1. Sheldon Anderson, MPA Project
Across the country public funds are used to purchase goods and services. The purchase or acquisition of goods and/or services is commonly referred to as procurement. Government procurement is the use of public funds in an effort to secure goods and services that enable the provision of government services. Procurement is an important function in all levels of government A few examples are a public hospital procuring hospital beds in order to provide in patient health care services, a public agency securing the services of an architectural firm to design bridges, buildings, and or roads. Our government consists of public agencies with missions to improve the public good.
New York State Minority and Women Owned Business (MWBE) Development Program Evaluation
Sheldon Anderson, MPA Project
Abstract
Data Analysis & Findings
Small businesses account for ninety-nine percent of New York State’s economy. All small businesses pay taxes to the federal, state, and local government. This study argues that all small businesses should have equal access to government contracting opportunities. Disparities and inequities in public contracting exist in New York State due to several variables. To address this problem New York State employs an affirmative procurement policy that is based on Executive Law Article 15-A.
This statute provides a foundation for the current affirmative procurement policy, the MWBE program, and establishes the need for a disparity study. This is a statistical disparity that attempts to identify any existing gaps in the award of New York State’s contracts to ready, willing, and able market area MWBEs. The disparity study is effectively a quantitative analysis; however this current study provides a qualitative analysis of the MWBE program. The purpose of this study is to provide a summative program evaluation on the NYS MWBE program, and high-light opportunities for improvement. Subsequent to this evaluation, I provide recommendations on whether or not the MWBE program should be continued, expanded, or ended.
Disparity Studies
The need for an effective disparity study with strong legal standing is a trend throughout affirmative procurement literature. If a study focuses on one particular aspect while neglecting the other this may negatively impact the study. A disparity study is important when seeking to affirm or establish an affirmative procurement program. “No longer are rhetorical statements or sweeping generalizations sufficient to establish racial classifications” (La Noue, 1997, p.794). Legislative bodies of government utilize disparity studies to provide statistical analysis of public contracting data, versus racially charged statements and commentary.
Analysis of the NYS MWBE Disparity Study (2010 & 2017)
The study was commissioned through the efforts of Governor David Patterson and the state legislature, after concerns were raised with lawmakers with regards to the states efforts to award contracts to minorities and women. “The study was commissioned in conformance with the statutory mandate to conduct a disparity study, adopted by the legislature in 2006, and will assist the State in evaluating whether its current M/WBE initiatives are still necessary to remedy discrimination, and to narrowly tailor existing and new measures” (NERA, 2010, p.13). The NERA dis-parity study methodology relied on quantitative analysis, with less emphasis on surveys, anecdotal, and qualitative data.
The primary finding based on the interviews is that the MWBE program should be continued and or expanded. One elite interviewee, who is responsible for leading a state agency MWBE program, stated “It allows MWBEs to be engaged in the government contracting process. More than 90% of the businesses in New York State are small businesses. Having MWBEs more active in the economy is good for economic diversity, sustainability, and health.“ Secondary findings below:
Stakeholder concerns in the public and private sector about staffing levels with the DMWBD. One example is the lengthy time for certification with the state.
The 2017 Disparity Study, current lawsuits against the state, and the sunset provision of Article 15-A are significant threats to the MWBE program.
Goal setting methodology on state funded projects has created frustration in the public and private sector. Elite administrators question the logic of having 30% MWBE goals on contracts where no firms are in the applicable geographic area.
The demand to explore strategic placement of MWBE staff within state agencies and authorities with respect to executive management.
Literature Review
Research Design & Methodology
Public Services via Government Contracting and Procurement
The “hollow state” refers to the “degree of separation between a government and the services it funds (i.e., the number of layers between the source and the use of funds) (Milward & Provan, 2000, p. 362). In public contracting, if a government agency or authority must satisfy a need and is unable to self-perform the work, they will start a procurement procedure. This process may vary in government, nonetheless, the government agency or authority expresses their needs and places a request to have that need satisfied. This could be a new highway, police station, and new hospital inventory (bed sheets, gurneys etc.).
