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SET-ASIDES are a form of affirmative action used by governments in contracting government business; they include programs that typically designate a percentage of government contracts or funds (either for services or construction of public works) for minority-owned businesses. In 1977 Congress passed a law that directed 10 percent of federal public works funds to minority-controlled businesses, which the Public Works Employment Act defined as ones in which 50 percent of the business was held by African Americans, Hispanic Americans, Asian Amer-icans,Native Americans,

Eskimos, or Aleuts. In 2000, federal agencies purchased more than $13 billion in goods and services from minority-owned businesses as part of the program.

Like affirmative action programs generally, set-aside programs are controversial and have raised constitutional challenges. Opponents claim that such programs constitute reverse discrimination and are not cost-efficient because contracts go to businesses that may not have been the lowest or the most qualified bidder. Proponents believe that such programs help overcome the traditional economic disadvantages minorities have faced and promote economic development in minority communities. In 1995, the Supreme Court, ruling in Adarand Constructors, Inc. v. Pena, held that the federal government must be subject to the same "strict scrutiny" as state and local governments when attempting to remedy discrimination. However, what initially appeared to be a victory for the white owner of Adarand Construction was modified by the Clinton administration, which overhauled certain programs while leaving the minority-contracting program in place. Since then, the Adarand case has gone back to the Colorado court, through federal appeals courts, and back to the Supreme Court, which, in the fall of 2001, refused to rule on the merits of the case. At the beginning of the twenty-first century, numerous other challenges to the set-aside program were brewing in state courts.


Lassiter, Christo. "The New Race Cases and the Politics of Public Policy." Journal of Law and Politics 12 (1996): 411458.

Orfield, Gary, ed. Diversity Challenged: Evidence on the Impact of Affirmative Action. Cambridge, Mass.: Civil Rights Project, Harvard University, 2001.

Katy J. Harriger / d. b.

See also Business, Minority ; Constitution of the United States ; Discrimination: Race ; Federal Aid ; Indian Economic Life ; Small Business Administration .

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