Why is Hispanic / Latino not a racial background choice?

According to U.S. government guidelines, ethnic heritage and racial background are to be separate, distinct questions and responses. "Ethnic Heritage" defines membership in cultural groups such as Hispanic / Latino, whereas "Racial Background" is based on ancestry and genetic groups. This issue is handled in various ways outside the U.S., and the current standards continue to evolve. We realize this distinction may be somewhat confusing, but we must conform to the latest reporting standards required by the government.
More precise definitions of the various racial background and ethnic heritage choices are as follows:

Racial Background

• American Indian or Alaska Native
  Persons having origins in any of the original peoples of North and South America (including Central America), and who maintains cultural identification through tribal affiliation or community recognition.
• Asian
  Persons having origins in any of the original peoples of the Far East, Southeast Asia or the Indian subcontinent, including for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam.
• Black or African American
  Persons having origins in any of the black racial groups of Africa.
• Native Hawaiian or Other Pacific Islander
  Persons having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands.
• White
  Persons having origins in any of the original peoples of Europe, the Middle East, or North Africa.

Ethnic Heritage

• Hispanic or Latino
  Persons of Cuban, Mexican, Puerto Rican, Central or South American, or other Spanish culture of origin, regardless of race.