5. THE VARIETIES OF FEDERAL PROGRAMS
This report examines most of the federal programs that would be
considered to be affirmative action. It may be useful, therefore,
to consider one or more taxonomies of those efforts. Figures 1
and 2 offer two possible matrices. In Figure 1, the horizontal
dimension arrays various policy devices from the most flexible
to the most pointed, while the vertical dimension arrays different
spheres of activity--from those most closely to those less closely
related to the federal government. (46)
In this array, examples of the eight categories of policies include:
Outreach & Hortatory Efforts:
Disclosure of Data:
- Various statutes encourage recipients of Federal funds
to use minority-owned and women-owned banks.
- DOL's Office of Federal Contract Compliance Programs (OFCCP),
for example, offers a periodic award for contractors with superior
affirmative-action practices, such as innovative recruitment or
Affirmative Action Plan Requirements:
- The Small Business Act (§502) requires SBA to monitor and
report on agency contracting with small disadvantaged businesses
(SDBs). This reporting serves hortatory purposes and creates a
competitive dynamic among agencies.
- Last year, the Administration announced plans to publish the rates
at which financial institutions made federally guaranteed loans
to women- and minority-owned firms. This reporting can leverage
public and intra-industry pressures to expand such lending.
Targeted Training & Investment Efforts:
- E.O. 11246 requires Federal contractors to maintain affirmative
action plans; since the Nixon Administration, such plans must
in certain circumstances contain flexible goals and timetables.
- The Community Reinvestment Act (CRA) requires certain chartered
financial institutions to conduct and record efforts to reach
out to undeserved communities.
- The Foreign Service maintains a minority internship program designed
to increase minority participation in the Foreign Service.
- EPA maintains a Mentor/Protegé program to encourage prime
contractors to develop relationships with small and disadvantaged
- The Small Business Act requires each agency to set goals for contracting
with small businesses and SDBs; the SBA coordinates the effort.
Additionally, Congress has, in several instances, legislated specific
goals for certain agencies. (As described in section 9 of this
Report, these goals are all flexible -- they are not quotas or
numerical straight jackets.)
- In response to dramatic imbalances in the numbers of women and
minority entrepreneurs participating in its programs, SBA now
sets management goals to increase diverse participation in its
core §7(a) loan guarantee program.
- In upcoming FCC auctions of certain licenses for personal communication
services and interactive video, the Commission had planned to
offer a 25 percent discount for women- and minority-owned businesses;
this effort was temporarily suspended by the Commission in light
- Under its "§1207" authority, the Defense Department
is permitted to provide a 10 percent bid price preference, and
to employ reduced-competition systems as a means of meeting its
SDB contracting goals. Last year's procurement reform legislation
extended this authority to non-DOD agencies as well.
- The Surface Transportation Assistance Act, and now the Intermodal
Surface Transportation Efficiency Act (ISTEA), authorizes use
of "subcontractor compensation" bonuses to prime contractors
who use SDBs; The payment is intended as rough compensation for
the prime contractor's expense in mentoring and technical assistance.
- ISTEA requires that 10 percent of contracts be allocated to disadvantaged
business enterprises (DBEs), except to the extent that the
Secretary determines otherwise.
- The Airport & Airway Improvement Act requires the same.
Obviously, there is no single best way to think about these efforts.
For example, in Figure 2, one could categorize efforts based on
their programmatic objectives, perhaps distinguishing programs
focused on education and training (as more "investment-oriented"),
from programs focused on employment and contracting (as more
"income-oriented"),from programs focused on the assignment of
scarce assets, such
as bank charters and spectrum licenses (as more "result"
or "reward-oriented"). There are obviously elements
of "opportunity" and "result" present across
the board, but the scale has some heuristic appeal.
- The Omnibus Diplomatic Security & Antiterrorism Act requires
that a minimum of 10 percent of funds appropriated for diplomatic
security projects be allocated to minority business enterprises.
- Certain small education grant programs target minorities in graduate