$1 Trillion Infrastructure Bill Includes ‘Minority Business Development Act’

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Hidden at the very bottom of the $1 trillion infrastructure bill that President Joe Biden will soon sign is the “Minority Business Development Act,” which grants the federal government broad spending powers to help “socially or economically disadvantaged” individuals.

The bill presumes all non-white individuals are socially or economically disadvantaged:

The Under Secretary shall presume that the term ‘’socially or economically disadvantaged individual’ includes any individual who is—(i) Black or African American; (ii) Hispanic or Latino; (iii) American Indian or Alaska Native; (iv) Asian; (v) Native Hawaiian or other Pacific Islander.

Title I of the Minority Business Development Act authorizes the Department of Commerce’s Minority Business Development Agency’s Under Secretary to provide minority businesses with management resources and technological assistance. The Under Secretary can also provide financial, legal, and marketing services whenever they determine necessary. In addition, the government must provide outreach and assistance in five different languages to ensure full access to the services.

The bill encourages federal government partnerships with private sector entities to “consult and cooperate” in the facilitation of assistance to minority-owned businesses. For example, the Minority Business Development Agency (MBDA) Business Center Program gives federal awards to eligible entities that provide “technical assistance and business development services, or specialty services, to minority business enterprises.”:

The purpose of the MBDA Business Center Program shall be to create a national network of public-private partnerships that— (1) assist minority business enterprises in— (A) accessing capital, contracts, and grants; and (B) creating and maintaining jobs (2) provide counseling and mentoring to minority business enterprises; and (3) facilitate the growth of minority business enterprises by promoting trade.

The minimum amount of federal assistance awarded to eligible entities is $250,000. Eligible entities include public and private sector entities as well as higher education institutions.

When determining which entities to enter into partnerships with, the federal government considers whether entities reside in majority-minority or economically distressed areas.

The law establishes a similar program for minority businesses located in rural areas.

There is an entire title devoted to “new initiatives to promote economic resiliency for minority businesses.” One of these initiatives is the annual “diverse business forum on capital formation,” where heads of federal agencies meet with minority business owners to address problems associated with creating wealth.

Another initiative focuses on educational development relating to management and entrepreneurship. The government will encourage universities and businesses to develop scholarships, apprenticeships, and internships specifically for minorities.

The bill authorizes grants to nonprofit organizations that “can demonstrate that a primary activity of the organization is to provide services to minority business enterprises.” These grants may be used to “support the development, growth, or retention of minority business enterprises.”

Additionally, the bill creates the Minority Business Enterprises Advisory Council to advise and assist the agency in its quest to help the black, Hispanic, Indian, or Asian people it presumes are socially or economically disadvantaged.

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