Determination of Group Eligibility for MBDA Assistance, 14238-14241 [2013-04955]

Download as PDF 14238 Federal Register / Vol. 78, No. 43 / Tuesday, March 5, 2013 / Proposed Rules MarketingOrdersSmallBusinessGuide. Any questions about the compliance guide should be sent to Laurel May at the previously mentioned address in the FOR FURTHER INFORMATION CONTACT section. A 60-day comment period is provided to allow interested persons to respond to this proposal. All written comments timely received will be considered before a final determination is made on this matter. emcdonald on DSK67QTVN1PROD with PROPOSALS Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), this notice announces AMS’s intent to request approval from the Office of Management and Budget (OMB) for a new information collection under OMB No. 0581–NEW. It will be merged with the forms currently approved under OMB No. 0581–0189 ‘‘Generic Fruit Crops.’’ Title: Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; Marketing Order No. 905. OMB Number: 0581–NEW. Type of Request: New Collection. Abstract: The information requirements in this request are essential to carry out the intent of the Act, to provide the respondents the type of service they request, and to administer the Florida citrus marketing order program. On July 17, 2012, the Committee unanimously recommended that all fresh citrus handlers, covered under the order, provide the Committee with a list of all growers whose fruit they handled each season. This form, titled Handler Supplier Report, would be submitted directly to the Committee by handlers by June 15 of each year. This information collection would benefit the facilitation of communication between the Committee and the growers. The information collected would only be used by authorized representatives of the USDA, including the AMS Fruit and Vegetable Program regional and headquarters staff, and authorized employees of the Committee. Authorized Committee employees would be the primary users of the information, and the AMS would be the secondary users. The Committee’s staff would compile the information and utilize it to distribute regulatory information, to seek grower nominations for Committee positions, to keep fresh growers informed of issues affecting the fresh segment of the industry, and to prepare both the annual report and marketing policy, as required under the order. All proprietary information would be kept confidential VerDate Mar<15>2010 13:45 Mar 04, 2013 Jkt 229001 in accordance with the Act and the order. The proposed request for new information collection under the order is as follows: PART 905—ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN FLORIDA 1. The authority citation for 7 CFR part 905 continues to read as follows: ■ Handler Supplier Report Authority: 7 U.S.C. 601–674. Estimate of Burden: Public reporting burden for this collection of information is estimated to be an average of 0.33 hours per response. Respondents: Handlers of fresh Florida citrus Estimated Number of Respondents: 45 Estimated Number of Responses per Respondent: 1 Estimated Total Annual Burden on Respondents: 14.85 hours Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology. Comments should reference OMB No. 0581–NEW and the Marketing Order for Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida, and should be sent to the USDA in care of the Docket Clerk at the previouslymentioned address or at http:// www.regulations.gov. All responses to this notice will be summarized and included in the request for OMB approval. All comments received will become a matter of public record and will be available for public inspection during regular business hours at the address of the Docket Clerk or at http://www.regulations.gov. If this proposed rule is finalized, this information collection will be merged with the forms currently approved under OMB No. 0581–0189 ‘‘Generic Fruit Crops.’’ Citrus, Marketing agreements, Reporting and recordkeeping requirements. For the reasons set forth in the preamble, 7 CFR part 905 is proposed to be amended as follows: PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 2. Section 905.171 is added to read as follows: ■ § 905.171 Handler Supplier Report. Each handler shall furnish a supplier report to the Committee on an annual basis. Such reports shall be made on forms provided by the Committee and shall include the name and business address of each grower whose fruit was shipped or acquired by the handler during the season. Handlers shall submit this report to the Committee not later than June 15 of each season. Dated: February 27, 2013. Rex A. Barnes, Acting Administrator, Agricultural Marketing Service. [FR Doc. 2013–04964 Filed 3–4–13; 8:45 am] BILLING CODE 3410–02–P DEPARTMENT OF COMMERCE Minority Business Development Agency 15 CFR Part 1400 [Docket No. 121130667–2667–02] Determination of Group Eligibility for MBDA Assistance Minority Business Development Agency, Commerce. ACTION: Response to petition. AGENCY: SUMMARY: On January 11, 2012, the Minority Business Development Agency (MBDA) received a petition from the American-Arab Anti-Discrimination Committee (ADC or Petitioner) requesting designation of the ArabAmerican community as a socially or economically disadvantaged group whose members are eligible for MBDA assistance. This document announces MBDA’s determination that the ADC Petition is not currently supported by sufficient evidence to establish social or economic disadvantage as required by the MBDA regulations and applicable legal precedent. FOR FURTHER INFORMATION CONTACT: Kimberly Marcus, Associate Director for Legislation, Education, and Intergovernmental Affairs, Minority Business Development Agency, 1401 Constitution Ave., Room 5065, Washington, DC 20230, (202) 482–6272. E:\FR\FM\05MRP1.SGM 05MRP1 Federal Register / Vol. 78, No. 43 / Tuesday, March 5, 2013 / Proposed Rules Pursuant to Executive Order 11625 (E.O. 11625), MBDA provides management and technical assistance to minority business enterprises (MBEs) through its services and programs. A minority business enterprise for purposes of E.O. 11625 is defined as a business owned or controlled by one or more socially or economically disadvantaged individuals.1 E. O. 11625 and subsequent MBDA regulations have designated the following groups whose members are currently considered socially or economically disadvantaged and therefore eligible to receive MBDA assistance: 2 Blacks, Puerto-Ricans, Spanish-speaking Americans, American Indians, Eskimos and Aleuts, Hasidic Jews, Asian Pacific Americans, and Asian Indians.3 In order for a group to become eligible for MBDA’s services, the group must submit a petition to MBDA demonstrating, by a preponderance of the evidence, that the group is socially or economically disadvantaged.4 On May 30, 2012, MBDA published a notice of proposed rulemaking and a request for comments in the Federal Register announcing receipt of a petition from the ADC seeking designation of Arab-Americans as a socially or economically disadvantaged group and requesting public comment on this designation.5 In particular, the notice requested comment on and evidence concerning the extent to which Arab-Americans are economically disadvantaged. Comments were accepted from the public for a 30 day period until June 29, 2012, and were posted with the petition on MBDA’s Web site. In response, the Agency received 37 comments. Of these comments, 19 were in support of ADC’s petition, while 13 expressed opposition, and five were disqualified for use of offensive or derogatory language. After careful SUPPLEMENTARY INFORMATION: 1 15 CFR 1400.1(b) (1984). Executive Order 11625, sec. 6 (1971); 15 CFR 1400.1(b) and (c) (1984). 