The Comptroller’s Office says the move eliminates race and gender-based preferences. A leading lawmaker argues the acting comptroller cannot change state law.
DALLAS — The Texas Comptroller’s Office on Tuesday announced it has restructured the state’s Historically Underutilized Business Program (HUB) and stripped away the designation for women and minority-owned businesses, now only giving that status to disabled veterans.
“It’s race-based and gender-based criteria, and in Texas, we don’t want race-based or gender-based,” said Acting Texas Comptroller Kelly Hancock. “We don’t want any discrimination. We want a level playing field for all businesses.”
Hancock told WFAA’s Inside Texas Politics that HUB was restructured under new emergency rules and will now become VetHUB, giving preferential treatment only to disabled veterans with a 20% or greater service-connected disability.
“The emergency rules, submitted today in the Texas Register, reduce the program’s size significantly, bringing its administration into alignment with the Texas and U.S. Constitutions by removing race- and sex-based preferences and adjusting the program’s focus to service-disabled veterans who qualify for the state contracting assistance program under legislative guidelines established in 2015,” according to a statement from the Comptroller’s Office.
In 1995, the Texas legislature created the HUB program to create equal opportunities for small, minority and women‑owned businesses wanting to get lucrative state contracts. It was designed to correct documented disparities in state contracting.
State agencies are supposed to “make a good faith effort” to increase the number of contracts that they award to historically underutilized businesses that are at least 51% owned by women, minorities, or disabled veterans.
In October, Hancock’s office announced that it had suspended the issuance of new certifications.
But state Senator Royce West, D-Dallas, told WFAA that Hancock cannot unilaterally end the program.
“He doesn’t have the authority to do it. It’s a statute,” the senator said. “I see nowhere in statute where an interim comptroller has the authority to repeal a statute that the legislature put in effect.”
West said he has been trying to meet with Hancock for weeks in hopes of giving him input from businesses that will be impacted.
As of May, the Comptroller’s Office reported 15,762 companies registered as HUB businesses in Texas. Those companies received 11% of statewide expenditures last year, totaling more than $2 billion.
“I don’t think the color of your skin or your gender determines whether you’re a successful business person,” Hancock said.