Lawmakers, advocates call for legislation to expand MWBE contracting

Lawmakers, advocates call for legislation to expand MWBE contracting

Lawmakers, advocates call for legislation to expand MWBE contracting
September 24, 2015

In the effort to award more government contracts to businesses owned by minorities and women, New York City has long been outpaced by the state. Explanations range from Gov. Andrew Cuomo’s remarkable success in prioritizing such firms at the state level to a lackluster record by Mayor Bill de Blasio’s predecessors, to the lack of a single point person in the city on minority- and women-owned business enterprises, or MWBEs.

But city officials emphasize that they are also hampered by statutory restrictions – including some that can only be changed through state legislation.

“There are so many barriers in the way that are legal barriers, just straight-up laws, that get in the way of the most committed agency’s desire to do business with MWBEs,” Maya Wiley, a top de Blasio adviser who oversees the city’s MWBE initiative, said during City & State’s annual On Diversity conference. “The truth is the state has more tools than we do, and we are precluded by state law – precluded by state law – from doing some of the same things the state does to get those numbers up.” 

One measure introduced in Albany this past session aimed at putting the city on a more even playing field would have allowed agencies to bypass the competitive bidding process and make discretionary purchases of up to $200,000 from certified MWBEs, up from caps ranging from $20,000 to $100,000, depending on the contract. The legislation, which would also create a capacity building program, was approved in the Assembly but did not advance in the state Senate.

“New York City, which has probably half of the population of the state of New York, are still not up to par in their municipal laws around MWBE,” said Assemblywoman Rodneyse Bichotte, the bill sponsor and chairwoman of a subcommittee on MWBEs, during a panel discussion. “So this bill provided a discretionary limit to go from $100,000 to $200,000, which is where the state is at. Why is New York City’s not?”

Bichotte added that the state should allow New York City to use a “best value” system with MWBEs instead of simply selecting the lowest bidder, and to expand lists of prequalified MWBEs to expedite the vetting process for agencies and prime contractors.

“MWBEs bring value in many different instances,” Bichotte said. “We’re actually creating jobs in communities of color that are often ignored. We are actually promoting diversity inclusion reflecting the face of the city of New York, so that is value in and of itself.”

Assemblyman Michael Blake urged Cuomo to sign a bill that was actually approved by both houses and could benefit MWBEs. The legislation would require state agencies to pay small contractors within 15 days, down from 30 days.

Other panelists, including representatives of the New York City School Construction Authority, the Metropolitan Transportation Authority and the Dormitory Authority of the State of New York, touted programs providing mentorship for smaller MWBEs. But despite the programs’ success in creating jobs and expanding the pool of contractors, they cannot be replicated at every agency or in the city due to additional restrictions in state law.

Bichotte said she wants to change state law to expand mentorship opportunities as well. “We want to somehow build models that will reflect certain types of mentorship programs,” she said, “so that MWBEs and small businesses will have a better chance of getting access to contracts.”

In New York City, the most recent figures show that only 4 percent of contracts go to MWBEs, compared to 25 percent at the state level. The de Blasio administration has set a specific dollar amount it would like to award to MWBEs, pledging $16 billion for such firms over a decade.

Wiley said on Thursday that the city had already made substantial progress toward that goal.

“We are announcing today that we have awarded $1.6 (billion) of that already,” Wiley said. “That’s 10 percent of our 10-year goal, so we both feel really good about it, and we also know that we have to continue to do better.”

But some critics still are unhappy with the city’s performance, despite the challenges. The New York City Comptroller’s office last year issued a report giving the city a “D” grade, citing a “failure of the City to achieve its M/WBE participation goals.”

Bertha Lewis, the president and founder of The Black Institute and an outspoken critic of the de Blasio administration’s performance on MWBEs, went even further, saying that a “D” grade is too generous.

“The controller cannot issue a report that says only 4 percent of all city contracts go to MWBEs,” Lewis said during a panel discussion at the City & State conference. “That means 96 percent of all city contracts go to non-MWBEs, mainstream white firms, OK? This city is 65 percent minority, and the city gets a ‘D’ when it’s only giving out 4 percent? The grade should be ‘F-minus!’”

Experts have also emphasized the importance of a chief diversity officer position tasked with carrying out MWBE goals. The position was created at the state level when David Paterson was governor, but the city has not followed suit. The de Blasio administration has said that Wiley, the counsel to the mayor, provides sufficient oversight of MWBEs.

Lewis vehemently disagreed, and went even further by saying that simply creating the position is not enough. The state’s chief diversity officer, she continued, should also have greater responsibility and more clout to hold agencies and contractors accountable.

“There needs to be someone in charge, and there needs to be a point person, there needs to be a central place,” Lewis said. “However, that person has to have the power to reward or to punish.”

Jon Lentz
is City & State’s editor-in-chief.