Idaho Attorney General Raúl Labrador is leading a 20-state coalition calling for the elimination of a federal contracting program that rewards companies based on race and gender rather than merit—costing taxpayers millions in the process.
In a court filing Wednesday, Labrador and his counterparts urged a federal judge to accept the Trump administration’s plan to dismantle the Disadvantaged Business Enterprise (DBE) program. The 40-year-old policy, which the Biden administration expanded with $37 billion in new funding, requires states to prioritize contracts for minority- and women-owned businesses on infrastructure projects.
“This federal program has operated like a racial quota system for decades,” Labrador said. “Federal bureaucrats forced states like Idaho to reject better bids from qualified contractors, wasting roughly $15 million in just a few years by requiring states to award a certain percentage of contracts based on race and gender instead of merit.”
The legal challenge originated last year from two Indiana-based companies that say they lost contracts solely because they were not DBE-certified. Biden’s Justice Department defended the program, but under President Trump, the federal government has reversed course—agreeing with the plaintiffs and asking U.S. District Judge Gregory Van Tatenhove to end the program through a consent decree.
Labrador’s filing calls the DBE framework “discriminatory and costly,” noting it often forces states to ignore the lowest bids or inflate project costs to meet DEI quotas. In one Idaho case, taxpayers had to eat a $500,000 premium to comply with the federal mandate.
“The DBE program wastes money on purpose,” the amicus brief states. “Its whole point is to force States to hire disadvantaged entities when they are not the lowest bidders.”
A 2009 MIT study backs up that claim, finding that race- and gender-based preferences increased contract costs by at least 5.6%.
Joining Idaho in the legal action are 19 other states, including Alabama, Florida, Texas, and Ohio, as well as the Arizona state legislature. Labrador made clear that the effort is part of a broader push under President Trump to uproot DEI mandates and restore merit-based standards across government.
“While the Biden Administration defended this system in court, President Trump is working to restore equality under the law,” Labrador said. “My office will continue fighting any federal program that forces states to treat citizens as members of groups rather than individuals with equal constitutional rights.”
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