3 15 CFR 1400.1(b) and (c) (1984). 4 Id. at § 1400.4(a). 5 Petition for Inclusion of the Arab-American Community in the Groups Eligible for MBDA Services, 77 FR 31,765–31,767 (May 30, 2012). If the applicant has submitted a Petition for formal designation as a socially or economically disadvantaged group, ‘‘the Department of Commerce will publish a notice in the Federal Register that formal designation of this group will be considered’’ requesting comments that will help in making a final determination. See 15 CFR 1400.5. MBDA extended the deadline for making its decision until March 1, 2013. See Petition for Inclusion of the Arab-American Community in the Groups Eligible for MBDA Services, 77 FR 72254 (December 5, 2012). emcdonald on DSK67QTVN1PROD with PROPOSALS 2 See VerDate Mar<15>2010 13:45 Mar 04, 2013 Jkt 229001 review of the application and comments as well as independent research, MBDA has determined that the Petition is not currently supported by sufficient evidence to prove the necessary elements of social or economic disadvantage within the specific requirements of 15 CFR 1400.4(a) of the MBDA regulations and applicable case law. Procedural Requirements for Determination of Group Eligibility for MBDA Assistance A group applying for designation as socially or economically disadvantaged within the meaning of the MBDA regulations must submit a written application to the Minority Business Development Agency containing a statement of request, a detailed description of the applicant group delineating sufficiently distinctive traits of its members, a brief summary of the submission, a narrative description of documentation in support of the claim, and a conclusion.6 Along with an adequate petition, MBDA must consider the comments received and may also consider any additional information gathered by the Agency from independent research.7 On January 11, 2012, the ADC filed a petition on behalf of the Arab-American community, requesting that MBDA designate Arab-Americans as a socially or economically disadvantaged group. The Petition defines the Arab-American group as persons who can trace their ancestry to one of the Arabic-speaking countries or areas of the world categorized as Arab countries. According to the Petition, these countries include, but are not limited to: Algeria, Bahrain, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Somalia, Saudi Arabia, Sudan, Syria, Tunisia, United Arab Emirates, and Yemen.8 The Petition included Census data showing 1.2 million Americans who report Arab ancestry.9 The Petition also includes a description of unique cultural and ethnic traits such as common Arabic language, traditional 6 15 CFR 1400.3 (1984). at § 1400.5. 8 American-Arab Anti-Discrimination Committee Petition for Determination of Group Eligibility for MBDA Assistance (filed, January 11, 2012) at 3 (ADC Petition or Pet.). The Petition also includes Palestinian-Americans within this group. 9 Pet. at 4 (citing Arab American Institute, Demographics: Religion (2002 Zogby International Survey), http://www.aaiusa.org/arabamericans/22/ demographics (last visited December 30, 2011)). See also De la Cruz, G. Patricia and Brittingham, Angela. US Census Bureau Census 2000 Brief, The Arab Population: 2000 (December 2003) available at http://www.census.gov/prod/2003pubs/c2kbr23.pdf. 7 Id. PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 14239 music, unique food, as well as an ArabAmerican press catering to this community. As required by its regulations, MBDA published the Petition in the Federal Register for 30 days and requested general comments and comments on specific social and economic issues related to Arab-Americans. This is the first time that MBDA has considered the inclusion of a group on the basis of racial or ethnic classification under the regulations set forth in 15 CFR 1400.1 through 1400.6 MBDA published several notices extending the time period for making a decision in order to consider fully the issues presented by the Petition, to conduct independent research, and to consider the implications of relevant legal precedent.10 These issues are addressed below. Substantive Requirements for Group Eligibility For a group to become eligible for MBDA’s services, it must submit a petition to MBDA demonstrating, by a preponderance of the evidence, that the group is socially or economically disadvantaged. The regulations at section 1400.2(b) define socially disadvantaged persons as ‘‘persons who have been subjected to cultural, racial or ethnic prejudice because of their identity as members of a group without regard to their individual qualities.’’ Section 1400.2(c) of the regulations defines economically disadvantaged persons as ‘‘persons whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities because of their identity as members of a group without regard to their individual qualities, as compared to others in the same line of business and competitive market area.’’ The petition must prove that the social or economic disadvantage has produced impediments in the business world for members of the group which are not common to all business people in the same or similar business and marketplace. The regulations also set out several nonexclusive categories of evidence that will be considered including: national income level and standard of living statistical data; evidence of employment and educational discrimination; evidence of denial of access to educational, professional, and social organizations; the kinds of business opportunities available to members of the group; the availability of capital, technical, and managerial resources; 10 Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (1995). E:\FR\FM\05MRP1.SGM 05MRP1 14240 Federal Register / Vol. 78, No. 43 / Tuesday, March 5, 2013 / Proposed Rules emcdonald on DSK67QTVN1PROD with PROPOSALS and any other evidence of denial of opportunity or access to those things that would enable successful participation in the American economic system.11 While the petitioner