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Article

Abstract

Small businesses play a pivotal role in the United States job market, constituting the largest source of employment throughout the national economy and employing more than 60 million Americans. However, small socially and economically disadvantaged firms, particularly those owned and operated by minoritized entrepreneurs, face substantial underrepresentation and challenges in securing government contract awards. Minority-owned firms have historically had difficulty in securing capital investments in comparison to non-minority-owned businesses due to having had to contend with the ongoing effects of systemic racism over generations. Acknowledging the tremendous value of small socially and economically disadvantaged businesses to the overall health and vitality of the economy, Congress and multiple presidential administrations have committed to investing in these businesses over a period spanning seven decades. Through the targeted provision of technical expertise, access to much-needed capital, and perhaps most importantly, through contract opportunities exclusively available to qualifying minority-owned businesses, minoritized business owners have been able to gain a footing in the national economy. The Small Business Administration's Section 8(a) Program has largely been responsible for effectuating this important national policy priority. Despite having significant congressional support, the Small Business Development Program has not been without its challenges. Over the years, some consternation and litigation have challenged the restrictive definitions of companies that can be enrolled in and receive the benefits of this extensive government program. The primary constitutional challenge has been centered on the affirmative action nature of a program designed to promote the interests of companies based largely on racial classifications. Although the Small Business Development Program has in the past successfully navigated constitutional challenges, the Supreme Court’s recent decision in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College (“SFFA”) suggests that programmatic and legislative changes may be necessary to ensure the long-term survivability of the program. The Small Business Development Program, one of numerous race-conscious federal programs that have been developed to remediate structural inequalities, will almost certainly be subject to future legal challenges in the wake of SFFA. This Article delves into the historical evolution and structure of the Small Business Development Program in light of the Supreme Court's rejection of race-based remedial measures. Fundamentally, this Article argues that, despite the Supreme Court's recent affirmative action decision in SFFA, the Small Business Administration's Section 8(a) Program remains socially desirable, economically and ethically necessary, and legally permissible.

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