, Prepared by BBC Research & Consulting for the
Oklahoma Department of Administration (2010).
50

Oregon
City of Portland Disparity Study, Prepared by BBC Research & Consulting (2011).
Oregon Department of Aviation, Oregon Statewide Airport DBE Disparity Study,
Prepared by Keen Independent Research (2021).
Oregon Department of Transportation Availability and Disparity Study, Prepared by
Keen Independent Research LLC (2016).
Portland Development Commission Disparity Study, Prepared by BBC Research &
Consulting (2011).
State of Oregon Disparity Study Update Final Report, Prepared by MGT of America,
Inc. for the Oregon Department of Transportation (2011).
The Port of Portland Small Business Program Disparity Study, Prepared by Colette
Holt & Associates (2018).
Pennsylvania
City of Philadelphia Fiscal Year 2019 Annual Disparity Study, Prepared by the City of
Philadelphia Department of Commerce and Miller3 Consulting (2020).
City of Philadelphia Fiscal Year 2018 Annual Disparity Study, Prepared by Econsult
Solutions, Inc. and Milligan & Company, LLC (2019).
City of Philadelphia Fiscal Year 2016 Annual Disparity Study, Prepared by Econsult
Solutions, Inc. for the City of Philadelphia Department of Commerce (2017).
City of Philadelphia Fiscal Year 2015 Annual Disparity Study, Prepared by Econsult
Solutions, Inc. and Milligan & Company, LLC (2016).
City of Philadelphia Fiscal Year 2014 Annual Disparity Study, Prepared by Econsult
Solutions, Inc. and Milligan & Company, LLC (2014).
City of Philadelphia Fiscal Year 2013 Annual Disparity Study, Prepared by Econsult
Solutions, Inc. and Milligan & Company, LLC (2014).
City of Philadelphia Fiscal Year 2012 Annual Disparity Study, Prepared by Econsult
Corp., Milligan & Company, and Winston Terrell (2013).
City of Philadelphia Fiscal Year 2011 Annual Disparity Study, Prepared by Econsult
Corp., Milligan & Company, and Winston Terrell (2012).
City of Philadelphia Fiscal Year 2010 Annual Disparity Study, Prepared by Econsult
Corp. and Milligan & Company (2011).
51

City of Philadelphia Fiscal Year 2009 Annual Disparity Study, Prepared by Econsult
Corp. and Milligan & Company (2010).
Commonwealth of Pennsylvania Department of General Services Disparity Study,
Prepared by BBC Research & Consulting (2018).
Pennsylvania Department of Transportation Disparity Study, Prepared by BBC
Research & Consulting (2018).
Rhode Island
State of Rhode Island Disparity Study Final Report, Prepared by Mason Tillman
Associates, Ltd. (2021).
Tennessee
Business Market Availability and Disparity Study Shelby County Schools Board of
Education, Prepared by MGT Consulting Group (2017).
City of Chattanooga, Tennessee Disparity Study Final Report, Prepared by Griffin &
Strong P.C. (2019).
City of Memphis, Tennessee Disparity Study, Prepared by Griffin & Strong P.C. (2016).
City of Memphis, Tennessee Disparity Study, Prepared by Griffin & Strong P.C. (2010).
Memphis Light, Gas, and Water Division Comprehensive Disparity Study and Policy
Formulation, Prepared by MGT of America, Inc. (2012).
Metro Nashville, Tennessee Disparity Study, Prepared by Griffin & Strong P.C. (2018).
Metropolitan Nashville Airport Authority Disparity Study, Prepared by Colette Holt &
Associates (2014).
Shelby County Disparity Study, Prepared by Mason Tillman Associates, Ltd. (2016).
The State of Minority and Women-Owned Business Enterprise: Evidence from
Memphis, Prepared by NERA Economic Consulting for the Memphis-Shelby County
Airport Authority (2013).
Texas
Availability and Disparity Study, City of Dallas, Texas, Final Report, Prepared by MGT
Consulting Group (2020).
Bexar County, Texas Disparity and Availability Study, Prepared by Mason Tillman
Associates, Ltd. (2011).
52