has the burden of providing sufficient evidence to meet the standard, MBDA as trier of fact may gather additional information which supports or refutes the group’s request.12 Since the promulgation of the MBDA regulations, the U.S. Supreme Court issued its opinion in Adarand v. Pena, which applied strict scrutiny to government programs that rely on racial classifications.13 To the extent that it applies, strict scrutiny analysis requires that in order to meet a constitutional challenge, the program must serve a compelling government interest and must be narrowly tailored to serve that interest. Courts have repeatedly found that the government has a compelling government interest in rectifying past discrimination caused by the government and in not passively participating in private systems of discrimination. To establish that compelling interest, the government must show a strong basis in evidence that a race based program is necessary to remedy racial or ethnic discrimination. Courts usually rely on a showing that includes statistical evidence of underrepresentation or underutilization in finding that the ‘‘strong basis in evidence’’ standard has been met. Therefore, to ensure that its programs meet constitutional standards as applicable, MBDA requires a group seeking eligibility for MBDA programs to provide substantial evidence of impediments in the business world to show a need for extending the program to that group. Social or Economic Disadvantage Evidentiary Standard In order to establish social or economic disadvantage for purposes of MBDA programs, a petition must present evidence of either social or economic disadvantage that meets each prong of the standard set out in the regulation. For social disadvantage, the petition must present evidence establishing that the group has been subjected to cultural, racial, or ethnic prejudice because of their identity as members of a group without regard to their individual qualities.14 The petition must show that the social disadvantage created by such 11 15 CFR 1400.4(b) (1984). at § 1400.5 (1984). 13 Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (1995). 14 15 CFR 1400.2(b). 12 Id. VerDate Mar<15>2010 13:45 Mar 04, 2013 Jkt 229001 prejudice is chronic, long standing, substantial, and beyond the control of the group’s members. Finally, the evidence must demonstrate that the social conditions experienced by the group have produced impediments in the business world for members of the group that are not common to those faced by all business people in the same or similar businesses or marketplaces.15 For economic disadvantage, the petition must present evidence demonstrating that members of the group have had their ability to compete in the free enterprise system impaired due to diminished capital and credit opportunities because of their identity as members of the group without regard to their individual qualities, as compared to others in the same line of business and competitive market areas. The evidence in the petition must establish that the economic disadvantage created by such prejudice is chronic, long standing, substantial, and beyond the control of the group’s members, as compared to others in the same line of business or market area. Finally, the economic conditions must have produced impediments in the business world for the group that are not common to those faced by all business people in the same or similar businesses or marketplaces.16 Application of Standard to ArabAmerican Petition MDBA has reviewed the evidence presented in the Petition and the comments, as well as its own recognition of barriers Arab-Americans have faced, and has determined that, while there is qualitative evidence that demonstrates that Arab-Americans have faced significant prejudice in numerous instances, there is insufficient evidence that this undeniable prejudice has impaired their ability to compete in the free enterprise system due to diminished capital and credit opportunities. In addition, the available evidence does not, for purposes of this program, adequately show chronic, long standing, and substantial bias that has produced impediments in the business world for members of the group that are not common to all business people in the same or similar business and market place.17 15 Id. at § 1400.4(a). § 1400.4(a). 17 In the absence of sufficient evidence in the Petition and comments, the Agency searched sources available to it and was unable to locate the type of statistical or empirical studies necessary to establish this element both for purposes of the regulation and as required to meet constitutional standards under existing case law. 16 Id. PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 The Petitioner adduces evidence that Arab-Americans have faced significant prejudice in the form of hate crimes and other adverse treatment based on characteristics, distinct clothing, or selfidentification.18 The Petition illustrates a sharp increase in prejudice since 9/11 by citing the Senate testimony of Assistant Attorney General Thomas E. Perez, that ‘‘more than 800 incidents involving violence, threats, vandalism, and arson against persons perceived to be Muslim or to be of Arab, Middle Eastern, or South Asian origin’’ were investigated by the Department of Justice between 2001 and 2011.19 The testimony also highlights a 1,600 percent increase in reports to the FBI of discrimination and harassment of ArabAmericans following 9/11. An ADC report submitted in support of the Petition demonstrates a rise in the level of employment discrimination complaints filed by Arab-Americans in the period following 9/11 and includes instances where employees were released without explanation or were called derogatory names in the workplace, which led to their subsequent resignation.20 This increase in prejudicial treatment is also suggested by evidence from the Equal Employment Opportunity Commission (EEOC) documenting 1,035 charges filed under Title VII alleging post-9/11 backlash employment discrimination.21 The Petition and supporting evidence demonstrates that, in too many instances, Arab-Americans have faced prejudice that has resulted in incidents of violence, assault, and other undeniably adverse treatment.22 But the Petition fails to connect this evidence to a showing of impediments in the business world for members of the group that are not common to all business people in the same or similar business and marketplace. Nor does the Petition establish that Arab-Americans have had their ability to compete in the 18 Pet. at 15–16, 18, 23–25. at 17 (citing Statement of Thomas E. Perez, AAG Civil Rights Division before Senate Judiciary Subcommittee on the Constitution, Civil Rights, and Human Rights ‘‘Protecting the Civil Rights of Muslim Americans’’ March 29, 2011 available at http://www.judiciary.senate.gov/hearings/ testimony.cfm?id=e655f9e2809e5476862f735da 169475f&wit_id=e655f9e2809e5476862f735da16947 5f-1-0). 