In a city as dynamic as ours, it’s undeniable that small businesses are the backbone of a successful economy. Small businesses employ nearly 50 percent of the private sector workforce, according to the U.S. Small Business Administration. These businesses also tend to hire and reinvest locally, spurring economic growth in communities across the five boroughs.
However, within the small business community, minority and women business owners have faced unique, institutional challenges that have kept them from reaching their full economic potential. These challenges include barriers to capital and other resources that help other businesses thrive. Under the leadership of Mayor Bill de Blasio, we have seen a newfound focus on this issue and a commitment to increase opportunities for minority and women-owned business enterprises (M/WBEs) that seek to do business with New York City.
These opportunities have led to the creation of thousands of jobs and millions in regional economic activity. Organizations like the NYC M/WBE Alliance (the “Alliance”) applaud the de Blasio administration for having a vested interest in seeing competent M/WBEs compete, perform and grow at unprecedented levels. But this work cannot fall solely on the shoulders of the city. As small, M/WBE business owners ourselves, the Alliance board members are all too familiar with the challenges that lie ahead and know the importance of enacting progressive state legislation that would remove additional barriers for small businesses and M/WBEs.
Right now, the de Blasio Administration is leading an urgent legislative push to get the state to grant the city authority to put its program and the over 4,800 city-certified M/WBEs on par with the state’s M/WBE program. New York City is seeking approval from the Legislature and the governor, for an important piece of legislation that would allow the city to match the state’s discretionary spending for contracts that may be awarded without competitive bidding.
New York City is seeking approval from the Legislature and the governor, for an important piece of legislation that would allow the city to match the state’s discretionary spending for contracts that may be awarded without competitive bidding.
Being both a minority and a woman in the construction field, the institutional challenges were twofold as my partner and I tried to navigate, compete and successfully perform in a male-dominated field. Often times, these obstacles were compounded when seeking to do business with the city. However, Mayor Bill de Blasio recognizes these issues and has prioritized the M/WBE program in a way not seen since the Dinkins Administration.
The de Blasio administration has expanded educational resources and capacity-building programs that help M/WBEs successfully bid on and perform on city contracts. The administration most recently launched the Contract Financing Loan Fund, a revolving loan fund that M/WBEs can apply to and receive up to $500,000 at a low 3 percent interest rate.
My firm, TaylorMade Contracting, was one of the first to receive this loan. As we transition away from residential projects to focus on commercial opportunities, we know firsthand the benefits of having accessible capital to perform on city construction projects. With the Contract Financing Loan, my firm was able to hire additional workers and equipment to streamline my workflow.
While initiatives such as the Contract Financing Loan Fund provide M/WBEs with much-needed support, the city cannot solely shoulder this responsibility. The city and M/WBEs need the state’s support to continue moving the M/WBE program forward.
Currently, City agencies have discretionary spending authority that allows them to spend $20,000 to $35,000 without a formal competitive process while the state’s threshold is up to $200,000. The process time associated with a formal competition can often discourage M/WBEs from going through, at times, a lengthy procurement process for projects that are small and offer only a slight profit margin. For any small business owner, time spent not focusing on running your business is money lost. That loss is compounded for M/WBEs who, historically, have been at a competitive disadvantage.
The city also is looking to implement mentoring programs across various industries and city agencies. The city’s current mentoring programs are most often used in the areas of contracting and construction management. This administration is seeking to extend those mentoring programs to professional services that include fields such as law and accounting where there may be an under-representation of M/WBEs.
If we truly want to see our M/WBEs succeed, if we truly want the city’s business to reflect the diversity of our great city, we need the state to act. Remind your legislators that we need their help to leverage the city’s procurement system to combat income inequality and reinvest in local communities.