The word is out that distribution of stimulus money for transportation projects has been alarmingly absent for minority- and women-owned businesses. A recent investigation by Chicago Public Radio found that less than 10 percent of stimulus funds awarded by the Illinois Department of Transportation went to organizations owned by minorities and women, despite the fact that the state had set a goal of 22.7 percent. Meanwhile, in Missouri, MoDOT has awarded just 1 percent of stimulus contracts to minority contractors and 8 percent to businesses owned by women, according to the NAACP. And the head of the California Hispanic Chamber of Commerce told New America Media he was “not aware of a single one of our members who’s received a contract related to the stimulus package.”
Protests about this distribution inequality have been gaining urgency, to the point where last week the Obama administration urged governors to work harder to ensure that minority-owned businesses get more of a shot on state transportation projects that receive federal funding.
Now the Transportation Equity Network has released the following data: Of the total funds given from the USDOT to qualified contractors, only 5.9% of it went to women-owned businesses, while 10.3% went to minority-owned businesses. Here’s a more detailed breakdown:
FEDERAL CONTRACTS (USDOT direct to qualified federal contractors only):
• Stimulus funds contracted for street, highway and bridge construction: Total: $163.8M
• Allocated to women-owned businesses: $9.7M (5.9%)
• Allocated to all minority-owned businesses: $16.8M (10.3%, including $4.7M or 2.9% to Hispanic-owned)
• Allocated to Hispanic-owned businesses: $4.7M (2.9%)
• Allocated to Black-owned businesses: 0
One question that this data raises is, “So what percentage of construction businesses in the U.S. are owned by women or minorities?” The answer, unfortunately, is “No one really knows.” Julie Cunningham, director of the Conference of Minority Transportation Officials, tells us that no one has a good number, since there is no national registry of minority-owned or DBE (disadvantaged business enterprise) contractors. Individual states have different categories for their registries, and registration is not required — and of the ones who do register, those contractors working in multiple states may be listed as DBEs in one state but do a majority of their work in another. Nevertheless, the numbers are pointing to a clear trend, and it’s not one that benefits female and minority pockets.
Tags: Contractors, Equality
So what else is new??
I got invited to talk about educational reform in Iraq, but they do the meetings in Dubai.
War is good business for those who want to participate. Also Wall street is not doing so bad for all the losers who don’t know what they are doing or lack in ethics.
without knowing what percentage of contruction companies are owned by women or minorites, this seems like a non-issue. Asking governors to give these businesses more of a shot at accessing funds reeks of affirmative action, the opposite way of rewarding skill and establishing a meritocracy. Of course, if the numbers were known and the actual distribution was unreasonably low, then there would be something to be concerned about.
Simple fact is the the bidding process is competitive. If the minority contractors do not submit the low bid….is the DOT supposed to ignore the low bid and award the contract to the lowest minority bid?
If that was the case, and minority contractors are going to get the job no matter what they do, what incentive is there for minority contractors to submit low bids?
Since this is tax-payer money you cannot ignore the competitive bidding process and arbitrarily award contracts to minorities. Otherwise minority contractors can bid however high they want and be confident that they will get the job, even if another (non-minority) contractor bids lower.
Bottom line – they need to stop whining and actually start submitting low bids. Otherwise they aren’t going to get any work.
[...] States have been missing their goals for allocating stimulus contracts to women- and minority-owned businesses, Melissa Lafsky writes at Infrastructurist. [...]
The fact is that many non minority contractors are still able to manipulate the system to gain access to these contracts. Yes in a perfect world the system is built to work on the low bid process. But there are usually a set of stipulations that accompanies that process, where many minority contractors will be disqualified. One such stipulation is the peformance and payment bond process. The systems isn’t set up for equality. This forces the minority contractor to whine or ask for fair shake at the process, just like everyone else.
It would be ideal if discrimination was only a word and practice of the past. However, even in 2010 it is unfortunately not. Is it difficult to accept the notion that a banker would charge higher interest rates or refuse to loan funds to businesses owned by minorities and women? Or a material supplier would charge higher fees for their wares because they have not done business with this indivdual before? When it comes to bonding and insurance requirements that could be another barrier as well. Especially in this current economic downturn. Bonding is difficult for alot of contractors but could be more of an issue for minority and women to obtain. If business relationships have not been cultivated or developed in the first place, it is very difficult for any person to achieve economic parity. In a competitive environment such as the construction industry there is still a need to have umpires (officials) to insure that everyone is playing by the same rules. Although this article points out the statistics attributed to USDOT contracts you would be amazed by the lack of enforcement of diversity and equal opportunity requirements for other federal agencies. Or perhaps not if you are the person that is being adversely affected. That unfortunately filters to the state and local levels. As a society I believe we tend to focus more on the construction industry when it comes to economic parity and nondiscrimination. But what about the other business and employment sectors in our country? And yes when it comes to the public dollar being used to pay for services everyone should have the same unencumbered opportunity to compete fairly. Until certain advantages are enjoyed by the many and not a select few in our society there will always be strive and conflict. One way to address these issues is through awareness and education that examines as many points of view as possible. And when an issue is identified develop real collaborative solutions to remedy this robber of economic justice.