Controller: Mentor minority businesses to boost contract participation

A report issued by the City Controller urges Philadelphia to implement a mentorship program to grow the number of female, disabled and minority owned businesses eligible for city contracts.

The 30-page report released by City Controller Alan Butkovitz Thursday notes how far Philadelphia has come in its hiring of such  firms but says there is a need to "deepen the bench."

In Fiscal Year 2014 twenty-nine percent of contracts went to minority and female-owned businesses in contracts for which such businesses were available. Compare that to in 2007 minority owned businesses received less than 12 percent of contracts.

The Office of Economic Opportunity, which keeps a registry of certified minority, female and disabled-owned firms, has more than 2,700 qualified businesses but a small group of 65 businesses receives 71 percent of the contracts.

About 70 percent of those contracts awarded to minority, female and disabled-owned businesses are for $500,000 or less and the report specifically says there is a dearth of businesses that can compete as "prime" contractors.

"Government can play a role to facilitate the process of leveling the playing field for minority and women-owned businesses," Butkovitz said in a release.  "Mentor-Protégé programs have been established at all levels of government, especially to help small businesses gain necessary skills from large firms."

The Mentor-Protégé program would expand areas of expertise where businesses are underrepresented, including construction, Information Technology, and Highway Transportation projects.

Similar programs which partner businesses with prime contractors or consultants has been implemented in Illinois, Missouri and Portland, the report says. Butkovitz said the program would be a three to five year initiative.

Given the city's development boom, there is a shortage of skilled unionized construction workers for current and planned development projects in Philadelphia – which total more than $8 billion, the report found.

"This shortage presents an opportunity for increasing diversity in the building and construction trades without undermining employment prospects for current members," the report said.

The report also suggested needed improvements to the certification process which is currently backlogged. Businesses get certified through third party organizations such as the Women's Business Enterprise National Council and the PA Unified Certification Program.

See the full 30-page report here.

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