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Philadelphia Ends Race-Based Contracting, Shifts to Small and Local Preference

Officials cite legal exposure following recent court rulings plus federal pressure.

Overview

  • Mayor Cherelle Parker signed an executive order Tuesday that removes race-based affirmative action from city procurement.
  • The city will use a tiered system that prioritizes small and locally headquartered firms, including bid preferences for local businesses.
  • Registered minority-, woman- and disabled-owned companies that meet the new definitions will be grandfathered into the program.
  • The order sets no numerical target for awards under the new approach, and officials expect most prior contractors to retain preferential status.
  • City leaders point to legal risk confirmed by outside counsel and say prior DEI rules underperformed, noting only about 20% of registered firms had active contracts and citing a Chetty study on weak upward mobility.