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De Blasio 'Moved Backwards' on Giving Contracts to Minority Firms: Stringer

By Jeff Mays | October 31, 2016 1:31pm
 The percentage of firms owned by minorities and women that received city contracts dropped for the first time in three years, according to a report Monday from Comptroller Scott Stringer.
The percentage of firms owned by minorities and women that received city contracts dropped for the first time in three years, according to a report Monday from Comptroller Scott Stringer.
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DNAinfo/Jeff Mays

FINANCIAL DISTRICT — The percentage of firms owned by minorities and women that received city contracts dropped for the first time in three years, according to a report Monday from Comptroller Scott Stringer.

Firms owned by minorities and women received 4.8 percent of the $15.3 billion in contracts awarded by the city in fiscal year 2016. That's down from the 5.3 percent awarded in fiscal year 2015. The city received the same D+ grade for its efforts.

But the city was given an F when it came to contracting with businesses owned by African-Americans, a D for Hispanic firms and women-owned firms and a C for companies owned by Asians.

"As much as we talk about moving forward, this report demonstrates that at least for the last fiscal year, we moved backwards and have a long way to go," Stringer said. "Government needs to lead by example, but it’s clear that when it comes to securing city contracts, our minority and women-owned businesses still aren’t getting a fair shot.

Mayor Bill de Blasio has defended the city's MWBE efforts, launching a $10 million loan program to help minority and women developers and pledging to reach a goal of awarding 30 percent of city contracts to minority- and women-owned firms by 2021. De Blasio also launched the Mayor's Office for MWBE. The mayor also acknowledged that it will need state law around the awarding of contracts to change to meet its goals.

Richard Buery, deputy mayor for Strategic Policy Initiatives and director of MWBEs, said Stringer "is wrong on the facts" when it comes to MWBE spending.

Stringer said he measured the amount of money the city actually paid to minority firms because he believes it is a more accurate representation of MWBE participation.

The city measures MWBE participation by citing how many contracts were awarded to those firms. City officials say that is a more accurate picture of what de Blasio is doing because money can be paid out to firms months and even years later.

"Last year this administration awarded $697 million in contracts to MWBEs, a 52 percent increase in dollars from the year prior. Our contracts went to MWBEs 14 percent of the time, up from 8 percent in the year prior. We are well on our way to awarding 30 percent of the value of our contracts to this important community of businesses," said Buery.

De Blasio's MWBE efforts have come under attack. The $10 million loan fund was deemed too small to help MWBE firms compete in a city where projects regularly top $100 million. And the timeline for the city to reach 30 percent minority contracting is too long, critics say. 2021 would be de Blasio's last year in office if he wins re-election next year.

Stringer said the city was moving at a "glacial pace" when it came to MWBE progress and would not likely reach the 30 percent goal for another 20 or 30 years.

Minority and women contracting likely will be an issue in the 2017 mayoral elections. Blacks and Latinos overwhelmingly voted for the mayor during his first run for office and continue to be his strongest supporters, according to polls.

Multiple potential candidates for mayor have criticized de Blasio's MWBE record, including Stringer who said the mayor wasn't moving fast enough to address inequality at a speech before the city's business community. Income inequality is an issue that helped carry the mayor into office.

On Friday, minority and women developers in the South Bronx said de Blasio's decision to award a $300 million project to redevelop the former Spofford Juvenile Detention Center to non-minority firms was a "kick in the face."

The Rev. Johnnie Green, a Harlem pastor who heads the statewide group Mobilizing Preachers and Community, called the numbers in Stringer's report "reprehensible" and shows that "this mayor is all talk without action."

Green and his group plan to oppose de Blasio's re-election based on his MWBE contracting record.

"It is a slap in the face of his African-American and Latino supporters who overwhelmingly supported him and elected him mayor," Green said. "I hope this is a wake up call for African-American leaders and activists who support this mayor's re-election."

The report found that 15 city agencies, nearly half of those examined, received grades of D or F. Eleven of those 15 agencies have received D's and F's since Stringer's report was launched in 2014. But some agencies have also improved. Eleven agencies received higher letter grades this year than last.

The report recommends hiring a full time chief diversity officer. Stringer also called for creating a dedicated pool of smaller contracts and then pre-certifying small businesses to compete for that work.

Stringer, who has included his own office in the report even though it does not fall under the mayor's office, received a B, which is up from a C last year.

Stringer toured the offices of Constructomics, a minority-owned general contractor and construction manager. Principal Trevor Prince said his firm does not do much city work because they lose out to larger firms even though they are MWBE certified and have a high level of bonding. Because they are competitors with those big firms, they are not used as subcontractors.

Prince and his fellow principal Glenn Levey said the city needs to do a better job of breaking down large contracts so minority-owned firms like theirs can get a piece. Prince said they sometimes hire as many as 50 percent of MWBE subcontractors for their projects.

Alex Pena of Totem NY, a general construction firm, said more MWBE firms need to be named as equity partners in large projects. He said he was tired of "idealistic goals" in regards to MWBE contracting.

"I want to see things put in motion. I want to see action. The goal could be 15 percent as long as it gets done," said Pena.