By Megan Sayles,
AFRO Business Writer,
Report for America Corps Member,
Mayor Brandon Scott’s administration recently released the findings of the 2022 Disparity Study for the City of Baltimore, which was conducted by Tampa, Fla.-based MGT Consulting Group.
This is the first time the study has been conducted since 2014 and much of the impetus for it was to evaluate the participation and utilization of minority- and women-owned businesses in the city’s procurement and contracting process.
The study found that past discrimination in the system has resulted in the underutilization of minority- and women-owned businesses and enterprises.
“We’re talking about a procurement system that really was—is, until we’re able to get it all changed, based to not support local, especially minority- and women-owned businesses, because it values lowest bid versus the biggest and greatest value to the city itself, which is what we’re trying to change,” said Mayor Brandon Scott.
Scott’s mayoral campaign included a pledge to reform the city’s procurement process, which he characterized as outdated, inefficient and inequitable. According to the mayor, his administration requested this study as part of its ongoing work to revise the system.
The study found that African American-owned businesses were underutilized in contracts for goods and services, architecture and engineering and professional services. Construction was the only category that found no disparity between African American-owned firms and their counterparts, but the bulk of the payments went to just two businesses, according to the study.
Overall, the study found that minority- and women-owned businesses and enterprises face disparities across all procurement categories. While 29.32 percent of city payments went to these firms, White, male-owned businesses were awarded 70.68 percent of total prime and subcontract spending.
When minority- and women-owned businesses and enterprises do procure projects from the city, they are also less likely to obtain prime contracts, according to the study.
Paul Taylor, director of the Mayor’s Office of Minority and Women-Owned Business Development (MWBD), said this underutilization results in dollar losses for Baltimore because the city government is not capitalizing on all of its local talent.
“It’s important because if we support those minority contractors and small businesses in the local market, more than likely, they’re going to hire somebody from the local market,” said Taylor. “When we hire people from the local market, they support our communities and our neighborhoods.”
In accordance with the study’s recommendations to mitigate disparities, Scott is reconfiguring the Minority and Women’s Business Opportunity Office (MWBOO) and placing it within the MWBD, so the agencies can coordinate their efforts and efficiently employ their resources.
The city is also assessing all minority- and women-owned businesses within the local market, looking at their capacity and challenges.
Taylor said there will be an overhaul of the city’s contract payment system to speed up payments, particularly for subcontractors, and the city is working to provide more information regarding future projects so minority- and women-owned businesses can better prepare themselves for procurement.
“You can’t meet 2020, 2021, 2022 goals on 1999- and 2000-based technology and systems, and that’s the most important thing that we’re changing alongside the combination of the offices,” said Scott.
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