CHICAGO — Cook County has pulled the plug on one of its federally funded small business grant programs after being sued over its constitutionality.

The suit, filed in December on behalf of Chicago chiropractor Domenic Cusano Jr., alleged the Small Business Source Grow Grant program treated applicants “differently based on their owners’ race, and specifically prioritizes ‘persons of color.’ ”

The lawsuit claimed that was a violation of the equal protection clause of the 14th Amendment, “discriminating against individuals on the basis of their membership in a racial group,” and that Cusano, who “identifies as white and Caucasian,” would not be “on equal footing” with other applicants. The suit was filed by the California-based law firm Pacific Legal Foundation, which “defends Americans’ liberties when threatened by government overreach and abuse,” according to its website.

“Litigation was recently filed against the County regarding the Cook County Grow Grant program,” the program website says. “In order to assist small businesses as quickly as possible, we have chosen to rescind the Grow Grant program and restructure and redesign our small business grant program.”

“It is wrong for the government to grant preferential treatment based on race,” Andrew Quinio, an attorney at Pacific Legal Foundation, said in a release when the case was filed. “The government is attempting to pick winners and losers based on race, in utter disregard for the Constitution. The 14th Amendment protects individuals from discrimination due to arbitrary classifications like race.”

Grow Grant was announced in late September. Using funding from the federal COVID-19 American Rescue Plan Act, it was slated to award $71 million in grants to small businesses in early 2023. The county’s Bureau of Economic Development planned to provide $10,000 grants “paired with one-on-one business advising to historically excluded businesses — including those owned by entrepreneurs of color, women, veterans, LGBQT+ and persons with a disability — to close racial wealth and opportunity gaps,” according to a county release.

Applicants had to be a for-profit business in Cook County with fewer than 20 employees, in operation prior to the pandemic and have “experienced a decrease in revenue or gross receipts, increased costs, or greater financial insecurity due to COVID.” Applicants were asked to mark their ethnicity, race, and whether the business was at least 51% minority-owned, operated, and controlled. The program’s pause was first reported by Cook County Record.

“There were no restrictions on applicants,” Nick Mathiowdis, a spokesman for Preckwinkle, told the Tribune in an email. “Any business that met the eligibility criteria below and submitted their application with all the correct documentation would have been considered.”

The application also noted that “historically excluded populations” would be prioritized, however.

Cusano’s complaint asked that the county be permanently barred “from enforcing” the program’s prioritization of minority business owners, pay for attorneys’ fees and $1 in damages.

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