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Minorities Get Boost on Federal Pacts

Business: The administration, after proposing to change how it awards contracts, will seek to preserve 'race-conscious measures.'


WASHINGTON — Hoping to preserve a "race-conscious" system of awarding federal contracts, the Clinton administration said Tuesday that it will try to use statistics to show that blacks, Latinos, Asians and Native Americans are unfairly excluded from obtaining government work.

Officials plan to figure the percentage of minority-owned firms in an industry, such as construction or engineering, and then calculate the percentage of government money that has been awarded to minority firms in the industry over the last three years.

If the federal government falls below the "industry-specific benchmark" in awarding contracts to minorities, it can continue to use "race-conscious measures" that give an advantage to these "socially and economically disadvantaged" businesses, the Justice Department said. However, if minority-owned firms are receiving a proportionate share of government money in a particular industry, the preferences should be "limited," it added.

The proposal "ensures that race-conscious procurement decisions are made only when warranted to help break down discriminatory barriers to contracting opportunities for minority firms," the department said Tuesday.

The proposal was first announced a year ago and will be published as a regulation in the Federal Register on Friday. However, it will not take effect for months, the government said, since the Commerce Department has yet to compile the industry-by-industry statistics.

At issue is the awarding of $200 billion a year in federal contracts and purchases. In recent years, 6.6% of this total, or $11 billion, has gone to minority-owned firms.

Administration officials called this latest plan a "reform of affirmative action" that carries out President Clinton's goal to "mend it, don't end it."

"This is a serious, good-faith effort to mend affirmative action and to target it to where it is most needed," said a Justice Department official who asked not to be named.

Critics called the announcement stalling.

"It is a facade for maintaining the status quo," said Clint Bolick, a former Ronald Reagan administration Justice Department official who is critical of affirmative action. "They are trying to create an image of reform while doing nothing."

Two years ago, the Supreme Court rejected a federal policy that favored a Latino contractor over a white road builder in Colorado and ruled that the Constitution generally forbids the use of race as a factor in federal contracting. However, the justices left open the possibility that race could be used "in the extreme case" to "break down patterns of deliberate exclusion."

Since then, the administration has refused to back away from race-based preferences. It has ended only one such program, a Defense Department policy that excluded white-owned firms from competing for some contracts when two or more minority firms applied.

Otherwise, the administration has worked to formulate a new way to justify bidding preferences that would survive a court challenge.

No one contends that minority firms are being deliberately excluded by federal officials from receiving government work. However, some administration lawyers believe that prime contractors may discriminate against small minority firms in subcontracting.

The statistical measures will help pinpoint such continuing discrimination, they said.

The federal proposal mimics the strategy used by many large cities, including Los Angeles and San Francisco, in response to a 1989 Supreme Court decision. That year, the justices struck down a Richmond, Va., ordinance that set aside 30% of its contracts for minority firms and ruled such city and state programs generally unconstitutional.

However, Justice Sandra Day O'Connor said that "a significant statistical disparity" between the percentage of qualified minority contractors in the area and the amount of government work they received could furnish "an inference of discriminatory exclusion." This might justify affirmative action "in the extreme case," she said.

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