This story has been updated.
Gov. Mike Braun announced Wednesday he would end some contracting preferences for women and minority owned businesses. The move follows a determination by Attorney General Todd Rokita that the practice was unconstitutional.
Rokita found that parts of the state’s Diversity Business Enterprises and Minority and Women’s Business Enterprises programs were unconstitutional because they favored some contractors based on sex and race.
“This blatantly illegal program singles out some Hoosiers for disfavored treatment purely because of their sex or the color of their skin, and it insults other Hoosiers by suggesting they cannot compete on a fair playing field. The program is both un-American and unconstitutional,” Rokita said in a statement.
The decision comes after the Indiana Department of Administration requested the Attorney General’s office to review the legality of the state’s race and gender based contract goals last year.
Rokita’s finding would overturn a 1983 statute creating some preferences for minority and women participation in state contracts. The state’s current goals are that, on average, 10% of state contracts go to women-owned businesses and 8% to minority-owned businesses.
Rokita pointed to the 2023 Supreme Court decision, Students for Fair Admissions, as evidence that racial preference programs can rarely be justified by the Constitution and that Gov. Braun could decline to implement an unconstitutional statute.
“Our Constitution mandates equal protection under the law, because a system where the government picks winners and losers on the basis of race or sex can never be fair,” Braun said in a statement. “Indiana has replaced divisive, politically-charged programs with a focus on Merit, Excellence, and Innovation: a level playing field where every single Hoosier has the chance to get ahead with hard work.”
Braun’s release indicates he plans to announce a new small business initiative to help Indiana businesses compete for state contracts.
The Attorney General is advising the Indiana Department of Administration on a lawful transition away from its current practices. Rokita said he would work with the General Assembly to repeal the underlying statute.
State Democrats were quick to push back on the announcement, calling it “bad public policy.”
“If Governor Braun believes portions of Indiana law should be changed to better reflect evolving constitutional precedent, he should come to the General Assembly and ask us to amend the statute,” said Rep. Mitch Gore (D-Indianapolis) in a statement. “What he cannot do is unilaterally stop carrying out duties the legislature has imposed simply because his administration disagrees with the policy.”
Last year, Indiana’s Black Caucus said the governor’s efforts to remove diversity, equity, and inclusion initiatives from state government sent a clear message that Braun did not care about fairness.
Chair of the Black Caucus Rep. Earl Harris (D-East Chicago) also responded to the governor’s announcement.
"Gov. Braun's decision erases opportunities for Black Hoosiers, women and other minority business owners who have historically been shut out of contracting — not because they lack merit or talent, but because the system was built to exclude them,” he said.
Rokita held a press briefing Wednesday afternoon to explain the decision. There, the attorney general said the governor has the authority to disregard state law - and lawmakers have been aware of it.
“We advised the general assembly very directly, very often, that they had an illegal and unconstitutional law on their books,” he said. “They have done nothing. The Governor and I have done something today.”
Rokita said he wasn’t aware of any people who had sued the state over the years alleging discrimination over the program - but it’s clear who the program harmed.
“Caucasian people have less of an opportunity because you’re giving preferential treatment to women or based on gender or race,” he said. “It has to be an even playing field.”
Contact Government Reporter Benjamin Thorp at bthorp@wfyi.org
