Isabel Casillas Guzman, the Biden administration’s small business chief, was in New Orleans on Friday to attend the Essence Festival of Culture with a message of support for diversity programs that are under attack in federal court.
Guzman, who has served as a cabinet member since March 2021, toured the site of the $1 billion River District development adjacent to the Ernest N. Morial Convention Center and met with Iam Tucker, the project’s lead civil engineering contractor.
“The current administration is fighting hard to ensure equity in all of our systems against the courts’ attempts to reverse that,” she said. “There’s a clear message against[diversityequityandinclusionorDEIprogramsbutinAmericadiversityisastrength”
The River District is the largest non-oil public-private development in Louisiana history, and Tucker, who was named SBA’s 2024 National Small Business of the Year, said he would not have been awarded the contract had he not participated in the SBA’s 8(a) Business Development Program for disadvantaged businesses.
Some version of the 8(a) program has existed since the SBA’s inception during the Eisenhower administration, but the current version is a nine-year program that pairs socially and economically disadvantaged businesses with large, established companies to help them win government and private sector business.
Last year, decisions by the U.S. Supreme Court and a federal court in Tennessee were widely seen as undermining years of efforts to promote diversity.
In June, the Supreme Court ruled that race-based affirmative action in college admissions is unconstitutional, a decision that legal experts say will have broad implications for diversity efforts.
Court ruling
Then, in July, in the case of Ultima Service Corporation v. USDA, the U.S. District Court for the Eastern District of Tennessee ruled that the SBA cannot base its eligibility determinations for the 8(a) program on a presumption that an employer is automatically considered disadvantaged because of its race or ethnicity. The owner of Ultima, who filed the lawsuit, is a white woman.
Guzman noted that the SBA acted quickly to issue new rules for businesses to apply for the program, including specific descriptions of how companies had been disadvantaged.
Guzman was also scheduled to speak at the Global Black Economic Forum on Friday as part of the convention center’s Essence Fest program, which has expanded in recent years from a primarily entertainment event to include economic, social and cultural events.
The three-day economic forum is expected to feature some of the nation’s most prominent figures, including voting rights activist Stacey Abrams, the Rev. Al Sharpton and U.S. Rep. Ayanna Pressley.
Guzman said the message at the forum will also touch on the risks facing diversity programs, noting that Black business ownership is growing at the fastest rate in the past 30 years and that the percentage of Black households that own businesses has more than doubled between 2019 and 2022, from 5% to 11%, according to SBA data.
“We need to ensure that[disadvantaged business owners]have a pathway to success and access government and private sector contracts,” she said. “Programs like 8(a), and IAMs are great examples, really provide an on-ramp to get into a system that has historically erected barriers to that.”
Tucker said her company, ISIL, founded by her father, Robert H. Tucker, 30 years ago, has won only about eight private sector contracts in that time and has relied primarily on federal mandates for growth during that time. She said she resents those who try to roll back diversity efforts when they suggest she won business on anything other than merit.
“We have to work three times harder to go half the distance as other people,” she said.
“We want to diversify our business more, but it’s hard to break into the private sector when everything’s already packaged and you’re using the same people every time,” she said. “That’s why programs like this are so important.”
