Letter of Transmittal
Pennsylvania Advisory Committee to
the U.S. Commission on Civil Rights
Members of the Commission
Mary Frances Berry, Chairperson
Cruz Reynoso, Vice Chairperson
Jennifer C. Braceras
Christopher Edley, Jr.
Peter N. Kirsanow
Les Jin, Staff Director
The Pennsylvania Advisory Committee submits this report, Barriers Facing Minority- and Women-Owned Businesses in Pennsylvania, as part of its responsibility to advise the Commission on civil rights issues in the commonwealth. The Committee approved this report in a vote of 10 to 0, with no abstentions.
In the 1980s and early 1990s, the U.S. Supreme Court’s Croson and Adarand decisions resulted in the dismantling—either voluntarily or by court order—of state and local government-sponsored minority and women business enterprise programs. Many viewed these programs that used race and gender as factors in awarding contracts as ways to ensure a fair distribution of business opportunities to minority- and women-owned business enterprises (M/WBEs). Against this changing landscape, the Advisory Committee received allegations that M/WBEs continue to encounter practices in Pennsylvania that impede their ability to compete for and carry out contracts successfully. The Committee became concerned that commitments by public leaders for an increased share of business opportunities for M/WBEs would weaken, and that in the absence of remedial or substitute efforts, discriminatory practices would continue.
To address these concerns, the Committee held a one-day forum in January 1999 in Philadelphia with M/WBE owners, government officials, community leaders, and representatives from large prime contractors. To supplement the forum, the Committee reviewed data on M/WBE participation rates in state and local contracting, literature on barriers M/WBEs encounter, and the structure and operation of state and local monitoring agencies. It also held meetings with Philadelphia agency representatives to follow-up on the city’s progress in revising its M/WBE program. Staff also closely monitored allegations of fraud and mismanagement in large-scale projects in Pittsburgh and Philadelphia for their adverse impact on M/WBE utilization. This report is based on information gathered from the forum and these subsequent follow-up efforts.
Extending the Advisory Committee’s longstanding interest in fair employment and equal economic opportunity, this report assesses barriers M/WBE owners face and comes to the following conclusions:
Limited available data suggest that M/WBEs receive a smaller share of state contracts and contract dollar amounts compared with majority-owned firms. State agencies charged with monitoring contracts are unable to provide comparison statistics between M/WBEs and majority-owned firms. This difficulty in monitoring M/WBE participation is in part exacerbated by understaffing at state agencies. The inadequate staffing at critical offices raises questions about the commitment of state leaders to M/WBE utilization and development.
At least 10 barriers identifiable in both public and private contracting impede M/WBEs’ chances for successful participation in contracts. The report makes 17 recommendations to address these barriers.
Philadelphia leaders have delayed the completion and release of a contracting disparity report, which could, indeed was intended to, form the basis of new M/WBE programs capable of withstanding judicial scrutiny. This contrasts inexplicably with other cities such as Pittsburgh where leaders and public agencies have diligently pursued completion of disparity analyses to support their programs. The mayor, City Council, and public officials should renew their commitments to develop appropriate programs based on the findings of the disparity studies.
Lacking a persistent effort to remedy longstanding barriers, M/WBEs may never gain a foothold in the marketplace. As illustrated by the three exemplary cases discussed in the report, coordinated and proactive leadership would greatly improve M/WBEs’ chances to receive their fair share of contract opportunities. Committed leadership at the state and municipal levels is sorely needed because it can play a catalytic role in promoting contract opportunities for M/WBEs.
The overall tenor, as well as some specific findings in this report, is corroborated by a recently released audit by the Pennsylvania auditor general and a policy report by Philadelphia Councilman Angel Ortiz.
The Committee believes this report will help the general public better understand the barriers M/WBEs face and how established bureaucratic structures could be improved to remedy these barriers. The Committee also hopes its identification and analysis of barriers and ameliorative recommendations will be of value to state and local officials as well as trade and community organizations in their work to enhance M/WBE opportunities, and thereby improve the overall economic vitality within their respective jurisdictions.
Mrs. Sieglinde A. Shapiro, Chairperson
Pennsylvania Advisory Committee