In recent years, the issue of placing EOC requirements on government contractors with respect to minority hiring had became increasingly controversial. To what extent can such guidelines increase the proportion of minorities employed private firmsbidding for government contrats? How do “reasonable” EOC guidelines affects the number and type of firms bidding for government business? And how do such guidelines affect government costs for goods and services?

These questions have been addressed in a major study of Resolution 12, (which established the Shelby County (Tennessee) Contract Compliance Program), carried out by the Memphis State University Institute for Governmental Studies and Research. In general, the study found that this EOC Contracting program resulted in a modest but significant increase in private contractor minority employment. The increase varied notably by product/Service Category, however, Implementation of Resolution 12 also resulted in an immediate and sharp drop in the number of private firms Participating in the bidding process--a drop which to date has not been completely reversed. On the other hand, neither the EOC guidelines nor the resultant drop in business participation had had any significant impact on the general level of Shelby County Government contracting costs, which have remained fairly low when compared to those incurred by several other municipalities