20 Id. at 23 (citing 2003–2007 Report on Hate Crimes and Discrimination against Arab Americans, American-Arab Anti-Discrimination Committee Research Institute at 34–38 (2008), available at http://www.adc.org/PDF/hcr07.pdf). 21 Id. at 25. 22 However, nothing in the forgoing discussion or any other part of this response to petition should be construed as MBDA’s acceptance of the Petition’s assertions that the federal government has discriminated against Arab-Americans. 19 Id. E:\FR\FM\05MRP1.SGM 05MRP1 Federal Register / Vol. 78, No. 43 / Tuesday, March 5, 2013 / Proposed Rules free enterprise system impaired due to diminished capital and credit opportunities. Specifically, the Petition fails to provide evidence of the type MBDA requires to establish a relationship between any discriminatory treatment and business impediments experienced by Arab-American businesses as a group that are not common to all business people in the same or similar market place. Section III of the Petition states that: Arab-Americans suffer from discrimination, prejudice and cultural bias in the workplace. This employment discrimination has produced obstacles in the business world for Arab-Americans—both as employees and entrepreneurs. Members of the group have no control over such discrimination. Other entrepreneurs and individuals, outside of the group, do not suffer from such discrimination and bias.23 But, the Petition does not substantiate this assertion by providing evidence to support the statement, such as statistical measures of the impact that employment discrimination complaints have on Arab-American business success or workplace attainment. The EEOC complaints discussed above must be coupled with an analysis or study of the impact of discrimination on ArabAmericans in the business world. In addition, a 2008 Arab American Institute Foundation study produced results contrary to the Petitioner’s arguments. This study found that ArabAmerican households’ mean individual income is 27% higher than the national average and that the group shows higher than average educational attainment.24 These figures are not dispositive, but do suggest that prejudice Arab-Americans have faced may not have impacted their economic opportunities to the extent necessary to establish that ArabAmericans’ businesses require the technical and outreach services that MBDA provides. The Petition also does not establish with the necessary type of evidence that Arab-Americans have experienced diminished capital and credit opportunities. The descriptions of immigration controls, employment discrimination complaints, and post-9/11 programs that the Petition states target Arab-Americans do not demonstrate that Arab-Americans are unable to compete in the free enterprise system due to diminished capital and credit opportunities. Statistical or empirical evidence demonstrating a relationship between the discrimination suffered by the group and business impediments, or impaired access to capital, credit, contracts, and other business opportunities experienced by the group is necessary to show the social or economic conditions required to qualify the Petitioners for eligibility for MBDA’s programs that assist businesses in obtaining access to capital, credit, contracting, and other business opportunities. The comments submitted in support of the Petition similarly lack this supporting information. Accordingly, MBDA does not currently have sufficient evidence to recognize the Arab-American community as a minority group that is socially or economically disadvantaged within the specific meaning of the regulation because the Petition is not supported by sufficient evidence to meet the necessary elements of social or economic disadvantage as required by 15 CFR 1400.4(a) of the MBDA regulations and applicable case law. As such, MBDA has returned the Petition to ADC for further consideration consistent with this response to petition. Dated: February 27, 2013. David Hinson, Director. [FR Doc. 2013–04955 Filed 3–4–13; 8:45 am] ACTION: 14241 Denial of petition. SUMMARY: EPA is denying a petition to remove acetonitrile from the list of chemicals subject to reporting requirements under section 313 of the Emergency Planning and Community Right-to-Know Act of 1986 (EPCRA) and section 6607 of the Pollution Prevention Act of 1990 (PPA). EPA has reviewed the available data on this chemical and has determined that acetonitrile does not meet the deletion criterion of EPCRA section 313(d)(3). Specifically, EPA is denying this petition because EPA’s review of the petition and available information resulted in the conclusion that acetonitrile meets the listing criterion of EPCRA section 313(d)(2)(B) due to its potential to cause death in humans. FOR FURTHER INFORMATION CONTACT: Daniel R. Bushman, Environmental Analysis Division, Office of Information Analysis and Access (2842T), Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: 202–566– 0743; fax number: 202–566–0677; email: bushman.daniel@epa.gov, for specific information on this notice. For general information on EPCRA section 313, contact the Emergency Planning and Community Right-to-Know Hotline, toll free at (800) 424–9346 or (703) 412– 9810 in Virginia and Alaska or toll free, TDD (800) 553–7672, http:// www.epa.gov/epaoswer/hotline/. SUPPLEMENTARY INFORMATION: BILLING CODE P I. General Information ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 372 [EPA–HQ–TRI–2006–0319; FRL–9787–1] RIN 2025–AA19 A. Does this notice apply to me? You may be potentially affected by this action if you manufacture, process, or otherwise use acetonitrile. Potentially affected categories and entities may include, but are not limited to: Acetonitrile; Community Right-toKnow Toxic Chemical Release Reporting Environmental Protection Agency (EPA). AGENCY: emcdonald on DSK67QTVN1PROD with PROPOSALS Category Examples of potentially affected entities Industry ............................. Facilities included in the following NAICS manufacturing codes (corresponding to SIC codes 20 through 39): 311*, 312*, 313*, 314*, 315*, 316, 321, 322, 323*, 324, 325*, 326*, 327, 331, 332, 333, 334*, 335*, 336, 337*, 339*, 111998*, 211112*, 212324*, 212325*, 212393*, 212399*, 488390*, 511110, 511120, 511130, 511140*, 511191, 511199, 512220, 512230*, 519130*, 541712*, or 811490*. *Exceptions and/or limitations exist for these NAICS codes. 23 Id. at 21. VerDate Mar<15>2010 24 Comment of Nicholas Legendre, http:// www.mbda.gov/sites/default/files/ AAPetitioncomments_asof062912.pdf at 56 (citing 13:45 Mar 04, 2013 Jkt 229001 PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 Arab American Institute Foundation, Quick Facts About Arab Americans, http://aai.3cdn.net/ afbc33810b07728c5a_oim6bx98f.pdf). E:\FR\FM\05MRP1.SGM 05MRP1

