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Minority Contractors Lose Preference At Pentagon
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Minority Contractors Lose Preference At Pentagon

Race

Minority Contractors Lose Preference At Pentagon

Minority Contractors Lose Preference At Pentagon
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A Pentagon affirmative action program that benefits contracting companies owned by racial minorities has been declared unconstitutional. The decision was issued Nov. 4 — Election Day — so it hasn't received much attention. But the decision could mean the end of similar programs at all levels of government.

MICHELE NORRIS, host:

From NPR News, this is All Things Considered. I am Michele Norris. On November 4th, Election Day, a federal appeals court issued a ruling that didn't get much attention. It declared unconstitutional a Pentagon affirmative-action program that benefits contracting companies owned by racial minorities. As NPR's Jeff Brady reports, the court decision could mean the end of similar programs at all levels of government.

JEFF BRADY: For about 10 years, Rothe Development Corporation had a contract to maintain and operate computers systems at Columbus Air Force Base in Mississippi. In the late 1990s, another company bid on the contract, and because it was owned by a Korean-American couple, it was given preference over Rothe. Dale Patenaude is Rothe's vice president. His company sued because, he says, the decision was unfair.

Mr. DALE PATENAUDE (Vice President, Rothe Development, Inc.): This is no different than Rosa Parks being told to go to the back of the bus. We were told to go to the back of the contracting bus because we were white and they were going to put somebody that was an Asian-American in front of us.

BRADY: Patenaude's wife is president of Rothe. They have about 150 employees, and he says arguing this case over the past decade has set them back $2 million. It's unlikely they'll recover much of that money, but Patenaude says this was not a business decision; it was about setting things right.

Mr. PATENAUDE: Affirmative action - I think - we need to be past affirmative action. We need to go - we need to move on, you know? We need to have everybody have an equal chance, but you don't give people an equal chance by pulling other people down.

BRADY: Earlier this month, the appeals court for the federal circuit in Washington ruled in Rothe's favor.

Professor STEVEN SCHWINN (Associate Professor, The John Marshall Law School): It is a significant decision.

BRADY: Steve Schwinn is a professor at John Marshall Law School in Chicago. He says Congress relied on racial-discrimination studies to reauthorize the law that was behind the decision to deny Rothe the contract. That law sets aside five percent of the money the Defense Department spends on contracts for minority-owned firms. Schwinn says the appeals court decision was critical of the studies.

Prof. SCHWINN: What it says specifically is that Congress lacked the evidence to justify a race-based program.

BRADY: Schwinn predicts that if the case makes it before the current Supreme Court, the decision will be upheld.

Prof. SCHWINN: It could have an effect on any level of government that has adopted a race-based affirmative-action program that's designed to remedy the effects of discrimination.

BRADY: Then, minority-owned companies would lose their advantage in billions of dollars worth of government contracts. One company is TGV Rockets in Norman, Oklahoma. Look at their webpage and there's a video of one of their rockets being tested at NASA.

(Soundbite of rocket launch)

BRADY: CEO Patrick Bahn is Asian-American. He says engineers look at that video and see success.

Mr. PATRICK BAHN (Chief Executive Officer, TGV Rockets, Inc.): I look at it, I see $30,000 a second rolling out the back, because I'm the guy writing the checks.

BRADY: Bahn also bids on Department of Defense contracts, and he says there's still a need for contracting preferences based on race.

Mr. BAHN: Oftentimes, people who are cut out of, you know, the middle path of American society still have very big things that they can contribute.

BRADY: Bahn will be among those watching closely to see what happens next with this case. Congress could decide to address the court's concern about the studies it examined to justify the law. The Air Force says it hasn't decided yet whether to appeal the decision. Jeff Brady, NPR News, Washington.

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