Texas freezes program helping Asian American, minority-owned businesses

Texas Acting Comptroller Kelly Hancock has frozen the state’s Historically Underutilized Business (HUB) program, blocking Asian American, Hispanic, Black, women-owned and disabled veteran-owned enterprises from receiving new certifications needed to compete for government contracts.

What you need to know: Hancock’s office reportedly removed the HUB program from its website last week while halting new and renewed certifications and deleting a 2009 disparity analysis that had established participation benchmarks. “Businesses deserve a level playing field where government contracts are earned by performance and best value — not race or sex quotas,” Hancock posted on social media.

The acting comptroller, who assumed his position in July and now faces two challengers in the Republican primary, called the review his highest priority upon arrival. Yet some business owners holding HUB certifications say they learned of the changes through news reports rather than official communication, leaving them uncertain about active bids.

About the program: Lawmakers established the HUB framework through legislation in 1999 during George W. Bush’s governorship, creating a certification pathway for businesses where economically disadvantaged groups — Asian Pacific Americans, Black Americans, Hispanic Americans, women, Native Americans and disabled veterans — control ownership. Under this framework, agencies must request proposals from certified businesses when contracts surpass specific dollar amounts, though no mandate exists to award work to program participants. Data shows the program’s reach: 15,762 certified businesses obtained approximately $2 billion in the fiscal year’s first half, representing 11% of total expenditures, with woman-owned operations receiving 41% and Hispanic-owned firms capturing 35%.

Broader implications: Asian American entrepreneurs and other minority business owners now face losing access to contracting opportunities that the program had created simply by raising awareness of smaller businesses capable of delivering services. Austin-based Aerospace Solutions filed suit last November arguing the framework violates equal protection principles, while Gov. Greg Abbott issued an executive order in January directing agencies to eliminate DEI practices. However, Hancock lacks statutory power to abolish the program entirely, which would require either court invalidation or legislative action.

State Sen. Royce West, who co-authored the 1999 bill, is now monitoring the suit, which excludes the Attorney General who is typically expected to defend such cases.