Agencies

[Federal Register Volume 78, Number 43 (Tuesday, March 5, 2013)]
[Proposed Rules]
[Pages 14238-14241]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-04955]


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DEPARTMENT OF COMMERCE

Minority Business Development Agency

15 CFR Part 1400

[Docket No. 121130667-2667-02]


Determination of Group Eligibility for MBDA Assistance

AGENCY: Minority Business Development Agency, Commerce.

ACTION: Response to petition.

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SUMMARY: On January 11, 2012, the Minority Business Development Agency 
(MBDA) received a petition from the American-Arab Anti-Discrimination 
Committee (ADC or Petitioner) requesting designation of the Arab-
American community as a socially or economically disadvantaged group 
whose members are eligible for MBDA assistance. This document announces 
MBDA's determination that the ADC Petition is not currently supported 
by sufficient evidence to establish social or economic disadvantage as 
required by the MBDA regulations and applicable legal precedent.

FOR FURTHER INFORMATION CONTACT: Kimberly Marcus, Associate Director 
for Legislation, Education, and Intergovernmental Affairs, Minority 
Business Development Agency, 1401 Constitution Ave., Room 5065, 
Washington, DC 20230, (202) 482-6272.

[[Page 14239]]


SUPPLEMENTARY INFORMATION: Pursuant to Executive Order 11625 (E.O. 
11625), MBDA provides management and technical assistance to minority 
business enterprises (MBEs) through its services and programs. A 
minority business enterprise for purposes of E.O. 11625 is defined as a 
business owned or controlled by one or more socially or economically 
disadvantaged individuals.\1\
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    \1\ 15 CFR 1400.1(b) (1984).
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    E. O. 11625 and subsequent MBDA regulations have designated the 
following groups whose members are currently considered socially or 
economically disadvantaged and therefore eligible to receive MBDA 
assistance: \2\ Blacks, Puerto-Ricans, Spanish-speaking Americans, 
American Indians, Eskimos and Aleuts, Hasidic Jews, Asian Pacific 
Americans, and Asian Indians.\3\ In order for a group to become 
eligible for MBDA's services, the group must submit a petition to MBDA 
demonstrating, by a preponderance of the evidence, that the group is 
socially or economically disadvantaged.\4\
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    \2\ See Executive Order 11625, sec. 6 (1971); 15 CFR 1400.1(b) 
and (c) (1984).
    \3\ 15 CFR 1400.1(b) and (c) (1984).
    \4\ Id. at Sec.  1400.4(a).
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    On May 30, 2012, MBDA published a notice of proposed rulemaking and 
a request for comments in the Federal Register announcing receipt of a 
petition from the ADC seeking designation of Arab-Americans as a 
socially or economically disadvantaged group and requesting public 
comment on this designation.\5\ In particular, the notice requested 
comment on and evidence concerning the extent to which Arab-Americans 
are economically disadvantaged. Comments were accepted from the public 
for a 30 day period until June 29, 2012, and were posted with the 
petition on MBDA's Web site.
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    \5\ Petition for Inclusion of the Arab-American Community in the 
Groups Eligible for MBDA Services, 77 FR 31,765-31,767 (May 30, 
2012). If the applicant has submitted a Petition for formal 
designation as a socially or economically disadvantaged group, ``the 
Department of Commerce will publish a notice in the Federal Register 
that formal designation of this group will be considered'' 
requesting comments that will help in making a final determination. 
See 15 CFR 1400.5. MBDA extended the deadline for making its 
decision until March 1, 2013. See Petition for Inclusion of the 
Arab-American Community in the Groups Eligible for MBDA Services, 77 
FR 72254 (December 5, 2012).
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    In response, the Agency received 37 comments. Of these comments, 19 
were in support of ADC's petition, while 13 expressed opposition, and 
five were disqualified for use of offensive or derogatory language. 
After careful review of the application and comments as well as 
independent research, MBDA has determined that the Petition is not 
currently supported by sufficient evidence to prove the necessary 
elements of social or economic disadvantage within the specific 
requirements of 15 CFR 1400.4(a) of the MBDA regulations and applicable 
case law.

Procedural Requirements for Determination of Group Eligibility for MBDA 
Assistance

    A group applying for designation as socially or economically 
