City cites stricter certification, limited pool for a big drop in share of municipal projects.
A recent performance-management report related to the Minneapolis Civil Rights Department shows that minority participation in city contracts has fallen steadily since 2010.
The decline was highlighted in a recent meeting discussing the report, said Council Member Cam Gordon, who wrote in an e-mail that he was “disappointed and curious” at the figures.
The Small and Underutilized Business Participation (SUBP) program aims to ensure that women- and minority-owned businesses get a fair shot to participate in city contracts. Goals are set for projects depending partly on the contractors available, and bidders are asked to make a good-faith effort to meet them.
In the fourth quarter of 2013, active contracts totaled about $383 million, according to a monthly report from the department. But the Results Minneapolis report shows that participation has fallen from 8.7 percent in 2010 to 5.3 percent in 2013.
The Star Tribune reached out to the department’s director, Velma Korbel, and asked why this number would be falling so steadily. She said it is partly the result of a stricter certification methodology implemented in 2011-2012 that impacted the number of eligible businesses.
“We also know that the economy took a toll on many small businesses previously certified to do business in Minneapolis, and some just no longer exist,” Korbel wrote in an e-mail.
“The numbers are also a factor of the increase in construction work in the Metro and not a lot of increase in the numbers of new [women- and minority-owned businesses] where all agencies draw from the same pool.”
Korbel added that large public projects such as the Vikings stadium, where everyone wants to work, “can also have a toll on the inclusion performance on smaller, less visible projects.”
The city plans to increase outreach and assistance to minority- and women-owned businesses to get them certified, the Results Minneapolis report said. The city also hopes to boost numbers by unbundling contracts and monitoring them more closely.
Lennie Chism, a former City Council candidate who founded the nonprofit Springboard Economic Development Corp., noted that ordinances allow the city to purchase raw materials for projects directly — sidestepping participation goals. He is pushing the council to change that.
“When the city purchases the materials directly, the Civil Rights Department … does not set any goals,” Chism said. “And so the purchasing manager can buy from anybody and they don’t have to buy from anybody that’s a registered participant in the SUBP program.”
Eric Roper • 612-673-1732