Well-Worn Playbook

In February, CIR filed a lawsuit against the SBA and USDA on behalf of Ultima Services Corporation challenging a federal program that sets aside government contracts for minority-owned businesses, called the Section 8(a) program.  Since then,  the agencies have turned to their well-worn playbook to try to have the case dismissed before the district court can reach the merits.

The USDA and SBA have moved to dismiss the case on the grounds that Ultima lacks standing to challenge Section 8(a).  They argue that Section 8(a) considers the race of applicants, but it also has race neutral requirements.  To challenge the race exclusivity of the 8(a) program, the contractor must first demonstrate that it would qualify for the programs under its race-neutral criteria, according to their motion.

The agencies’ argument misses an important detail.  Ultima is not trying to be included as a Section 8(a) contractor; rather, it is challenging the government’s authority to take contracts out of the general pool and set them aside with a racially discriminatory intent.  The law may have race-neutral components, but the program as a whole discriminates on the basis of race.  CIR filed its Brief in Opposition on July 31, 2020.