Stringer: M/WBE Share of City Spending Falls

New York City Comptroller Scott M. Stringer on Oct. 31 speaking about his report on city contracts with M/WBEs. (Photo by Karen Pennar for Voices of NY)

New York City Comptroller Scott M. Stringer on Oct. 31 speaking about his report on city contracts with M/WBEs. (Photo by Karen Pennar for Voices of NY)

The city is moving “at a glacial pace” to boost contracting with minority and women-owned businesses (M/WBEs) and its most recent performance amounts to a step backward, New York City Comptroller Scott M. Stringer said on Oct. 31. The situation warrants “a sledgehammer approach,” Stringer said, to reverse this performance and create strong gains in city spending  with such businesses – and ensure economic growth for the city for years to come.

Stringer’s third annual report card on how 31 mayoral agencies and his own office performed shows that the actual dollar amount going to M/WBEs in fiscal year 2016 amounted to only 4.8 percent of the $15.3 billion procurement budget, down from a 5.3 percent share the year before.

Stringer gave the city an overall grade of D+.

A month ago, Mayor Bill de Blasio announced that the city aimed to have 30 percent of city contracts go toward M/WBEs by 2021, and said that the number of M/WBE-certified businesses should double by 2019. He also said he had appointed Richard Buery, deputy mayor for Strategic Policy Initiatives, as the director of the city’s new M/WBE programs, and Jonnel Doris as senior advisor to the initiative.

Stringer was complimentary of both Buery and Doris, but suggested that the mayor’s moves were inadequate. Using back-of-the-envelope calculations, he said, “you could estimate that at the rate we’re going we will not see real change in New York City for another 20 to 30 years.”

Stringer noted that even city-certified M/WBEs appear to be having great difficulty in getting city dollars. Of the 4,527 businesses certified as minority and women-owned, only 927 were beneficiaries of city spending in fiscal year 2016.

To turn this situation around, Stringer said, the city needs to name a chief diversity officer, and each agency should have its own diversity procurement officer to ensure that a greater share of purchasing is directed toward M/WBEs. In addition, he said, prompt payment by the city, a mentorship program that provides support over the life cycle of a contract and a streamlined “universal certification application process” across local, state and federal M/WBE programs should be adopted.

Only one agency, the Department of Housing Preservation and Development, received an A grade, for the second year in a row. And a B grade was received by only five agencies and the Office of the Comptroller. Three agencies received a failing grade: The Business Integrity Commission, the Department of Buildings and the Department of Sanitation.

To highlight the release of the study, Stringer held his press conference at the downtown Manhattan offices of Constructomics, a privately-owned M/WBE construction company that has not received any city contracts. He briefly spoke with their executives as well as those of two other M/WBE contractors, soliciting their comments and views on what might be needed to improve M/WBE contracting before formally announcing the results of his office’s study. Choosing more prime M/WBEs who in turn will work with subcontracting M/WBEs – such as Constructomics does with other firms on private sector jobs – can “leverage success,” as Stringer noted, and thereby ensure that more and more companies are pulled into the contracting process.

“Too many companies and entire communities of businesses are still being left behind year after year,” Stringer said.

The comptroller also announced a new tool, a set of interactive maps, showing the location and city spending history of all certified M/WBEs.  “They truly illustrate the problem at hand,” he said.

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