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NBCC - Black-owned Businesses and the ARRA

Page history last edited by Faye Anderson 14 years, 7 months ago

National Black Chamber of Commerce

eBlast September 3, 2009

 

To Members and Friends:

 

On August 31, 2009, various members of the NBCC Board of Directors and member business owners held a conference call with staff from the House Committee on Oversight and Government Reform.  The subject was:  Are Black owned firms benefiting from the Recovery Act (Stimulus).  The following is a recap of our response.

 

The economic Stimulus Bill is well intended.  The rules issued by the Office of Management and Budget (OMB) clearly stated that all laws pertaining to Title VI of the Civil Rights Act, Executive Order 11246, Disadvantaged Business Enterprises, etc. are applicable.  However, when the money started flowing to our communities the procurement process had not changed.  There has been no increase in Black business participation; in fact, much of the activity has been going down so fast that diversity or minority participation does not even exist in much of the procurements.

 

The major share of Stimulus money has come through state and local departments of transportation.  The required Disadvantaged Business Enterprise (DBE) program hardly exists.  With normal funds state departments do less than 1.1% with Black firms.  From what we see so far, they don’t attain a third of that with stimulus money.  Local governments have no interest in minority business inclusion of the stimulus money.  They do this without impunity.

 

Other federal agencies such as Department of Defense are continuing the practice of bundling contracts to the point that no disadvantaged business could approach a bid or RFP.  The stimulus funds are coming down in $1 billion and $500 million dollars chunks and companies like Halliburton, Shaw, Lockheed, etc. are the true recipients and beneficiaries of the Stimulus Bill.  They have no regard to subcontracting with minority owned firms and no one from the federal level is forcing them to do that.

 

Capital access is as elusive as ever.  The banks that have TARP money are using it to clean up their own balance sheets.  The thought of making loans to small business has not even crossed their minds and there are no safe guards to require them to do this.  Also, bonding requirements have certainly not changed.  Thus, any pots of money for increased bonding availability are useless as the big issue is to be eligible to be bonded.  Technical assistance is what is needed to increase bonding capacity.  This is not being addressed.

 

Finally, to include Black owned businesses into federal procurement including the Stimulus Bill we must have rules and safeguards that are enforceable.  Agencies, grant recipients, etc. must comply with Title VI or face fines, freezing of funding, cancellations and other penalties.  Until there is “teeth” in the programs “being nice” will never happen.  In the history of equal opportunity in the federal procurement arena there has never been a withholding of funds or fines assessed for lack of compliance.  That time is overdue.

 

“Intentional discrimination creates habit, habit creates attitude and attitude creates a culture.  We must work on changing the culture in order to correct the past injustices.”  Larry Ivory, Chair, Illinois Black Chamber of Commerce and NBCC Board Member.

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