Members of the Indiana Black Legislative Caucus believe they may be able to sue Gov. Mike Braun over his recent move to end some contracting preferences for women and minority owned businesses.
But first, they need to find minority-owned business owners affected by Braun’s actions last month to replace the minority contract goals with a “merit-based” system.
The Black Legislative Caucus announced a callout during a Monday press conference. It is looking for any businesses currently under contract with the state, or under a proposed contract, that are dealing with the deleted minority participation goals.
Those in the caucus are accusing Braun and Attorney General Todd Rokita, through his opinion on ending the minority program, of overstepping their authority by not rescinding the state statute through the Indiana General Assembly.
"All we're saying is that if the governor and the attorney general want to eliminate a program, they should go through the legislative process to get that done, not through an executive order,” said Sen. Greg Taylor (D-Indianapolis).
Last month, Rokita issued an opinion in response to questions sent in by the Indiana Department of Administration that asked for a legal review of the state’s race and gender based contract goals last year.
Rokita said he found that parts of the state’s Diversity Business Enterprises and Minority and Women’s Business Enterprises programs were unconstitutional because they favored some contractors based on sex and race.
The program set diversity goals for the state that meant, on average, 10% of state contracts go to women-owned businesses and 8% to minority-owned businesses.
Rokita pointed to the 2023 Supreme Court decision, Students for Fair Admissions, as evidence that racial preference programs can rarely be justified by the Constitution and that Gov. Braun could decline to implement an unconstitutional statute.
Sen. Taylor contends that Rokita cannot determine whether a state statute is unconstitutional on his own, but rather, that determination must be made through a court action.
Braun also announced at the time that he plans to launch a new small-business initiative to help more Indiana businesses compete for state contracts.
The governor’s office told WFYI on Monday that it expects to provide an update on the merit-based approach in October. They also welcome various stakeholders to provide input to the new merit-based system “that ensures every business operates on a level playing field.”
Chair of the Indiana Black Legislative Caucus, Rep. Earl Harris (D-East Chicago) also said on Monday that he worries that by eliminating the diversity program, it will hurt Indiana’s chance to be competitive and the state’s overall economy.
“If the administration believes its new approach is better, then show us the data,” Harris said. “Show us how many businesses will have access to contracts. Show us how competition will be maintained. Show us how Indiana taxpayers will save money.”
The caucus is also calling on Gov. Braun to continue issuing the state’s disparity study, which state law requires every five years. However, the last disparity study that was released was in 2020.
Denise Herd of the National Association of Women Business Owners Indianapolis chapter said she worries about what will happen to women-owned businesses when pathways for contracts are eliminated.
“Women business owners are not asking for special treatment,” Herd said. “We are asking for a fair opportunity to compete, demonstrate our value, and earn business based on on the quality of our work.”
WFYI Government Reporter Benjamin Thorp contributed to this story.
Contact WFYI Government Reporter Caroline Beck at cbeck@wfyi.org
