WASHINGTON -- The Clinton administration will announce a new approach in the awarding of government contracts that may end race-based preferences for some minority-owned businesses while making billions of dollars in federal contracts available for others, officials said yesterday.
The new effort reflects a commitment within the administration to preserve some affirmative action programs while complying with court rulings that severely limit them.
The revised approach, in proposed Justice Department regulations to be issued this week, will substantially change the rules for awarding federal contracts worth $200 billion a year.
It will rely heavily on an ambitious industry-by-industry review, already under way at the Commerce Department, that is intended to determine where minority groups may actually be experiencing discrimination in the awarding of government contracts.
While some minority-owned businesses may well benefit from the findings, the review may also determine that minority groups are over-represented in some areas of government contracting. In those cases, officials said, preferences will be scaled back, suspended or eliminated.
The proposal is a response to a 1995 Supreme Court decision that limited the ability of federal programs to award benefits on the basis of race or sex. The case involved a white-owned Colorado company that lost a federal highway construction job to a Hispanic-owned business that had submitted a higher bid.
The Supreme Court ruled 5-4 that race-based preference programs were constitutional only in response to quantifiable evidence of discrimination against an affected party.
The administration has been struggling since then to find a way to comply with that decision while preserving affirmative action programs that are strongly supported by important Democratic constituencies: blacks and other minorities, as well as women.
Businesses that are owned by minorities, or that for other reasons qualify as economically disadvantaged, now account for 6.6 percent, or $11 billion, of annual federal procurement of goods and services, from paper products to engineering studies.
President Clinton in 1995 vowed to "mend" affirmative action but not "end" it. He promised to establish legal measures to help disadvantaged businesses to compete fairly with more established companies without imposing "reverse discrimination" on white-owned concerns.
Administration officials, who insisted on anonymity, said the rules were an effort to find a "narrowly tailored fix" that could pass the Supreme Court's rigid standard while meeting the president's goal of keeping some preferences intact.
Pub Date: 5/06/97
