Aerospace Solutions brings specialized staffing expertise to aerospace technology. Like most companies in the field, Aerospace’s success depends on having a fair, competitive shot to win state contracts.
In 2021, inspired by the state’s reputation for entrepreneurship, Aerospace Solutions relocated to Austin, TX. The company already had earned national recognition as a trusted resource for companies looking to fortify their workforce with good, hard-working talent. It moved to Texas looking to expand.
But Aerospace has learned the hard way that Texas played favorites when it came to bidding on state contracts. Instead of competing on an even playing field, Aerospace was placed at a significant disadvantage—simply because of the owners’ sex and race. Texas’ Historically Underutilized Business (HUB) program forced companies like Aerospace to hand over a large slice of any state contract to HUB-certified businesses.
To qualify as a HUB business, a company had to be at least 51% owned by someone belonging to the state’s preferred minority groups: Black Americans, Hispanic Americans, Asian Pacific Americans, Native Americans, women, or service-disabled veterans. Because Aerospace’s owners did not fit into any of these categories, their company was automatically disadvantaged when bidding on state contracts.
The real-world impact of the HUB program hit home in August 2023 when the Texas Department of Transportation sought proposals for a three-year employee recruitment contract. Despite its expertise and capacity, Aerospace couldn’t submit a competitive bid under the HUB restrictions. The program’s mandatory 26% set-aside meant surrendering more than a quarter of the contract’s value to other companies—not because they could do better work, but because of the owner’s race.
This discriminatory system created a system where merit and value were less important than racial classifications in deciding the winners.
The problem ran deep in Texas government. Nearly 300 state agencies and universities had to follow these race-based contracting rules. Local governments adopted them, too.
Courts had struck down similar programs nationwide for violating the Equal Protection Clause. Moreover, these systems waste taxpayer money, breed corruption, and push the false notion that certain racial groups need government preferences to succeed.
Texas should focus on removing real barriers that hold back small businesses. Factors like experience, capability, and value—not race—should determine who wins government contracts.
The Constitution demands equal treatment under the law. Taxpayers deserve the best service at competitive prices—and this is exactly what Aerospace wanted to provide. It fought back.
Represented by Pacific Legal Foundation at no charge, Aerospace Solutions filed a federal lawsuit to restore fair competition in Texas’ contracting and ensure public contracts go to the most qualified bidders, regardless of race. Unfortunately, in 2025, the district court granted the defendant’s motion to dismiss.
What’s At Stake?
- Government contracts shouldn’t be handed out on the basis of race. Government contracting programs that assign benefits or burdens based on the race of a company’s owner violate the constitutional promise of equality before the law.
- What’s more important is the ability to serve the public by doing an excellent job at a reasonable price. The government should select contractors based on their ability to perform the work needed, rather than on the race of their owners.
