Public Hearing - October 16, 2018
1 JOINT HEARING BEFORE THE NEW YORK STATE SENATE
STANDING COMMITTEE ON LABOR,
2 STANDING COMMITTEE ON AGRICULTURE,
AND
3 STANDING COMMITTEE ON ECONOMIC DEVELOPMENT
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4
PUBLIC HEARING:
5
TO EXAMINE THE MINORITY AND WOMEN-OWNED BUSINESS
6 ENTERPRISES PROGRAM, AND CONSIDER POTENTIAL
LEGISLATIVE SOLUTIONS TO CREATE A MORE
7 EFFECTIVE AND EFFICIENT PROGRAM TO ENHANCE
NEW YORK'S BUSINESS CLIMATE
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9
Senate Hearing Room
10 250 Broadway, 19th Floor
New York, New York
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October 16, 2018, at 11:00 a.m.
12
13 PRESIDING:
14 Senator Patty Ritchie, Chairman
NYS Senate Standing Committee on Agriculture
15
16 ALSO PRESENT:
17 Senator Elizabeth Little
18 Senator Thomas F. O'Mara
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20
21
22
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24
25
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1
SPEAKERS: PAGE QUESTIONS
2
Jonnel Doris 5 13
3 Senior Advisor and Director
The Mayor's Office of MWBE
4 (New York City)
5 Lou Coletti 36 45
President and CEO
6 Building Trades Employers' Association
7 Sandra Wilkin 53 63
A Co-Founder
8 Krista Gobins
A Co-Founder
9 Women Builders Council
10 Jolie Milstein 71 79
President and CEO
11 New York State Association
for Affordable Housing
12
Denise Richardson 81 89
13 Executive Director
General Contractors Association
14
J. Naomi Glean 104 116
15 EEO Officer
WDF, Incorporated
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24
25
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1 SENATOR RITCHIE: Good morning, everyone, and
2 thank you for attending this hearing.
3 It's the sixth and final hearing of the
4 New York State Senate's Task Force on the MWBE
5 program.
6 I want to acknowledge that Senator Akshar has
7 been working across the state at these hearings.
8 He's unable to attend today.
9 But on behalf of Senator Akshar and myself,
10 I want to thank everyone who has been willing to
11 travel across the state to make their comments and
12 recommendations heard.
13 I would also like to thank Senator Little for
14 joining me here today.
15 She's been somebody who has been involved in
16 the MWBE program, and someone that we've worked
17 together on a number of the issues.
18 We have a number of people who are going to
19 testify. I know on the agenda we have them laid out
20 timewise.
21 We do have at least one person who is
22 supposed to testify who won't be here, so we're just
23 going to roll from one presenter to the next.
24 I know everybody's schedule is very busy, and
25 we want to get everyone out as soon as possible.
4
1 But, once again, thank you for being here
2 today.
3 We look forward to working with my colleagues
4 on potential legislation once we come back into
5 session in January.
6 And with that, I'll turn it over to
7 Senator Little.
8 SENATOR LITTLE: Thank you, Senator Ritchie.
9 And, you know, I'm really glad to be down
10 here for this particular hearing because, as upstate
11 legislators, we have some, possibly, different
12 issues in accessibility and numbers, and all of
13 that, businesses, and the ability to have enough
14 minority- and women-owned businesses to meet any of
15 the goals.
16 So, it's going to be really interesting to me
17 to hear your issues, and how we can be of help to
18 you.
19 And, certainly, you couldn't have two more
20 upstate Senators here today.
21 Senator Ritchie is a stone's throw from
22 Canada, and I'm about 150 miles from Canada.
23 So, actually, Montreal -- I'm less than that.
24 Montreal is 150 miles from my house, so it's closer
25 than New York City.
5
1 So, thank you for being here, and I look
2 forward to hearing your comments.
3 SENATOR RITCHIE: Certainly, it will be
4 interesting for me.
5 I know there are some challenges in my area,
6 but I've heard that things may work a little bit
7 better in the New York City area.
8 So I'm looking for, potentially, some
9 recommendations, or some issues that we need to work
10 on, to make the program even better than it is now.
11 So with that, I'd like to start with the
12 first speaker, and that is Jonnel Doris, senior
13 advisor and director of the Mayor's Office.
14 JONNELL DORIS: Good morning.
15 Thank you for having us here today.
16 Good morning, Committee Chairs, and members
17 of this Senate -- State Senate Committee on Labor
18 and Agriculture and Economic Development.
19 My name is Jonnel Doris, and I'm the senior
20 advisor and director of the Mayor's Office of MWBE.
21 Today I will provide an overview of the
22 City's program, including the progress made to date,
23 certification utilization goals by this
24 administration.
25 In the fall of 2016 Mayor Bill de Blasio
6
1 announced the creation of the Mayor's Office, and
2 the critical step to the administration's commitment
3 to increasing contract and opportunities for
4 MWBEs.
5 The mayor pledged ambitious goals, achieving
6 30 percent of the MWBE utilization by the end of
7 2021, and having 9,000 certified MWBEs by the end
8 of 2019.
9 In 2015 the mayor outlined a separate
10 citywide goal of $16 billion to MWBEs by 2025.
11 The one NYC goal, the 30 percent goal, covers
12 mayoral and non-mayoral agencies.
13 On the heels of our May 2018 disparity study,
14 the mayor announced that he was -- we were
15 $1.8 billion ahead of schedule, and, therefore,
16 increased our goal from 16 billion to 20 billion by
17 2025.
18 We're excited to have the leadership of our
19 Deputy Mayor Thompson. His career-long justice and
20 equity work continues to increase economic
21 development opportunities by calling out the
22 challenge of structural and historical barriers in
23 the marketplace and within government.
24 Under the supervision of the deputy mayor's
25 small-business services, and the Mayor's Office of
7
1 contract services, we play an integral role in
2 implementing the MWBE program.
3 "SBS," or, the department of small business
4 services, certifies MWBEs, and provides essential
5 capacity-building programs and technical assistance
6 to ensure they can compete for and execute on City
7 contracts.
8 MOCS tracks and reports on utilization data
9 for all City contracts, subject to Local Law 1.
10 The purpose of the City's MWBE program is to
11 remedy the impact of discrimination in the market
12 where the City makes its procurements.
13 This impact is statistically analyzed in the
14 disparity study.
15 The most recent study demonstrated that
16 MWBEs' firms are underutilized in City
17 procurement.
18 Local Law 1 of 2013 established citywide
19 contracting goals which match disparity gaps
20 revealed by the 2011 disparity data analysis.
21 The City will make policy changes to -- in
22 accordance with the key findings and recommendations
23 of the disparity study that was published this past
24 May.
25 Along with my colleagues, we support the
8
1 strategic role in ensuring that the City's (sic)
2 remain focused on achieving the goals of the
3 program.
4 Since the start of our administration, the
5 number of certified firms have increased by
6 86 percent.
7 At the close of fiscal year '18, the number
8 of certified MWBE firms was 6,829.
9 Additionally, at the end of fiscal year '18,
10 MOCS reported the MWBE utilization at 19 percent,
11 representing 1.069 billion in awards to MWBE
12 contracts under our Local Law 1 program, as compared
13 to 8 percent, or, $465 million in fiscal year '15 at
14 the start of the administration.
15 We are also very happy to report, our 2015
16 goal of 20 billion to MWBEs by 2025, that we are,
17 right now, at 10 billion this past October -- this
18 past September.
19 So we're very excited that we're halfway to
20 our goal.
21 Since the enactment of Local Law 1, the City
22 has implemented a number of creative initiatives to
23 help WMBEs build capacity and obtain capital, and
24 has also advocated for state legislative initiatives
25 to give the City more tools for its program.
9
1 Pursuant to Local Law 1, the goals therein,
2 the percentage of dollars awarded to MWBEs, subject
3 to City's program, has trended upward from
4 8 percent, to nearly 20 percent, since '15 to now in
5 2018.
6 Just to put that into perspective, at the
7 close of '18, we reported, again, we were closer to
8 our 30 percent goal, and we believe that we can
9 achieve that by 2021.
10 Still, we have more to do.
11 We are lowering, where we can and wherever
12 possible, removing structural barriers to enter into
13 City's procurement marketplace by providing
14 resources for increased programming at the City
15 agencies, and creating strategic initiatives to
16 increase MWBEs' ability to compete successfully.
17 In accordance with the four core principles
18 of our office -- accountability, accessibility,
19 capacity, and sustainability -- we have implemented
20 initiatives to address issues of MWBEs faced in the
21 private marketplace; namely, access to capital,
22 which is a common obstacle for many small and
23 mid-sized businesses.
24 In order to respond to this need, this
25 administration launched a Contract Finance Loan Fund
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1 and a Bond Collateral Assistance Fund, both
2 administered through our small-business services
3 department, and the emerging Developer Loan Fund,
4 which is administered by our Economic Development
5 Corporation.
6 Together, the initial City investment to
7 these funds was $30 million.
8 As you may know, the mayor also convened our
9 city banks to begin a discussion about a partnership
10 to create more access to capital for these firms.
11 Earlier this year, on -- in -- February 21st,
12 we announced that three banks had committed to
13 invest in our MWBE program an additional $40 million
14 to the 30 million that we already had in that
15 program.
16 In the spring of 2017, we were joined by many
17 MWBEs, advocates, and stakeholders, including
18 other City agencies, in calling for the passage of
19 S6513, A8505.
20 This bill proposed, one, increasing the City
21 discretionary spending limit for goods and services
22 purchased from MWBEs, and giving the City the
23 authority to provide to the State -- to the State,
24 sorry, to offer MWBEs a price or points
25 preference.
11
1 The bill passed overwhelmingly in the
2 Assembly and the State Senate.
3 And for that, we thank our elected officials,
4 including the Senators here today, for their
5 advocacy and support.
6 This change provides MWBEs with access to
7 more and larger contracts to help build their
8 capacity and succeed as prime contractors.
9 The discretionary threshold for goods and
10 purchases was implemented on March 5, 2018.
11 And by June 30th of 2018, 181 contracts were
12 awarded to MWBEs in the amount of $12.5 million.
13 We plan to return to Albany this session and
14 advocate for State approval for innovative policy
15 tools that the City has previously requested, but
16 have not yet received.
17 We understand what a valuable tool a
18 mentor-protege program can be, specifically in the
19 construction industry.
20 Many state agencies and public authorities
21 have implemented mentorship programs for MWBEs and
22 small businesses.
23 We hope to be able to do the same, but need
24 State authorization.
25 Additionally, we will seek the authority to
12
1 create prequalified lists exclusively for MWBEs for
2 City agencies.
3 This would enable the City to reserve certain
4 procurement opportunities to MWBEs.
5 The housing preservation department, or,
6 "HPD," has been able to do that similarly by
7 creating prequalified lists for MWBE developers for
8 certain projects, pursuant to state legislation
9 enacted in 2014.
10 HPD's MWBE pre-qual program established,
11 pursuant to that authority, aims to increase in
12 contract and opportunities for certified MWBEs in
13 HPD -- HDC subsidized affordable housing projects.
14 In January of 2017, the mayor, HPD, and our
15 office announced that 8 MWBEs had been selected to
16 lead construction on 6 new, 100 percent affordable
17 housing developments, or, 440 homes, for seniors and
18 New Yorkers with a variety of income levels,
19 including extremely low-income and formerly homeless
20 households.
21 Although these projects were developed --
22 projects were developed, rather, than in the
23 procurement-process contracts, and so they did not
24 count, sorry, towards the City's utilization goals
25 under Local Law 1, they are a valuable demonstration
13
1 of how prequalified lists allowed HPD to meet the
2 double bottom line here by employing many of the
3 City's MWBEs to build affordable housing.
4 We want MWBEs to have the opportunity to
5 join MWBE prequalified lists in the procurement
6 setting as well.
7 Going forward, we will continue to work
8 closely with all our elected partners to increase
9 opportunities for MWBEs, and work together on MWBE
10 outreach networking and educational events.
11 Thank you for the opportunity to testify
12 today, and your continued support and advocacy of
13 our program.
14 I'd be happy to take your questions.
15 SENATOR RITCHIE: I guess my first question
16 would be:
17 I've heard from a number of people who spoke
18 about the program in New York City, how they are
19 able to certify substantially faster at the city
20 level than at the state level.
21 Could you just give me maybe an overview of
22 the certification process?
23 JONNELL DORIS: Sure.
24 Our certification process is conducted by our
25 small-business services department.
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1 We take, generally, about 6 to 8 weeks for
2 certifications.
3 We do require the business to be in business
4 for at least a year.
5 We also have default areas, which included
6 the five boroughs, but also Nassau, Putnam,
7 Rockland, Suffolk, Westchester counties, and,
8 five counties in New Jersey -- Bergen, Hudson,
9 Passaic counties in New Jersey.
10 That's within our catchment area, and so we
11 do get firms from just about all over the state too,
12 but also in the direct New York City area.
13 We do also ask for, where applicable, to the
14 ownership or licensing, and also permit process.
15 We also go on-site to visit the MWBEs, to
16 ensure that they are who they say they are.
17 And we do have a robust staff who is out
18 there looking to certify firms.
19 We have a big goal of 9,000 businesses.
20 We're about 7,000 businesses now.
21 And by 2019, we have to -- that's the end of
22 our fiscal year, this coming June, we have to
23 certify another 2,000 businesses.
24 So we are -- you know, we put a lot of
25 resources into that, and that's why I believe we're
15
1 able to, you know, certify businesses at the rate
2 that we have been able to.
