Santa Clara County to study public contract disparities


By Lorraine Gabbert, Spotlight on San Jose

August 11, 2022

Santa Clara County wants to level the playing field for minority-owned businesses that have no skin in the public contractor game.

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The county plans to conduct a supplier diversity study to examine how the process can be improved. It will collect data to examine how companies are selected for county contractor jobs and analyze it to discriminatory practices.

Small businesses – owned by minorities, women, LGBTQ businesses and veterans with disabilities – will be invited to share their experiences through one-on-one interviews, meetings, surveys and an interactive website. Study information is available online in multiple languages, and virtual business engagement meetings will also be translated into Chinese, Spanish, Tagalog, and Vietnamese.

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Virtual business forums will take place in August and September, with the first session today. The meetings will be hosted by Florida-based consulting firm MGT, with offices in Sacramento. County staff will not be present and supplier feedback will remain anonymous to encourage honest dialogue. The county aims to complete the study by February 2023.

Santa Clara County currently does not keep data on the percentage of its contracts with minority-owned businesses, Gene Clark, the county’s purchasing manager, told San Jose Spotlight. He said this information will be key to understanding where the barriers to entry are for minority-owned businesses.

“We know they have the possibility of having more contracts, but you need good data,” he said. “One of the things I’m hoping for is that once we see success it will turn into a domino.”

The county reached out to local chambers of commerce and trade associations like the Minority Business Consortium to compile lists of minority-owned small businesses to interview.

Two years ago, the group conducted its own disparity study of the county’s contractor hiring process and encouraged the county to do a similar study based on its findings, said Walter Wilson, co-founder and CEO. from Minority Business Consortium.

“We knew there was contract discrimination in Santa Clara County, whether intentional or not,” Wilson told San Jose Spotlight.

According to the consortium’s study, from 2012 to 2020, the county awarded 107 capital construction contracts worth $570 million to 52 prime contractors. Of these, only six (12%) were from minorities, receiving 16% of the total dollars.

For minority businesses to be targeted for government contracts, Wilson said the state requires a disparity study showing they are unable to compete fairly.

Wilson said Santa Clara County needs to use an equity lens in contracting. He said hundreds of millions of dollars are at stake and should go to local businesses. Tolerances must be made when requesting quotations, because small companies don’t have the bandwidth to compete with larger companies that dedicate departments to new projects, he said.

Dennis King, executive director of the Silicon Valley Hispanic Chamber of Commerce, said his chamber partners with the county and San Jose to help minority-owned businesses, but the process is difficult. By establishing what business contracts with minorities exist, local governments can progress to future steps, he said.

“The status quo is not designed to open up new competition,” he told San José Spotlight.

King said entrepreneurs want to know where the opportunities exist and the size of the projects. These factors determine whether they should work with the general contractor like a subcontractor painter with a builder. It is encouraged by the county and city which are undergoing supplier diversity studies.

“This has long been one of the most controversial and overlooked areas,” he said, “but as the clouds of COVID lift, there will be more and more opportunities. This is a good time to re-evaluate where we are going as a community.”

Wilson hopes studying the disparities will help change workflow, but said implementation will be crucial. Billions of dollars could flow back into local communities and that would change the landscape, he said.

“If done well, this disparity study will open the floodgates to bring minority-owned businesses into the county’s contracting environment in a real way,” he said.

To learn more about the Diversity Study, visit countyofsantaclaradisparitystudy.com. To participate in business forums and find business opportunities, subscribe to the supplier newsletter at scccprc.org.

Contact Lorraine Gabbert at lorrainegabbertsjspotlight@comcast.net.


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