Emanuel moves to clean up minority contractor program
By Fran Spielman City Hall Reporter email@example.com October 24, 2011 11:54AM
Updated: November 26, 2011 8:08AM
Chicago will carve out construction projects under $3 million for small businesses and give city contractors credit for the minority hiring they do in the private sector, under a mayoral plan unveiled Monday to bolster minority contracting.
Instead of maintaining a legally shaky “Target Market” program that allows minorities and women to compete against each other for the more lucrative role of prime contractor, Mayor Rahm Emanuel plans to launch a “Small Business Initiative” that’s race- and gender-neutral.
Small businesses that cannot compete with the big guys — and all too often, don’t even try — will now have roofing, fencing and other construction work below the $3 million benchmark reserved just for them. That’s likely to total $30 million to $40 million in 2012 alone, officials said.
Inspector General Joe Ferguson has urged Emanuel to immediately halt the “Target Market” program on grounds that it may be considered a quota program, which has been explicitly rejected as unconstitutional by the U.S. Supreme Court.
The second new initiative, known as the “Diversity Credit Program,” is aimed at leveraging the city’s purchasing power to bolster minority contracting in the private sector.
For every $3 of private sector money shared with minority and women-owned contractors, a company will get $1 worth of credit when it comes time to bid on subsequent city work with a maximum credit of 5 percent. That 5 percent could turn out to be the difference between being the low bidder or not.
To qualify for credits, company attorneys and accountants will be required to sign sworn affidavits verifying minority contracting and open their books to periodic audits.
“What I love about this approach is the innovation of making sure that, when they’re not working on city [contracts] doesn’t mean you lose the importance of working with minority and women-owned businesses. It’s not like, ‘OK. Poof. I’m done with city work. I don’t have to do this anymore,’ ” Emanuel said.