A Black Eye Affair

A minority firm takes a hit for no good reason

The presumption of guilt was in the air. Jeff Rainford, the spokesperson for Mayor Slay, was quoted saying, "This is exactly the kind of shenanigan that gives the city a black eye."

Two days later, the newspaper reported that Slay had ordered the suspension of United from the city's minority set-aside program "to protect the integrity" of the program. He also blocked all other MBC certifications and ordered an investigation into those firms and their preferred status. The Post story was accompanied by an editorial entitled "Concrete Cronysim," commending Slay on his moves.

"That shit has been like a personal attack," Person says calmly. He pauses, then adds quickly, "But it hasn't hurt business."

Tim Person Jr: "I can run a business -- I know how to do that -- but I had to learn about the concrete industry."
Tim Person Jr: "I can run a business -- I know how to do that -- but I had to learn about the concrete industry."

Eric Vickers believes United is exactly the kind of company that a tough certification program would toss out. The city ought to look beyond the 51 percent stock ownership by minorities and the percentage of minority employees, says Vickers, to the issue of who controls the company. In United's case, he believes -- with no hard evidence to back him up -- that Lohse controls the company, Lohse has the expertise, and Lohse will profit far more than the three minority owners. He has seen the pattern before, he says. If that weren't the case, he says, Bosley and Person would have tried to set up a "joint venture," where they would have their own minority company, Lohse would have his own company, and together the two would work on a subcontract. That way, says Vickers, of a $100,000 contract given to a joint venture, only $50,000 would count toward the set-aside goal. In United's case, the whole amount gets counted toward the goal.

Person is stung by the "front company" allegation. He is the guy in charge at United, he says. He signs all checks, he signs all sales contracts, and he is there every day to make the decisions, he says. As for the "joint venture" or other legal arrangements, Person says minority firms ought to have the choice of deciding what kind of a setup is more conducive to their purpose and plans. He and Bosley decided that the 51-49 split was best suited to both learning and profits.

Vickers -- and presumably Green, who referred us to the mayor's office for comment -- would like to see the city go back to doing its own thorough investigation of all firms that apply for minority certification, including site visits. Trouble is, that ignores the very reason Harmon decided to rely on certification by other agencies: There had been repeated complaints about red tape and delays with the city's certification program, which is under the auspices of the St. Louis Development Corp., a quasi-governmental agency that reports to the mayor. At the least, the city would have to pump more dollars for staff and resources into that program.

If Slay wants to re-evaluate the city's certification process, that's fine and dandy, but it has nothing to do with United Materials.

That horse is already out the barn door, and the city held it wide open for them.

It's a legitimate question, one the Post has raised: Should the city have a tougher certification process of its own, rather than accepting certification by MBC and other area agencies? But the newspaper didn't question why Percy Green had not acted on United's application since February. Nor did it question why Green had not persuaded the Slay administration to undo Harmon's directive.

Did the new mayor really need the daily newspaper to prompt a policy review when the strongest advocate of such a review -- Percy Green -- works for the mayor? Oddly enough, Rainford's answer is yes. "We're reacting to something that was brought to us and, in large measure, as I understand it, was brought to the Post-Dispatch by the African-American business community," he says.

But neither Rainford, nor anyone else at Room 200, has been able to explain why Green and the mayor's office didn't act earlier.

For their part, Bosley and Person believe the Post story was leaked by Slay's office as a payback to Bosley for opposing him in the mayoral race, a charge Rainford flatly denies as a "conspiracy theory." Who's right is essentially a moot point, although Slay would be well advised to smoke the peace pipe with Bosley. Given the ongoing hostilities regarding the redrawing of the city ward map, Slay already has Ald. Sharon Tyus on the warpath. Having both Tyus and Bosley -- who are among the city's most high-profile black political figures, for better or for worse -- lined up against him isn't the most prudent thing for a white mayor presiding over a city that, for the first time ever, has a black majority population.

Slay's office is about to announce its decision on whether it will continue to accept the MBC certifications.

What it all comes down to is this: Bosley and Person, entrepreneurs without a boatload of cash, saw an opportunity in an industry they didn't know much about, so they partnered with a white guy who had both resources and expertise. And yes, part of their "equity" may have been their race. But they've been above board about United's ownership, its employees and the fact that Lohse had the expertise in the concrete business. They were certified by the MBC when the city's policy was to accept such certification. They got the contracts to work on the two city projects because they had the necessary certification. There's no evidence that they skirted any laws in conducting business.

It seems United is one minority company that has already been helped by the city's set-aside program and is on its way to compete in the market on its own. "We don't give a damn if they count us toward the minority goal or not," Person says.

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