Business Disparities in the Austin Independent School District Market Area, Prepared
by NERA Economic Consulting (2015).
Business Disparities in the Austin, Texas Market Area, Prepared by NERA Economic
Consulting for the City of Austin, Texas (2015).
Business Disparities in the San Antonio, Texas Market Area, Prepared by NERA
Economic Consulting for the City of San Antonio (2015).
Business Disparities in the Travis County, Texas Market Area, Prepared by NERA
Economic Consulting for Travis County, Texas (2016).
City of Fort Worth, Texas, Disparity Study, Prepared by Colette Holt & Associates
(2020).
Dallas County Texas Disparity Study, Prepared by Collette Holt & Associates (2015).
Dallas Fort Worth International Airport Disparity Study, Prepared by Collette Holt &
Associates (2019).
Disparity Study for Corpus Christi and CCRTA, Prepared by Texas A&M University
South Texas Economic Development Center (2016).
Harris County Texas Disparity Study, Prepared by Collette Holt & Associates (2020).
Metropolitan Transit Authority of Harris County, Texas, Disparity Study, Final
Report, Prepared by Mason Tillman Associates, Ltd. (2021).
Minority- and Women-owned Business Enterprise (M/WBE) Program Disparity Study
for the San Antonio Water System, Prepared by MGT of America (2015).
North Central Texas Council of Governments Joint Availability and Disparity Volume
1: Legal, Anecdotal, Private Sector, & Capacity Analyses, Prepared by Mason Tillman
Associates (2010).
North Central Texas Council of Governments Joint Availability and Disparity Volume
2: City of Arlington, Prepared by Mason Tillman Associates (2010).
North Central Texas Council of Governments Joint Availability and Disparity Study
Volume 4: Dallas/Fort Worth International Airport Board, Prepared by Mason Tillman
Associates, Ltd. (2010).
North Central Texas Council of Governments Joint Availability and Disparity Volume
4: Dallas Fort Worth International Airport Board Supplemental Study, Prepared by
Mason Tillman Associates (2010).
Parkland Health and Hospital System Disparity Study, Prepared by Colette Holt &
Associates (2015).
53

Texas Department of Transportation Disparity Study, Prepared by Colette Holt &
Associates (2019).
The State of Minority- and Women-Owned Business Enterprise in Construction:
Evidence from Houston, Prepared by NERA Economic Consulting for the City of
Houston (2012).
Virginia
Commonwealth of Virginia Disparity Study, Prepared by BBC Research & Consulting
(2020).
A Disparity Study for the Commonwealth of Virginia, Prepared by MGT of America,
Inc. (2011).
City of Hampton and Hampton Schools Disparity Study, Prepared by MGT of America,
Inc. (2014).
City of Virginia Beach Disparity Study, Prepared by BBC Research & Consulting
(2018).
Portsmouth Public Schools Procurement Disparity Study Final Report, Prepared by
MGT of America, Inc. for Portsmouth, Virginia Public Schools (2011).
Procurement Disparity Study, City of Portsmouth, Virginia, Prepared by MGT of
America, Inc. (2015).
Washington
2012 DBE Program Disparity Study State of Washington Department of
Transportation, Prepared by BBC Research & Consulting (2013).
City of Tacoma Disparity Study, Prepared by Griffin & Strong P.C. (2018).
Port of Seattle Disparity Study Executive Summary, Prepared by Colette Holt &
Associates (2019).
Port of Seattle Disparity Study, Prepared by BBC Research & Consulting for the Port of
Seattle, Washington (2014).
Sound Transit Disparity Study, Prepared by BBC Research & Consulting for Sound
Transit, Seattle, Washington (2013).
State of Washington Disparity Study, Prepared by Colette Holt & Associates (2019).
Washington State Airports Disparity Study, Prepared by Colette Holt & Associates
(2019).
54