disadvantaged within the meaning of the MBDA regulations must submit a 
written application to the Minority Business Development Agency 
containing a statement of request, a detailed description of the 
applicant group delineating sufficiently distinctive traits of its 
members, a brief summary of the submission, a narrative description of 
documentation in support of the claim, and a conclusion.\6\ Along with 
an adequate petition, MBDA must consider the comments received and may 
also consider any additional information gathered by the Agency from 
independent research.\7\
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    \6\ 15 CFR 1400.3 (1984).
    \7\ Id. at Sec.  1400.5.
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    On January 11, 2012, the ADC filed a petition on behalf of the 
Arab-American community, requesting that MBDA designate Arab-Americans 
as a socially or economically disadvantaged group. The Petition defines 
the Arab-American group as persons who can trace their ancestry to one 
of the Arabic-speaking countries or areas of the world categorized as 
Arab countries.
    According to the Petition, these countries include, but are not 
limited to: Algeria, Bahrain, Djibouti, Egypt, Iraq, Jordan, Kuwait, 
Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Somalia, Saudi 
Arabia, Sudan, Syria, Tunisia, United Arab Emirates, and Yemen.\8\ The 
Petition included Census data showing 1.2 million Americans who report 
Arab ancestry.\9\ The Petition also includes a description of unique 
cultural and ethnic traits such as common Arabic language, traditional 
music, unique food, as well as an Arab-American press catering to this 
community.
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    \8\ American-Arab Anti-Discrimination Committee Petition for 
Determination of Group Eligibility for MBDA Assistance (filed, 
January 11, 2012) at 3 (ADC Petition or Pet.). The Petition also 
includes Palestinian-Americans within this group.
    \9\ Pet. at 4 (citing Arab American Institute, Demographics: 
Religion (2002 Zogby International Survey), http://www.aaiusa.org/arabamericans/22/demographics (last visited December 30, 2011)). See 
also De la Cruz, G. Patricia and Brittingham, Angela. US Census 
Bureau Census 2000 Brief, The Arab Population: 2000 (December 2003) 
available at http://www.census.gov/prod/2003pubs/c2kbr-23.pdf.
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    As required by its regulations, MBDA published the Petition in the 
Federal Register for 30 days and requested general comments and 
comments on specific social and economic issues related to Arab-
Americans. This is the first time that MBDA has considered the 
inclusion of a group on the basis of racial or ethnic classification 
under the regulations set forth in 15 CFR 1400.1 through 1400.6 MBDA 
published several notices extending the time period for making a 
decision in order to consider fully the issues presented by the 
Petition, to conduct independent research, and to consider the 
implications of relevant legal precedent.\10\ These issues are 
addressed below.
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    \10\ Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (1995).
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Substantive Requirements for Group Eligibility

    For a group to become eligible for MBDA's services, it must submit 
a petition to MBDA demonstrating, by a preponderance of the evidence, 
that the group is socially or economically disadvantaged. The 
regulations at section 1400.2(b) define socially disadvantaged persons 
as ``persons who have been subjected to cultural, racial or ethnic 
prejudice because of their identity as members of a group without 
regard to their individual qualities.'' Section 1400.2(c) of the 
regulations defines economically disadvantaged persons as ``persons 
whose ability to compete in the free enterprise system has been 
impaired due to diminished capital and credit opportunities because of 
their identity as members of a group without regard to their individual 
qualities, as compared to others in the same line of business and 
competitive market area.'' The petition must prove that the social or 
economic disadvantage has produced impediments in the business world 
for members of the group which are not common to all business people in 
the same or similar business and marketplace.
    The regulations also set out several nonexclusive categories of 
evidence that will be considered including: national income level and 
standard of living statistical data; evidence of employment and 
educational discrimination; evidence of denial of access to 
educational, professional, and social organizations; the kinds of 
business opportunities available to members of the group; the 
availability of capital, technical, and managerial resources;