3 SENATOR RITCHIE: I know I've had numerous
4 calls at home from people who are trying to certify
5 and make their way through the paperwork at the
6 state level.
7 So I'm just wondering, do you have some kind
8 of streamlined application process, or -- other
9 than, it looks like New York City has a lot more
10 staff, which is something that I think we need to
11 address at the state level?
12 Do you have some kind of streamlined
13 application process that's helping you get
14 businesses certified in 6 to 8 weeks?
15 JONNELL DORIS: Thank you, Senator.
16 Yes, I believe I -- you know, I would say
17 yes.
18 We started off by really taking a look at our
19 certification process, from the beginning to the
20 end, and then we implemented some changes.
21 One of the things that we did was, really
22 requiring a year of tax returns instead of several
23 years of tax returns. That was helpful.
24 Also, working with the businesses to reduce
25 the volume of paper, actual paper, associated with
16
1 the applications by 30 percent.
2 Also, looking at some questions that are on
3 that particular application. See, some of them may
4 be redundant or we may not need them.
5 And so we did -- and so we reduced the number
6 of questions, the number of actual physical paper,
7 and we're also online now with our process.
8 So we did some -- a few things to streamline
9 it, and I think it is bearing well with our MWBE
10 community.
11 SENATOR RITCHIE: And as far as outreach, do
12 you have someone, or a number of individuals, who
13 are dedicated to helping businesses make their way
14 through the paperwork process?
15 JONNELL DORIS: Absolutely.
16 I think that's a valuable asset that we
17 provide to our MWBEs.
18 We have a whole department that is dedicated
19 to going out to the businesses and, personally,
20 one-on-one, walking them through the process.
21 If they come to us, we help them in our
22 business solutions centers. We have them all across
23 the city. And they can, essentially, walk-in, and
24 we are able to walk them through the process of
25 certifying. So, they are given an MWBE analyst who
17
1 walks them personally through that process.
2 And I think that one-on-one interaction has
3 been critical in helping us move our program
4 forward.
5 SENATOR RITCHIE: And do you have any issues,
6 or many issues, with businesses that are looking to
7 recertify after?
8 I mean, one of the other things that I've
9 heard is that, after businesses spent so much time
10 getting certified, that the paperwork and the length
11 of time, and sometimes the fact they don't get
12 recertified, you know, it's discouraging other
13 people from applying.
14 JONNELL DORIS: Yeah, that's a great
15 question, Senator.
16 I believe that, in the beginning, when we
17 first came in to office, you know, we had to
18 reevaluate the process, and part of that was our
19 recertification process.
20 And we found that, in the beginning, a lot of
21 businesses were choosing not to recertify, for
22 whatever purposes, reasons, that they had chosen.
23 Some of them was the paperwork, was the
24 process itself was onerous, et cetera.
25 So the streamlining also included the
18
1 recertification.
2 So there are things that, for instance, for a
3 sole proprietor, that will never change, you know,
4 and, therefore, we don't need to revisit those --
5 you know, the paperwork or requirements to say, for
6 instance, "tell us who you are again.:
7 Because you're a sole proprietor, why do we
8 need to go through that process?
9 So we've revamped our process and changed
10 that, and also given certification for sole
11 proprietors, which we didn't have before.
12 So, they now are coming back, and also other
13 businesses. Because the process is generally
14 streamlined, we now have an 80 percent
15 recertification rate, and that's high. Right?
16 So businesses are really coming back because
17 it's easier, but, also, they know that there's real
18 opportunity here at the City.
19 SENATOR RITCHIE: And those that don't
20 recertify, is that because there's a cap on the
21 personal wealth?
22 What's -- do you know what the reason is that
23 some of them aren't recertifying?
24 JONNELL DORIS: We don't have a cap on the
25 personal net worth here in the City.
19
1 SENATOR RITCHIE: (Indiscernible) the City
2 okay?
3 JONNELL DORIS: Pardon?
4 SENATOR RITCHIE: So that's not an issue
5 here?
6 JONNELL DORIS: No.
7 SENATOR RITCHIE: That is an issue at the
8 state level, though.
9 JONNELL DORIS: Yes, we are aware.
10 But for us, we don't have a personal net
11 worth.
12 I think, you know, being a small-business
13 owner, you make business decisions.
14 As a former small-business owner, you know,
15 every day you have to make a business decision,
16 what's working, what's not working.
17 And we try to make the case for these small
18 businesses that our program is viable, our program
19 is working, and you can participate in our
20 marketplace.
21 But some businesses may choose to not
22 participate, and that's their prerogative. But
23 80 percent of them are choosing to stay in.
24 And the others that are choosing not to stay
25 in the program, you know, we do talk to them about
20
1 what their issues may be, or what the challenges
2 that they may face.
3 And the private sector also is a robust
4 private sector and economy at this particular time,
5 and, you know, we're, essentially, competing with
6 the private sector for these firms as well, right,
7 because they can also go to the private sector and
8 do work, and do the work with the City or with
9 government, is an option.
10 And if they're busy elsewhere, because the
11 market is viable and thriving at this particular
12 time, they may choose not to do business with the
13 City.
14 So that's one of the reasons that they give
15 as well.
16 SENATOR RITCHIE: Just my final question:
17 I would have thought that there -- because of
18 the number of businesses here, there really wouldn't
19 be any kind of issue with finding enough businesses
20 to fill your 30 percent goal.
21 But I have heard from a few people that it
22 still is a struggle.
23 There's a lot more businesses that are
24 certified, but there's a lot more construction
25 projects, in particular.
21
1 So I'm just wondering, have you heard that
2 there is an issue there here in the city also?
3 JONNELL DORIS: As when it comes to
4 availability, I mean, we do have firms who are
5 available to do the work, from the small firms who
6 are now engaging in our market, to large firms who
7 have been very successful; MWBEs very successful.
8 I mean, we've reached $10 billion in our
9 MWBE program, from 2015 till now, and that's a
10 significant number.
11 90 percent of that is their prime contracts,
12 and 10 percent subcontracts.
13 And so we're very excited about that number
14 because it speaks to the availability, but the
15 capacity for these firms to actually perform.
16 Do we have MWBEs that do everything? No.
17 And I think our process helps us to deal with
18 that.
19 And we have capacity-building programs at our
20 SBS (small-business services) department that works
21 with some firms who are trying to graduate from the
22 small firms, to the medium, to the larger.
23 And -- but we're looking at our procurement
24 process to make sure, also, that how we put out our
25 procurements allow for competition on all levels,
22
1 right, and so that not just the big firms are
2 winning or the small firms are being left out.
3 And, also, to speak to about joint-venturing
4 and coming together with large firms, smaller firms.
5 And that's why our mentorship program that we
6 are seeking, the authority to do, will help us to
7 alleviate some of those concerns that we have.
8 SENATOR LITTLE: Thank you very much.
9 JONNELL DORIS: Senator.
10 SENATOR LITTLE: I'd like to go back to your
11 certification process.
12 And when -- now that you've simplified it,
13 and we would love to -- I'd love to get my hands on
14 an application and just see.
15 JONNELL DORIS: Sure.
16 SENATOR LITTLE: And I suppose we can do that
17 online. Right?
18 JONNELL DORIS: Sure.
19 Or we can get one to you.
20 SENATOR LITTLE: Okay.
21 Just to really see, because ours is a very
22 difficult process.
23 Also, if you have an online -- do you have an
24 online tutorial that would tell people how to do the
25 certification; how to apply online, and do that part
23
1 of it?
2 SENATOR RITCHIE: Yes, we do have
3 instructions, and --
4 SENATOR LITTLE: Oh, that goes with it, or
5 no?
6 JONNELL DORIS: -- can I get back to you on
7 the video part?
8 But I do know we have presentations and
9 different things online that you can look, to help
10 you through that process.
11 SENATOR LITTLE: Look at and do it. Okay.
12 JONNELL DORIS: Not sure about the video.
13 SENATOR LITTLE: How long does the
14 certification last?
15 JONNELL DORIS: You can recertify it for
16 five years.
17 SENATOR LITTLE: Five years.
18 See, what we're finding is, before they turn
19 around, I mean, it takes -- I have one that has put
20 in their application for recertification March 8th
21 of 2018, and has not been recertified yet. And
22 they're expired, their certification, in just a few
23 years.
24 So, that's definitely a problem upstate as
25 well.
24
1 And for your contractors, or your agencies,
2 are they required, in the 30 percent goal, to have
3 15 percent minority-owned business and 15 percent
4 women-owned business?
5 JONNELL DORIS: The City's program, our
6 goal-setting process, which is outlined in our local
7 law, requires us to assess each contract for goals;
8 and so we do not have that specification.
9 As we do have disaggregated goals, generally,
10 for the City, that's where you'll be able to find
11 where the disparity was, and, therefore, we are able
12 to address those. But we don't specify it that way.
13 SENATOR LITTLE: Okay.
14 Well, we're finding, at the state level, that
15 a lot of that's being done. And it's not even --
16 the word "goal" is not even being used.
17 The word "requirement" is being used, which
18 is unfortunate.
19 So those two things were questions I really
20 wanted to ask.
21 And the other one is on, you have no cap.
22 So we have a personal net-worth cap of, like,
23 $3 1/2 million.
24 So a construction firm that owns cranes, it
25 owns buildings, especially if it's privately owned
25
1 and personally owned, can't even apply because
2 they're too wealthy.
3 And I've been told that the program is really
4 for start-up businesses, to help them gain some
5 ground and grow and be successful.
6 And, of course, if the woman- or
7 minority-owned business gets too successful, then
8 they're capped. So now they're no longer certified,
9 so many of the contracts they had, they can't get
10 again.
11 And so it's almost like, well, you can't be
12 too successful here.
13 You don't have that?
14 JONNELL DORIS: We do not.
15 We do not have a personal net-worth cap.
16 SENATOR LITTLE: Well, do the big companies
17 overwhelm the smaller companies and get more of the
18 projects, or do they just use the subcontracts?
19 JONNELL DORIS: So, in the City, a few things
20 we've done to address that scalability.
21 I think it's important that we build
22 businesses.
23 It's important that we invest in small
24 businesses, mid-sized businesses, and that we allow
25 the larger firms to also engage because, they also
26
1 mentor the smaller firms, they also work with them.
2 And, also, I think they -- they sort of
3 address a myth about success in our program, right,
4 because, you know, here, we can show you.
5 We have firms with 300 employees who are
6 MWBEs, who are doing very well, and can compete
7 with any large firm.
8 And then there are smaller firms that need
9 this sort of assistance that we provide,
10 particularly at our small-business services.
11 So I do -- you know, I do agree that we are
12 structured and very specific on how we make sure
13 that all tiers of businesses are engaging.
14 The subcontractor model is one, yes, that the
15 smaller businesses can participate in and be like an
16 entryway into the program.
17 But we don't want to say to a large business,
18 because you're successful, you're not a part of it,
19 because I think they bring valuable lessons learned,
20 you know, how to do business, how to grow.
21 All these businesses that start large, they
22 started as small businesses on the small end of the
23 small-businesses spectrum, and now they've grown.
24 And one last thing I'd say is that, the
25 agencies, for instance, our department of design and
27
1 construction, we looked at the fact that different
2 MWBEs can compete in different levels.
3 And so one of the things we did was, we said,
4 well, let's make a micro pre-qual list, a small
5 pre-qual list, a medium, and large.
6 And so, if you meet the criteria, you can
7 compete in those particular areas that are most
8 suitable for your business.
9 And so we're thinking strategically at that
10 nature so that there is some equitable share here in
11 the opportunity, and the larger businesses, either
12 MWBE or not an MWBE, are not pushing everyone else
13 out.
14 But if we can scale the work where they can
15 compete and the requirements are equitable, I think
16 we've seen success there.
17 For instance, "DBC," our design and
18 construction, did over a half billion dollars in
19 MWBE contracting in last year alone. And part of
20 that is these, sort of, innovative tools we're
21 using.
22 SENATOR LITTLE: And on your prequalified
23 businesses, how long does that prequalification
24 last?
25 As long as they're certified?
28
1 I mean, do you certify them?
2 Or, how does that work?
3 Because I don't think we have that.
4 And I'd love to know how you got out of the
5 State regulations.
6 It's just -- you know, the City is exempt
7 from the State, but you're actually certifying
8 businesses outside of New York City to do work in
9 New York City?
10 JONNELL DORIS: Yes, so -- yes, to -- two
11 questions.
12 The first question concerning the
13 certification:
14 So I think how we view it is, the folks that
15 are outside -- I'll go to the second one first.
16 The folks who are within what we call "our
17 catchment area," our geographic area, which we
18 needed for statistical analysis, that may not be
19 physically in the city, but they have what we call a
20 "nexus to the city," meaning they have an office
21 here, they signed up with our city to do business
22 with us, these firms are engaged in our marketplace.
23 We want to engage them too.
24 For instance, on Nassau County,
25 Suffolk County, we did, last year alone, about
29
1 $290 million in MWBE spend for those businesses;
2 meaning, out of those counties, which were not the
3 city, with those counties, we've engaged those
4 businesses, MWBEs, out of Nassau County and
5 Suffolk County. And they're participating in our
6 program at a very robust stage, because we know is
7 viable, and they're part of our New York City market
8 area.
9 SENATOR LITTLE: They have to some
10 relationship with New York City in order --
11 JONNELL DORIS: Correct.
12 They have to have an office here, or they
13 have to have a -- you know --
14 SENATOR LITTLE: History of business here, or
15 something?
