“Houston Proposes Excluding Asian Businesses from MWBE Program”

Photo – At a public hearing held in Houston regarding proposed amendments to the MWBE program ordinance, Daniel Yoo, Vice President of the Asian Chamber of Commerce, speaks in opposition.

[Houston] The Asian Chamber of Commerce of Houston is pushing back strongly after the City of Houston moved to exclude Asian-owned businesses from its MWBE (Minority- and Women-Owned Business Enterprise) program.

The City of Houston’s Office of Business Opportunity currently runs the MWBE program, which provides preferences in public contract opportunities to minority- and women-owned businesses. However, after a white couple residing in Spring, Texas filed a lawsuit in 2023 claiming reverse discrimination against white-owned businesses, the city commissioned a disparity study to strengthen its legal defense.

Houston hired MGT Consulting Group to conduct the 2023 Disparity Study. Based on its findings, the city has proposed an amendment to remove Asian American-owned businesses from the MWBE program and exclude Hispanic-owned businesses from preference in the construction sector.

This proposal has sparked growing backlash, with critics questioning the credibility of the disparity study and voicing strong opposition to the exclusion of Asian Americans.

Eden Lee, President of the Korean American Chamber of Commerce in Houston, attended a public hearing hosted by the city and clearly voiced his opposition to the proposed ordinance. “The Korean Chamber is working with the Asian Chamber of Commerce to respond to this proposal,” he said. “We cannot accept any move to exclude Asian Americans.”

The Asian Chamber of Commerce of Houston issued a firm statement:
“We strongly oppose the proposed amendments to Chapter 15 of the City of Houston ordinance by the Office of Business Opportunity. The proposed changes would cause severe and long-lasting harm to Asian-owned businesses and the overall Houston economy. While the city has long valued diversity, equity, and inclusion in business opportunities, this proposal would effectively shut Asian American entrepreneurs out of fair competition for city contracts.”

The chamber added:
“Asian American businesses have made significant contributions to Houston’s economy. Excluding them from MWBE consideration will make it harder for these businesses to secure city contracts, leading to fewer opportunities for growth and job creation. Asian American businesses still face discrimination and systemic barriers when pursuing government contracts, and removing them from the program undermines its original intent. Moreover, this policy change could send the false message that Asian American businesses no longer need support.”

Critics also warn that excluding a specific racial or ethnic group from a diversity program undermines the principles of fairness and inclusion, potentially weakening MWBE protections for other minority groups in the future.

The Asian Chamber of Commerce is calling on the Office of Business Opportunity to withdraw the proposal and refrain from submitting it to the City Council.

Concerns over the credibility of Houston’s disparity study

Low response rate: Only 2% of targeted businesses participated

Concerns over the disparity study’s reliability have also been raised by community organizations, not just the Asian Chamber. Although the city reportedly surveyed over 30,000 businesses during the study, only about 800 responded — a response rate of just 2%, leading many to question the validity of the findings.

Nevertheless, the study concluded that Hispanic and Asian American-owned businesses showed no measurable disparity in the professional services sector, and thus recommended excluding them from MWBE program eligibility.

The Houston City Council is required to act on the study’s findings by the second week of April. If not adopted, the city will have to rely on data from a 2006 study to defend against the 2023 lawsuit. While the city argues that using more recent data provides stronger legal footing, critics say the study’s sample size, methodology, and interpretation lack credibility — leaving the city’s next move under close public scrutiny.