Monday, September 26, 2016

St. Louis' Plan to Hire More Minority Contractors Draws Heat

Posted By on Mon, Sep 26, 2016 at 1:03 PM

click to enlarge Activist Anthony Shahid (left) and St. Louis Development Corp. Director Otis Williams (center, wearing tie) are separated during a meeting. - PHOTO BY DOYLE MURPHY
  • Photo by Doyle Murphy
  • Activist Anthony Shahid (left) and St. Louis Development Corp. Director Otis Williams (center, wearing tie) are separated during a meeting.
St. Louis spends tens of millions of dollars each year on contracts with private businesses owned by white guys.

City leaders are trying to open up some of that work, but it's harder — and more controversial — than they might have hoped. Minority contractors say the proposed solutions pit races and ethnic groups against each other while still shortchanging many of the businesses that have traditionally been cut out of the system. 

"This is dividing us, rather than uniting," said Sergio Cuevas, owner of Clean-Tek Flooring Services, a janitorial company that cleans Lambert-St. Louis International Airport. 

He was one of a couple of dozen people who attended a sometimes heated meeting on Friday at the St. Louis Development Corporation's headquarters on Market Street. In 2013, Mayor Francis Slay directed the development corporation to commission a "disparity study" to see if the city discriminates against minority- and women-owned businesses in the way it doles out contracts.

The study, conducted by California-based Mason Tillman Associates, found "significant disparities" in a review of more than 6,200 contracts worth $591.6 million during a five-year period between July 1, 2007 and June 30, 2012. The biggest chunk of that money went toward construction. The city hired 205 lead contractors during that time, but most of the work was awarded to a small cluster of companies. The top seven contractors handled 50 percent of the business — worth more than $132 million. 

Not one of those contractors is a business owned by a woman or minority, according to Mason Tillman's study, which was released in May 2015.

"Black folks aren't working on these jobs," activist Anthony Shahid shouted during Friday's meeting, adding, "This is another way of killing us — by not letting black folks get construction jobs."

He ended up in a brief, but tense exchange with the development corporation's director, Otis Williams, before the men were separated. Shahid later walked out when one of the private businessmen in attendance asked the city if it would do more to work with LGBTQ businesses.

"They talking about fags," Shahid said as he left.

Eleanor Mason Ramsey, president of Mason Tillman, said they're trying to help the city follow the law as it tries to maximize its Minority and Women-owned Business Enterprise program. 

Mason Tillman has suggested offering credits to businesses in the program that would count towards their ranking when the city evaluates bids. The city could also consider their bids at 95 percent. That would mean a minority-owned contractor could bid $95,000 on a contract to be more competitive but still get paid $100,000 if it was selected.

One contested piece of the proposal focuses on construction subcontractors. The city spent nearly $118 million on them during the five years considered in the study. A provision would set minimums based on race, gender and ethnicity. Mason Tillman calculated percentages that would go to each group based on the number of businesses that can and want to do the work — 21.35 percent for African American-owned business, 11.25 percent for Caucasian women and 1.63 percent for Hispanics.

Representatives for the St. Louis Chapter of OCA —Asian Pacific American Advocates and the Hispanic Chamber of Commerce have said the study undercounted Asian- and Hispanic-owned businesses, which sets them up to get screwed.

Mason Tillman's researchers claim they found so few Asian construction subcontractors that were willing and able to handle city work that they couldn't even include them in the minimums, according to the study. 

The Supreme Court has said the contract awards must be representative, but critics say the researchers didn't count all the eligible businesses. They claim Mason Tillman's study leaned too heavily on lists of subcontractors provided by the city, which covers a pool of businesses owned mostly by whites.

The plan was originally expected to go next to the mayor for an executive order, but the Board of Aldermen want to take up the matter first, Williams says.

We welcome tips and feedback. Email the author at doyle.murphy@riverfronttimes.com or follow on Twitter at @DoyleMurphy.


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