16 JONNELL DORIS: -- history of business,
17 contracts here. Or, signed up with us to actually
18 do business here.
19 We have something called a "payee information
20 portal" where every business has to go to to sign up
21 if they want to participate in our program.
22 So once they've done that, they've shown
23 interest that they want to be in our marketplace.
24 And -- so we don't exclude folks from coming
25 from around the state.
30
1 I think I've mentioned we've had some folks
2 from upstate as well, and other places, who have
3 engaged in our marketplace. And we don't exclude
4 them from coming to do business with us, but they
5 just have to set up a nexus to our city.
6 SENATOR LITTLE: Well, it sounds like you
7 really conquered a lot of the things that we're
8 dealing with in the upstate -- in the regular State
9 program.
10 But I've been on -- right from the very
11 beginning on the Task Force on the Minority- and
12 Women-Owned Business, which hasn't met in three
13 years. So, I think it's actually disbanded, it must
14 be, after so many years.
15 But, there's just a lot of issues that we
16 have to deal with upstate, that we have not been
17 able to get through.
18 But thank you for your testimony.
19 I have no other questions.
20 SENATOR RITCHIE: Let me just ask a follow-up
21 question.
22 Your certification list; your list of
23 businesses that are certified by the City, how do
24 you keep that current?
25 That's one of the other issues that
31
1 I continually hear complaints about at the state
2 level; that people try to contact a business that's
3 been certified, and they find out that the business
4 is no longer there, the contact information is
5 wrong.
6 How do you keep the list up to date?
7 JONNELL DORIS: So, we have several intervals
8 in which we engage our businesses.
9 One is at recertification, so we're able to
10 know, you know, what's happening with them.
11 Also, in our capacity-building programs,
12 which we have quite a few, once the MWBEs come
13 into that program, we have the ability to ask them
14 about their updated information, make sure that
15 they've done that.
16 We've also invested, in two thousand,
17 I believe, it's sixteen, we went out to the
18 community and did some engagement with some firms,
19 to actually go out and work with MWBEs, to make
20 sure that their information is correct.
21 We actually paid firms to go and target MWBE
22 firms to make sure that we update their information.
23 SENATOR LITTLE: Is that like an audit, you
24 mean? Or --
25 JONNELL DORIS: Not, an audit.
32
1 It's more of a technical assistance and
2 support services.
3 SENATOR LITTLE: Okay.
4 JONNELL DORIS: So we're able to do that.
5 And we spent some money to make sure that
6 happened, and it actually produced great results.
7 But I think part of the challenge that we
8 face, and that we see, is that businesses do change
9 addresses. They do move to a new building, or, you
10 know, they -- some adjustment in their contact
11 information.
12 So we're constantly sending out reminders,
13 If you're going to change, please let us know.
14 SENATOR LITTLE: And that's part of your
15 notification program, that if they do make changes,
16 just like in a liquor license, that you need to
17 notify and change your license, change your
18 certification.
19 JONNELL DORIS: Correct.
20 SENATOR LITTLE: Well, I just have one more
21 question.
22 How do you -- how involved is the mentorship
23 program?
24 I mean, in today's world, people are so busy,
25 and businesses are busy, busy, busy.
33
1 Do they actually really get involved with a
2 smaller company and try to mentor them?
3 Or, how do you guide them?
4 How do you check on it?
5 Or how do you -- how does it work?
6 JONNELL DORIS: So we do not have a
7 mentorship program, let's say, as the MTA has.
8 It's a different kind of mentorship. Our
9 mentorship program is more so technical assistance
10 and support. It's more sort of a classroom-type
11 program.
12 For instance, when I was a contractor, I went
13 to -- Turner Construction had one, and I went. And,
14 you know, it's like mostly a classroom. We -- for
15 six months we learned about how to do business, what
16 to do business, how we sort of engage in the
17 marketplace.
18 And that's, generally, what we have.
19 What we're asking for from the Senate and
20 from the State is, and what we've asked before is,
21 to be able to designate specific contracts to link
22 to this mentorship agreement and program, which is
23 different than what we say, our mentorship program
24 is more educational at this particular point.
25 We want to tie projects to that education.
34
1 We want to -- right now we have classroom.
2 We want to actually have the, you know,
3 contracts and workplace mentorship opportunities
4 where we tie the two, where there's a job
5 opportunity at the end of the classroom.
6 So right now we have classroom, but there's
7 no jobs associated with that because we're
8 prohibited in having those exclusionary
9 prequalified --
10 SENATOR LITTLE: You mentioned the word
11 "protege program."
12 I mean, that sounds like somebody taking a
13 smaller company under their wing.
14 And do you actually do that?
15 JONNELL DORIS: Not at this particular
16 juncture.
17 We're asking for authorization to do a
18 program like that.
19 SENATOR LITTLE: You need legislation to do
20 that, or you need money to do that?
21 JONNELL DORIS: We would -- we hadn't -- we
22 did not ask for funds to do it; however -- we're
23 always happy to receive.
24 [Laughter.]
25 SENATOR LITTLE: That would be next.
35
1 JONNELL DORIS: Yeah.
2 But we do ask -- but we do ask for -- I mean,
3 so the mayor has made MWBE a priority of his
4 administration; and, therefore, created our office,
5 staffed up our small-businesses services.
6 I mean, we've invested quite a bit in our
7 program. So we're not -- and we went to the private
8 sector to raise funds also for our program.
9 And so we're very engaged in making sure that
10 we're self-sustaining.
11 But, what we need out of the State is the
12 authority to designate contracts, which we cannot do
13 now, for such a program.
14 And that's what -- where the mentorship
15 arrangement comes in play.
16 And so we do not have that authority right
17 now to set aside specific contracts and associated
18 prequalified lists for exclusively MWBE
19 mentorship-protege arrangements.
20 SENATOR LITTLE: Okay. I would be interested
21 in following that.
22 SENATOR RITCHIE: I just want to say thank
23 you so much.
24 We've been joined by Senator O'Mara.
25 JONNELL DORIS: Senator.
36
1 SENATOR RITCHIE: Thank you for being here
2 today. It's very enlightening.
3 You know, I'm hoping that, at some point in
4 the future, you would be willing to share, you know,
5 some of your knowledge and your time to kind of go
6 over exactly what you do in New York City that has
7 worked well, that maybe we could bring back to the
8 state level, because I have heard a number of really
9 positive comments about the certification process,
10 especially being able to get it done in 6 to 8 weeks
11 is so much better than what we're hearing on the
12 state level.
13 JONNELL DORIS: Thank you, Senator.
14 SENATOR O'MARA: Two years.
15 Yeah.
16 JONNELL DORIS: Wow.
17 Thank you.
18 SENATOR O'MARA: Thank you.
19 JONNELL DORIS: Thank you, Senator.
20 SENATOR LITTLE: Thank you again.
21 JONNELL DORIS: Thank you, Senator.
22 SENATOR LITTLE: Maybe the State can be your
23 protege.
24 SENATOR RITCHIE: Next we will hear from
25 Lou Coletti, president and CEO of Building Trades
37
1 Employers' Association.
2 LOU COLETTI: Good morning.
3 Welcome to New York City.
4 SENATOR O'MARA: Good morning.
5 LOU COLETTI: I'm going to -- my testimony is
6 going to be a little different, because I think I've
7 been before your panel at some of the hearings in
8 Albany. And so I think much of the material we've
9 submitted to you already.
10 I just want to -- which included a number of
11 recommendations.
12 But I also want to ask you to go back and
13 take a look at our capacity report.
14 That capacity report measured the actual
15 number of MWBE contracts awarded, by dollar volume
16 and by race, in New York City, and came to the
17 conclusion that you can't meet 30 percent goals.
18 But I suggest to you that that report also
19 applies to New York State contracts in the five
20 boroughs.
21 Okay. What I'd like to do -- because I have
22 a couple of more recommendations that we didn't talk
23 about.
24 But what I'd like to do at the beginning,
25 because I think the prime-contracting community is
38
1 probably one of the most misunderstood elements in
2 this discussion, so what I'd like to do is take a
3 moment and explain to you who we are. Okay?
4 The Building Trades Employers' Association is
5 an organization that represents 26 trade
6 contractors, general contractors, construction
7 managers, and every subcontractor who has a union
8 agreement. We have 1300 members.
9 But our organization has the largest number
10 of MWBE contractors in the entire state of New York.
11 We have over 85, with almost 52 -- 52 percent
12 of them can perform contracts, $5 million and above;
13 32 percent can provide, again, are doing
14 work, from between a million and 4.9 million;
15 And 18 percent can do between 500,000 and
16 nine hundred -- and a million.
17 The members of the building trade unions that
18 we employ, which seems to be a very hot topic of
19 discussion in this city, of the 8500 active union
20 apprentices in New York City, 65 percent are
21 African-American, 33 percent are Latino, 27 percent
22 are Asian and other nationalities, 10 percent women,
23 and 72 percent New York City residents.
24 We have programs with the New York City
25 School Construction Authority to recruit people.
39
1 We've placed over 900 returning military
2 veterans in the programs, and over 1500 women.
3 So when you're looking to talk about
4 diversity, and the dialogue that I read, I really
5 suggest that you come talk to us because we've got
6 the numbers that back it up.
7 Some of the proposed amendments I'd ask you
8 to suggest for 15-A, is to include specific language
9 that eliminates the state agency's ability to impose
10 liquidated damages for failure to hit the goal.
11 I'm going to try to say this politely.
12 Liquidated damages violate the Croson versus
13 Richmond U.S. Supreme Court decision, where these
14 goals are aspirational, not mandated.
15 And I think I can speak for my membership,
16 the tolerance level for getting multimillion-dollar
17 fines for an inability, after going through a
18 process to help try to find companies, is getting
19 very frustrating.
20 And I think, if we don't do something,
21 somebody's going to do something else that is not in
22 the best interests of anyone.
23 I was listening to the previous conversation,
24 where we were talking about mentoring programs and
25 things like that.
40
1 We can't do them.
2 You cannot -- the law does not prevent a
3 prime -- and the law prevents a prime contractor
4 from providing any technical assistance to a
5 subcontractor working for them on that job.
6 SENATOR LITTLE: Really?
7 LOU COLETTI: Yes.
8 And to prove it, a couple of years ago, there
9 must have been 8 or 10 -- I'm sure Denise Richardson
10 will talk about it when she gets up here -- of our
11 contractors who were fined, agreed to six-, eight-,
12 ten-million-dollar civil penalties, because they
13 wanted to charge us criminally for violating the
14 commercially useable function.
15 You can't do it.
16 It has to be an independent third party
17 that's providing that kind of mentoring.
18 So all this talk about mentor-protege and
19 ment -- I'm telling you, our contractors are not
20 going to put themselves at risk to do it.
21 Okay?
22 We'd also ask you to amend 15-A with language
23 that makes it clear, that when you're establishing a
24 goal, the goal is based on the hard cost of
25 construction; not soft cost, not total project cost,
41
1 like it's done now.
2 You have a $100 million project. The goal
3 becomes 30 percent of $100 million, as opposed to,
4 maybe, either 70 million of that is actual hard
5 construction costs.
6 So we'd also ask that the State provide
7 funding for capacity-building programs.
8 There is a way to do it, but they have to put
9 some money on the table.
10 You know, I heard -- hey, listen, I like
11 Janelle.
12 I heard a lot of good talk about it, about
13 the mentoring programs, but, I'm not seeing it.
14 I'm not seeing it in the City.
15 I'm not seeing it in the State.
16 You want a model?
17 Look at the school -- New York City School
18 Construction Authority.
19 The way they set it up is, they invest their
20 own money, and they hire a series of third-party
21 consultants.
22 It could be a contractor, it could be a
23 financial expert, it could be a bonding expert.
24 And one of their -- when one of their prime
25 contractors goes to that agency's staff person and
42
1 says, "Listen, this MWBS struggling a bit," then the
2 agency hires the appropriate technical expertise as
3 a third-party contract that can go and help them,
4 because the prime contractor cannot provide any
5 assistance.
6 And it's a model that works, and it clears
7 everybody in terms of the law.
8 SENATOR LITTLE: Does the agency pay for
9 that?
10 LOU COLETTI: Yes.
11 SENATOR LITTLE: Okay.
12 LOU COLETTI: The other thing, as an amend --
13 comes to the State, is I would urge you to put in
14 the language, and establish what the ESD did for the
15 regional economic development councils, and we
16 should have regional MWBE advisory councils --
17 SENATOR LITTLE: Absolutely.
18 LOU COLETTI: -- with New York having its
19 own.
20 It would be nice if the language would
21 include that the membership has to be from
22 prime-contractor organizations as well as MWBEs,
23 because, right now, we have two MWBE councils, one
24 in the city, one in the state, and nobody talks to
25 us.
43
1 I can tell you, in New York City, my members
2 are doing about $50 billion worth of work.
3 They're doing JFK.
4 They're doing all the big infrastructure
5 projects.
6 They're doing the airports.
7 They're doing dormitory authority work.
8 It's like we don't exist.
9 Now, I'm not saying there should be some
10 meetings where MWBEs have, and address issues
11 without us, but bring us to the table.
12 We want this program to be successful, and
13 all we do is get penalized and penalized and
14 penalized and ignored. Doesn't matter whether it's
15 the State of New York or the City of New York.
16 And the other thing I would urge you to do,
17 is to establish a commission that will address
18 issues that affect not only MWBEs, but all
19 contractors, about agency payment practices.