Washington State Department of Transportation Disparity Study, Prepared by Colette
Holt & Associates (2017).
Sound Transit 2020 Disadvantaged Business Enterprise Disparity Study, Prepared by
BBC Research and Consulting for Sound Transit, Seattle, Washington (2020).
Wisconsin
Madison Public Works Disparity Study, Prepared by Keen Independent Research for
City of Madison, Wisconsin (2015).
55

APPENDIX C
Relevant Studies and Reports from 2010 to 2020
 	Lawrence C. Manson, Jr., Access to Capital: Accelerating the Growth of Diverse-
and Women-Owned Businesses, The Trillion Dollar Opportunity, NexTier
Consulting Solutions, LLC (July 2020).
 	Robert W. Fairlie, The Impact of COVID-19 on Small Business Owners: Evidence
of Early-Stage Losses from the April 2020 Current Population Survey, National
Bureau of Economic Research (June 2020).
 	Andre Dua, Deepa Mahajan, Ingrid Millan, and Shelley Stewart, COVID-19’s
effect on minority-owned small businesses in the United States, McKinsey &
Company (May 2020).
 	Dominique Derbigny, On the Margins: Economic Security for Women of Color
Through the Coronavirus Crisis and Beyond, Closing the Women’s Wealth Gap
(April 2020).
 	The Paycheck Protection Program Continues to be Disadvantageous to Smaller
Businesses, Especially Businesses Owned by People of Color and the Self-
Employed, Center for Responsible Lending (April 2020).
 	Claire Kramer Mills and Jessica Battisto, Can Small Firms Weather the
Economic Effects of COVID-19?, Federal Reserve Bank of New York (April 2020).
 	Andre Perry, Jonathan Rothwell, and David Harshbarger, Five-star reviews, one-
star profits: The devaluation of businesses in Black communities, Metropolitan
Policy Program at Brookings (February 2020).
 	Anne Price, Don’t Fixate on the Racial Wealth Gap: Focus on Undoing Its Root
Causes, Insight and Roosevelt Institute (February 2020).
 	Eric Rodriguez, Why Latinos Will Lose under the OCC and FDIC’s Proposal to
Modernize the Community Reinvestment Act, UnidosUS (January 2020).
 	Small Business Credit Survey: Report on Minority-Owned Firms, Federal
Reserve Bank of Atlanta (December 2019).
 	Lisa D. Cook and Jan Gerson, The implications of U.S. gender and racial
disparities in income and wealth inequality at each stage of the innovation
process, Washington Center for Equitable Growth (July 2019).
 	Robert Bartlett, Adair Morse, Richard Stanton, and Nancy Wallace, Consumer-
Lending Discrimination in the Fintech Era, National Bureau of Economic
Research (June 2019).
56

 	Nora Esposito, Small Business Facts: Spotlight on Minority-Owned Employer
Businesses, U.S. Small Business Administration, Office of Advocacy (May 2019).
 	Anna Maria Ortiz, Small Business Administration: Key Entrepreneurship
Programs and Activities Do Not Specifically Target Historically Black Colleges
and Universities, but Collaboration Exists with Some Schools, U.S. Government
Accountability Office (March 2019).
 	Carolyn Schulman, The Partnership for Lending in Underserved Markets:
Increasing Minority Entrepreneurs’ Access to Capital, Milken Institute
(November 2018).
 	Carolyn Karo Schulman, Partnership for Lending in Underserved Markets,
Phase II Summary: Lessons Learned for Advancing Minority Small Business
Capital Access, Milken Institute (2018).
 	Nora Esposito, Data From The Census Bureau Shows Growth In Hispanic-
Owned Businesses, U.S. Small Business Administration, Office of Advocacy
(October 2018).
 	Edward N. Wolff, The Decline of African-American and Hispanic Wealth Since
the Great Recession, National Bureau of Economic Research (October 2018).
 	Alicia M. Robb, Financing Patterns and Credit Market Experiences: A
Comparison by Race and Ethnicity for U.S. Employer Firms, Prepared for Office
of Advocacy, U.S. Small Business Administration (2018).
 	Robert W. Fairlie, Latino Business Ownership: Contributions and Barriers for
U.S.-born and Immigrant Latino Entrepreneurs, Prepared for the Office of
Advocacy, U.S. Small Business Administration (2018).
 	U.S. Department of Commerce, Minority Business Development Agency, The
State of Minority Business Enterprises: An Overview of the 2012 Survey of
Business Owners (2018).
 	Small Business Credit Survey: Report on Minority-Owned Firms, Federal
Reserve Bank of Cleveland (November 2017).
 	Carolyn Karo and Jackson Mueller, Partnership for Lending in Underserved
Markets, Phase I Summary: Developing Action-Oriented Solutions to the
Financing Challenges Facing Minority-Owned Small Businesses, Milken
Institute (September 2017).
 	Dedrick Asante-Muhammad, Chuck Collins, Josh Hoxie, and Emanuel Nieves,
The Road to Zero Wealth: How the Racial Wealth Divide Is Hollowing Out
America’s Middle Class, Prosperity Now (September 2017).
57

