Despite progress, MWBEs say challenges remain

Both New York City and the state are on their way to achieving contracting goals for minority- and women-owned business enterprises. But even with legislative changes opening new opportunities for so-called MWBEs and city and state efforts to increase their utilization, many of these businesses still face obstacles.

Both the city and state have set a goal for themselves: 30% of government contracts will go to MWBEs by 2021. The state has nearly hit that number, with 29.13% of contracts awarded to state-certified MWBEs. The city is further behind at 24% in the previous fiscal year, but the administration of Mayor Bill de Blasio touted progress in certifying businesses as a positive indication the 30% goal will be hit. The city last year announced it hit its milestone of certifying 9,000 MWBEs by June 2019. 

At City & State’s Diversity Summit, officials involved in the MWBE programs laid out progress made in the past year. Notably, Gov. Andrew Cuomo renewed the state program for an additional five years, extending it until 2024 with an eye to the future. “Even though we have a lot to be excited about with the reauthorization of Article 15, I want you to know that we are not complacent,” Johnathan Smith, Cuomo’s deputy secretary for civil rights, said during a panel discussion at City & State’s event. The reauthorization also raised the personal wealth cap for applicants and increased the size of contracts the state could award to MWBEs, two changes Smith hopes will result in even more state contracts going to certified businesses.

And at the city level, state lawmakers in Albany approved legislation allowing the awarding of contracts of up to $500,000 and established a new mentorship program within the city Department of Design and Construction. Previously, the city was treated similarly to other municipalities in terms of contracts it could award, despite having a substantially larger economy “Finally, we’re on par with the state,” Jonnel Dorris, senior adviser and director of the New York City Mayor’s Office of MWBEs, said at City & State’s event. Dorris added that the change, along with an increasing number of certified MWBEs, will allow the city to set new, more ambitious goals for itself.

But even with recent advances, minority and women business owners still face obstacles that officials are trying to address. In New York City, the process to get certified – which is necessary to be eligible for contracts – can be cumbersome and time-consuming. “The city process is extremely antiquated,” Doris said. “But we’re working with our council members to get that streamlined.” Ensuring both a fast and transparent process not just in New York City, but across the state, came up multiple times over the course of a discussion of areas for improvement in MWBE programs.

Different programs also have entirely separate application processes – someone looking for MWBE certification with the state and New York City currently has to navigate both programs independently. This can pose a problem for companies that want to receive both state and city contracts. “People are very confused by that,” New York City Councilman Robert Cornegy said. “There has to be a way to share information across both spectrums to get people in the city and state system’s simultaneously.”

The state has begun taking steps to address this particular issue, according to Smith. He said Cuomo had recently announced a proposal to do exactly what Cornegy is suggesting – a streamlined, simple way to apply to multiple MWBE programs at once through a shared portal. “I liken this to the (college) common application,” Smith said. “You go to one website, you fill out one information. You may have supplemental information, but (it’s) really to have a centralized process.”

Other issues raised during the City & State event don’t have easy solutions. Despite the work done by MWBE programs, and plans to improve them in the future, structural barriers remain. “The markets have not changed their behaviors when it comes to small businesses and minority and women businesses in particular, meaning we know for a fact it’s harder for you to get funded in the marketplace to actually advance your business,” Dorris said. “We have all types of programs for you, but the issue remains.”