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Judge Orders Timetable For Women's Set-Aside

A federal judge has ordered the Small Business Administration to set a timetable for implementing the women’s set-aside program that was signed into law five years ago.

But U.S. District Judge Reggie Walton in Washington refused to set a deadline for SBA to put the program into operation, as the U.S. Women’s Chamber of Commerce had requested in its lawsuit against the agency.

In his Nov. 30 opinion, Judge Walton wrote, “This court is compelled to conclude that the almost five year delay, based on the record in this case, is unreasonable.” President Clinton signed the women’s procurement program into law on Dec. 21, 2000.

SBA contended that Congress set no deadline for implementing the law, but Walton said, “This court does not agree that Congress intended to afford the defendants the authority to delay the completion of the study and the adoption of procedures indefinitely.” He gave SBA 45 days to submit a schedule for implementing the set-aside and said he would monitor the agency’s progress.

SBA said it will not appeal the ruling because it is moving toward implementation of the program “as soon as practical.”

In October the agency issued an RFP for a study to determine which industries will be eligible for the set-aside. “Our contracting department is currently considering the bids that were received,” SBA attorney Eric Benderson said in a statement. SBA has said the contractor would have six to nine months after a contract is awarded to complete the study. (SAA, 10/21)

“Women business owners are losing billions of dollars in opportunities every year as we wait for the SBA and Administrator [Hector] Barreto to do their jobs,” said U.S. Women’s Chamber CEO Margot Dorfman. “After five long years, they still require an additional six months to simply write the procedures necessary to implement this program.”

Congress created a two-tiered set-aside program: In industries in which woman-owned businesses are “underrepresented” in federal contracting, set-asides will be available to small businesses owned by disadvantaged women; in industries found to be “substantially underrepresented,” all woman-owned small businesses will be eligible for set-asides.

SBA drafted a study to determine eligibility in 2001, but officials have said the Justice Department rejected it because it did not prove discrimination against woman-owned businesses, and therefore might not stand up to a court challenge under Supreme Court decisions on affirmative action. Last spring a committee of the National Academy of Sciences issued a long-delayed report agreeing that the original SBA study should be scrapped.

SBA’s 2001 study found that woman-owned firms were underrepresented in 66 of the 71 industries surveyed, according to a report by Democratic members of the House Small Business Committee. (SAA, 11/29/2002)

Judge Walton said he will hold a status hearing after SBA submits its schedule and will retain jurisdiction over the case.


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