Op-Ed: Where There’s Smoke: Our MWBEs May Be in Trouble

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Our firm’s third annual Minority and Women-Owned Business Enterprises (MWBE) event for construction-related contractors and suppliers presented real challenges. How do we put on our signature spring event during a pandemic without putting contractors or staff in danger?  Would anyone even show up?

After some brainstorming we came up with the following format: Call MWBE firms, direct them to a mobile-friendly webpage that lists available projects, have them fill out a simple contact form, and send their info to our clients.

We started three weeks ago, and to date called over 500 MWBE firms, but unfortunately only made contact with a handful. By and large, their phones went unanswered, had full voice mailboxes, or were disconnected. Keep in mind that much of construction was deemed essential, so if MWBE firms weren’t answering the phone, were they even in business?

MWBE contracting goals are baked into government-subsidized affordable housing and commercial development deals with government agencies like HPD [Housing Preservation & Development], HCR [NYS Homes and Community Renewal], EDC [New York City Economic Development Corporation], ESD [NYS Empire Development Corporation], and DOF [Department of Finance].

Substantial penalties can be incurred when goals aren’t met, however, if a project can demonstrate that it made a provable good-faith outreach effort, a waiver on goals will likely be granted. Given the current crisis, waivers on a large scale can set back MWBE contracting overall, after so many years of positive gains. 

The good news is that it’s not too late to intervene. There are things that can be done immediately to help MWBE firms:

Agencies that award subsidy already have web pages that list their projects’ MWBE goals. They can team up with MWBE certifying agencies to promote these web pages through e-blasts, phone calls, robo-calls, and even USPS mail to draw attention to available projects.

Local elected officials can also be worked in. They have newsletters, can do robo-calls, host virtual town halls, and more.

And as long as MWBE firms are being contacted, let’s also make sure they’re asked to update their contact info, and call their attention to financial and technical assist programs available.

The state can make an instant impact by allowing “certification reciprocity” and give MWBE credit on state-subsidized projects using NYC certified firms (the city already accepts state-certified firms on its projects). The state can attach strings if needed, e.g. that the firm be New York State-based or have a pending state certification, either of which is better than outright denying credit for using NYC certified MWBE firms on state projects.

Government agencies can explore ways to push harder for bifurcated trade contracts—splitting up otherwise large contracts into two or more parts—putting opportunities within reach of small-sized MWBE firms. Many large contractors already sub-out parts of their work, so it’s not a stretch. 

Incentivize MWBE goal achievement—a carrot rather than yet another stick. For example, project developers that exceed MWBE goals without using waivers can be given “preferred status” and thus be rewarded with an expedited review on their next project.

An expedited review is within the purview of a commissioner and doesn’t require an act of legislation. An expedited review means shovels in the ground sooner, means shovels out of the ground sooner, means rent-up sooner. MWBEs, developers, government agencies all win, as well as communities waiting on new much-needed affordable units.

It’s not just government that can help. Some chambers of commerce and trade associations have policies that only allow member-to-member marketing. This isn’t the time to keep an opportunity away from any member, let alone an MWBE one; providing access to these opportunities is far more in line with their missions than a “members only” approach.

These are just ideas, and not a critique. In fact, city and state agencies should be applauded for how far they’ve come in MWBE contracting in just a few years. Let’s not let these gains slip by looking the other way during this crisis and instead do some real out-of-the-box thinking. The MWBE community is counting on it. 

In the meantime, if you know of MWBE certified construction firms that may be interested in work, please direct them to www.btn-consulting.com/2020fair.

Manny Burgos is CEO of By the Numbers Consulting Services Corp., a leading provider of outreach, compliance, advisory, and data gathering services. BTN Consulting serves the tristate area with offices in New York and Puerto Rico.

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