20 No damages for delay, change orders that
21 never seem to get done, affect the cash practice,
22 payment processes, they're horrible.
23 And when the public sector has to compete
24 with a hot private sector, it's one of the reasons
25 people are walking away on the building side,
44
1 walking away from public work, because they're never
2 going to get paid.
3 And, cash, I don't have to tell you, cash is
4 king in our industry.
5 So I'll conclude my statements, and any
6 questions you may have, by just saying that, I've
7 been saying this for a while, and I'm constantly
8 reminded when you talk about MWBE programs, of a
9 saying Confucius said in 500 BC: When goals can't
10 be reached, don't adjust the goals, adjust the
11 action steps.
12 And that's what I think we need to do to make
13 New York State's MWBE program: to build upon the
14 success they've had.
15 I'm not suggesting that they haven't been
16 successful.
17 But if you want to build upon that success,
18 we're projecting, in New York City, in the next
19 two to three years, there's still going to be
20 $50 billion a year of activity.
21 If we don't do it now, when are we going to
22 do it?
23 Make it work for both parties.
24 We are not the enemy.
25 So I thank you for your attention.
45
1 I'd be glad to answer any questions that you
2 might have.
3 SENATOR RITCHIE: Just, I appreciate you
4 being here again, and I appreciate you being at the
5 hearing in Albany.
6 So, thank you --
7 LOU COLETTI: Thank you for having us.
8 SENATOR RITCHIE: -- thank you for your time.
9 Can you just give me, specifically, what
10 you're looking for with regards to the meeting?
11 You're looking for your organization to meet
12 with the MWBE organization?
13 Is that --
14 LOU COLETTI: There is, in the state of
15 New York, I believe the Governor's Office has an
16 MWBE advisory board.
17 I have no idea who's on it, but I can tell
18 you that none of the prime contractors are.
19 The City of New York, which is not, I know,
20 your jurisdiction, but it's the same thing, have an
21 MWBE advisory council. There are no prime
22 contractors.
23 I'm going to be in real trouble for saying
24 this.
25 When Mike Bloomberg was mayor, we were there,
46
1 and we worked together in trying to improve the
2 program.
3 That's not the case here; we're not at the
4 table.
5 So why wouldn't you want to be at the table
6 to work on -- because I bet you, on 50 to 60 percent
7 of the things that I think we think can improve the
8 program, we'd be willing to participate.
9 You want us to mentor, and go in a classroom
10 and provide that?
11 Well, you know what? Maybe we would do that
12 if we got 10, 15, 20 percent credit toward the goal.
13 That costs my members money; their staff
14 time, their expertise.
15 What can we do to make this work for both
16 parties?
17 SENATOR LITTLE: No, I appreciate all your
18 comments.
19 And, certainly, I think the regional councils
20 would be, you know, a great help.
21 And I almost think the task force started out
22 as, but it was mostly agencies, and people from all
23 the different state and city was involved as well.
24 But this sounds like a good idea.
25 That, you know, we've got to get -- for
47
1 people up where we are, they're dealing with people
2 in New York City and state agencies to try to get
3 information. And the staff at the state level is so
4 small, it's just not workable.
5 And you want someone to get certified.
6 And the reason they're getting certified is
7 they realize it would be a benefit to them, and they
8 could hire more people and provide more jobs and
9 improve the economy; but they can't get certified.
10 And it's just not working.
11 LOU COLETTI: No, as big a problem as it is
12 for us here in New York City, I can't imagine how
13 difficult it is outside of New York City, and
14 especially upstate.
15 And the best thing I can say for the
16 certification process -- I'm going to defer to
17 Denise Richardson -- is blow it up and start all
18 over again. It doesn't work anywhere.
19 Okay?
20 New York City, for some of the major projects
21 we're talking about, general contractors tell me
22 that they are adding anywhere from 2 to 4 million
23 dollars to their bid just for compliance, to make a
24 case, and hope they don't get fined for liquidated
25 damages because they can't find MWBEs.
48
1 SENATOR LITTLE: Well, the worst part about
2 it is that, you're trying to improve the economy in
3 the local area. And by requiring -- and it is only
4 a goal, it's not a requirement -- but by what
5 they're doing, and making them have minority and
6 women-owned businesses as part of the contract, so
7 if you're up north, where do you go to get
8 contractors?
9 LOU COLETTI: That's right.
10 SENATOR LITTLE: Syracuse, Albany,
11 New York... anyplace.
12 But they don't exist in the North Country to
13 the number.
14 LOU COLETTI: That's right.
15 SENATOR LITTLE: And even the ones that are
16 trying to get certified, it takes so long to get it.
17 And then if they own a lot of property, or
18 equipment, they're past the $3 1/2 million
19 threshold.
20 LOU COLETTI: Yeah.
21 Yeah, and given the strength of the
22 New York market, those firms that are locally based
23 here are not going to look to do jobs Upstate
24 New York.
25 So you have a double problem with Upstate
49
1 New York.
2 SENATOR LITTLE: Right.
3 I've been told that businesses that call
4 around, to try to prove that they need a waiver
5 because they can't get anyone to do the work, the
6 companies down here will say, Stop calling us.
7 We're not going to do the work. We can't come up
8 there.
9 LOU COLETTI: Yes.
10 SENATOR RITCHIE: Senator O'Mara?
11 SENATOR O'MARA: Yeah, I've got a couple.
12 Thank you for being here, Lou.
13 LOU COLETTI: Thank you, Senator.
14 SENATOR O'MARA: Appreciate it.
15 On the -- to follow-up on Betty's question on
16 the wealth, $3.5 million that knocks an MWBE entity
17 out, how restricting is that in the New York City
18 metropolitan area?
19 SENATOR LITTLE: They don't have it.
20 SENATOR O'MARA: You don't --
21 LOU COLETTI: Oh, I think it becomes more
22 restrictive here.
23 You know, I think it's restrictive in
24 general.
25 SENATOR O'MARA: Yeah.
50
1 LOU COLETTI: It becomes more restrictive
2 here than it would be upstate.
3 SENATOR O'MARA: Exactly.
4 SENATOR LITTLE: The guy said that they don't
5 have it in New York City. They don't have a
6 threshold.
7 LOU COLETTI: Oh, no, you're right.
8 You're right; he's right.
9 We don't have that in New York City.
10 SENATOR O'MARA: You don't have that in
11 New York?
12 LOU COLETTI: We do not have that in
13 New York City.
14 SENATOR LITTLE: Size; micros, mediums and
15 large.
16 LOU COLETTI: Yeah, I think the most
17 difficult issue that you have to find a reasonable
18 path on with MWBEs, is that, at some point, you have
19 to graduate from the program and get out into the
20 marketplace and compete.
21 I don't have a clue as to what that point is.
22 Again, I know the SCA --
23 SENATOR O'MARA: To have that level in
24 New York City, there is no point that you get out of
25 the program.
51
1 LOU COLETTI: No.
2 But in the school --
3 SENATOR O'MARA: You always have that
4 benefit.
5 LOU COLETTI: -- right.
6 But in the School Construction Authority
7 program, they have contract limits.
8 So once you -- I think they have two or three
9 different levels.
10 Once you get -- graduate from that third
11 contract level, you must go in and compete with
12 every other contractor for their work.
13 SENATOR O'MARA: The membership data that you
14 talked about is not written in your testimony that
15 we have here.
16 LOU COLETTI: Oh, you know what? Because
17 I brought a new one.
18 SENATOR O'MARA: Yeah, it says --
19 LOU COLETTI: You may have an old one.
20 It's attached to the back.
21 SENATOR O'MARA: -- (indiscernible) the data.
22 Yeah, can you -- can you -- is it in the back
23 here?
24 LOU COLETTI: If it's not there, we brought
25 25 copies of the new one, because we -- is it in the
52
1 back?
2 SENATOR O'MARA: No.
3 LOU COLETTI: All right.
4 SENATOR O'MARA: It's not.
5 LOU COLETTI: We gave your staff 25 new
6 copies where it is.
7 SENATOR O'MARA: Those are the buildings
8 trades' members.
9 LOU COLETTI: On the workforce side, yes.
10 SENATOR O'MARA: Yes.
11 LOU COLETTI: Okay. On the contractor side
12 they are our members.
13 There's two -- you'll see two documents.
14 One that talks about the number of MWBE
15 contractors.
16 The second page talks about the number of
17 minority and women workers in the building trade
18 unions who we employ.
19 SENATOR O'MARA: Okay. Great. That will be
20 helpful to get that.
21 And then, Senator Little, do you know if this
22 council that was referenced, the MWBE state council
23 or working group, has that ever met?
24 SENATOR LITTLE: Well, no. There was a task
25 force, and we met the first couple of years.
53
1 We haven't met in about three years.
2 It wasn't really --
3 SENATOR O'MARA: That's unusual for a
4 Governor's task force or panel, unfortunately.
5 A lot of these are named. Sometimes members
6 aren't even appointed to them. And they rarely, if
7 ever, meet.
8 LOU COLETTI: They may not be appointed to a
9 council, but I can tell you there are meetings going
10 on between the Governor's Office and representatives
11 of the MWBE community on some regular basis, without
12 any prime-contractor representation.
13 Same thing here in New York City.
14 They may be informal, but they go on.
15 And all we're asking for is, give us a seat
16 at the table.
17 SENATOR O'MARA: We'll look into that.
18 LOU COLETTI: Thank you very much.
19 Okay. Thank you.
20 SENATOR RITCHIE: Appreciate you coming.
21 SENATOR LITTLE: Thank you.
22 SENATOR RITCHIE: Next we will hear from
23 Sandra Wilkins (sic) and Krista Gobins from the
24 Women's (sic) Builders Council.
25 SENATOR O'MARA: Gobins (different
54
1 pronunciation).
2 SENATOR RITCHIE: Gobins.
3 Sorry, Krista.
4 KRISTA GOBINS: That's okay.
5 SANDRA WILKIN: Good afternoon.
6 And I would like to thank Senator Ritchie,
7 Senator Little, and Senator O'Mara, and the senators
8 who comprise the New York State Working Group on the
9 Minority and Women Business Enterprise to have the
10 opportunity to speak today.
11 My name is Sandra Wilkin.
12 I am proud to be a New York State-certified
13 woman-owned business owner.
14 I am here today as a co-founder of the
15 Women Builders Council, and I have served multiple
16 boards and organizations as an advisor at both the
17 state and local level of MWBE issues.
18 It is with this body of legislators and the
19 Office of the Governor and the mayor of New York who
20 have understood the needs for laws and policies in
21 support of New York State's MWBEs.
22 That support, in turn, grows our state
23 economy.
24 Looking back over the 25 to 30 years that
25 I have been in the building industry:
55
1 I could point to disparity study after
2 disparity study; I can point to minority contracting
3 utilization; I can point to numerous local cases,
4 state, and U.S. Supreme Court cases, all recognizing
5 the same thing: Disparity is real. Disparity is
6 ongoing.
7 And it is our duty; MWBEs, legislators,
8 New York business associations, and government
9 entities, to continue to remedy this disparity.
10 Disparity in the construction industry has
11 been an open secret.
12 We don't have to look any farther than the
13 statewide MW utilization goals of 30 percent.
14 On the face of it, it looks high, almost
15 1 out of 3 to be MWBE businesses. But you have to
16 ask yourself: Why is it just 30 percent, and why
17 can't we meet it?
18 The open secret of disparity in the
19 construction industry is the reason we can't even
20 meet a goal of 30 percent MWBE utilization, and it
21 is the entire reason that we must continue to use
22 the law to fight the problem of disparity.
23 It is also a two-way street, where certified
24 minority and women businesses also have a duty and
25 responsibility to participate in wanting to do
56
1 business with New York State, and to continue to
2 grow their businesses while knowing and being aware
3 of the risks they face.
4 99 percent of the businesses in
5 New York State are, in fact, small businesses.
6 And there is a website that I refer in my
7 testimony.
8 MWBEs make up 53.5 percent of available
9 prime contractors and 53.48 percent of available
10 subcontractors in New York State.
11 To me, this represents a great opportunity to
12 increase the access and certification for minority
13 and women small businesses statewide.
14 If there was ever a time in our nation's
15 history for us to use these programs to encourage
16 businesses, it is now.
17 These programs must continue, and must be
18 funded, so that we can grow the state of New York.
19 Several points to raise to help us with this:
20 First: It shouldn't be a Herculean effort
21 for subcontractors to get paid.
22 Often you hear about the difficulty in
23 getting paid.
24 If we can track a Fed-Ex package through
25 every facility on the way to our door, why can't we
57
1 do the same with payments, in having a method of
2 tracking them from the initial requisition through
3 the final payment, and see it all online?
4 MWBEs are commonly subcontractors and are
5 at the mercy of the primes.
6 They should be able to confidently know that
7 the status of any requisition, request, and payment.
8 Second: Insurance premiums are
9 disproportionately higher for small minority and
10 women businesses as compared to their large
11 counterparts.
12 Third: Dispute resolution for construction
13 projects shouldn't be the domain of those with time,
14 money, and lawyers.
15 Very often, small minority, women, businesses
16 do not have the resources to hire outside council to
17 navigate the time-consuming disputes so often found
18 in large construction projects, and construction
19 without representation just should not stand.
20 Fourth: We ought to expand mentorship and
21 technical-assistance program to the small businesses
22 and MWBEs statewide who have to navigate the often
23 confusing and complex procurement processes at the
24 state-agency level.
