In a significant shift in federal policy, the Trump administration has taken steps to dismantle a long-standing $37 billion highway contracting program designed to support minority- and women-owned businesses. This move, announced on May 28, 2025, has sparked intense debate, with critics arguing it could undermine opportunities for underrepresented groups in the $759 billion transportation contracting sector, while supporters claim it addresses constitutional concerns about fairness in government contracting. Here’s a closer look at the program, the administration’s rationale, the potential impacts, and the broader implications for small businesses across the United States.
The Disadvantaged Business Enterprise (DBE) program, established in 1980, is a federal initiative administered by the U.S. Department of Transportation (DOT). It mandates that at least 10% of federal funding for transportation infrastructure projects—amounting to roughly $37 billion under the 2021 Infrastructure Investment and Jobs Act—be allocated to small businesses owned by socially and economically disadvantaged individuals, particularly women and racial minorities. The program, reauthorized in November 2021, serves an estimated 49,000 contractors nationwide, providing a critical lifeline for minority- and women-owned firms in a highly competitive industry.
The DBE program was designed to address systemic barriers that have historically limited access to federal contracts for these groups. By setting aside funds, it aims to level the playing field, enabling small businesses to secure contracts for road construction, transit projects, and other infrastructure work. For many of these firms, the program has been a cornerstone of growth, helping them compete against larger, more established companies.
On May 28, 2025, the Trump administration filed a motion in the U.S. District Court for the Eastern District of Kentucky, siding with two White-owned contracting businesses that challenged the DBE program’s constitutionality. The Justice Department argued that the program violates the equal protection clause of the U.S. Constitution by prioritizing race and gender in awarding contracts. This stance aligns with broader efforts by the administration to eliminate policies perceived as discriminatory, including those promoting diversity, equity, and inclusion (DEI).
The challenge stems from a lawsuit brought by the Wisconsin Institute for Law & Liberty (WILL) on behalf of two Indiana-based construction companies. WILL argued that the DBE’s goals create “discriminatory barriers” that prevent non-minority-owned firms from competing fairly. The administration’s decision follows a 2023 Tennessee court ruling that struck down a similar Small Business Administration program, which presumed certain ethnic groups were inherently disadvantaged—a key factor in receiving contract set-asides.
Supporters of the administration’s move, such as WILL Associate Counsel Cara Tolliver, hailed it as a “monumental victory” for equality under the law. They argue that race- and gender-based preferences are inherently unfair and that contracts should be awarded based on merit alone. Kramer Koetter, a client of WILL and owner of Mid-America Milling Company, emphasized the need for a “level playing field,” stating that businesses should be judged on the quality and cost of their work, not demographic factors.
The decision to dismantle the DBE program has raised alarm among minority- and women-owned businesses, as well as advocacy groups. Critics argue that the program is essential for overcoming entrenched barriers in the construction industry, where minority-owned firms have historically been underrepresented. According to the U.S. Department of Labor, in 2021, minority-owned businesses made up 24% of eligible firms for federal contracts but received only 3% of awards, underscoring the need for targeted support.
Colette Holt, a San Antonio-based attorney with decades of experience defending minority contracting programs, warned that the end of the DBE could lead to a significant loss of opportunities for firms that have relied on it to build their businesses. She noted that while the settlement leaves room for preferences based on economic disadvantage rather than race or gender, such a shift could dilute the program’s effectiveness in addressing systemic inequities.
A coalition of businesses that intervened in the Kentucky court case after President Trump took office echoed these concerns, arguing that the DBE is vital for breaking down barriers in the $759 billion contracting sector. Without it, many small firms may struggle to compete, potentially leading to job losses and reduced economic opportunities in underserved communities. For example, during President Joe Biden’s term, the Minority Business Development Agency, which supports similar initiatives, helped minority-owned firms secure over $3.2 billion in contracts and create more than 23,000 jobs.
The move to dismantle the DBE program is part of a broader push by the Trump administration to overhaul federal spending and contracting practices. Since taking office, the administration has issued executive orders aimed at streamlining procurement, reducing DEI initiatives, and prioritizing “merit-based” opportunities. For instance, Executive Orders 14151 and 14173 revoked policies promoting equal employment opportunity and DEI for federal contractors and grant recipients, signaling a shift away from programs that explicitly consider race or gender.
