SASS/SCSS: Bootstrap 5 Color functions not working well?

You will need to change the value of the $min-contrast-ratio variable to a lower value.

By default, Bootstrap v5 sets 4.5 as the default value as the recommend WCAG [ISO-9241-3] and [ANSI-HFES-100-1988], especially for elderly people or those with vision loss. https://www.w3.org/TR/UNDERSTANDING-WCAG20/visual-audio-contrast-contrast.html

In your case, change the contrast ratio to a lower value but be aware that users with low vision or cognitive impairments may not be able to read your text.

Adding $min-contrast-ratio: 2.5; to your code will override the default making the text in your code white.

// Variables
$min-contrast-ratio: 2.5;

// Bootstrap
$_luminance-list: .0008 .001 .0011 .0013 .0015 .0017 .002 .0022 .0025 .0027 .003 .0033 .0037 .004 .0044 .0048 .0052 .0056 .006 .0065 .007 .0075 .008 .0086 .0091 .0097 .0103 .011 .0116 .0123 .013 .0137 .0144 .0152 .016 .0168 .0176 .0185 .0194 .0203 .0212 .0222 .0232 .0242 .0252 .0262 .0273 .0284 .0296 .0307 .0319 .0331 .0343 .0356 .0369 .0382 .0395 .0409 .0423 .0437 .0452 .0467 .0482 .0497 .0513 .0529 .0545 .0561 .0578 .0595 .0612 .063 .0648 .0666 .0685 .0704 .0723 .0742 .0762 .0782 .0802 .0823 .0844 .0865 .0887 .0908 .0931 .0953 .0976 .0999 .1022 .1046 .107 .1095 .1119 .1144 .117 .1195 .1221 .1248 .1274 .1301 .1329 .1356 .1384 .1413 .1441 .147 .15 .1529 .1559 .159 .162 .1651 .1683 .1714 .1746 .1779 .1812 .1845 .1878 .1912 .1946 .1981 .2016 .2051 .2086 .2122 .2159 .2195 .2232 .227 .2307 .2346 .2384 .2423 .2462 .2502 .2542 .2582 .2623 .2664 .2705 .2747 .2789 .2831 .2874 .2918 .2961 .3005 .305 .3095 .314 .3185 .3231 .3278 .3325 .3372 .3419 .3467 .3515 .3564 .3613 .3663 .3712 .3763 .3813 .3864 .3916 .3968 .402 .4072 .4125 .4179 .4233 .4287 .4342 .4397 .4452 .4508 .4564 .4621 .4678 .4735 .4793 .4851 .491 .4969 .5029 .5089 .5149 .521 .5271 .5333 .5395 .5457 .552 .5583 .5647 .5711 .5776 .5841 .5906 .5972 .6038 .6105 .6172 .624 .6308 .6376 .6445 .6514 .6584 .6654 .6724 .6795 .6867 .6939 .7011 .7084 .7157 .7231 .7305 .7379 .7454 .7529 .7605 .7682 .7758 .7835 .7913 .7991 .807 .8148 .8228 .8308 .8388 .8469 .855 .8632 .8714 .8796 .8879 .8963 .9047 .9131 .9216 .9301 .9387 .9473 .956 .9647 .9734 .9823 .9911 1;

@function color-contrast($background, $color-contrast-dark: $color-contrast-dark, $color-contrast-light: $color-contrast-light, $min-contrast-ratio: $min-contrast-ratio) {
  $foregrounds: $color-contrast-light, $color-contrast-dark, $white, $black;
  $max-ratio: 0;
  $max-ratio-color: null;

  @each $color in $foregrounds {
    $contrast-ratio: contrast-ratio($background, $color);
    @if $contrast-ratio > $min-contrast-ratio {
      @return $color;
    } @else if $contrast-ratio > $max-ratio {
      $max-ratio: $contrast-ratio;
      $max-ratio-color: $color;
    }
  }

  @warn "Found no color leading to #{$min-contrast-ratio}:1 contrast ratio against #{$background}...";

  @return $max-ratio-color;
}

@function contrast-ratio($background, $foreground: $color-contrast-light) {
  $l1: luminance($background);
  $l2: luminance(opaque($background, $foreground));

  @return if($l1 > $l2, ($l1 + .05) / ($l2 + .05), ($l2 + .05) / ($l1 + .05));
}

@function luminance($color) {
  $rgb: (
    "r": red($color),
    "g": green($color),
    "b": blue($color)
  );

  @each $name, $value in $rgb {
    $value: if($value / 255 < .03928, $value / 255 / 12.92, nth($_luminance-list, $value + 1));
    $rgb: map-merge($rgb, ($name: $value));
  }

  @return (map-get($rgb, "r") * .2126) + (map-get($rgb, "g") * .7152) + (map-get($rgb, "b") * .0722);
}

@function opaque($background, $foreground) {
  @return mix(rgba($foreground, 1), $background, opacity($foreground) * 100);
}

@function tint-color($color, $weight) {
  @return mix(white, $color, $weight);
}

@function shade-color($color, $weight) {
  @return mix(black, $color, $weight);
}

@function shift-color($color, $weight) {
  @return if($weight > 0, shade-color($color, $weight), tint-color($color, -$weight));
}

$white:          #ffffff       !default;
$black:          #000000       !default;

$min-contrast-ratio:   4.5                   !default;
$color-contrast-dark:  $black                !default;
$color-contrast-light: $white                !default;

$orange: #fd7e14 !default;

$orange-50:  tint-color($orange, 90%)  !default;
$orange-100: tint-color($orange, 70%)  !default;
$orange-200: tint-color($orange, 50%)  !default;
$orange-300: tint-color($orange, 30%)  !default;
$orange-400: tint-color($orange, 10%)  !default;
$orange-500: $orange                   !default;
$orange-600: shade-color($orange, 20%) !default;
$orange-700: shade-color($orange, 40%) !default;
$orange-800: shade-color($orange, 60%) !default;
$orange-900: shade-color($orange, 80%) !default;

$theme-colors: () !default;
$theme-colors: map-merge(
    (
        "orange":   $orange
    ),
    $theme-colors
);

@mixin alert-variant(
  $background,
  $border,
  $color: color-contrast($background)
) {
  color: $color;
  background-color: $background;
  border-color: $border;
}

@each $color, $value in $theme-colors {
  .alert-#{$color} {
    @include alert-variant($value, $value);
    padding: 15px 10px;
    font-size: 1rem;
    text-align: center;
    margin-bottom: 15px;
  }
}

Alternatively, you may add the extra parameters to the color-contrast function if you don't want to affect the minimum contrast ratio directly or globally.

@mixin alert-variant(
  $background,
  $border,
  $color: color-contrast(
        $background,
        $color-contrast-dark, // Black text
        $color-contrast-light, // White text
        2.5 // minimum contrast ratio
  )
) {
  color: $color;
  background-color: $background;
  border-color: $border;
}