25 It is how I became a mentor contractor.
58
1 I got my start working in public projects,
2 actually, at the School Construction Authority, and
3 now have the honor and the opportunity to assist
4 programs developing mentor and technical-assistance
5 programs.
6 Fifth: We must remain ever diligent of those
7 who seek to sidestep our laws through using
8 pass-throughs and fronts to get around MWBE
9 requirements.
10 Too many out there will seek to game the
11 system if enforcement of our MWBE law is not robust
12 and consistent.
13 Ultimately, how we choose to treat MWBEs
14 creates two visions of the future of the state of
15 New York.
16 In one, if we choose not to support MWBEs,
17 we are choosing to cripple a critical component of
18 our economy in New York. We are choosing to allow
19 the open secret of disparity to stand.
20 When there are hurdles for MWBEs to get to
21 the market, we lose out on competition that can
22 decrease prices and increase quality.
23 But there is another vision, one where
24 MWBEs are continued to be welcomed and included as
25 essential parts of New York's growth.
59
1 It is a vision where our laws protect
2 individuals and business owners, and help them
3 flourish.
4 One that recognizes that the contributions
5 minorities and women have made to our great state
6 and country, and one that allows those contributions
7 to build our economy.
8 We are stronger together when we all work to
9 build our great state.
10 Our vision as New Yorkers and legislators is
11 one where MWBEs are included, welcomed, and
12 promoted.
13 Join me in building the future of our great
14 state.
15 I look forward to answering any of your
16 questions you may have.
17 Thank you, Senators.
18 SENATOR RITCHIE: Krista, did you have
19 something to add before we --
20 KRISTA GOBINS: Yeah, I just wanted to
21 apologize on behalf of Deborah Bradley.
22 Her husband has Parkinson's disease.
23 Actually, and I'm here to say, thank you,
24 because your office helped him when we walked all
25 the way from New York City to Canada. And your
60
1 office organized volunteers for him two years ago.
2 So she apologizes that she can't be here
3 today.
4 I think that Sandra and I are going to be
5 able to answer any questions that you have, but
6 I know that what Deborah wanted to communicate is
7 that, our members, which represent women builders
8 from all around the state, many of whom live in your
9 districts, support the reauthorization of
10 Article 15-A.
11 We think that there are some areas for
12 improvement that are listed in Deborah's testimony,
13 which include things that Sandra mentioned, and also
14 Lou from the BTA mentioned, which is, reviewing
15 "CUF," the commercially useful standard, so that
16 there's a clear, definite line of when a prime
17 contractor can work with an MWBE, and they're not
18 unfairly hurt because they are an MWBE.
19 So, for example, speaking on behalf Deborah,
20 she worked on the Tappan Zee Bridge project as a
21 subconsultant -- MW -- WBE subconsultant.
22 At one point she needed to use a crane.
23 And instead of being able to use the GC's
24 crane and rent it from the GC, they said, No, we
25 don't want to get sued for fraud. You have to come
61
1 in and bring in your own crane.
2 So she had to rent the crane. It cost more
3 on the project, more for the taxpayers. It's
4 onerous for the MWBEs on the project. And they're
5 almost treated differently.
6 So I think we have a list of recommendations
7 that could help further clarify that for GCs
8 working on these projects, so that they're not
9 unfairly treated on a project, and it doesn't cost
10 the State more money, which no one wants.
11 And we also talk about, again, as you had
12 said, Senator Ritchie, giving New York State and ESD
13 more resources so that they can hire more staff to
14 help with certification.
15 In New York City, I know that we have people
16 who call WBC. We give them some certification
17 assistance to the much of our abilities.
18 But especially in areas that are upstate and
19 in Western New York, it would be nice if they could
20 have the bandwidth to reach out and have a direct
21 relationship with their constituent, rather than
22 just being, you know, some person in New York City.
23 So we would like to see ESD in this year's
24 budget get some more resources so that they can hire
25 some more help and get rid of any backlog they might
62
1 have.
2 The third issue -- and I'm sure, Sandra, you
3 can talk about this -- is the personal net-worth
4 cap.
5 We worked a lot with you, Senator Ritchie, on
6 this issue.
7 We're a strong supporter of you and your
8 initiative. And anything that we can do to help
9 further that message of not capping and limiting
10 minority and women business enterprises.
11 Because even the idea, or the concept, as you
12 said, Senator Little, of saying, you can be
13 successful, but not that successful.
14 So I think we can all agree on that level.
15 And then, our final recommendation would be
16 to expand the statewide mentorship programs, which,
17 if you have any questions, Sandra would be a great
18 person to ask.
19 We are highly supportive of the New York City
20 School Construction Authority program and all they
21 do to build small business.
22 The MTA also has their small-business program
23 that was put into statute in 2010, also given
24 supporting funds by the budget. So, that gives them
25 the ability to have these programs to get these
63
1 small contractors, and then to grow them.
2 Sandra can also speak on that because she's a
3 large part of the program, its inception, and also
4 the consulting team.
5 So if you guys have any questions, we'd be
6 happy to answer them.
7 SENATOR RITCHIE: (Indiscernible) actually
8 was the one question that I did have, if you could
9 kind of explain what the mentorship program consists
10 of, that would be helpful.
11 SANDRA WILKIN: Ah, yes, thank you,
12 Senator Ritchie.
13 And thanks to Krista Gibbons (sic), our
14 policy advisor for WBC.
15 The mentor programs do take on different
16 models, and, perhaps, one size doesn't necessarily
17 fit all agencies.
18 The ones that we feel that have experienced
19 the greatest growth, for instance, are, as you've
20 heard in the past, school construction, the MTA, and
21 other agencies that are looking at developing those
22 which have a higher budget level, and require the
23 most in terms of construction.
24 For other agencies, they can have very
25 similar models.
64
1 For instance, the EDC, or the ESD, for
2 New York State, for the other agencies, depending on
3 the kind of services that they are rendering, you
4 can put in a mentor program.
5 The key elements to the mentor program is
6 that it's both learning and providing the service at
7 the same time.
8 By doing that, the -- most of the capacity,
9 or the capabilities, are met in those cases.
10 SENATOR LITTLE: One of the things, I guess,
11 I didn't quite understand, but I do from your
12 testimony, is that the large contractor is an MWOB.
13 But if they hire subcontractors as MWOBs,
14 they can have no relationship with them, like you
15 talked about this renting of the crane.
16 But if they're not MWOBs, they would be
17 able to use the crane and they could have done
18 everything else.
19 SANDRA WILKIN: Right.
20 SENATOR LITTLE: So on this hand, then, why
21 would you want to subcontract to MWOBs if you had
22 already met your goal by being the large contractor?
23 It doesn't even make sense.
24 And then you penalize them if they work
25 closely with them.
65
1 KRISTA GOBINS: Do you want me to speak to
2 that?
3 SANDRA WILKIN: Sure.
4 KRISTA GOBINS: So the situation I was
5 speaking of, the person/the general contractor was
6 not an MWBE.
7 They hire the MWBEs, and then as a
8 subcontractor, they perform the work.
9 But there is, in law, called "commercially
10 useful function." And this was really devised for a
11 very good reason; to make sure that there wasn't
12 fraud, and that people weren't creating shell
13 companies saying that they were minority- or
14 women-business-owned.
15 You know, so, they really wanted to make sure
16 that these companies weren't getting too much help.
17 But if -- and I can certainly send some
18 information to your office on CUF.
19 SENATOR LITTLE: That's clear.
20 But a lot of this stuff needs to be clarified
21 and easier for people to understand getting into the
22 business.
23 The other thing is, on the personal wealth,
24 it should be according to the type of business,
25 because if you're in a business that requires cranes
66
1 and equipment and large buildings, then -- and
2 you're a privately-held company, you're way over;
3 you don't even apply.
4 I have a great company, totally woman-owned,
5 and she won't even apply.
6 She says, There's no way I can apply. I'm
7 over it just with my property.
8 SANDRA WILKIN: Senator Little, you bring up
9 a great question, and, actually, in some way, this
10 is the crux, and a good problem for New York to
11 have.
12 We're seeing very large growth because of
13 these programs for minority and women businesses;
14 and, yet, some of the guidelines and the laws are so
15 restrictive that it eliminates the opportunity for
16 these firms to grow.
17 So, they are not big enough in terms of
18 capacity, in terms of bonding --
19 I'm referring to, obviously, the construction
20 industry at this point.
21 -- to be able to sustain having to be able to
22 be the largest prime on that project, but the --
23 they're gearing towards that.
24 And you find, unfortunately, this -- there is
25 a middle group of firms that should still be able to
67
1 have the opportunity of working as minority and
2 women businesses.
3 And if we're able to navigate that path for
4 them, and eliminate the biases that are out there
5 and the restrictions, they'll be able to grow their
6 businesses.
7 And their businesses, as the same as any
8 business within those goals or contracts, they also
9 require to have goals on their contracts.
10 KRISTA GOBINS: And, Senator Little, I think
11 what you're talking about, how different areas
12 require a different amount of capacity construction
13 is extremely expensive.
14 You take a huge amount of risk.
15 You're required to have a lot of personal
16 wealth to receive access to capital, bonding, and
17 just to have your own personal savings in case
18 you're doing a public-work job. And things get
19 delayed or things go wrong, you need to have the
20 capital to be able to continue the company.
21 So you're right, construction is a very
22 expensive industry to start up and to continue in.
23 SENATOR LITTLE: It seemed like when we first
24 started, they were talking about financial firms and
25 women that were investment bankers, and things like
68
1 that, who had -- who may, if they're successful,
2 accumulate a large personal wealth.
3 But now we're talking about equipment and
4 your buildings, and your buildings and your
5 property, that helps you have the business that you
6 have.
7 It's not just personal wealth, although you
8 do own it, but you wouldn't have the business
9 without the equipment, and cranes, and all that.
10 (Indiscernible) --
11 KRISTA GOBINS: And you want to have small
12 businesses make smart decisions.
13 If you're leasing a building, and you're a
14 WBE, you want to buy that building because it's the
15 smart thing to do.
16 We have members who are terrified that they
17 will reach that cap, reach that capacity.
18 We had someone who had a parent pass away,
19 and they were afraid to take inheritance or building
20 or homes because -- or, equipment, like you said,
21 because they don't want to --
22 SENATOR LITTLE: No, I had somebody that put
23 things in a trust fund, and establish a charity, and
24 all kinds of things, because she had inherited money
25 and she didn't want to put her business at risk --
69
1 KRISTA GOBINS: It's a bad decision to make.
2 SENATOR LITTLE: -- (indiscernible) employees
3 are purchasing the business, you know, as they begin
4 to retire, and, you know, they're mostly women.
5 To stay as a women-owned businesses has been
6 beneficial to them, to being certified.
7 SANDRA WILKIN: Senator Little, just to --
8 another comment on that.
9 We understand that these programs are for
10 small businesses, but small businesses do grow, and
11 that the personal net worth is an important factor.
12 But, in reviewing it, and recommendations
13 that we can make, to just get the personal net
14 worth, in terms of guidelines, and in terms of
15 categories, perhaps, that would be more consistent
16 with the businesses that are there.
17 SENATOR LITTLE: Thank you.
18 SENATOR O'MARA: I've just got a couple of
19 questions.
20 Of your -- the Women Builders Council, how
21 many member companies do you have in that group?
22 SANDRA WILKIN: (Indiscernible.)
23 KRISTA GOBINS: You mean companies that
24 comprise our organization?
25 We have, probably, about 175. And we have
70
1 about 33 Board Members.
2 SENATOR O'MARA: How many of those companies
3 are qualified MWBEs; do you know?
4 KRISTA GOBINS: I would say about 75 percent
5 of our membership are M -- WBEs.
6 But, also, we have, like, some of the larger
7 companies. We have female executives that sit on
8 those large. Like the Turners, the Skanskas, we
9 have their participation on our board as well.
10 So we represent not only WBEs, but we
11 represent the women executives who serve in
12 leadership positions on some of these big prime
13 companies.
14 So it's a plethora of women.
15 SENATOR O'MARA: What are your thoughts on
16 this upper level of wealth that we've talked about,
17 3.5 million for upstate, which is relatively small,
18 and then you get kicked out of the system?
19 But, what are your thoughts on, at some
20 point, should a company that's reached a certain
21 success level have to then compete head-to-head with
22 non-MWBE companies and the bidding in con -- and the
23 bidding that goes on?
24 SANDRA WILKIN: I think that we -- I think it
25 needs to take a better look at what is preventing
71
1 firms from being able to grow, number one.
2 Whether or not we -- I think we all
3 understand to -- or, we feel, in terms of business,
4 that a 3.5 net worth in doing business, as in the
5 financial industry, and in most businesses, is quite
6 a low threshold.
7 So as far as what that number is, I think
8 would really depend on the particular industry that
9 would be doing business, and not have a circumstance
10 as what we're hearing, where those firms are
11 deciding not to do business with New York.
12 SENATOR O'MARA: Thank you.
13 SENATOR RITCHIE: Thank you both very much.
14 Thank you.
15 Next we will hear from Denise Richardson, the
16 executive director of General Contractors
17 Association.
18 (Pause in the proceeding.)
19 (The hearing resumed.)
20 SENATOR RITCHIE: So we are going to change
21 the order now.
22 We'll hear from Jolie Milstein, who is the
23 president and CEO of New York State Association for
24 Affordable Housing, and then we will hear from
25 Denise Richardson.
72
1 JOLIE MILSTEIN: Thank you, Senator.
2 Thank you for the opportunity to participate
3 in today's hearing regarding Minority- and
4 Women-Owned Business Enterprise Program.
5 My name is Jolie Milstein. I'm the president
6 and CEO for New York State's Association for
7 Affordable Housing, known as "NYSAFAH," the trade
8 association for New York's affordable housing
9 industry statewide.
