By Nicole Scott, NDG Contributing Writer
A recent review of contracts allocated by Dallas ISD and their breakdown by ethnicity reveals an age-old impasse, African-American businesses are receiving a paltry fraction of the pie. To those who have been on the front lines of the fight against disparity this comes as no surprise. African-American contractors received $90.1 million, or 7 percent, less than half of what Hispanic owned businesses pocketed from the available $1.36 billion of funding for the 2008 bond program.
Dallas ISD Trustee Dr. Lew Blackburn says the findings that African-American firms did not fare well in this recent bond were not surprising to him as he has long been skeptical as to whether Black contractors were on equal footing with their counterparts.
“We notice that over the years the African-American firms are getting less and less each year. We have more Hispanic firms that are being chosen and even more than that we have [White] women owned businesses that are getting the majority of the M/WBE (Minority and Women Business owned Enterprises) contracts,” Blackburn stated.
With such strong African-American representation on the Board, observers are surprised and wonder why it is not resulting in greater opportunity for African-American contractors. Certainly Black firms should have to earn contracts, however, the perception is a diverse Board should bring about a more equitable outcome, specifically for those who have historically been locked out. Dr. Blackburn indicated there are other factors inhibiting Black owned firms from securing contracts. A significant factor is the loss of points during the scoring process in the awarding of contracts.
“Twenty percent of the score is based on M/WBE participation. A lot of our African-American firms seem to think because they are a minority firm they should qualify for those points. When a minority firm bids on their own without bringing another minority to the table then they in effect disavow 20 points,” Dr. Blackburn stated.
Charles O’Neal, former President of the Dallas Black Chamber of Commerce, stated the problem African-American contractors are dealing with is even much broader than the one Dr. Blackburn defines. He claims the issue is systemic and goes back to African-American firms historically being excluded from the table.
“Let’s say, for instance, 1998 there was a bond issued if an African-American firm had been able to successfully be awarded a contract then, the likelihood that they would be qualified to access a contract under an upcoming bond would be enhanced,” O’Neal stated.
The empirical data affirms O’Neal’s assertion the disparity in African-American businesses being awarded their equitable share of state contracts is clearly a systemic problem. Since the inception of the Statewide HUB (Historically Underutilized Business) program in 1991, a 1994 study, which focused on the fiscal years of 1989-1993, found not only was disparity prevalent in all areas of state issued contracts with the exception of Asian-Americans in the area of professional services and commodities but also discrimination. And of all the groups surveyed and interviewed African-American owned firms reported the highest incidence of discriminatory treatment as well as bid requirements. The study also found following the implementation of the HUB program all other minority groups, including White women, faired better except for African-Americans and Hispanics.
Fast forward to a 2009 study, of the $2.95 billion in state prime spending awarded to HUB vendors, African-American owned firms received 0.63 percent, the second lowest preceding Native Americans. The highest earnings, 3.87 percent, went to firms owned by White women, followed by Hispanic firms with 2.10 percent then Asian-American firms with 0.97 percent.
Dating as far back to 2006 businesses owned by White women have increasingly received the highest amount of M/WBE contracts awarded. Under a recent DISD bond program 19 percent, $240 million, was awarded to businesses owned by White women. That is more than double the amount awarded to Black owned businesses. The biggest objectors to affirmative action relish in perpetuating the myth of unworthy or less than qualified African-Americans receive unearned opportunities. Opportunities, which they claim, should go to Whites who are better qualified but are bypassed due to minority set asides. However, the aforementioned only validates the well-documented fact that since its inception White women have been the greatest beneficiaries of affirmative action.
In one survey, M/WBEs expressed the following complaints: inadequate enforcement of the HUB programs. Specifically, participants expressed concern that (1) HUBs are listed in HUB subcontracting plans but are dropped after the contract is awarded, and (2) good faith effort submissions are not reviewed or enforced.
Chairman of Black Contractors Association in Dallas, John Proctor says he and other African-American contractors have been extremely disgruntled and dismayed with the entire bidding process. Also with the lack of contracts awarded to African-American firms. Proctor, who has been a contractor for more than 16 years, says the experiences of Black owned firms with DISD have been “terrible.”
“We have had African-American firms under contract [with DISD] and received absolutely no work. Several Black owned businesses that I know received contracts with DISD and never performed a dollar’s worth of work and I’m concerned about them using those numbers making the public think that our contractors are doing work with them when we’re not,” Proctor stated.
The issue of disparity as it relates to African-American firms is not only troublesome for them but for the greater African-American community as well. When Black businesses flourish Black communities prosper.
“If the 250,000 Black owned business in the State of Texas were able to earn enough money, to maintain enough property, to hire one full-time employee, there would be absolutely no unemployment in Black Texas”, O’Neal said.
It is also important to remember that these State contracts are made possible by tax dollars, tax dollars that African-American residents, as well as businesses, are paying with very little to no return. It is a very grim reality that O’Neal says has left African-American contractors “jaded.”
It’s good to make sure contracting programs are open to all, that bidding opportunities are widely publicized beforehand, and that no one gets discriminated against because of skin color, national origin, or sex. But that means no preferences because of skin color, etc. either–whether it’s labeled a “set-aside,” a “quota,” or a “goal,” since they all end up amounting to the same thing.
Such discrimination is unfair and divisive; it breeds corruption and otherwise costs the taxpayers and businesses money to award a contract to someone other than the lowest bidder; and it’s almost always illegal—indeed, unconstitutional—to boot (see 42 U.S.C. section 1981 and this model brief: http://www.pacificlegal.org/document.doc?id=454 ).
Those who insist on engaging in such discrimination deserve to be sued, and they will lose. How would you like it if you owned a company and lost out on a bid because you were the wrong color or the wrong sex? Why do race, ethnicity, and sex need to be considered at all in deciding who gets awarded a contract?