[[Page 14240]]

and any other evidence of denial of opportunity or access to those 
things that would enable successful participation in the American 
economic system.\11\ While the petitioner has the burden of providing 
sufficient evidence to meet the standard, MBDA as trier of fact may 
gather additional information which supports or refutes the group's 
request.\12\
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    \11\ 15 CFR 1400.4(b) (1984).
    \12\ Id. at Sec.  1400.5 (1984).
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    Since the promulgation of the MBDA regulations, the U.S. Supreme 
Court issued its opinion in Adarand v. Pena, which applied strict 
scrutiny to government programs that rely on racial 
classifications.\13\ To the extent that it applies, strict scrutiny 
analysis requires that in order to meet a constitutional challenge, the 
program must serve a compelling government interest and must be 
narrowly tailored to serve that interest. Courts have repeatedly found 
that the government has a compelling government interest in rectifying 
past discrimination caused by the government and in not passively 
participating in private systems of discrimination. To establish that 
compelling interest, the government must show a strong basis in 
evidence that a race based program is necessary to remedy racial or 
ethnic discrimination. Courts usually rely on a showing that includes 
statistical evidence of underrepresentation or underutilization in 
finding that the ``strong basis in evidence'' standard has been met. 
Therefore, to ensure that its programs meet constitutional standards as 
applicable, MBDA requires a group seeking eligibility for MBDA programs 
to provide substantial evidence of impediments in the business world to 
show a need for extending the program to that group.
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    \13\ Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (1995).
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Social or Economic Disadvantage Evidentiary Standard

    In order to establish social or economic disadvantage for purposes 
of MBDA programs, a petition must present evidence of either social or 
economic disadvantage that meets each prong of the standard set out in 
the regulation.
    For social disadvantage, the petition must present evidence 
establishing that the group has been subjected to cultural, racial, or 
ethnic prejudice because of their identity as members of a group 
without regard to their individual qualities.\14\ The petition must 
show that the social disadvantage created by such prejudice is chronic, 
long standing, substantial, and beyond the control of the group's 
members. Finally, the evidence must demonstrate that the social 
conditions experienced by the group have produced impediments in the 
business world for members of the group that are not common to those 
faced by all business people in the same or similar businesses or 
marketplaces.\15\
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    \14\ 15 CFR 1400.2(b).
    \15\ Id. at Sec.  1400.4(a).
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    For economic disadvantage, the petition must present evidence 
demonstrating that members of the group have had their ability to 
compete in the free enterprise system impaired due to diminished 
capital and credit opportunities because of their identity as members 
of the group without regard to their individual qualities, as compared 
to others in the same line of business and competitive market areas. 
The evidence in the petition must establish that the economic 
disadvantage created by such prejudice is chronic, long standing, 
substantial, and beyond the control of the group's members, as compared 
to others in the same line of business or market area. Finally, the 
economic conditions must have produced impediments in the business 
world for the group that are not common to those faced by all business 
people in the same or similar businesses or marketplaces.\16\
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    \16\ Id. Sec.  1400.4(a).
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Application of Standard to Arab-American Petition

