City of Cincinnati officials on Sept. 30 unveiled ordinances to address
inequalities in the city’s contracting practices, including race- and gender-based requirements for contractors.
The ordinances come after a so-called Croson Study showed that between 2009 and 2013, black-owned businesses were awarded only 2.7 percent of the city’s contracts, totaling about $5 million, despite blacks making up more than 45 percent of the city’s population. Businesses owned by women fared only slightly better during the study’s time frame, getting 6.2 percent of the city’s contracts.Mayor John Cranley said the report is a positive step toward more equitable contracting for the city.
“We’re finally here after a long amount of hard work,” Cranley said during a ceremony at City Hall featuring a wide array of city officials, faith leaders, members of the business community, activists and others. “Clearly, the city’s procurement process has not reflected the diversity of our city.”
City Councilman Wendell Young also praised the study but sounded a somber note.
“Since we’ve confirmed what we already know, how hard are we willing to work to address the problems?” he asked.
The study shows that black-owned businesses in the city have the capacity to take on up to 20 percent of the city’s contracts. Businesses owned by women see a similar capacity gap: The report shows female-owned businesses have the ability to tackle another 20 percent of the city’s contracts. The report also revealed that 70 percent of the city’s $1.2 billion in prime contracts went to a small group of businesses.
“That’s one hell of a country club,” Councilman Christopher Smitherman said.
Cranley touted steps the city has taken toward diversifying its contracting, including recently establishing the city’s new Department of Economic Inclusion and making changes to its Small Business Enterprise (SBE) program. But he also said the Croson Study’s recommendations are a huge part of the solution.
Cincinnati City Council will consider ordinances that would create Women Business Enterprise and Minority Business Enterprise programs for subcontracting through the city and set requirements for women- and minority-owned hiring for companies awarded prime bids by the city.
One recommendation made by the Croson Study that the city has not yet considered is ending so-called master agreements, or contracts with companies that can be used by multiple city departments on separate projects and which can be subject to multi-year renewals without re-bidding.
Though the report is clear, there are complicated legal realities around what the city can and can’t do to increase minority contracting. Cincinnati has already been through a lawsuit over its contracting practices. In 2004, Cleveland Construction Company sued the city over its contracting diversity policies. As a result of the suit, the city amended the race- and gender-related parts of its small business enterprise program.
Undertaking the Croson Study offers some protection from future lawsuits, say city officials and representatives from Mason Tillman Associates, which conducted the 338-page report.