The Cumberland County Board of Education has taken the first step toward eliminating formal contracting goals for businesses owned by women, minorities, and disabled people after state lawmakers dismantled the framework supporting those requirements.
The board voted unanimously September 8 to approve the first readings of proposals to rescind two policies—“Participation by Historically Underutilized Businesses” and “Participation by Minority Businesses.”
The policies establish goals of 15% participation goals. The policy for underutilized businesses applies to the total annual value of goods and services the district purchases to operate, such as supplies, equipment, and services provided by outside vendors.
The policy about minority businesses applies to the value of work performed by minority-owned businesses on certain construction, renovation, and repair projects. Its 15% goal covers projects costing more than $300,000, as well as projects costing more than $100,000 when Cumberland County Schools receives state appropriations or grants for the work.
The board is expected to rescind the policies during a second reading at its October 13 meeting.
During a Sept. 1 Policy Committee meeting, Board attorney Nick Sojka told members that the proposals were prompted by the fiscal year 2026 state budget, which abolished the Office for Historically Underutilized Businesses and repealed several statutes governing minority-business participation. Gov. Josh Stein signed the budget into law on July 7.
The state budget also mandated that school districts allow students to receive off-campus religious instruction during school hours, a policy change the school board also gave preliminary approval to September 8.
The state budget bill transferred the North Carolina Small Business Enterprise Program to the Department of Administration’s Division of Purchase and Contract. It also removed minority- and women-owned business requirements from several procurement statutes and prohibited government entities from establishing or requiring compliance with such goals in certain design-build contracting processes.
Sojka said the statutory changes eliminated the legal foundation for the district’s policies and could jeopardize its requests for qualifications (RFQs) and bidding processes.
An RFQ is a process used to compare firms’ experience, credentials, and ability to perform the work before one is selected for contracts and services.
“There’s just no legal basis for continuing to do any of this, and it could definitely jeopardize your RFQ and bid processes going forward if we were to try to continue to incorporate these procedures,” Sojka said.
He emphasized that rescinding the policies would not prohibit historically underutilized businesses from seeking district contracts or prevent Cumberland County Schools from considering their bids.
“That’s not to say that qualified historically underutilized businesses who choose to respond to our bids won’t be fairly considered with other bidders,” Sojka said. “But the prior practice of highlighting their involvement and all that statutory foundation was washed away with the stroke of a pen.”
‘This Board Is Being Watched’
During the Sept. 1 committee discussion, three board members expressed concern about what could happen after the policies and their participation goals are removed.
Board member Mary Hales said the state-law changes do not relieve the distrit of its responsibility to treat businesses fairly.
“I am concerned—very concerned,” Hales said. “However, I am prayerful that this board will continue to be a fair board.”
Hales acknowledged that the district must comply with the law while continuing to evaluate contractors fairly.
“We can’t violate the law, but it does not preclude us from being fair and ensuring that we are doing the right things.”
“This board is being watched,” she added.
Board member Terra Jordan raised similar concerns about small businesses competing with larger companies.
“We’re going to have our small businesses getting overlooked because they can’t compete with the big businesses and get picked,” Jordan said. “They’re not going to be recognized, so they can’t get other business. This is going to be interesting as it moves forward, especially as it pertains to our minority businesses.”
Board member Deanna Jones said minority- and women-owned businesses already face barriers when seeking major contracts.
“We have a lot of African American businesses and women-owned businesses that do get overlooked when it comes to big projects,” Jones said. “This is not good.”
What Rescinding the Policies Means
The underutilized businesses policy set a goal of directing 15% of the district’s total annual purchases of goods and services to businesses owned by minorities, women, and people with disabilities. Nonprofit work centers serving people who are blind or severely disabled were also included.
The policy also required the district to undertake efforts to attract those businesses, including advertising bids through media reaching minority businesses, making bidding documents available, participating in vendor seminars, and helping qualifying companies join state-maintained business directories.
The minority business participation policy established a 15% goal for each building project costing more than $300,000. The same goal applied to projects costing more than $100,000 when the district received state appropriations or grants for the work. For other projects costing at least $30,000 but no more than $300,000, the policy required Cumberland County Schools to solicit minority-business participation and document its recruitment efforts.
If the rescissions receive final approval, the participation goals, outreach procedures, and documentation requirements will be eliminated.
District Fell Short of Minority Participation Goals
State records show that Cumberland County Schools fell short of its goal of having 15% of purchases go to minority-owned businesses each of the past three fiscal years.
In 2024-25, the district reported approximately $163.2 million in purchases covered by the state’s Historically Underutilized Business participation program. Approximately $4.5 million, or 2.76%, went to qualifying businesses.
Of the $4.5 million, the state attributed nearly $3 million to women-owned businesses, $872,348 to Black-owned businesses, and $39,825 to businesses owned by people with disabilities.
In 2023-24, qualifying businesses received approximately $1.9 million of $60.8 million in covered purchases, or 3.05%. Approximately $1.7 million was attributed to women-owned businesses, $92,878 to Black-owned businesses, and $9,238 to disabled-owned businesses.
In 2022-23, historically underutilized businesses received approximately $2.4 million of the district’s $78.9 million in covered purchases, or 3%. Of the amount reported, approximately $2.2 million was attributed to women-owned businesses, $121,122 to Black-owned businesses. The report attributed no spending to disabled-owned businesses.
Construction participation varied. Historically underutilized businesses accounted for 10.64% of the districts’ reported construction spending in 2022-23 and 22.95% in 2023-24.
However, the policy goal applied to each qualifying project, so the combined annual figures do not establish whether every project reached 15%.
‘Those Businesses Remain Eligible’
Lindsay Whitley, the school district’s associate superintendent of communications and community engagement, said the participation goals and requirements would disappear if the board gives the rescissions final approval. The district would continue following state law and other procurement requirements.
“The changes affect the district’s policies and procedures, not a business’s ability to compete for CCS contracts,” Whitley said in a written response to CityView. “Black-owned, other minority-owned, women-owned, and disability-owned businesses remain eligible and are encouraged to compete.”
“Purchasing decisions will continue to be made through fair, open, and competitive processes based on applicable law, qualifications, and established procurement requirements,” he said.
Whitley also said the district does not anticipate changing how it reaches potential vendors.
“At this time, CCS’ Purchasing Department is not planning to change its current outreach methodology as a result of the proposed policy rescissions,” he said.