10 Our 375 members include for-profit and
11 not-for-profit developers, lenders, investors,
12 attorneys, architects, and others active in
13 financing, construction, and operation of affordable
14 housing.
15 Together, NYSAFAH's members are responsible
16 for most of the housing built in New York State with
17 federal, state, or local subsidies.
18 NYSAFAH strongly support the efforts to
19 encourage greater participation by MWBEs in public
20 and private contracting.
21 Greater diversification of the contractor
22 population ensures a more equitable prosperity for
23 New Yorkers, leads to a stronger, more resilient
24 workforce, and to greater innovation.
25 All of these outcomes contribute to a
73
1 prosperous business climate for which New York has
2 historically been recognized and to which we always
3 aspire.
4 Based on the 2016 disparity study conducted
5 by New York State, we are seeing positive trends in
6 utilization of MWBEs for public projects and
7 procurements.
8 Similarly, in the affordable-housing
9 industry, MWBEs have become a more active part of
10 the affordable-housing industry, as evidenced by
11 their growing membership within NYSAFAH, which now
12 stands at 12 percent of our total membership, and is
13 an even higher percentage of the construction
14 portion of our membership.
15 We are especially proud of this growth
16 because our MWBE members provide dynamic
17 contributions in the development and preservation of
18 affordable housing.
19 They are the architects and engineers who
20 create energy-efficient housing, the developers who
21 bring together many resources necessary to build
22 affordable housing, and the contractors and
23 subcontractors who construct the safe, quality
24 housing that's critical for families to thrive.
25 State funding and subsidies are essential in
74
1 the construction of affordable housing.
2 In 2017, the Senate, the Assembly, and the
3 Governor appropriated 2.5 billion for a 5-year
4 housing plan that will produce around 100,000 units
5 of affordable housing in our state.
6 This was a landmark level of support for
7 housing in New York State, and I would be remiss if
8 I didn't thank you for all your support for these
9 funds.
10 Moreover, use of the subsidies from those
11 funds include MWBE participation utilization
12 requirements, the topic of this hearing and very
13 relevant to NYSAFAH.
14 While we understand increasing MWBE
15 utilization rates is a complex issue, and one that
16 we all take a stake in improving, we believe the
17 efforts should continue to focus on enhancing the
18 administration of the existing MWBE requirements.
19 We hear from MWBEs in the affordable-housing
20 industry that the regulatory burdens and
21 inefficiencies in the program create challenges for
22 MWBEs.
23 Many working in the housing field tend to be
24 small, with 10 or fewer employees, and lack
25 significant capital.
75
1 Even more, lack of staff resources to fill
2 key compliance requirements imposed by the State,
3 prompting many to forgo opportunities where the
4 State is a party.
5 The State should create a system with fewer
6 regulatory burdens for MWBEs, or, at a minimum,
7 greater financial and technical assistance, such as
8 the availability of no-cost or low-cost program
9 software, in order to comply with various State
10 recordkeeping and reporting obligations.
11 Administration of the MBE (sic) program has
12 improved over the years; however, there remain many
13 impediments.
14 The certification, recertification, process
15 for an MWBE can take up to three years,
16 significantly more time than the typical three-month
17 certification-approval process in New York City.
18 One commonsense improvement would be for the
19 State to expedite recertification where the MWBE is
20 already performing services pursuant to an awarded
21 State contract.
22 MWBEs should also be allowed to update
23 their profiles to include their certification
24 status, their MWBE certification expiration date,
25 and capacity-related information, such as the size
76
1 of the largest project worked on, the percentage of
2 work that's self-performed, general and excess
3 liability limits, and references.
4 Developers and contractors do not want to
5 hire an MWBE, only to then find out its
6 certification is about to expire or it lacks the
7 required bonding capacity to undertake a project.
8 There's also too much duplication in
9 reporting.
10 For instance, an MWBE operating in
11 New York City and New York State must include their
12 information through two separate portals and
13 databases.
14 We appreciate there are two different
15 jurisdictions, but seeking ways to import
16 information from one database to another would be
17 our modest -- would be one modest efficiency to help
18 these small businesses.
19 This applies to updates in MWBE contractor
20 information as well. Efforts must be made to ensure
21 that the MWBE only has to input updated information
22 once.
23 Moreover, the list of MWBEs from which
24 developers and contractors can select is in need of
25 improvement.
77
1 One common complaint shared with NYSAFAH is
2 that this -- the list of MWBEs lacks companies in
3 key major trades, including excavation, foundation,
4 plumbing, and structural steel, precast concrete,
5 among others, making it difficult to satisfy
6 utilization-plan requirements.
7 Accordingly, while developers must agree to
8 certain MWBE utilization goals, it makes sense that
9 the State should have goals to increase the number
10 of listed MWBEs, in total, and by category of
11 work, to actively market through outreach events
12 across the state to fulfill those goals.
13 The State could even go further by helping
14 identify MWBEs with experience in key areas.
15 The division of homes and community renewal
16 could, for example, provide a list of MWBEs
17 participating in affordable-housing projects to the
18 division of minority and women business development,
19 which could include the information on MWBE profile,
20 and provide an overall list to the
21 affordable-housing industry.
22 There is significant potential to collate the
23 data held by the State to help increase MWBE
24 participation and visibility and to market upcoming
25 opportunities on public projects if the State is
78
1 willing to invest in the systems to do so.
2 A more immediate reform that the State and
3 Assembly have championed is a proposed change to the
4 MWBE net-worth criteria.
5 Currently, each minority- or women-owned, or
6 upon whom MWBE certification is based, cannot have a
7 personal net worth in excess of $3.5 million.
8 This limitation prevents otherwise qualified
9 MWBEs from participating in public contracts.
10 The criteria encourages MWBEs to underperform
11 in order to remain on the net-worth threshold, and
12 punishes them when they are successful.
13 It is for this reason that we support
14 legislation sponsored by Senator Ritchie and
15 Assemblywoman Peoples-Stokes, and passed by the
16 Senate and Assembly earlier this year.
17 The legislation would provide for additional
18 certification classifications for MWBEs that are
19 otherwise ineligible to be certified due to
20 personnel net worth or the small-business criteria.
21 While we prefer eliminating, or raising, the
22 net-worth threshold, given that the Governor has
23 vetoed such legislation in 2017 based on legal
24 concerns, we believe the current legislation is a
25 reasonable solution to the net-worth issue.
79
1 We hope Governor Cuomo will approve the
2 legislation and enact this commonsense reform.
3 Thank you for your opportunity to testify
4 today, and for your consideration of NYSAFAH's
5 comments regarding the MWBE program.
6 I'm happy to answer any questions.
7 SENATOR LITTLE: You know, one question comes
8 to mind, and I don't even know if this is being
9 done, but, in the housing industry, it's pretty
10 close-knit, and all.
11 Is there any -- ever any best-value
12 attributed to an MWBE-certified business, whether --
13 or, quality of work, or standards, or --
14 JOLIE MILSTEIN: You know, it's generally
15 word of mouth. There's no formal network that
16 I know of.
17 But as you well know, this is a very tight
18 labor market.
19 And I think that successful developers that
20 have a bench, a deep bench, I don't think they're
21 particularly broadcasting that around just because
22 it's such a tight labor market.
23 So, I don't know how collegial people are in
24 sharing their best subs and contractors.
25 SENATOR LITTLE: Nor do I know how the State
80
1 would evaluate every one of these businesses.
2 Then I know one contractor who hired an
3 asbestos-removal company that was an MWBE, that
4 could not do the work. And they had to give up on
5 that one and hire another one.
6 And the second contractor used a power washer
7 to get rid of the asbestos.
8 It's not quite the best idea in a renovated
9 building.
10 And in the end, the result was terrible.
11 And the current contractor lost a -- the job
12 and, you know, had consequences.
13 JOLIE MILSTEIN: I'm not aware of, within the
14 program, an evaluation system on past performance.
15 But it certainly is something that might
16 improve the whole --
17 SENATOR LITTLE: I would think, at some
18 point, as we go through this, they have to get to a
19 point where you -- you know, you get a 3-star,
20 4-star, or 5-star rating as an MWBE.
21 But, I mean, upstate, we don't have enough,
22 so it's, just, if you can get one, you go for it.
23 So, thank you.
24 That's something that, I guess, that has to
25 be done in the future, and we have to look at it.
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1 SENATOR RITCHIE: I'd just like add, you
2 know, I've heard a number of stories too.
3 Another was with an asbestos contractor, that
4 they had heard over and over again, not great
5 reviews, and were really concerned. But that was
6 the only company that would fall under an MWBE, for
7 them to attempt to get to their quota.
8 And, you know, the program has merit, and we
9 need to find ways to make the program work better.
10 But, making a contractor hire a business that
11 they know is not going to be able to perform is not
12 the right way to do it.
13 JOLIE MILSTEIN: That doesn't help anyone,
14 and it certainly isn't a good use of taxpayer
15 dollars.
16 SENATOR LITTLE: No.
17 SENATOR RITCHIE: Thank you so much;
18 appreciate the testimony.
19 JOLIE MILSTEIN: Thank you for your time.
20 SENATOR LITTLE: Thank you.
21 SENATOR RITCHIE: Denise.
22 DENISE RICHARDSON: Good afternoon.
23 It's nice to see all of you again.
24 Before I get into my specific remarks, I just
25 want to touch on some things that the prior speakers
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1 have talked about.
2 First of all, New York City's MWBE program
3 does have a cap; however, it's not about personal
4 net worth. It is about size of contract awards.
5 So in the New York City MWBE program, if you
6 have received over $50 million worth of contract
7 awards in a 3-year period, you are considered to
8 have graduated.
9 So that's an important distinction.
10 But one of the things that I think works
11 about that, is that it's tied to actual amount of
12 work that a company has received and about the size
13 of the company's business, as opposed to the
14 personal net worth of the owner.
15 So -- and we recommended in prior hearings
16 that the State look at a size-of-business model for
17 graduation as opposed to personal net worth of the
18 owner.
19 SENATOR O'MARA: Is that an annual
20 calculation?
21 DENISE RICHARDSON: It's over -- it's a
22 rolling 3-year period.
23 SENATOR O'MARA: Rolling 3-year period?
24 Okay.
25 DENISE RICHARDSON: Which is helpful, because
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1 it also kind of takes into account, particularly for
2 construction, that if you're working on a prime
3 contract, that's also about the average duration of
4 a prime contract, so, it works.
5 So I just wanted to make that point.
6 The second thing I wanted to point out is,
7 I know that you have focused a great deal on
8 certification, and I know that you reacted very
9 favorably to New York City's time frame of
10 certification.
11 And it is -- the certification process itself
12 is much more efficient in New York City than in
13 New York State.
14 However, in New York City, the MWBE program
15 suffers from a very big disconnect between
16 certification, which is about, is the company a
17 minority- and women-owned business versus the type
18 of work that the business actually performs?
19 And in New York City, the focus is on
20 certification as to MWBE status.
21 And it is, basically, up to the MWBE firm
22 to -- in a completely separate system that is not
23 managed by the department of small business services
24 that is doing the certification, the MWBE firm, in a
25 separate system known as the "payee information
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1 portal," self-selects the type of work that it
2 performs, that it wishes to be known as.
3 That has created enormous problems for the
4 prime-contracting industry in identifying firms to
5 participate in MWBE work.
6 In 2016 the General Contractors Association
7 spent a million dollars of our own money, paid for
8 by our member dues. We are, in fact, a
9 private-sector trade association.
10 But we were struggling with so many
11 difficulties in the list, that we felt as though we
12 needed to provide a service to our members, by
13 surveying the city's MWBE firms, to work with them
14 to straighten out their codes, so that we could give
15 our members some current information about the types
16 of work that firms perform.
17 We found numerous inaccuracies in the list.
18 We turned over all of that information that
19 we collected to the department of small business
20 services.
21 They have corrected some of the information.
22 I believe they're still working with other
23 portions of the information.
24 But to date, right now, in -- on the
25 New York City-certified MWBE list, there are over
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1 1400 firms with no indications whatsoever of the
2 types of work that they perform.
3 And we continue to work with SBS on trying to
4 straighten out the coding, similar to what I talked
5 about when I testified in September at your hearing
6 on Long Island, about the State's need to undertake
7 that same kind of effort to work with the MWBE
8 community to straighten out their certification
9 list.
10 We also took our information and turned that
11 over to ESD as well. And, to date, I am not sure to
12 the extent that they have made the corrections that
13 we noted in our own research.
14 So I want to point out that, although
15 New York City has a much more efficient
16 certification process, there is still work that
17 needs to be done on matching the certified MWBEs
18 with the type of work that they perform.
19 Also, I would like to also correct some
20 information about what happened on the
21 Tappan Zee Bridge.
22 The prime contractors on the
23 Tappan Zee Bridge are General Contractors
24 Association members.
25 And when Deborah Bradley brought it --
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1 brought to my attention what happened, I asked them,
2 you know, what the circumstances were.
3 She's completely right when she talks about
4 the issue of commercially useful function.
5 On a large construction project sometimes
6 there are oversights.
7 Her contract was silent on the issue of
8 providing a crane.
