While the state continues to fall short of its requirements for contracting with minority and women-owned businesses, the city of Providence has, for the first time in recent history, surpassed its goal.
Nearly 23% of the $103.8 million in contracts and purchase orders the city awarded in fiscal year 2020 – the most recent available – went to certified women and minority businesses, according to data provided by the city. By comparison, the state spent under 8% of its roughly $1 billion in contracts and purchase orders on women and minority businesses in the same time frame. The fiscal year 2020 marks the 32nd year the state has fallen short of the 10% goal in the 34 years since the law creating the Minority Business Enterprise program was passed.
Providence, too, has historically struggled to hit its own 20% target, fluctuating between 2% and 4% spending on minority and women-owned businesses for fiscal years 2016-2019.
What changed?
Providence Mayor Jorge O. Elorza said the improvement reflected outreach to minority and women-owned businesses, as well as general education about how bidding and procurement work for city contracts.
The dramatic increase also stems in part from a higher number of city construction contracts in fiscal year 2020, an area typically easier to find and award contracts and subcontracts to minority and women-owned businesses. For example, the $1.6 million contract awarded in fiscal year 2020 to London-based consultant Arup Group for a Kennedy Plaza redesign included nearly 28% participation from women or minority-owned subcontractors, according to the city purchase order.
Among the minority subcontractors on the project is Narragansett Engineering Inc., a Portsmouth-based, Asian American-owned engineering consulting firm. Neal Hingorany, company president, got involved thanks to a fellow minority business owner who gave his company’s name to Arup Group.
“It definitely seemed like Arup was doing their homework, kind of fishing around for as much MBE participation as they could find,” Hingorany said.
The state struggled to find certified minority and women-owned businesses for some of the specific purchases it needed in fiscal year 2020, particularly those related to the pandemic such as testing and laboratory supplies and personal protective equipment, according to Derek Gomes, R.I. Department of Administration spokesman.
But the city relies on the state’s list of certified minority and women-owned businesses, so the potential pool was the same for both.
The state also suspended its 10% MBE participation goal in the final three months of fiscal 2020 when the pandemic hit as part of the emergency declaration under former Gov. Gina M. Raimondo. The city of Providence did not.
What the city has that the state lacks, according to Lisa Ranglin, president of the Rhode Island Black Business Association, is the support of those at the top.
“I think the state is not there yet in terms of having the full buy-in to realize why we need to do this,” Ranglin said. “It’s not just about checking a box. It’s a critical business element that can serve a very strategic function.”
State Rep. Anastasia P. Williams, D-Providence, put it more bluntly.
“The city does not have a moral compass that is completely broken,” she said.
In an emailed statement, Gomes declined to comment on the city’s MBE participation rate relative to the state program.
Elorza was also reluctant to compare the two.
“We’re not spiking the football because of one year of data,” he said. “There’s still a lot of work we need to do to make sure these are deep, structural changes.”
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.
