12/08/2025
For Immediate Release
Contact:
Jim Wyatt, Chairman
Texas Council on African American Affairs (TCOAAA)
Email: [email protected] I Phone: (361) 550-1507
TAXATION AND NO CONTRACTS:
Texas Comptroller’s Emergency Suspension of the HUB Program Violates State Law, Civil Rights Standards, and the Legislature’s Original Intent
Austin, Texas — The Texas Council on African American Affairs (TCOAAA) issues this urgent statement regarding the Texas Comptroller’s emergency action dismantling key components of the Historically Underutilized Business (HUB) Program. This action, taken by an interim administrative official, contradicts Texas statute, undermines civil rights protections, and erases the very communities the HUB Program was created to support.
Texas Government Code Chapter 2161 defines HUBs as:
- Minority-owned businesses
- Women-owned businesses
- Service-disabled veteran–owned businesses
- Other economically disadvantaged individuals
This law is still in full effect. Only the Texas Legislature can amend or repeal it.
No Legal Emergency Exists to Justify Suspending State Law
Emergency rulemaking requires a real, immediate threat to public welfare or state operations. None exists.
- No court has ruled the HUB statute unconstitutional.
- No injunction has been issued.
- No procurement crisis exists.
- No fiscal emergency exists.
- No imminent harm has been identified.
This “emergency” is self-created, political, and legally insufficient.
Administrative Officers Cannot Suspend Statutory Protections
The Comptroller — especially an interim one — has no authority to eliminate statutory HUB categories. Removing women- and minority-owned businesses from the program:
- Defies Chapter 2161
- Exposes state agencies to compliance violations
- Jeopardizes procurement reporting requirements
- Strips economic opportunity from communities the Legislature meant to protect
This is not administrative oversight — this is nullification of a statute.
Historical Intent Undermined: Political Add-On Categories Preserved While Original Minority Protections Are Removed
When the HUB Program was created in 1999, its purpose was unmistakable:
To correct long-standing disparities affecting African American, Hispanic, Native American, and Asian-owned businesses across more than 180 state agencies.
These communities had endured systematic exclusion from state procurement for decades.
Over time, women-owned and service-disabled veteran–owned categories were added politically, not because they were part of the original civil-rights mission.
Disabled Veteran Category Lacked Required Constitutional Foundation
In the landmark decision Richmond v. Croson (1989), the U.S. Supreme Court ruled that any preferential contracting program must be supported by a strong evidentiary basis, including a disparity study proving historic discrimination against the group receiving preference.
Texas has conducted multiple disparity studies validating discrimination against racial, ethnic, and women-owned businesses.
But Texas has NEVER conducted a disparity study showing systemic discrimination against service-disabled veterans in state contracting.
This means:
- The SDV category was a political addition, not a Croson-compliant remedial category.
- Their inclusion lacked the constitutional evidence required for minority or gender-based programs.
- Elevating SDVs while removing the groups with proven disparities fails strict scrutiny and violates the spirit of civil rights law.
Today, the only group remaining in the HUB Program is the one never shown to be disadvantaged — while all groups shown through data to face systemic disparities have been removed.
Discriminatory Impact and a Return to “Taxation and No Contracts”
By eliminating the groups with proven disparities, the Comptroller has effectively reinstated a historical condition that African Americans and other minorities have confronted for generations:
Taxation without contracts.
Minority Texans pay into the state treasury, yet the state closes the door to the contracting opportunities their tax dollars help to create.
Call to Action
“The HUB Program was established by the Legislature for a reason,” said Jim Wyatt, Chairman of the Texas Council on African American Affairs. “It was created to remedy documented disparities. Those disparities still exist today. An interim administrative official cannot erase women-owned businesses and minority-owned businesses from the protections granted to them by state law. This suspension is unlawful, unconstitutional, and morally indefensible.”
TCOAAA calls on:
- The Texas Legislature to review and reverse the emergency rule
- State agencies to maintain compliance with Chapter 2161
- Local governments and chambers to stand against discriminatory implementation
- Community organizations to speak out firmly
Contact:
Jim Wyatt, Chairman
Texas Council on African American Affairs (TCOAAA)
Email: [email protected] I Phone: (361) 550-1507