Additionally, the administration has implemented a contracting freeze that has already forced some small firms out of business due to delayed invoice payments, according to the Professional Services Council. This freeze, combined with cuts to other programs like the Minority Business Development Agency, has raised concerns about the impact on small and minority-owned businesses nationwide. A federal judge in Rhode Island recently blocked attempts to shrink the Minority Business Development Agency, highlighting tensions between the administration’s cost-cutting measures and existing legal protections.
The proposed settlement to end the DBE program is not yet finalized and faces potential challenges. The coalition of businesses defending the program could push back in court, arguing that its elimination would harm minority- and women-owned firms disproportionately. If approved, the settlement might allow for a restructured program that prioritizes economic disadvantage over race or gender, though experts like Holt warn that such changes could reduce the program’s impact.
The debate over the DBE program reflects broader questions about affirmative action and fairness in government contracting. Supporters of the program argue that systemic inequities in the construction industry justify targeted interventions, while opponents contend that any form of race- or gender-based preference violates constitutional principles. As the case moves forward, its outcome could set a precedent for other federal programs aimed at supporting underrepresented groups.
The potential end of the DBE program comes at a critical time for U.S. infrastructure. The 2021 Infrastructure Investment and Jobs Act allocated significant funding for transportation projects, and the DBE program has been a key mechanism for ensuring that small businesses share in those opportunities. Without it, the contracting landscape could become even more competitive, potentially favoring larger firms with greater resources.
For small business owners like Remona Antoine, whose consulting firm has been affected by recent federal cuts, the loss of programs like the DBE could stifle growth and innovation. Samuel Wiggins, president of the Virginia Minority Chambers, described federal contracts as the “holy grail” for minority-owned firms, emphasizing their importance in building sustainable businesses.
The Trump administration’s move to dismantle the $37 billion DBE program has ignited a firestorm of controversy, pitting advocates of equal opportunity against those who prioritize constitutional fairness. As the legal battle unfolds, the future of minority- and women-owned businesses in the transportation sector hangs in the balance. The outcome will likely shape not only federal contracting but also the broader conversation about equity and opportunity in America’s economy.
For more details on the administration’s actions, read the full report from The Washington Post or explore the legal arguments presented by the Wisconsin Institute for Law & Liberty. For insights into the broader impact on minority-owned businesses, check out NBC Washington’s coverage.
The Trump administration has initiated steps to eliminate a $37 billion federal program aimed at supporting minority- and women-owned businesses in transportation contracting. Announced on May 28, 2025, this decision has sparked debate over fairness, constitutional rights, and the future of small businesses in a $759 billion industry.
The Disadvantaged Business Enterprise (DBE) program, launched in 1980, ensures that at least 10% of federal transportation funding—approximately $37 billion—supports small businesses owned by women and minorities. Administered by the U.S. Department of Transportation, it serves 49,000 contractors, addressing historical barriers in the contracting sector.
In a motion filed in the U.S. District Court for the Eastern District of Kentucky, the Justice Department argued that the DBE violates the equal protection clause by favoring race and gender. The move supports a lawsuit by two White-owned businesses, backed by the Wisconsin Institute for Law & Liberty, which claims the program creates unfair barriers.
Critics warn that dismantling the DBE could limit opportunities for minority- and women-owned firms, which received only 3% of federal contracts in 2021 despite comprising 24% of eligible businesses. Experts like Colette Holt suggest that a shift to economic-based preferences may weaken the program’s ability to address systemic inequities.
This decision aligns with the administration’s broader efforts to eliminate DEI initiatives and streamline federal spending. Executive orders and a contracting freeze have already impacted small firms, with some closing due to delayed payments.
The settlement faces potential challenges from a coalition of businesses defending the program. If approved, it could reshape federal contracting, with implications for infrastructure projects and small business growth.
The debate over the DBE program highlights tensions between equity and constitutional fairness. Its outcome will shape the future of minority- and women-owned businesses in America’s infrastructure sector.
Sources:
Read More :- Social Media Platforms Test New Ad Formats, Prioritizing Short-Form Video Content in the USA
New York City is vast and ever-changing, but no borough captures its creative pulse quite…
When Resorts World Las Vegas opened its doors in 2021, it was billed as a…
Las Vegas may be known for over-the-top luxury, but it also offers something wonderfully unexpected—world-famous…
Las Vegas has always been synonymous with extravagance, but in 2025, the city’s most elite…
Las Vegas may be the ultimate playground, but venture just a short drive beyond the…
When most people think of Las Vegas, they imagine casinos, cocktails, and late-night glamour. But…