Last week’s revocation of federal affirmative action requirements was accompanied by a statement from the Trump administration stating its intent to eliminate any federal program that promotes DEI principles. This action calls into question the future of programs that require that portions of some federal contracts be offered to women and minority-owned small businesses.
Unlike the executive order Trump revoked last week about affirmative action, these set aside programs, which are administered by the Small Business Administration, are based on federal statutes that would need to be modified or revoked through legislative action. Regardless, the SBA has significant authority to modify set aside rules and exceptions to such rules that could result in a significant decrease in application or enforcement of these laws.
Many of these certified businesses rely on the mandatory set asides to compete for contracting business with larger companies. Elimination of these programs could jeopardize those small businesses, including those that supply military bases across the U.S. The potential loss of those businesses and accompanying jobs in communities with a heavy federal contracting presence may forestall efforts to eliminate set asides. However, if the Trump administration is serious about eliminating all federal programs that use race or sex as the basis for contractor qualification, contracting set asides appear ripe for review and change.
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