The US Department of Transportation (US DOT) said in a court filing this week it has agreed to end consideration of race or gender in DOT’s Disadvantaged Business Enterprise Program (DBE) program when awarding billions of dollars in federal highway and transit projects. USDOT agreed with plaintiffs in the suit that the DBE “program’s use of race- and sex-based presumptions in awarding contracts is unconstitutional." USDOT previously defended the policy as seeking to remedy past discrimination but said it has since reevaluated its position in light of factors including a 2023 Supreme Court decision.
The case was brought in 2023 by two Indiana based construction companies that alleged the program led to their losing contracts because of DBE program requirements. In a series of preliminary orders issued last fall the judge signaled his intention to declare the program unconstitutional leading USDOT to propose the current settlement agreed to by the plaintiffs.
If, as expected, the judge approves the proposal, USDOT will be prohibited from requiring states to award contracts based on race and sex, effectively ending the DBE program’s founding mission. The program began in 1983 in that year’s highway authorization legislation and has been continued in subsequent reauthorization bills. USDOT will now likely issue guidance to states on next steps.