WISCONSIN INSTITUTE FOR LAW & LIBERTY, INC.

330 E. Kilbourn Ave., Suite 725, Milwaukee, WI 53202-3141

414-727-WILL
Fax 414-727-6385
www.will-law.org

February 24, 2025

Hon. Pam Bondi, Attorney General

Christine Stoneman, Section Chief
U.S. Department of Justice, Civil Rights Division
Federal Coordination and Compliance Section
950 Pennsylvania Avenue, NW, 4CON, 7th Floor
Washington, DC 20530
Via email to FCS.CRT@usdoj.gov, christine.stoneman@usdoj.gov

Re: Title VI Complaint, New York Department of Economic

Development

Dear Attorney General Bondi:

We represent Contractors for Equal Opportunity, a nationwide association of

companies negatively impacted by race discrimination in government contracting
programs. Please consider this letter a civil-rights complaint under Title VI of the
Civil Rights Act of 1964 against the New York Department of Economic
Development (DED) for its discriminatory Minority and Women-Owned Business
Enterprise Program (MWBE Program). DED is a recipient of federal funds and
therefore subject to the nondiscrimination provisions of Title VI. We are filing this
complaint with the U.S. Department of Justice because DED receives federal grants
from multiple federal agencies.

President Trump’s Executive Orders

Since he took office on January 20, 2025, President Trump has issued
multiple executive orders requiring federal agencies to identify, investigate, and
ultimately terminate race-based programs. Under Ending Radical and Wasteful
Government DEI Programs and Preferencing, all agencies must recommend actions
to align agency enforcement activities “with the policy of equal dignity and
respect.”1 Also, the Executive Order on Ending Illegal Discrimination and Restoring
Merit-Based Opportunity, declares it to be the policy of the United States “to protect
the civil rights of all Americans” and orders “all agencies to enforce our

1White House, Executive Order on Ending Radical and Wasteful Government DEI Programs and
Preferencing (Jan. 20, 2025), available here.
longstanding civil-rights laws.” 2 Furthermore, under this Executive Order “every
contract or grant award” must ensure that the recipient is in “compliance in all
respects with all applicable Federal anti-discrimination laws.”

Investigating civil rights violations is one of the most fundamental duties of

the Attorney General. In this complaint, we are asking you to open an investigation
into a state-based supplier and procurement program that discriminates openly
against small businesses based on race. Many states operate similar programs (19
states by our count). These programs are similar to the federal Disadvantaged
Business Enterprise Program. As you may know, a federal judge ruled that the
DBE program is unconstitutional because it discriminates based on race. 3 If that
federal program is unconstitutional, then these state-based counterparts are
similarly unconstitutional. We therefore request that you investigate these
programs and determine that they are operating in violation of Title VI. Each state
agency operating such a program receives federal funds and is therefore bound by
Title VI and subject to your jurisdiction.

DEC’s MWBE Program

The MWBE Program exists to “increase the participation of minority [ ]

owned businesses in State procurement opportunities.”4 Under New York state law,
DED administers the program by “encourag[ing] and assist[ing] [ ] agencies in their
efforts to increase participation by minority [ ] owned business enterprises on state
contracts and subcontracts so as to facilitate the award of a fair share of such
contracts to them.” 5 DEC’s rules administering the program require agencies to: (1)
set goals for the use of minority-owned business enterprises, (2) consider a bidder’s
“diversity practices,” including their use of minority-owned contractors, (3) require
contractors to “submit utilization plans for achieving contract goals established” for
the participation of certified minority-owned businesses; (4) accept contractor
utilization plans that meet goals for certified minority-owned businesses; (5) enforce
the goals by requiring contractors’ best efforts; and (6) disqualify contractors that
fail to meet the racial goals of a project.6

Additionally, state contractors are subject to intense compliance

investigations. One such provision requires an “in-depth compliance review,” which
compares the ratios of “minority group members in a contractor's work force to the
relevant availability and expected levels of participation of minority group members

2 White House, Executive Order on Ending Illegal Discrimination and Restoring Merit-Based
Opportunity (Jan. 21, 2025), available here.
3 See MAMCO v. USDOT, 2024 WL 4267183, No. 23cv72 (Sept. 23, 2024).
4 Department of Economic Development, Agency Appropriations, available here.
5 N.Y. Exec. Law § 311(3)(a).
6 See N.Y. Comp. Codes R. & Regs. tit. 5, § 142.1–14. The complete rules are available here:

https://esd.ny.gov/sites/default/files/MWBERegulations-120220.pdf.

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[ ] on State contracts.”7 In short, if a contractor does not have the correct racial
balance of workers, it is subject to penalties or disqualification.

“Minority” is defined under the regulations as including only the following:

“(1) Black persons having origins in any of the African racial groups; (2)
Hispanic/Latino persons of Mexican, Puerto Rican, Dominican, Cuban, Central
American or South American descent of either Native American or Latin American
origin, regardless of race; (3) Native American or Alaskan native persons having
origins in any of the original peoples of North America; or (4) Asian and Pacific
Islander persons having origins in any of the Far East countries, South East Asia,
the Indian Subcontinent or the Pacific Islands.”8

New York’s minority- and women-owned business utilization goal is 30%. On

November 12, 2024, Gov. Hochul announced a 2024 utilization rate of 32.21%,
representing $3 billion in public contracts awarded in the previous fiscal year. 9

MWBE Program Violates Title VI

Title VI states that no person shall be subject to discrimination “on the

ground of race, color, or national origin” “under any program or activity receiving
Federal financial assistance.” 10 Under this law, “it is never permissible to say ‘yes’
to one person but to say ‘no’ to another person even in part because of the color of
his skin.”11 Race-based preferences “are by their very nature odious to a free people
whose institutions are founded upon the doctrine of equality.” 12 “That principle
cannot be overridden except in the most extraordinary case.”13

DED cannot offer any justification to defend its MWBE Program, which
illegally discriminates by enforcing a 30% utilization rate for minority- and women-
owned businesses in state procurement and contracting. Under Students for Fair
Admission v. Harvard (which was a Title VI case), a program like this one must
pass several independent tests. Here, DED cannot satisfy any of them.

