Proposal to Modify State Contract Set-Aside Program

Lawmakers are considering a proposal to modify the state’s contract set-aside program. The set-aside program calls for certain types of businesses, such as those that are minority-owned, to receive a fixed percentage of certain state contracts.  

HB 6579 proposes several changes to the existing set-aside law, including:

• Removing the municipal exemption from the set-aside program
• Redefining “minority”
• Reallocating how contracts are set aside

Current law requires state agencies and political subdivisions in Connecticut, excluding towns and cities, to set aside at least 25% of the total value of the contracts they award for small contractors. Then, 25% of those contracts must be reserved for minority business enterprises. 

Under HB 6579, the program’s requirements would change.

Municipalities Included

Right now, Connecticut’s towns and cities are exempted from the set-aside program. However, HB 6579 will require municipalities to participate.

Redefine Minority

Second, the bill’s revised definition of minority does not include women. This is noteworthy because implementation of the bill’s other revisions, specifically changes to the set-aside requirement, are impacted by this change.

Rules Changed

HB 6579 revises the program so that half of the contracts set aside for minority business enterprises must be awarded to minorities as defined under the new bill.

There’s a difference between the two terms: Under this bill “minorities” does not include women, while the definition of “minority business enterprises” includes women, as well as other groups. (It’s also important to point out that these statutory definitions include other important criteria that have been omitted for purposes of this article.) 

So, under this new bill, the set-aside program would operate in this way: 

• State agencies, political subdivisions and cities and towns must reserve 25% of the total value of their contracts for small contractors
• 25% of those contracts must be reserved for “minority enterprise businesses”
• And of that portion, half must be reserved for “minorities”

HB 6579 is being considered by the Government Administration and Elections Committee. 

For more information, contact CBIA’s Jennifer Herz at 860.244.1921 or jennifer.herz@cbia.com.