A quiet change in federal rules threatens to close the door again on Black and immigrant small businesses in Minnesota
In this op-ed, Makee Company founder R. Lynn Pingol warns that a proposed change to OMB rules would eliminate supplier diversity programs, technical assistance and the SBA 8(a) pathway that Black, immigrant and women-owned small businesses rely on to access federal contracts, threatening Minnesota’s business corridors and the communities they anchor.
Across Minnesota, small businesses are struggling to survive. You see it on Lake Street, on University Avenue, on West Broadway, on Payne Avenue… corridors rebuilt by the strength of black, immigrant and women’s businesses after years of crisis. These businesses are more than storefronts. They are the cultural and economic anchors of our communities. They hire our neighbors, mentor our young people, and keep money flowing where it’s needed most.
And now, a quiet change in federal rules threatens to undo that progress.
The Office of Management and Budget is proposing a rule that would eliminate the very tools small businesses rely on to access federal dollars: outreach, supplier diversity programs, technical assistance, and the SBA’s 8(a) pathway. These are not “extras”. They are the only reason many small businesses, especially Black and immigrant-owned ones, ever get a seat at the table.
Without these tools, the federal market becomes a closed loop dominated by the largest players. And when the big fish enter the small pond, we already know who gets kicked out.
Let’s be honest about the numbers. In 2023, white-owned businesses received 97% of all federal contracting dollars. Large corporations captured more than three-quarters of the entire market. Meanwhile, black-owned businesses received 0.5%; Hispanic-owned businesses received 0.6%; Native-owned businesses received 0.3%; Asian-owned companies received 1.1%; and women-owned businesses received 5%.
These disparities did not appear because of DEI programs. They existed long before DEI was talked about. DEI programs were created because the market was already closed to most of us.
So what happens if OMB eliminates the few access points we have?
Minnesota’s running backs will feel it first.
Small businesses operate on slim margins. A breached contract can mean a hiring freeze. A late payment can mean closure. A lost subcontract could mean another “For Lease” sign on a block that was just beginning to recover. And once vacancies spread, the entire corridor suffers. Foot traffic decreases, property values drop, and the neighborhood loses one more place that felt like home.
The damage doesn’t end there. Cities lose tax revenue. Learning linked to federal projects disappears. Skilled workers leave the trades. Supply chains are becoming more fragile. And the stairs to the middle class, the ones our communities fought to build, are removed.
This is not a technical policy change. It’s a structural change that will hit Black, immigrant, and female-owned businesses first and hardest.
Minnesota can’t afford it. Our communities cannot afford it.
If the federal government is serious about equity, economic mobility, and rebuilding cities from the ground up, then it must strengthen, not dismantle, the mechanisms that allow small businesses to compete.
The OMB should withdraw this rule.
Minnesota leaders should oppose it.
And our communities must speak up before the door closes again.
Because when small businesses lose access to opportunity, our neighborhoods lose their future.
R. Lynn Pingol is the founder of Makee Company. She can be contacted at rlynnp@makeecompany.com.