Comments Concerning Environmental Protection Agency Regulations for Minority Business Enterprise

B-197772: Published: Mar 4, 1980. Publicly Released: Jun 4, 1985.

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A question was raised regarding the legality of the Environmental Protection Agency's (EPA) regulations for minority business enterprise involvement in the supply of goods and services for construction of water treatment works. The question was essentially concerned with the legality of the EPA regulations which mandate set-asides for minority business enterprises on any work performed in connection with the construction of water treatment facilities, and whether the provisions of a federal procurement law, which is intended to expand subcontracting opportunities for both small businesses and economically and socially disadvantaged businesses by requiring large business offerers and bidders to submit subcontracting plans which will become part of contracts awarded, contradict the EPA regulations. GAO held that the work on the construction of water treatment facilities is being performed under a contract let by either a state or local government in accordance with a grant of monies to it by EPA and is not a direct federal procurement. Additionally, the EPA regulations being questioned implement the Office of Management and Budget policies regarding regulations for minority business enterprises. Therefore, there is no basis for questioning the legality of the EPA regulations on the basis of any conflict with the provisions of federal procurement law.

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