Gender and Racial Disparities in Government Procurement and Workforce
The Fourteenth Amendment of the U.S. Constitution provides equal rights to all Americans. Equality can be defined as treating everyone the same. According to Gooden, “In terms of public administration, equality means sameness or identical distribution of government services or implementation of public policies. Equity means the fair or just distribution of such services or policies” (Gooden, p.372, 2015). Just distribution is important because it poses a challenge for lawmakers and policy makers, to go beyond equal provision of services. A mix of rural and urban citizens have varying needs, therefore housing assistance programs need to be adjusted for specific needs, identical distribution of services may not be practical in this situation.
Affirmative Procurement Constitutionality
Two questions emerge: 1) “When may government be color conscious rather than color blind?” (Rice, p.115, 1991); and 2) “Should the strict scrutiny of racial classifications be relaxed when they are employed for the asserted purpose of aiding a minority?” (Rice, p.115, 1991). Throughout the case analysis, the author finds potential conflicts between the Constitution and states’ rights in prohibiting the limitation of opportunities of anyone based on race, and how MWBE programs provide preferences based on race. Contractor associations challenged the MWBE program due to a violation of the Fourteenth Amendment, essentially arguing for reverse discrimination.
Disparity Studies
Implications - Future Research - Recommendations
This program evaluation uses a qualitative research design to determine if the New York State affirmative procurement policy (MWBE program) should be continued, expanded, or ended. I solicited interviews via phone and to all MWBE’s in the eight counties of Western New York and elite administrators connected to the MWBE program.
In order to help ensure that the persons recruited for the interviews had the ability to answer the questions posed in this research, prospective respondents had to be involved with the MWBE program, directly working with MWBEs in the private sector or a public administrator with similar capacity. Examples of these types of positions included compliance officers, program managers or analysts, and business service professionals (i.e. lawyers, accountants, lobbyists, etc.).
I solicited interviewees and via phone and . In the initial contact, I disclosed the purposes and intent of the study. Potential respondents were made aware of my status as a graduate student, past employment, and public policy interest as a means of introducing myself to them). Respondents were given the option of an in-person interview; however, to accommodate individuals’ schedules and distance, respondents were also provided the option of an interview over the phone or by video call. Overall, five in person interviews were completed, and one interviewee consented to be recorded, during interviews without recordings I took extensive notes and sought clarification on points at the conclusion of the interview.
The interviews were longer than forty-five minutes in length, and often ended with a dialogue that furthered my understanding of the policy issue beyond the official semi-structured interview questions I had developed. In total, six interviews were conducted by phone and five conducted in person. For phone interviews, I took detailed notes and transcribed their remarks, at points asking for them to clarify a point or idea. I asked a total of thirteen questions and in the paper identify the reasoning behind each question.
Question 12, is the most important question as it directly identifies the interviewees opinion on the future of the MWBE program. I want to get a strong indication after the interview, which includes critiques and constructive remarks, related to the program.
There is a need to increase the number of full time employees dedicated to MWBE compliance, certification, and development across the state. State agencies may send requests for services and resources, including an increase of staffing, along with definitive roles and responsibilities to increase impact.
The placement of MWBE goals on contracts using a uniformed methodology will allow for flexibility in establishing contract specific goals. This has been discussed by elite administrators and was captured during my interviews. MWBE officers should have direct and independent access to the Commissioner of their respective agency or authority regarding procurement and compliance with Article 15-A.
More is needed to explore the relationship between resources and the ability to meet established goals. Agency resources include (staffing, technology, legal and policy experience, and technical expertise). Goals without the necessary support can hollow out the validity of the program, creating the appearance of an unfunded or underfunded program. Support of the program within all state agencies is critical to long term success.
References
La Noue, G. (1997) Who counts?: Determining the availability of minority businesses for public contracting after Croson. Harvard Journal of Law & Public Policy, 21, 793.
Gooden, S. T. (2015). PAR’s Social Equity Footprint. Public Administration Review, 75(3), doi: /puar.12346
Rice, M. F. (1991). Government Set-Asides, Minority Business Enterprises, and the Supreme Court. Public Administration Review, 51(2), doi: /977104
NERA, Economic Consulting, Disparity Study.(2010), The state of minority-and woman- owned business enterprise: evidence from New York. Prepared for the New York state department of economic development.
State of New York 2016 MWBE Disparity Study (Publication). (2017). Oakland, CA: Mason Tillman Ltd.
Provan, K., Milward, H.B. (2000). Governing the Hollow State. Journal of Public Administration Research and Theory, 10(2),
Advisor: Dr. Jason Rivera
Second Reader: Dr. Atta Ceesay
Acknowledgments