Company sues Colorado for using racial preferences in granting COVID-19 relief grants

A Colorado event planning company is suing the state’s Office of Economic Development and International Trade over a bid to block racial preferences in the distribution of COVID-19 relief funds.

“We believe that the government should treat individuals as individuals”, Wen Fa, an attorney for the Pacific Legal Foundation, who represents Stephen Collins, owner of Resort Meeting Source, told FOX Business in an interview. “The government should not grant preferences based solely on membership in an arbitrary group.”

Legal Pacific filed the complaint on October 7, alleging that racial preferences for COVID-19 subsidies violate the equal protection clause of the 14th Amendment. District Court Judge William J. Martinez on Tuesday issued a temporary restraining order preventing OEDIT executive director Patrick Meyers from enforcing preferences for minority-owned businesses in COVID-19 subsidies.

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Martinez did not comment on the merits. But he found that Collins was likely to prevail in the lawsuit because the Colorado law at issue “expressly requires that the OEDIT give priority to minority-owned businesses in the distribution of grants under the program. subsidies to disproportionately impacting businesses “and because” the process of qualifying as a business disproportionately impacting business differs for minority and non-minority businesses. “

The lawsuit claims that a minority-owned business, unlike a non-minority business, is automatically considered a disproportionately affected business whether or not it meets other criteria. The grant program in question is intended to help businesses that lost revenue during the COVID-19 pandemic and did not receive funds under the federal paycheck protection program. The Colorado program will provide grants between $ 1,500 and $ 10,000, from a $ 4 million fund.

Researcher Annabel Alonso works at a Bond Pet Foods lab on July 1, 2021 in Boulder, Colorado. (Photo by PATRICK T. FALLON / AFP via Getty Images) (PATRICK T. FALLON / AFP via Getty Images / AP Newsroom)

OEDIT declined to comment on the lawsuit, but the office forwarded two legal documents to Fox News. The office on Wednesday filed a motion to dismiss the lawsuit, saying “race has played no role in OEDIT’s funding decisions.”

OEDIT also tabled a statement by Michael Landes, Director of OEDIT’s Opportunity Zone program. Landes said racial preferences will only come into play after all other criteria have been assessed.

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“After reviewing the eligibility criteria of each applicant, and if the total amount requested by participants exceeds the resources available in the grant program, priority will be given to applicants based on the number of criteria for which they qualify in the program, “Landes wrote.

He said the office would prioritize business income and personal wealth (criteria 5 and 6), but if multiple requests appear “equal” for those criteria, “preference will be given to disproportionately affected businesses that belong both to minorities and meet additional statutory criteria. “

Even so, minority ownership of a business is still one of the seven grant eligibility criteria.

According to Wen, the controversy dates back to December, when Colorado passed a small business law “that segregated $ 4 million in COVID grants and loans to minority-owned businesses.” In a lawsuit brought by Pacific Legal on behalf of a barber shop, Colorado changed the law to only give preference to minority-owned businesses.

Collins, owner of Resort Meeting Source, hosted two big events in Pennsylvania and Utah that were canceled due to the COVID-19 pandemic, Wen told FOX Business. Both events reportedly had hundreds of attendees, and the cancellations cost Collins about $ 26,000 in lost revenue, or 30% of the company’s revenue that year.

“It meets all the eligibility criteria to apply for a grant under this program,” Fa said. “I think anyone who meets all the eligibility criteria should receive grants, but Colorado insists on applying. this trade preference belonging to minorities. “

In June, a federal judge allowed a temporary injunction preventing President Biden’s Agriculture Department from implementing a race-based loan cancellation program. The Pacific Legal Foundation is representing a Florida farmer in this case.

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“I think these racial preferences represent a growing sense of racial essentialism in America, and it’s more important than ever to combat that,” Fa told FOX Business. Unlike racial essentialism, he championed “the concept of individualism, whereby individuals share universal values ​​such as freedom and justice for all. This is what Americans of all races do. should fight “.

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