    MDBA has reviewed the evidence presented in the Petition and the 
comments, as well as its own recognition of barriers Arab-Americans 
have faced, and has determined that, while there is qualitative 
evidence that demonstrates that Arab-Americans have faced significant 
prejudice in numerous instances, there is insufficient evidence that 
this undeniable prejudice has impaired their ability to compete in the 
free enterprise system due to diminished capital and credit 
opportunities. In addition, the available evidence does not, for 
purposes of this program, adequately show chronic, long standing, and 
substantial bias that has produced impediments in the business world 
for members of the group that are not common to all business people in 
the same or similar business and market place.\17\
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    \17\ In the absence of sufficient evidence in the Petition and 
comments, the Agency searched sources available to it and was unable 
to locate the type of statistical or empirical studies necessary to 
establish this element both for purposes of the regulation and as 
required to meet constitutional standards under existing case law.
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    The Petitioner adduces evidence that Arab-Americans have faced 
significant prejudice in the form of hate crimes and other adverse 
treatment based on characteristics, distinct clothing, or self-
identification.\18\ The Petition illustrates a sharp increase in 
prejudice since 9/11 by citing the Senate testimony of Assistant 
Attorney General Thomas E. Perez, that ``more than 800 incidents 
involving violence, threats, vandalism, and arson against persons 
perceived to be Muslim or to be of Arab, Middle Eastern, or South Asian 
origin'' were investigated by the Department of Justice between 2001 
and 2011.\19\ The testimony also highlights a 1,600 percent increase in 
reports to the FBI of discrimination and harassment of Arab-Americans 
following 9/11. An ADC report submitted in support of the Petition 
demonstrates a rise in the level of employment discrimination 
complaints filed by Arab-Americans in the period following 9/11 and 
includes instances where employees were released without explanation or 
were called derogatory names in the workplace, which led to their 
subsequent resignation.\20\ This increase in prejudicial treatment is 
also suggested by evidence from the Equal Employment Opportunity 
Commission (EEOC) documenting 1,035 charges filed under Title VII 
alleging post-9/11 backlash employment discrimination.\21\
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    \18\ Pet. at 15-16, 18, 23-25.
    \19\ Id. at 17 (citing Statement of Thomas E. Perez, AAG Civil 
Rights Division before Senate Judiciary Subcommittee on the 
Constitution, Civil Rights, and Human Rights ``Protecting the Civil 
Rights of Muslim Americans'' March 29, 2011 available at http://www.judiciary.senate.gov/hearings/testimony.cfm?id=e655f9e2809e5476862f735da169475f&wit_id=e655f9e2809e5476862f735da169475f-1-0).
    \20\ Id. at 23 (citing 2003-2007 Report on Hate Crimes and 
Discrimination against Arab Americans, American-Arab Anti-
Discrimination Committee Research Institute at 34-38 (2008), 
available at  http://www.adc.org/PDF/hcr07.pdf).
    \21\ Id. at 25.
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    The Petition and supporting evidence demonstrates that, in too many 
instances, Arab-Americans have faced prejudice that has resulted in 
incidents of violence, assault, and other undeniably adverse 
treatment.\22\ But the Petition fails to connect this evidence to a 
showing of impediments in the business world for members of the group 
that are not common to all business people in the same or similar 
business and marketplace. Nor does the Petition establish that Arab-
Americans have had their ability to compete in the

[[Page 14241]]

free enterprise system impaired due to diminished capital and credit 
opportunities.
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    \22\ However, nothing in the forgoing discussion or any other 
part of this response to petition should be construed as MBDA's 
acceptance of the Petition's assertions that the federal government 
has discriminated against Arab-Americans.
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    Specifically, the Petition fails to provide evidence of the type 
MBDA requires to establish a relationship between any discriminatory 
treatment and business impediments experienced by Arab-American 
businesses as a group that are not common to all business people in the 
same or similar market place. Section III of the Petition states that:

    Arab-Americans suffer from discrimination, prejudice and 
cultural bias in the workplace. This employment discrimination has 
produced obstacles in the business world for Arab-Americans--both as 
employees and entrepreneurs. Members of the group have no control 
over such discrimination. Other entrepreneurs and individuals, 
outside of the group, do not suffer from such discrimination and 
bias.\23\
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    \23\ Id. at 21.

But, the Petition does not substantiate this assertion by providing 
evidence to support the statement, such as statistical measures of the 
impact that employment discrimination complaints have on Arab-American 
business success or workplace attainment. The EEOC complaints discussed 
above must be coupled with an analysis or study of the impact of 
discrimination on Arab-Americans in the business world.
    In addition, a 2008 Arab American Institute Foundation study 
produced results contrary to the Petitioner's arguments. This study 
found that Arab-American households' mean individual income is 27% 
higher than the national average and that the group shows higher than 
average educational attainment.\24\ These figures are not dispositive, 
but do suggest that prejudice Arab-Americans have faced may not have 
impacted their economic opportunities to the extent necessary to 
establish that Arab-Americans' businesses require the technical and 
outreach services that MBDA provides.
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    \24\ Comment of Nicholas Legendre, http://www.mbda.gov/sites/default/files/AAPetitioncomments_asof062912.pdf at 56 (citing Arab 
American Institute Foundation, Quick Facts About Arab Americans, 
http://aai.3cdn.net/afbc33810b07728c5a_oim6bx98f.pdf).
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    The Petition also does not establish with the necessary type of 
evidence that Arab-Americans have experienced diminished capital and 
credit opportunities. The descriptions of immigration controls, 
employment discrimination complaints, and post-9/11 programs that the 
Petition states target Arab-Americans do not demonstrate that Arab-
Americans are unable to compete in the free enterprise system due to 
diminished capital and credit opportunities. Statistical or empirical 
evidence demonstrating a relationship between the discrimination 
suffered by the group and business impediments, or impaired access to 
capital, credit, contracts, and other business opportunities 
experienced by the group is necessary to show the social or economic 
conditions required to qualify the Petitioners for eligibility for 
MBDA's programs that assist businesses in obtaining access to capital, 
credit, contracting, and other business opportunities. The comments 
submitted in support of the Petition similarly lack this supporting 
information.
    Accordingly, MBDA does not currently have sufficient evidence to 
recognize the Arab-American community as a minority group that is 
socially or economically disadvantaged within the specific meaning of 
the regulation because the Petition is not supported by sufficient 
evidence to meet the necessary elements of social or economic 
disadvantage as required by 15 CFR 1400.4(a) of the MBDA regulations 
and applicable case law. As such, MBDA has returned the Petition to ADC 
for further consideration consistent with this response to petition.

    Dated: February 27, 2013.
David Hinson,
Director.
[FR Doc. 2013-04955 Filed 3-4-13; 8:45 am]
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