The city of San Diego did $123 million worth of construction business last year, but only $1.5 million went to contractors owned by women, Latinos, African-Americans, Native Americans and Asians. That means that 98.8 percent of those dollars went to businesses owned by white guys. The figures, reported to the City Council’s Rules and Open Government Committee last Wednesday, show that the city’s ability to direct dollars to minority- or women-owned businesses has actually gotten slightly worse since Mayor Jerry Sanders publicly apologized in August 2007 for the city’s failure to create contracting opportunities for everyone. In 2007 and 2008, the proportion was slightly better, as 96 percent of the city’s construction business went minority-owned businesses.
“I have become an old woman up here speaking to you so many years, and the numbers have not changed,” said Rebecca Llewellyn, a contractor who spoke at the Rules Committee meeting.
The theory behind equal-opportunity contracting is that public dollars and public contracts provided by the city can be used to raise up businesses owned by traditionally underrepresented people. But San Diego has for years been giving out most of its contracts to companies owned by white men. At Wednesday’s meeting, contractor after contractor came before the council to express the same lament: There had been no progress despite years of hearings. No one seems to have a solid explanation for the delay.
Debra Fischle-Faulk, the city’s director of administration, told the committee that her staff had spent the last year meeting with contractors and holding public outreach so they could develop a new program to improve the numbers.
But no one seemed satisfied with that answer, given that the numbers had actually gotten worse.
“I’m not pleased,” Sanders told CityBeat in an interview. “It’s a complex and difficult issue, and minority-owned businesses deserve their fair share of opportunity. I foresee me talking to the contracting folks.”
For the three years CityBeat has been covering this issue, the Black Contractors Association of San Diego has been a moderate voice. No more.
“We’re looking at suing,” BCA president Abdur-Rahim Hamid told CityBeat.
Hamid said he’d been in contact with other contractor associations in the area and that there’s strong interest in filing a lawsuit. But Hamid is trying several avenues of external pressure. He said he’s met with members of the local congressional delegation, and he e-mailed his members to do the same. And he’s going to try to shine a bright light on San Diego.
“I met with the Rev. Al Sharpton in New York this spring to see about bringing him out here,” he said.
Sharpton, a longtime civil-rights activist and one-time candidate for president, is a one-man media circus. His presence in San Diego would likely put the city on the national radar.
Meanwhile, the City Council is taking action of its own. City Councilmember Tony Young issued a memo the day after the committee meeting that said he was “appalled and dismayed” by the city’s performance. He called for a study of the way the city does its contacting, called a disparity study. A similar study in the late 1990s found that San Diego’s practices were “passively racist.” The study led to the implementation of new programs, notably the Subcontractor Outreach Program, but they have been under-funded and only partially executed.
The idea of a disparity study has the support of City Council President Ben Hueso, who was equally upset by the city’s poor performance.
“If this was a priority, [the mayor] would have made sure they had a better policy,” Hueso told CityBeat. “We have to sit here and hear these updates; nothing is changing. It’s ridiculous.”
As chair of the Rules Committee, Hueso has used his authority to docket equal-opportunity contracting three times this year, and he has a fourth meeting planned for November, when he hopes to hear the city’s plan for fixing the problem. He also says he’s met with the BCA and others a number of times, but this is the first he’s heard of a lawsuit.
Meanwhile, City Councilmember Donna Frye is looking for ways the City Council can take immediate action. At the committee meeting, she learned from Deputy City Attorney Sanna Singer that the City Council has a policy on the books that allows the city to give preference to local businesses, as opposed to out-of-towners. The policy applies only to providers of goods and services, but Frye was wondering if it could be applied more broadly. Singer said special rules for construction contracts made that impossible but that she wasn’t even sure if the city is applying the local preference at any time.
The city’s failure is made all the more stark by the success of other nearby government agencies and businesses. The San Diego Community College District is able to get 38-percent participation from minority- and women-owned contractors, the San Diego Unified School District 41 percent and San Diego Gas & Electric 30 percent.
City officials argue that city work is fundamentally different in nature and regulation. Municipal construction contracts are more tightly regulated because they must always go to the lowest bidder, and the lowest bidder is often a large contractor. Fischle-Faulk pointed out at the committee meeting that this makes it harder for the city to give preference to women- or minority-owned businesses.
The Associated General Contractors (AGC) of San Diego, a nonprofit organization of local contractors, argues that minority- and women-owned contractors don’t win contracts from the city simply because they can’t.
“We believe the city should do an availability study to determine the capacity and number of contractors, or just any contractors that can do the water projects, sewer projects that the city is constantly putting out,” AGC vice president Brad Barnum told CityBeat.
AGC maintains a number of programs through the city’s schools that it believes will help train San Diego’s contractors of the future. Barnum argues that participants go from these programs straight into the workforce.
“What’s interesting to note is the diversity on the workforce, on the site, is incredible,” Barnum said. “That’s where your future contractors come from.”
But San Diego’s minority contractors have been waiting long enough for the diversity to come organically.
“We have to change the mindset in our city,” Hamid said. “The city is becoming more of a South African apartheid rule.”
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