9 The prime contractor did not specifically
10 indicate in her subcontract that she would have use
11 of their crane; and so, therefore, when the DBE
12 program manager looked at her situation, a
13 determination was made that, in order to prevent a
14 later violation of a commercially-useful-function
15 standard, she needed to provide her own crane.
16 However, it's being perceived as though the
17 prime contractor denied her that, and I don't think
18 that that is a fair assessment of the situation.
19 It does point out the fact, though, however,
20 that when you look at commercially useful function,
21 there are two things that need to take place.
22 Number one: The firm has to come to the
23 table with the ability to do the work that they are
24 subcontracted to -- that they are contracted to
25 perform.
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1 Certainly, in the case of Deborah Bradley,
2 her firm certainly has the technical capability to
3 perform the work that she was subcontracted to do.
4 The issue of the crane was an oversight on a
5 very large project.
6 What needed to happen in that process was a
7 very quick decision on the part of the government
8 agency involved. And that's not what happened in
9 this case.
10 And because they needed to move the job
11 along, and they couldn't get clear direction, the
12 decision was made to tell her to provide her own
13 crane.
14 That's a very different scenario than saying
15 that the prime contractor refused to assist their
16 MWBE sub.
17 It comes back to, on a construction project,
18 time is of the essence, and these kinds of
19 administrative decisions need to be made quickly.
20 So with those things being said, what I would
21 like to mention today is, you know, in looking at
22 the whole MWBE program at the level of detail that
23 the General Contractors Association certainly has,
24 one of the things that we have noticed is that the
25 documentation for good-faith effort is completely
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1 paper-oriented.
2 Thousands of pages of spreadsheets and
3 telephone logs and letters are submitted for prime
4 contractors to document their good-faith effort in
5 their efforts to meet what are, in fact, the MWBE
6 requirements.
7 There has been a lot of discussion about
8 needing to do a better job on the part of the
9 government agencies of identifying firms to
10 participate in capacity-building programs.
11 The good-faith-effort documentation, if it
12 were automated in a searchable-type database, where,
13 you know, ESD or DOT or any of the agencies could
14 query the documents, they could find out:
15 Who's bidding?
16 What types of jobs are they bidding on?
17 Why is someone who's in a "structural steel"
18 code only bidding on painting work?
19 That's probably a good indication that
20 they're in the wrong code and they're a painter, and
21 not a structural steel erector.
22 Right now, with all this paper, there's no
23 way to generate any value out of all of the
24 information that's being collected.
25 And, in fact, for our members, what we find
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1 repeatedly, is that we will submit boxes of
2 documents, and the agency will say: We're not even
3 going to look at that. Our definition of
4 "good-faith effort" is to meet the goal.
5 That's a separate issue that we will not get
6 into today.
7 But I think in terms of your recommendations,
8 going back to how to strengthen the MWBE program,
9 what should be looked at is a partnership with the
10 industry to develop an automated way of submitting
11 good-faith efforts so that we can get some value out
12 of the information that our members are spending
13 millions of dollars to collect.
14 And that's my recommendation for today.
15 And I'll answer any questions you have.
16 SENATOR RITCHIE: First, I want to say, thank
17 you, because I know you've been at several hearings,
18 and you put in a lot of time making sure that we
19 heard your members' concerns.
20 So, I want to thank you for that.
21 DENISE RICHARDSON: Thank you.
22 SENATOR RITCHIE: Just a quick question on
23 the crane scenario.
24 That was the one thing that popped into my
25 head: Was there no way to get any kind of approval
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1 from an agency before they had to spend that money?
2 Is that part of the process, it was too slow,
3 or there isn't any?
4 DENISE RICHARDSON: It was too slow, and an
5 immediate decision had to be made in order to
6 procure the crane in time.
7 And I think that that was unfortunate.
8 And I don't want -- I don't want to cast
9 aspersions on the agency because, obviously, with
10 the Tappan Zee, there were hundreds of decisions
11 that had to be made every single day.
12 But it does kind of show the need for,
13 I think, better coordination on these projects.
14 And we face it also on other projects, where
15 we will, literally, be waiting for a determination
16 from an agency on an MWBE issue, and it's holding up
17 the rest of the project.
18 And so that aspect of the project needs to
19 move faster, which is why, in terms of
20 mentor-protege, we can't be expected to build the
21 job and teach how to build at the same time.
22 What we favor in a mentor-protege program is
23 a model like the school construction authority or
24 like the MTA mentor program, where a separate
25 contractor or consultant is engaged to work with the
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1 firms that are in the program on their own work; not
2 as part of a much larger construction project where
3 the prime contractor, who's trying to meet a
4 schedule and build a scope, and keep -- you know,
5 and manage costs associated with that project, is
6 also trying to teach their MWBE subcontractors how
7 to work at the same time.
8 That is a recipe for disaster.
9 But we definitely support a school
10 construction authority-type model program.
11 SENATOR O'MARA: How much expense does
12 something like that add to a project?
13 Can you give us some examples?
14 DENISE RICHARDSON: I can't really talk about
15 the expense of having a -- of managing a
16 mentor-protege program on a particular project
17 because we have not been in that situation.
18 What I can talk about, though, are the
19 compliance costs that we're facing for our M -- for
20 MWBE efforts, and it is becoming significant; it's
21 millions of dollars.
22 I have one member who told me recently that
23 he has more people on his staff managing compliance
24 issues than he has actually managing projects.
25 That's a scary prospect.
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1 But when you look at, in particular, trying
2 to meet a 30 percent goal, when most subcontracts
3 are of a smaller dollar value, and you have more
4 subcontractors on a project than you've ever had
5 before, and so you're slicing the work into ever
6 smaller pieces in order to meet a goal that's based
7 on a total-dollar value of the project, not just on
8 subcontractible work, you're adding additional
9 supervisors, you're adding additional
10 superintendents, you're adding additional safety
11 people.
12 And so it's starting to increase the overhead
13 cost exponentially, which is not really being
14 reflected in agency estimates.
15 SENATOR O'MARA: Are you recouping that cost?
16 DENISE RICHARDSON: I would not be able to
17 say yes in every instance.
18 SENATOR O'MARA: If you are recouping the
19 cost, that's adding to the overall cost of the
20 project?
21 DENISE RICHARDSON: It's definitely adding to
22 the overall cost of the project, there's no question
23 about that.
24 Where it becomes problematic for a prime
25 contractor is, if the project, for whatever reasons,
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1 is delayed; if there are many, many change orders;
2 and the overhead of the project starts to get
3 squeezed by a schedule that has gone beyond what the
4 prime contractor anticipated, that's where the cost
5 becomes significant.
6 SENATOR LITTLE: Thank you.
7 Going back to the crane, I hate to do that,
8 but, is what happens here is:
9 The prime contractor is not an MWOB.
10 So, the subcontractor is.
11 But if the subcontractor wanted to rent the
12 crane, the prime contractor is afraid he'd get
13 penalty for helping that subcontractor, and making
14 it look like they -- you were just using that
15 subcontractor to get your MWBE -- help your goal,
16 and it wasn't real?
17 Is that --
18 DENISE RICHARDSON: Yes, our members have
19 faced a number of issues in terms of perceived
20 violations of commercially-useful-function
21 standards. And there are many cases associated with
22 that.
23 The way the auditors, the agencies, the
24 investigators, look at it is that, the subcontract
25 must lay out, in great specificity, exactly what the
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1 responsibilities of the subcontractor versus the
2 prime contractor will be.
3 Had the subcontract said, You will be
4 entitled to use our crane, there would have been no
5 issue.
6 It's not that the
7 commercially-useful-function standards prohibit
8 that. It's that it must be documented.
9 In this instance, the subcontract did not
10 say, "you will be entitled to use our crane"; and,
11 thus, when that oversight was discovered, it became
12 a question of, you know, are we permitted to allow
13 our subcontractor to use the crane, given that her
14 subcontract did not spell that out?
15 SENATOR LITTLE: Is there a way to put some
16 clarity in this, or clarify those guidelines, or
17 make it easier and clearer for the prime contractor
18 to understand and the subcontractors to understand?
19 DENISE RICHARDSON: I think that what has
20 happened, certainly to our members, and other
21 contractors around the country, now that this issue
22 is being looked at, is that the whole issue of
23 commercially useful function becomes an audit issue
24 several years after the project has been completed.
25 And so I think, certainly for the
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1 General Contractors Association members, which is
2 whom I'm speaking on behalf of today, we would be
3 extraordinarily concerned about any program language
4 that left it vague in one way or another.
5 And we have been told, you know, by the
6 various prosecutors at different times, that what
7 they look for is the deep pocket to make, you know,
8 this a revenue case.
9 So we would be extraordinarily reluctant, and
10 concerned, about any standard that allowed a
11 judgment call based on the need.
12 We would support, you know, engagement by the
13 agency, affirmative determinations by an agency,
14 yes, you can do this; no, you can't do that.
15 However, I wish to point out that, in
16 instances where we have brought issues to an agency
17 concerning the viability of an MWBE firm, because we
18 felt as though they could not provide the function
19 that they represented they provided, we have been
20 told by the agency, Well, you need to meet the
21 requirement. Go ahead and use the subcontractor.
22 And our members have repeatedly taken firms
23 off their utilization plan because they raised
24 questions themselves, and they could not get
25 assistance from the agency.
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1 So we're not in a position where we are
2 willing to take liability for something where, later
3 on, our company's reputation will suffer.
4 And that's why we support -- the
5 General Contractors Association supports the
6 commercially-useful-function standards as they are
7 written.
8 And in the event that an MWBE or group of
9 MWBEs need assistance, to manage that separately
10 through a mentor program under a separate contract
11 by the agency.
12 It's just too much liability and risk for us.
13 SENATOR LITTLE: Do you have instances where,
14 when they go to do the final audits for the
15 payments, that they deduct or they disqualify some
16 of your MWB -- -OB contracts?
17 DENISE RICHARDSON: Yes.
18 SENATOR LITTLE: And then they won't pay?
19 DENISE RICHARDSON: Yes.
20 SENATOR LITTLE: And that's happened often?
21 DENISE RICHARDSON: Yes.
22 SENATOR LITTLE: Well, there's got to be a
23 way to avoid that, somehow, if they have accepted
24 this.
25 I had one, where it was a State grant;
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1 therefore, it had to be MWB -- -OB goals. And it
2 was for a city civic center, they bought a big
3 jumbotron.
4 And it was listed on the list of MWOB
5 contractors that they could buy from, and they
6 bought it.
7 But they said, after it's up, then used for
8 six months, great thing.
9 Then they said, Well, that contractor didn't
10 really build the screen and the unit. It was a
11 Panasonic.
12 So suddenly, now, they took away a huge
13 percentage of their things.
14 In the end, we had to work to get a waiver,
15 and everything else, because there was no way to
16 correct that. And that they shouldn't have been on
17 their list.
18 But, you know, it's just almost impossible at
19 times.
20 There's got to be more flexibility, and there
21 has to be more clarity, in this whole program.
22 DENISE RICHARDSON: Well, I think to your
23 point, that scenario that you described has happened
24 to us frequently.
25 And we have found, at the end of a project,
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1 where the agency, you know, is coming through and
2 making those exact determinations.
3 And I agree that there needs to be
4 flexibility to reflect, certainly in the case of
5 construction, how the construction industry works,
6 or in the case of providing goods and services, that
7 not every person who is a legitimate supplier may
8 stock every single item.
9 And I do think that, in many instances, the
10 rules were written in a very rigid, black-and-white
11 scenario without accounting for how business really
12 works, how things will happen on a project.
13 At the same time, because of what, certainly,
14 the GCA members have encountered, I am very
15 concerned about guidelines that would be too loose,
16 that would lead to, later on, second-guessing.
17 I think it's better to spell out up front
18 exactly what the expectations are that everybody
19 abides by.
20 But to your point about what happened with
21 one of your constituents, we face that all the time.
22 SENATOR RITCHIE: It still is confusing to me
23 how this is only a goal, and that so many companies
24 face penalties, and money is held back, when it's
25 not a requirement. It's an aspirational goal.
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1 So...
2 DENISE RICHARDSON: I think that our next
3 speaker, who represents a company who is a GCM
4 member, will speak to that in detail.
5 There is a perception that the
6 prime-contracting industry just does not want to
7 make the program work.
8 And nothing could be further from the truth.
9 As prime contractors, the way that we are
10 successful is by bringing the best team of
11 subcontractors who are available to the table at all
12 times.
13 Prime contractors and their subcontractors
14 make money when they finish a job ahead of schedule;
15 not late.
16 So it's in our interest to bring on any
17 project that we're bidding, the best subcontractors
18 that we can find, that can help us deliver that job
19 ahead of schedule.
20 So I think that there is a myth that we don't
21 want the MWBE program to be successful.
22 I also want to point out that most of the
23 prime contractors today started out as small
24 subcontractors, and grew their businesses to become
25 primes.
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1 So, if there's any group of people that wants
2 to see a robust subcontracting industry, it's us,
3 because that's how we all started as well.
4 SENATOR O'MARA: Do you -- as I have asked
5 the other individuals testifying, what the numbers
6 of your organization are, MWBEs, and are actually
7 certified?
8 DENISE RICHARDSON: We have about 20 percent
9 of our membership who are MWBEs.
10 We have two companies, in particular, that
11 started out as MWBE subcontractors purely, have
12 graduated from the program.
13 And, now, while they demographically would be
14 considered minority-owned businesses, they are no
15 longer participants in the program and bid in the
16 prime-contractor open market.
17 SENATOR O'MARA: How many members do you have
18 altogether?
