4/10/2011. April 18, Ken Weeden Laverne Hall Franklin Lee Donna Stevenson

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1 April 18, 2010 of 1 Planning View Contract Compliance MBE Legal Perspective MBEconomic Outlook Ken Weeden Laverne Hall Franklin Lee Donna Stevenson 2 Moderator: Donna Stevenson Chief Executive Officer N. Holliday Street Baltimore, MD Phone: , x1110 Fax: donna@emslab.com Panelist: Laverne Hall Director, Office of Contract Compliance Cook County 118 North Clark Street, Room 1020 Chicago, Il Phone: Laverne.hall@cookcountyil.gov Panelist: Franklin Lee Attorney Tydings and Rosenburg 100 East Pratt Street Baltimore, MD Phone: Fax: FLee@tydingslaw.com Panelist: Ken Weeden President Weeden & Associates Post Office Box 3113 Wilmington, NC Phone: Fax: kweeden@isaac.net of 3 1

2 Donna Stevenson, MBA, CCA PRISMCompliance.com of Small and Minority Business growth Number of minority-owned businesses Size standards for disadvantaged businesses Race-based Business Programs decline Industry and Contract based goals Discrimination vs. Availability SBE Programs and Set-Asides increase Economic Development Business Programs HUB Zone Section 3 Resident Local Small Business 6 2

3 White Black Asian Hispanic Other Total Minority 7 Minority population is the Majority More Diversity in workplace More opportunity for SMBEs Alignment with Industry Composition of education, skills, and certifications New Benchmarks for Labor Compliance Shrinking middle class for African Americans Equity in Wages (Disparities Studies) More enforcement in local hiring programs Less emphasis on Affirmative Action and Equal Employment policy 8 Ken Weeden Ken Weeden & Associates of 9 3

4 How will goals be established when collectively special groups will be a majority? The current Federal USDOT-DBE goal-setting methodology is a very good, replicable model. This model is referenced in federal regulations for USDOT entities (airports, highways, and transit), i.e. 49 CFR, Part 26. The Federal method has been tested and proven in courts for establishing goals. The federal method considers factors tied to business ownership, rather than just race or ethnicity. Factors in Goal Setting: Expenditures, of any type, i.e. goods, services, capital projects, etc. Can be forecast, or projected for mid-range planning, i.e. 3-5 years. Breakdowns of expenditures or projects into percentages by major NAICS codes. 4

5 Normal Factors in Goal Setting: Breakdowns of expenditures or projects into percentages by major NAICS codes. Comparison of relative availability of Underrepresented firms to... All Firms in those NAICS, within the normal purchasing or procurement areas for the goods, services, and capital projects. Your City Municipal Construction Office building construction FY 2012 Engineer s Estimate Item # Description Total Cost NAICS Code Weight 1 Concrete $420, % 2 Steel $960, % 3 Masonry/Tile $420, % 4 Glazing $360, % 5 Roofing $360, % 6 Electrical $1,260, % 7 Plumbing/ Sprinkler System $960, % 8 Drywall $840, % 9 Painting $360, % TOTAL $6,000, % All DBE Percent of project Weighted Total NAICS Codes DBE Firms Firms Availability by code Availability % 8.2% 1.5% % 15.2% 2.0% % 8.2% 0.3% % 7.0% 0.1% % 14.1% 2.9% % 7.0% 0.3% % 9.4% 0.9% % 5.9% 0.2% % 7.0% 0.2% % 8.0% 1.6% % 10.0% 3.0% TOTAL % WEIGHTED Initial Under-represented Participation Goal FIGURE = 13.0% 5

6 Workforce Diversity: Who will do the work? With Population Diversity, will come workforce diversity. It might become useful to have models to preforecast the diversity of each project, as well as set goals for the Under-Represented businesses. Such a pre-forecast, combined with goals established for business participation, could help to insure a level playing field in future municipal goals programs. Laverne Hall, Director Contract Compliance Cook County Government of 17 2 nd largest county in the country 5.4 million residents New Board President Toni Preckwinkle Services include the following: Health Care Criminal Justice Public Safety Environmental Stewardship 18 6

7 M/W/VBE Certification Process new applications Recertify every 3 years No Change Affidavits annually Conduct site visits Compliance Monitoring Monthly Utilization reports Project monitoring reports Notification of award Quarterly reports Annual report of 19 On-line application process Reports by industry Link to industry codes sites Certification workflow Workflow Tracking reports Certified Vendor reports Vendor Outreach Vendor Announcements edirectory Vendor Profile Management Goal setting & commitment Insurance certification Contract Maturity Tracking Reporting by Primes and Subcontractors Compare Contract Award vs. Payment Performance Indicators M/W/VBE Certification Compliance Monitoring 20 Transparency Accountability Comprehensive reporting Real-time reporting Improved Services 21 7

8 Franklin Lee, Attorney Tydings & Rosenburg, LLP of 22 Data-driven Goal Setting (Narrow Tailoring) Automated & Targeted Outreach (User-friendly good faith efforts ) Proliferation of Small Local Business Enterprise Program Models Increased Emphasis on Private Sector MBE Participation Public / Private Partnerships in Capacity- Building Commercial nondiscrimination policies (Title VI) 23 Higher Standards for Accountability Contract compliance monitoring (automated tools) Verification of good faith efforts Transparency in payment data New Benchmarks for MBE Program Success Graduation rates and post-graduation utilization Size standards based upon competitive viability 3 rd Generation Disparity Studies (growth rate disparities, industry diversification, competitive viability, bid success rates) 24 8

9 25 Minority Business Enterprise Programs Labor or Work Force 26 Minority Business Enterprise Programs Labor or Work Force 27 9