 	Benjamin Whetzel, Home Equity Used to Start Seven Percent of U.S. Businesses,
Eye On Housing (August 2017).
 	U.S. Department of Commerce, Minority Business Development Agency,
Contracting Barriers and Factors Affecting Minority Business Enterprises: A
Review of Existing Disparity Studies (December 2016).
 	Alicia Robb and Arnobio Morelix, Startup Financing Trends by Race: How
Access to Capital Impacts Profitability, Annual Survey of Entrepreneurs Data
Briefing Series, Prepared for the Kauffman Foundation (October 2016).
 	Michael McManus, Minority Business Ownership: Data from the 2012 Survey of
Business Owners, U.S. Small Business Administration, Office of Advocacy
(September 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: Minority-Owned Businesses in the United States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: Black- Or African American-Owned Businesses In The United
States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: Asian-Owned Businesses In The United States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: American Indian- And Alaska Native-Owned Businesses In The
United States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: Hispanic-Owned Businesses In The United States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Survey of Business
Owners Facts: Native Hawaiian- and Pacific Islander-Owned Businesses In The
United States (May 2016).
 	U.S. Small Business Administration, Office of Advocacy, Minority STEM
Entrepreneurs (April 2016).
 	Robert Fairlie, Alicia Robb, and David T. Robinson, Black and White: Access to
Capital among Minority-Owned Startups (March 2016).
 	U.S. Department of Commerce, Minority Business Development Agency, Impact
of Minority Businesses on the U.S. Economy (December 2015).
 	Robert Rubinovitz, Utilization of Women-Owned Businesses in Federal Prime
Contracting, Department of Commerce (December 2015).
58

 	Michael S. Barr, Minority and Women Entrepreneurs: Building Capital,
Networks, and Skills, Prepared for The Hamilton Project, Brookings Institution
(March 2015).
 	Aaron K. Chatterji, Kenneth Y. Chay, and Robert W. Fairlie, The Impact of City
Contracting Set-Asides on Black Self-Employment and Employment, Journal of
Labor Economics (July 2014).
 	Signe-Mary McKernan, Caroline Ratcliffe, Eugene Steuerle, and Sisi Zhang,
Disparities in Wealth Accumulation and Loss from the Great Recession and
Beyond, American Economic Review (2014).
 	Alicia Robb, Access to Capital among Young Firms, Minority-owned Firms,
Women-owned Firms, and High-tech Firms, Prepared for the Office of Advocacy,
U.S. Small Business Administration (April 2013).
 	Signe-Mary McKernan, Caroline Ratcliffe, Eugene Steuerle, and Sisi Zhang, Less
Than Equal: Racial Disparities in Wealth Accumulation, Urban Institute (April
2013).
 	Signe-Mary McKernan, Caroline Ratcliffe, Margaret Simms, and Sisi Zhang, Do
Financial Support and Inheritance Contribute to the Racial Wealth Gap?, Urban
Institute (September 2012).
 	Robert Fairlie and Christopher M. Woodruff, Mexican-American
Entrepreneurship, The B.E. Journal of Economic Analysis & Policy (2010).
59