New York City prides itself in first place in can-do attitude, getting the job done and taking no nonsense from any quarter. A grade ‘A’ if you will. However, this week
City Comptroller Scott M. Stringer slammed the city with a ‘D’ grade for it’s unequal and pitifully lack of funding of ‘minority’ and women-owned business enterprises (M/WBEs).
“This report shows that the city is still shortchanging women and minority owned businesses,” he told the Amsterdam News in an exclusive interview.“New York City spends $19.3 billion in procurements every year, and all of that spending every year goes to people who look like me and not the people who reflect the majority of this city – only 5.5% goes to women and minority-owned businesses.”
In his no holds-barred fifth annual “Making the Grade” report, he evaluates each City agency’s spending with M/WBEs, which in his own words showed that while overall spending with diverse firms increased in Fiscal Year 2018, 80% of certified M/WBEs are still not receiving any business from the City.
Since 2014 Stringer has been issuing his Making the Grade report in an effort to through exposure, to shame drive the City to improve its spending with diverse firms, and hold agencies accountable when they fail to do so.
The City should be concerned, he said that he has given a fourth-consecutive “D+” grade by awarding $1 billion in contracts to M/WBEs out of a $19.3 billion budget in FY18 – just 5.5 percent of the total budget.
Overall figures are bad, specifics are worse. While the City earned itself an atrocious ‘D’, it got an abysmal ‘F’ for spending with Black-owned firms. Meanwhile, spending with Asian-American firms earned the City a ‘C,’ with Hispanic-Americans a ‘D,’ and with women-owned firms a ‘D.’
The city’s chief numbers man said, “The city spends 19.3 billion dollars in procuring services; we hire law firms, accounting firms, food vendors. The city is big business, but of that 19billiion only 5.5% went to women and minority owned businesses.”
That amounts to “just under a billion dollars. So here we are spending 19 billion dollars in a city as diverse as ours, and we can only spend a billion dollars with people of color and with women?”
Hence the reason why he as comptroller wanted to do this annual report he said, to showcase the reason why we are not creating wealth in all of our communities …because the city is not giving contracts to women and minority owned businesses.”
The infrastructure to bring about immediate redress is not in place, he said. Hence his call for multipleChief Diversity Officers (CDO) in all 32 city agencies. And, “Why we are working with community based organizations and faith based organizations, we have had a task force for the last five years.”
However, he said, “It is not getting better fast enough. We have to give more opportunities to people of color… This is a majority minority city and yet the money does not reflect that position
Who is to blame?
Stringer is clear, “The mayor and the commissioners and the city agencies – the ones who do the contracts.
I am blaming the city government, it’s their job to empower communities and make it easier for small businesses and MWBE to make it in New York City.”
There is “a disagreement with City Hall,” he said.” They need a CDO in City Hall who reports to directly to the mayor and one in every City agency.”
Making a point he added, “I appointed the city’s first diversity officer Carra Wallace, now its Wendy Garcia [who] is now conducting classes – MWBE University where people come and hear whats going on with agencies and learn about procurement. When we bring them in they are ready to go, but they are not getting the contracts.”
Stringer said that in “ fact Black owned businesses get hit the hardest. They get the least amount of city money. We need to change this because it is the right thing to do , because small businesses need economic opportunity and our communities need to create wealth, and if we do not invest in women and M/WBE we are not investing in most of the neighborhoods in New York Citywide.”
Emphasizing his position, Stringer said that some agencies had made progress over the last fiscal year. Scoring themselves an ‘A’ grade were the Department for the Aging, Commission on Human Rights, and Department of Health and mental Hygiene. At the same time grades increased at 9 agencies, decreased at 5 agencies, and stayed the same at 17 agencies – meaning almost 30 percent of agencies increased their grade. Disappointingly though theMake the Grade report said that ten agencies absolutely failed to do so, earning either a ‘D’ or ‘F’ grade accounting for 50 percent of the City’s total M/WBE spending, lowering the citywide grade despite areas of improvement.
Stringer’s report offers four main proposals to “level the playing field for M/WBEs and ensure the City’s multi-billion dollar procurement budget is lifting up all New Yorkers.”
Solutions are not hard to find the city comptroller said.
Stringer is calling for a City Charter change to mandate the hiring of a Chief Diversity Officer (CDO) in the Mayor’s cabinet and in every city agency. According to public data, out of 32 mayoral agencies, only seven currently have a CDO, with only four reporting to the Commissioner. “Every agency needs a dedicated, executive-level leader to focus on diversity and drive results.”
Stringer also said that a major obstacle to increasing M/WBE spending is the Citywide requirements contracts that represent approximately 10 percent of the City’s total budget. The City should increase opportunities for M/WBEs by awarding requirements contracts to a pool of vendors, rather than one vendor alone, and by striving to include M/WBE subcontracting goals in all requirements contracts.
A no-brainer Stinger said is that the City should require prime vendors to disclose details about their commitment to diversity, including their own supplier diversity plans.
The City should change up their own roster of needs be, he said.In FY18, the City’s top 25 vendors received $2.7 billion from the City, but only 3.8% of those dollars made it to M/WBEs. To encourage more M/WBE opportunities among top vendors, the City should require vendors to share details of their own supplier diversity programs when they bid on City contracts.
“You can’t just say it is racism,” Stringer declared. “I say it is laziness. It’s hard work to find new people.”
A CDO sitting in the office could solve that problem he said.
The City Charter should be amended to alleviate the financial burden of contract delays for M/WBE vendors by assigning deadlines to every agency in the contract review process. In FY18, one in four M/WBEs had to work for at least three months without a contract in place or wait just as long after their contract start date to begin work. “We need to alleviate contract delays, procurement reform means strict timelines, so that with M/WBE contracts we get a timeline so that they don’t languish, and have to borrow money.
“Let’s not hurt them, let’s help them.”
He acknowledged that for city agencies who do not comply,“There’s no penalty, but there ought to be a change in policy.”
Meanwhile, Stringer noted, “Agencies that have take our report serious they have improved radically.”
For the sake of city, Stringer – who some say is poised to run for mayor in a few, concluded, “Let’s change the rules so that every person of color, every woman owned business can also have a level playing field when it comes to city dollars, our tax payer money. People talk about how do you create wealth? Well you invest in small businesses.”