Indiana will discontinue aspects of a diversity program it used for decades to recruit minority and female contractors after the state attorney general determined the program’s race and gender preferences were unconstitutional.
Gov. Mike Braun announced Wednesday morning he will replace race- and sex-based contracting preferences in the Minority and Women’s Business Enterprises Program and Indiana’s Diversity Business Enterprises Program with a merit-based system.
The decision follows a legal review conducted by Attorney General Todd Rokita, who issued an opinion this week finding the preferences violate the constitution’s equal protection clause.
“Our Constitution mandates equal protection under the law, because a system where the government picks winners and losers on the basis of race or sex can never be fair,” Braun said in a statement. “Indiana has replaced divisive, politically-charged programs with a focus on Merit, Excellence, and Innovation: a level playing field where every single Hoosier has the chance to get ahead with hard work.”
Department of Administration Commissioner Brandon Clifton requested the legal review last August, citing the U.S. Supreme Court’s ruling against the use of race in college admissions and a memorandum from the U.S. attorney general warning against unlawful discrimination.
Clifton’s request covered the entire diversity business program — enacted by law in 1983 to promote diversity in state contracts — and asked whether the division needed to comply with state law requiring a five-year diversity study due last year.
At the time of his request, the division’s diversity participation goals were set at an average of 8% for minority-owned businesses and 10% for women-owned businesses.
Rokita found race- and sex-based preferences unconstitutional, but determined preferences for veteran-owned businesses are lawful.
His legal opinion is nonbinding, and he said he will work with lawmakers to repeal the 1983 statute.
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“This blatantly illegal program singles out some Hoosiers for disfavored treatment purely because of their sex or the color of their skin, and it insults other Hoosiers by suggesting they cannot compete on a fair playing field. The program is both un-American and unconstitutional,” Rokita said in a news release Wednesday.
He determined Braun has the authority to decline to implement the statute because race- and sex-based preferences “are clearly unconstitutional and deprive certain Hoosiers of their right to equal protection under the law.”
The Department of Administration will now decide how to unwind the race- and sex-based elements of the program, with the Attorney General’s office advising the administration through the transition.
The decision quickly drew condemnation from Democratic lawmakers.
Indianapolis Rep. Mitch Gore issued a statement Wednesday calling the decision “bad public policy” and a “failure to faithfully execute the laws enacted by the Indiana General Assembly.”
“For more than forty years, Indiana has recognized that expanding opportunities for qualified minority- and women-owned businesses strengthens our economy, increases competition and delivers better value for taxpayers,” Gore said. “That policy is not merely an executive initiative — it is the law.”
He continued, “The Governor has now chosen to dismantle that statutory framework based upon an advisory opinion from the Attorney General. That is not how our constitutional system works. The Attorney General does not invalidate statutes. The Governor does not repeal laws.”
This story will be updated.
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