By VABayNews Staff
As Virginia approaches the 2026 implementation date of a major overhaul to its small-business procurement rules, a renewed political firestorm is erupting online over claims that the law “bars White men” from government contracts.
The controversy centers on legislation introduced by Jeion A. Ward, a Democrat from Hampton, during the 2024 session of the Virginia General Assembly. The measure — House Bill 1404 — passed both chambers, was signed by the governor, and is now law as Chapter 834 of the 2024 Acts of Assembly.
While critics frame the law as discriminatory, supporters argue it formalizes long-standing diversity goals in state contracting. The dispute highlights a deeper divide over equity programs, government procurement, and how far the state should go in reshaping economic outcomes.
What the Law Actually Does
HB 1404 establishes the Small SWaM Business Procurement Enhancement Program, expanding Virginia’s existing SWaM framework — which includes Small, Women-owned, Minority-owned, and Service-Disabled Veteran-owned businesses.
Key provisions include:
- A statewide goal of 42% utilization of certified small SWaM businesses in discretionary spending by executive branch agencies and covered institutions.
- A 50% subcontracting target for small SWaM businesses on new capital construction projects when the prime contractor is not itself a small SWaM business.
- A requirement that agencies increase SWaM utilization by 3% annually until the 42% goal is reached, or document achievable alternatives.
- Creation of a Division of Procurement Enhancement within the Department of Small Business and Supplier Diversity (SBSD) to coordinate implementation across agencies.
- A mandated disparity study every five years to evaluate gaps between business availability and actual contract awards.
Most controversially, the law establishes a set-aside for purchases up to $100,000, requiring those contracts to be reserved for certified small SWaM businesses.
Where the Backlash Comes From
Online critics — including a widely circulated post by conservative commentator Christian Heiens — claim the law “bars White men from consideration” for small discretionary contracts and allows agencies to award contracts to minority- or women-owned firms even when they submit higher bids.
That framing simplifies, but does not entirely invent, the effect of the set-aside.
The statute does not explicitly ban White male-owned businesses. However, because eligibility for these set-aside contracts is limited to certified small SWaM businesses, a small business owned by a White male that does not qualify under women-, minority-, or veteran-owned criteria would typically be excluded from competition for contracts under $100,000 — unless insufficient certified firms are available or pricing is deemed unreasonable.
Additionally, Virginia procurement law permits price preference thresholds — generally up to 5–10% — allowing agencies to award contracts to certified firms even if their bids are slightly higher.
To critics, this amounts to de facto exclusion based on identity. To supporters, it is a targeted mechanism to correct documented disparities.
Not New — But More Aggressive
Virginia has operated SWaM certification and utilization goals for years, similar to federal Disadvantaged Business Enterprise (DBE) programs. What HB 1404 does differently is codify specific percentage targets, enforce annual increases, and expand mandatory set-asides, particularly for small contracts.
That escalation is why the law is drawing renewed attention as its January 1, 2026 effective date approaches.
The Role of the Disparity Study
To withstand constitutional scrutiny, programs that differentiate based on race or gender must be supported by evidence of actual disparities. HB 1404 therefore requires SBSD to conduct an independent disparity study every five years, with the most recent one due by January 1, 2026.
The Commonwealth commissioned BBC Research & Consulting to conduct the study, which began in 2025 and included public testimony from Virginia businesses. The results are intended to inform whether such procurement preferences remain legally justified and economically necessary.
Supporters argue this data-driven approach protects the program from legal challenge. Skeptics counter that once targets and set-asides are in place, they rarely shrink — regardless of findings.
A Broader Political Fault Line
At its core, the debate over Virginia’s SWaM expansion reflects a broader national argument: whether government should prioritize race- and gender-based remediation, or return to strictly neutral, lowest-bid contracting.
For Democrats in Richmond, the law represents an effort to formalize access for businesses they argue have been historically sidelined. For conservatives, it is another example of state-sanctioned favoritism that penalizes merit and small businesses that don’t meet identity criteria.
What is clear is that, as implementation begins in 2026, this once-technical procurement statute has become a political lightning rod — and a preview of the legal and cultural battles likely to follow.
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