Shelby County Commission starts restructuring minority- and women-owned contracting program after lawsuit settlement and disparity findings

County moves to rebuild a contracting framework paused after litigation

Shelby County commissioners have begun restructuring the county’s minority- and women-owned business contracting effort, taking initial legislative steps toward reinstating a program that had been largely dormant for nearly three years following the settlement of a discrimination lawsuit brought by contractor groups.

The renewed effort is designed to increase the share of county procurement—across construction, professional services, and goods—awarded to eligible minority- and women-owned firms, while aligning program targets with legally required evidence of disparity and with annual changes in the local vendor market.

How the county got here

The county’s prior framework for minority- and women-owned business participation relied on findings from a 2016 disparity study. That approach became the subject of litigation in 2019 and ultimately ended with a settlement reached in late 2020. Following the settlement, Shelby County operated without an MWBE program while continuing to use race-neutral tools such as its locally owned small business program for certain procurements.

As part of the groundwork for a revised approach, Shelby County commissioned an updated disparity study completed in 2022. The study found underutilization of Black American-owned firms in prime contracting across the five categories analyzed: construction, architecture and engineering, professional services, other services, and goods. The study also identified underutilization for other groups in certain categories and found evidence of disparities after controlling for race- and gender-neutral factors related to business capacity.

What commissioners are restructuring

The proposal moving through the commission is structured as a multi-step ordinance process, with an initial reading beginning the formal legislative pathway. The framework ties aspirational participation goals to the 2022 disparity study and to measures of local availability—an approach intended to produce targets that vary by project type and the presence of qualified firms in the marketplace.

Under the plan under consideration, participation targets would be recalculated annually based on two factors: the availability of certified minority- and women-owned firms in relevant fields and the county’s utilization in the prior year. The program also includes expanded outreach and contract compliance components compared with earlier versions, and it updates elements of eligibility definitions intended to broaden participation among smaller minority-owned firms.

Enforcement and “good-faith effort” standards

The restructuring includes compliance mechanisms that would allow county oversight staff to investigate potential violations when participation is substantially below an aspirational goal or contract-specific subcontracting target. The framework also retains “good-faith effort” standards for prime contractors as a method for evaluating whether efforts to meet subcontracting goals were genuine when targets are not reached.

Key program elements under consideration

• Project-specific goals tied to measured availability, with targets that may differ widely by contract type.
• Annual updates to aspirational goals based on market availability and prior-year utilization.
• Certification requirements administered through the county’s equal opportunity compliance function.
• Residency rules for participating firms, with defined exemptions based on operating history and local employment.
• Program priority sequencing relative to the county’s locally owned small business program.

As the ordinance process continues, commissioners retain the ability to amend program language before final adoption, a step that will shape how the county balances legal constraints, vendor availability, enforcement capacity, and procurement outcomes.

The commission’s next votes will determine the final structure, the oversight tools used to track participation, and how Shelby County will measure progress against the revised goals once implemented.