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Successful, Affluent but Still ‘Disadvantaged’

June 13, 1995

Santos Garza doesn’t fit everyone’s definition of ``disadvantaged.″

The owner and chief executive of a growing security company, she lives in a $350,000 house in the affluent Washington suburb of Bethesda, Md. She directs 375 employees _ engineers, investigators and guards _ who protect such federal agencies as the State and Treasury departments. Her company’s revenue last year topped $10 million, and she pays herself a salary of about $100,000.

But more than three-quarters of Ms. Garza’s business comes courtesy of a Small Business Administration program that steers government contracts to the ``socially and economically disadvantaged.″ Because she is of Mexican descent, her company, Counter Technology Inc., gets access to public contracts that white-owned companies can’t bid for.

Ms. Garza’s story is the sort that infuriates some critics of racial preferences. ``It’s disgraceful″ that skin color determines who gets certain federal work, asserts Herbert Saunders, president of a similar but white-owned company, Varicon International Co. of Falls Church, Va.

Yet Santos Garza also is precisely the sort of success story that makes backers of affirmative action proud. The child of migrant farm workers, Ms. Garza spent part of her childhood in dirt-floor company housing and was two years late finishing high school because she worked to help support the family. She has built a company whose work force is 60 percent women or minorities, some of whom, with her guidance, have gone on to start their own companies.

Now such racial-preference programs are on the griddle. The Republicans who control Congress are threatening to repeal them and got a boost from Monday’s Supreme Court decision potentially undercutting federal affirmative-action programs.

Some affirmative-action critics say it is unfair to give special treatment to minorities who are already in the middle class. Government preferences, this argument goes, should help only those who are down and out. ``That’s where we need to push: to help those who are really deserving, not to enrich those who have already made it,″ says Clint Bolick of the conservative Institute for Justice in Washington.

But others reply that it would be senseless to give government contracts to people almost certain to fail. ``A poor person can’t handle a $500,000 or $1 million contract,″ says Timothy Bates, an economist at Wayne State University in Detroit. ``You have to go to someone with business skills, which means someone who is probably already middle-class.″

Ms. Garza, 47 years old and a Republican who defends affirmative action, acknowledges the delicacy of her position. She continues to take advantage of opportunities based on her ethnicity, conceding: ``I never would have made it from a tiny company _ four people _ to where I am today without the set-asides.″

But she also says she is ``sick and tired″ of other members of minority groups ``who are always (complaining), `Poor me.′ ... Work, and you won’t be poor.″

Ms. Garza has come a long way from the cotton fields of Texas. As a little girl, one of six children, she tagged along with her mother, who earned 35 cents a pound for picking cotton, while her father drove a farm truck. By 1957, the Garzas had saved enough to settle in Aurora, Ill., near Chicago, and buy a three-bedroom house for $4,800. ``That’s the first time I felt like a real American, because we were living in our own house, like on `Father Knows Best,‴ Ms. Garza says.

Married and divorced in her early 20s, Ms. Garza raised two boys on her own and held two jobs at a time. She took some college classes and joined the Aurora Police Department in 1976. ``They made it clear that they hired me because of affirmative action,″ she says.

After 11 years and several frustrated bids for sergeant’s stripes, Ms. Garza decided the Aurora police weren’t ready to promote a Hispanic woman and resigned from the force. Cashing in her pension and severance, she paid $20,000 for Counter Technology, a nearly defunct security company run by Richard Roth, a former Secret Service specialist in debugging and antiterrorist planning. Mr. Roth, who is white, became Ms. Garza’s employee; about a year later, they married.

From the start, some competitors grumbled that Ms. Garza was ``fronting″ for Mr. Roth so that CTI could get setasides. Mr. Saunders, for example, says he has nothing personal against Ms. Garza and thinks CTI does high-quality work but contends its status as minority-owned ``is a sham because her husband is the guy really behind it.″

Ms. Garza responds angrily: ``Unlike a lot of my (minority) competitors, who own 51 percent of their company and have someone (white) behind them, the only person who put any cash in this company is San Garza.″

She has the documents to back up what she says, including police department letters showing she collected her pension of $18,308.97 and severance of $2,542.67 in 1987 and canceled checks written a short time later with which she bought all the CTI stock. She also has a ``property agreement″ dated Aug. 23, 1988, under which she and her husband agreed that her stock ``shall not be considered marital property.″ Ms. Garza submitted her documents to the SBA. ``We’ve been satisfied,″ says Neil Wensel, a senior minority-business official in the SBA’s Washington office.

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