Changes expected for city minority business hiring ordinances

Proposed changes to the city’s procedures for hiring minority- and women-owned businesses are likely to come before the City Council this spring or early summer, with consultants and a working group that recommended 21 changes or multiple changes to hiring practices.

A memo published last week details the results of a two-year review of the city’s Minority-Owned and Women-Owned Business Enterprise (MBE/WBE) Procurement Program Ordinance. Central to the findings are the results of a 2022 disparity study conducted by Colette Holt & Associates that found the city’s minority business hiring practices are generally successful and well-organized. -ay, with some suggested changes.

Among the recommended ordinance changes: reduce the number of ordinances from four to two; eliminate the numerical goals cited in the ordinance to address confusion; certification of local program companies using North American Industry Classification System (NAICS) codes; implement a more extensive and detailed industry code review process when it is time for a company to seek re-certification; and adopt the federal approach of revising the policy so that a company remains certified until its eligibility is removed instead of having a company’s certification “expire.”

Also among the recommendations from staff made in December were strategies to refine the MBE/WBE hiring program. Those recommendations include creating written criteria to determine when to set ethnic-specific goals, considering bidding on some contracts without goals that determine there are significant opportunities. for participating in MBE or WBE, removing the requirement that bidders must place advertisements in newspapers, and clarifying the criteria for counting the participation of certified firms in joint venture agreements.

The February report from the city’s Small and Minority Business Resources Department also presented 20 recommendations from a working group focused on current city practices that need to have better communication methods or go through small or large changes.

In September, the Council extended the sunset date of the current ordinance until August 31 of this year. The extension gives staff more time to improve communication on the five current practices specified, and begin planning to make minor changes to the other six practices.

Major changes could be even longer in the future, with the report saying the changes “will require significant time, effort and cross department coordination and may require the collaboration of outside agencies to implement. The staff began to connect with the main partners and look forward to creating a more conclusive timeline of the necessary planning efforts and steps for implementation. It is important to remember that the recommendations specified as Major Modifications may require additional funding and personnel to be fully implemented and administered.

Changes to ordinances and practices covering minority business hiring have been a long time coming, with the Council first requesting a study in late 2018 and approving $1 million for its funding in early 2020 before the start of the Covid-19 pandemic.

That initial delay was partly because there were only three companies that submitted bids to conduct the disparity study required every five years, the last of which was completed in 2015 by New York-based NERA Economic Consulting.

That work found evidence of business discrimination against MBEs and WBEs in the city’s private sector and says that discrimination may be behind the finding that women and minorities are less likely to own their own businesses.

In January, the Mayor’s Committee for People with Disabilities pushed for the city to amend the MBE/WBE criteria to include people with disabilities in the select category of vendors considered for contract opportunities. In October, at a meeting of the Council’s Audit and Finance Committee, Council Member Alison Alter pushed that there are handicaps involved in minority business hiring, even if the leaders are from the Small and Minority Business office. said considerations should be handled by the city’s procurement office.

the Austin MonitorIts work is made possible by donations from the community. Although our reporting covers donors from time to time, we are careful to separate business and editorial efforts while maintaining transparency. A complete list of donors is available here, and our code of ethics is explained here.