Texas business owner sues to halt state’s race-based contracting practices

Austin, TX; November 13, 2024: Aerospace Solutions, LLC, an aerospace staffing agency represented by Pacific Legal Foundation, has filed a federal lawsuit challenging Texas’ Historically Underutilized Business (HUB) program’s mandate that a certain percentage of state contracts are reserved for businesses owned by members of preferred minority groups.  

Despite its proven expertise, Aerospace Solutions is unable to submit competitive bids for Texas Department of Transportation contracts, simply because the company does not meet the racial requirements for HUB certification. The program stipulates that at least 51% of a company must be owned by individuals from designated minority groups: Black Americans, Hispanic Americans, Asian Pacific Americans, Native Americans, women, or service-disabled veterans. In order to bid on a contract, Aerospace Solutions would have to forfeit over a quarter of the contract’s value to a HUB subcontractor, making the contract financially unfeasible.

“The government at all levels is supposed to treat every citizen equally, regardless of skin color,” said Erin Wilcox, an attorney at Pacific Legal Foundation. “Race-based preferences in public contracting do the exact opposite. They prioritize businesses based on the owners’ race when all that should matter is which company can do the best job at the best price.” 

Nearly 300 Texas agencies and universities must follow these race-based contracting rules. Local governments can adopt them too. This discriminatory system creates a stark double standard. While Aerospace Solutions must split contracts with subcontractors, their HUB-certified competitors can keep 100% of contract work for themselves. Racial classifications, not merit, are used to award contracts worth millions of taxpayer dollars.  

The Constitution demands equal treatment under the law. Taxpayers deserve the best service at competitive prices.  

The case is Aerospace Solutions, LLC v. Greg Abbott, et al. filed in U.S. District Court for the Western District of Texas.