First, DED’s program is illegal because it does not remedy “specific, identified
instances of past discrimination that violated the Constitution or a statute.”14 DED

7 N.Y. Comp. Codes R. & Regs. tit. 5, § 143.4.

8 N.Y. Comp. Codes R. & Regs. tit. 5, § 140.1.
9 State of New York, Governor Hochul Announces New York State Exceeds 30% Minority- and

Women-Owned Business Utilization (Nov. 12, 2024), available here.

10 42 U.S.C. § 2000d.
11 Students for Fair Admissions, Inc. v. President & Fellows of Harvard Coll., 600 U.S. 181, 310

(2023) (Gorsuch, J. concurring) (cleaned up).

12 Rice v. Cayetano, 528 U.S. 495, 517 (2000) (quotation omitted).
13 SFFA, 600 U.S. at 208. DED, as a subunit of the State of New York, is not immune. Title VI

explicitly abrogates state immunity. See 42 U.S.C. § 2000d-7.

14 SFFA, 600 U.S. at 207; see also Vitolo v. Guzman, 999 F.3d 353, 361 (6th Cir. 2021).

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has not identified any past intentional discrimination that it perpetrated, or
explained how its race-based target is narrowly designed to remedy that past
discrimination.

Second, DED cannot “articulate a meaningful connection between the means

they employ and the goals they pursue.” 15 For example, DED employs the same type
of “overbroad” and “imprecise” racial categories employed by Harvard and North
Carolina.16 DED “group[s] together all Asian” business owners and does not explain
why business owners from Jordan, Iraq, Iran, and Egypt are excluded from the
program.17

Third, DED’s program uses race as a “negative.”18 White business owners,

because they are white, cannot bid on equal footing with minority-owned firms,
which have a clear preference and exclusive access to certain resources based on
race. DED contracts are “zero-sum” because there are only a limited number of
contracts. Therefore, race is used by DED as a “negative”: “A benefit provided to
some applicants but not to others necessarily advantages the former group at the
expense of the latter.”19

Fourth, DED’s program furthers “stereotypes that treat individuals as the

product of their race, evaluating their thoughts and efforts—their very worth as
citizens—according to a criterion barred to the Government by history and the
Constitution.”20 It is simply a pernicious racial stereotype to claim, as DED does
here, that all black businesses need help because their owners are black, and that
no Arab-owned businesses need help because their owners are Arab.

Fifth, and finally, DED’s program has no “logical end point.”21 DED has run
this program since 1988, and the agency offers no plan to wrap it up. Apparently, it
will continue forever: “In short, there is no reason to believe that respondents will—
even acting in good faith—comply with the Equal Protection Clause any time
soon.”22

Under SFFA, a race-based government program must meet all five of these
requirements to comply with Title VI. DED cannot meet any of these, let alone all
five.

15 SFFA, 600 U.S. at 215.

16 See id. at 216.
17 Id.
18 Id. at 218.
19 Id. at 218–19.
20 Id. at 221.
21 Id.
22 Id. at 225.

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DED is subject to Title VI

Title VI applies to a “program or activity” that receives federal funds. This

includes “all the operations of… a department…of a state,” when “any part of which
receives federal financial assistance.” 23 As the U.S. Department of Justice explains
in its Title VI manual, “[W]hen any part of a state or local government department
or agency is extended federal financial assistance, the entire agency or department
is covered.”24

According to USASpending.gov, in the last 36 months, DED received $23

million in federal funds from 64 separate transactions. 25 Several different agencies
have issued grants to DOA, including the Department of Commerce, Small Business
Administration, and the National Institutes of Standards and Technology.

Therefore, it is beyond question that Title VI applies to DOA, and it is

forbidden from discriminating based on race, yet it does, as explained above. 26

USDOJ Should Investigate These Allegations

Based on this clear evidence of a Title VI violation, we ask that you open a
formal investigation based on this complaint and find that DED’s MWBE Program
violates Title VI. Corrective action should include, at a minimum, a requirement
that the program be open to all businesses regardless of race, or that the program
should be terminated immediately so that all procurement and contracting
decisions at DED are race neutral.

Sincerely,

WISCONSIN INSTITUTE FOR LAW & LIBERTY, INC.

Daniel P. Lennington
Managing Vice President & Deputy Counsel

23 See USDOJ Title VI Manual, p. 21 (quoting 42 U.S.C. § 2000d-4a(1)).

24 USDOJ Title VI Manual, p. 24 (quoting S. Rep. No. 100-64, at 16 (1988), reprinted in 1988
U.S.C.C.A.N. 18).
25 The recipient identifier is M8UJVQN4Q5X5 (UEI), 363661802 (Legacy DUNS).
26 DOA itself admits that Title VI applies to its actions in its nondiscrimination statement, which is

available here.