19 DENISE RICHARDSON: 300.
20 SENATOR O'MARA: You know, there's a lot of
21 concern, the need for this program. And
22 I understand contractors do want to see this work
23 and be successful.
24 And it's important for us on this panel, and
25 the Senate, to make sure we have a working thing.
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1 But some of these, what I call "quotas," and
2 not goals, are causing problems within the program.
3 But there's also, to look at it from the
4 need for it, that this is to help these MWBEs
5 break through what's commonly referred to as
6 "the old-boys' network."
7 Can you comment on that kind of feeling?
8 I mean, it's, like, you got the big 'ole boys
9 that always play with themselves, share contracts
10 with themselves, and kind of block out these smaller
11 up-and-coming entities.
12 DENISE RICHARDSON: You know, before I came
13 to the GCA, I worked for over 20 years at various
14 public agencies as -- in procurement.
15 And I appreciate the perception that it's an
16 old-boys' network.
17 But in a competitive-bidding situation, the
18 bidding is available to the open market. And
19 whomever bids, and whoever is the lowest responsive
20 and responsible bidder, gets the job.
21 The issue, in terms of what we would call,
22 you know, "the club of contractors," is driven by
23 other forces.
24 If you look at public-agency contracts,
25 they're extraordinarily adversarial, extraordinarily
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1 complicated.
2 And so for a firm who has never bid on a DOT
3 contract, and let's say they're a very successful
4 MTA contractor, and now it's the first time that
5 they're coming to bid a DOT contract, it's a whole
6 new process of bidding and contract requirements and
7 specifications.
8 And so what tends to happen over time -- and
9 the construction industry is, you know, fairly
10 specialized -- if you are a contractor that, you
11 know, builds wastewater treatment plants, you've
12 developed an expertise. You know the technology.
13 You know the requirements. You have a workforce
14 that you have trained in that specialty. Same way
15 if you're a bridge builder or a paving contractor.
16 So the perception of the old-boys' network is
17 really driven by the type of work the firm performs,
18 the specialties that they have; the agencies where
19 they know the specifications, they know the
20 requirements, they know the expectations.
21 And just like in medicine, you know,
22 construction also has become much more specialized
23 over the years.
24 So you see a group of contractors that
25 consistently bid for state DOT, or maybe for city
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1 DOT, or whatever, which is more driven by the
2 contract terms, the type of work; also, the
3 portfolio of projects that are in any given capital
4 program.
5 And one of the biggest barriers to entry for
6 new contract -- new prime contractors in particular,
7 and we've really seen this with State DOT, where you
8 have seen gaps in years when the agency did not have
9 an approved program.
10 Contractors look on a 12- to 18-month
11 schedule of what's coming out to bid in a certain
12 agency.
13 When we've gone for, you know, a year or two
14 with the MTA capital program, for example, being
15 rolled over, or, the DOT capital program, you know,
16 being uncertain as to what projects are going to be
17 in the portfolio, that takes that group of
18 contractors saying: I don't know what to do.
19 Should I bid in another state? Should I move to
20 another market? Should I, you know, lay off some of
21 my key people? What should I do?
22 And the best way to assure that you have a
23 robust pool of new firms is to have an ongoing
24 portfolio of work that's being bid, because,
25 particularly for infrastructure work, if you're an
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1 infrastructure contractor, your market is,
2 typically, the public sector.
3 On the building side, they will switch back
4 and forth between public and private work with much
5 more flexibility.
6 But if you're an infrastructure contractor,
7 the public sector is your market.
8 SENATOR O'MARA: Thank you very much.
9 SENATOR RITCHIE: Thank you.
10 DENISE RICHARDSON: Thank you.
11 SENATOR LITTLE: Thanks, Denise.
12 SENATOR RITCHIE: And our last speaker
13 for today is J. Naomi Glean, EEO officer,
14 WDF, Incorporated.
15 J. NAOMI GLEAN: Good afternoon.
16 Thanks so much for having me, allowing me to
17 speak.
18 Thanks so much for showing so much interest
19 in this topic.
20 I am, I think, the only person representing
21 the prime contractor today, and the only MWBE
22 officer to speak to you, so, I'm hoping you guys
23 have questions about the day-to-day as well.
24 First of all, I work for WDF, Inc., which is
25 a specialty construction company that works mainly
105
1 throughout New York City, but we are a New York
2 State company.
3 I was a little reluctant to submit my
4 testimony because I'm busy at work, trying to put
5 together all the good-faith efforts that we're doing
6 on our several, several city and state agency
7 projects.
8 But I said to myself, that this is much more
9 important than just getting the next letter out to
10 our agencies, in order to speak to how -- the
11 efficiency that's of the program.
12 First and foremost, we wholeheartedly support
13 the MWBE program.
14 We have a robust program in-house for
15 ourselves, but, we as a group, and myself
16 personally, truly believes that small businesses
17 need a helping hand.
18 Every single large prime contractor, if
19 you've spoken to any of the CEOs, they'll all tell
20 you the long list of people that helped them get to
21 where they are.
22 So, to try to tell ourselves that
23 minority-owned businesses, women-owned businesses,
24 don't need a helping hand just doesn't make any
25 sense.
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1 The program is great to show that there is a
2 disparity in opportunities.
3 But I am here as someone who's worked as an
4 MWBE officer for seven years, to let you know that
5 I've seen some changes in the program, and how prime
6 contractors are viewing the program.
7 The good things, that's more small businesses
8 are getting jobs.
9 All contractors -- all prime contractors that
10 I know are trying to meet the goal.
11 And it is no secret that the agencies are not
12 letting you get away with not meeting the goal.
13 When I started seven years ago, you could put
14 together a one-page letter and say, "I tried my best
15 and I couldn't find anyone," and that would be
16 accepted, and you can go on and -- with your
17 1 percent participation.
18 That is no longer acceptable; that's not the
19 standard.
20 The amount of efforts that we as -- at WDF
21 put forth to provide a good-faith effort takes a
22 department.
23 It takes me training the rest of the company,
24 so that everybody helps me to get to our goals.
25 It starts with our solicitation of MWBEs,
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1 and we rely heavily on the certification on
2 directories that you've been talking about all day.
3 And I'll speak to how we can work on those
4 directories.
5 But it starts with a solicitation, through
6 several means of solicitation, to negotiations for
7 subcontracts and purchasing, to vetting the firms.
8 Which is something that I don't know if you
9 guys are familiar, that the primes spend a lot of
10 time, cost on manpower, on vetting the firms, even
11 though they're on the certified directory.
12 Because one of the biggest issues we have is
13 that there's prosecutors, and then there's the
14 agencies that you work for, and those two entities
15 are not on the same path; they do not think the same
16 way.
17 So the directory, I would suggest -- and
18 I did suggest in my written testimony, that the
19 certification process is more robust.
20 I know we've spoken about how long it takes
21 people to get certified, but I'm -- quite frankly,
22 I don't think enough is being asked during that
23 certification process.
24 When we vet a firm, we're looking to see that
25 the 51 percent owner is the minority, is the woman,
108
1 but that they have their own staff to do the work
2 that we're going hire them to do, that they have
3 their own equipment to do the work, and that they
4 have a facility that is capable of doing what
5 they're supposed to be doing.
6 We spoke -- someone else spoke about
7 self-certification.
8 There are some firms that check off the boxes
9 of what they do.
10 And I am not convinced that the agencies are
11 looking at exactly what those firms do.
12 In order for me to take credit for an MWBE,
13 they have to be certified with the agency, but
14 certified for a particular work.
15 And so if the work that they're certified for
16 is not the work that they're bidding on, then
17 I can't take the credit for it.
18 If I find out that they are certified to do
19 one thing, and then they've offered to do these
20 whole other five things, I can't take credit for
21 that either.
22 A lot of times the agencies can tell that
23 we're paying a minority- or woman-owned business,
24 and so they say, Why aren't you taking the credit?
25 Well, I know they're not certified to do this
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1 particular work, and so I'm not going take the
2 credit.
3 Or, I vetted and I found some other issues
4 with this firm, and I don't think that a prosecutor
5 is going to look well at what they're doing on this
6 portion, so I'm not going to take that credit.
7 All of these things are major issues in the
8 certification process.
9 You may be certified to do one thing, but
10 then you do another in your contract.
11 And that has to be scrutinized a little more
12 in the certification process, in my opinion.
13 When I go to the different events, sort of --
14 networking events, firms come up to me and they say,
15 Oh, I don't -- I haven't gotten an e-mail. How do
16 I give a bid to your company?
17 I say, Well, what do you do?
18 They tell me what they do.
19 And I say, Well, I go to the directory and
20 I pull down every single MWBE that does that scope
21 of work, and I have sent them a fax, an e-mail, and
22 we've called them. You haven't gotten any of those
23 things?
24 No.
25 Well, what are you certified?
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1 Well, actually my certification's for a
2 different thing, but I'm going to change it.
3 There has to be more scrutiny on the
4 certification list.
5 In terms of the goals, some people are
6 talking about how the goals are assessed.
7 It is my understanding of the regulations,
8 that a goal is supposed to be assessed to the actual
9 project.
10 Right now there is just a general number that
11 is given, and it is assessed to every single
12 project, which does not take into account when there
13 is specialty work.
14 WDF is a specialty contractor. We do
15 plumbing and we do heating work and we do sprinkler
16 work. Half of the work we do has to be done under a
17 license.
18 So the sprinkler work we do and the plumbing
19 work we do has to be done with the licensed holder,
20 and so we cannot subcontract out the work that's
21 under our license. So there's that whole chunk of
22 work that we can't sub out unless we totally give
23 away our -- we win the bid and then give away the
24 whole project.
25 And then, on top of that, the -- we're a
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1 union shop. And so any company that works with us
2 has to be a part of the union or sign up with an
3 agreement.
4 And there's no conversation -- there's not
5 much conversation about the fact that the
6 certification list is dwindled by a lot when you
7 look to see who is unionized, and who is willing to
8 sign up on one -- for one agreement with the union
9 per project.
10 That takes a lot of people out of the running
11 in working with your -- working on our projects in
12 particular.
13 The goals right now are a general number.
14 And then, if we cannot meet the goal, then we
15 have to present good-faith efforts.
16 Now, my good-faith efforts are binders,
17 sometimes boxes worth, of documentation of who we've
18 e-mailed, who we've faxed, who we've called, who
19 we've negotiated with, and the e-mails back and
20 forth.
21 And 99 percent of the time no one looks at
22 all of that documentation. Everybody just wants you
23 to meet the number, and that is all. Do not talk to
24 me until that number is met, and that's it.
25 So we're at a place, it's kind of backwards.
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1 I feel that the agency -- that the government
2 should look at the contracts, see what is actually
3 available to subcontract out, what's actually
4 available to purchase, and then set the goal on
5 that.
6 Now, the SCA uses that goal. They -- their
7 goals are centered around what is subcontracted out.
8 So they ask the prime contractor, What are
9 you actually subbing out? What is the value of
10 that? Who are all the firms you're using.
11 And out of that value, that's where your goal
12 is; and that to me makes the most sense because you
13 know exactly what everybody is doing.
14 Everybody is actually -- I'm going to sub out
15 some of my work. I'm not going to do it all.
16 But that portion -- a portion of that should
17 go out to minority- and women-owned businesses.
18 And where we can go above and beyond, we
19 definitely do.
20 In terms of, back to certification, not only
21 is there a cost to extra vetting by the prime
22 contractors, we're looking to see if the firms can
23 provide a commercially useful function.
24 And right now, we do not -- I do not believe
25 that there's enough guidelines across the board of
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1 what a "commercially useful function" actually is.
2 Because we're very -- at WDF, we scrutinize
3 the rules, the regulations. We're very cautious on
4 what we take credit for.
5 And I do not believe that every prime
6 contractor feels the same way, I do not feel that
7 every agency feels the same way, or all the
8 prosecutors feel the same way.
9 I have had many agency reps tell me, Just
10 take the credit because they're on the certified
11 list.
12 And the very same firm, I've had a prosecutor
13 tell me, You should have known you can't take credit
14 for that firm because they're not legitimate MWBE.
15 There has to be guidelines so, across the
16 board, all the primes know we're all on the same
17 playing field, because, the higher the goal gets, it
18 leaves room so people to do things illegally and try
19 to get around the system in order to meet those
20 numbers.
21 So we spoke about -- other people spoke about
22 the mentor-protege programs; giving assistance to
23 minority- and women-owned businesses.
24 I would like to see more paths to give small
25 companies a helping hand, but our industry right now
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1 is based in perception.
2 There is a lot of gray area, that you don't
3 know exactly how it's going to shake out if you do a
4 certain thing.
5 And so, if we can figure out actual
6 guidelines for what "help" means, and how you can do
7 it and still take credit.
8 I will tell you that I have two letters out
9 right now to agencies, asking if I can do a certain
10 thing and still take credit for MWBEs.
11 And it's been months, and I haven't gotten a
12 response.
13 And so if I've been doing it for seven years,
14 the company's been doing it for longer, we don't
15 know the answer, and the agency is not responding,
16 then I can only assume that other companies are
17 dealing with the same thing.
18 If there's some sort of guideline book that
19 all firms can have, it would be helpful.
20 And dealing with MWBEs directly on a
21 day-to-day basis, I would tell you that they need
22 the guidelines more than anybody else.
23 If you're a small business, what I've seen
24 is, that you hear: That if you become
25 MWBE-certified, you would probably get more
115
1 contracts. Your company will seem more interesting
2 to larger companies and you'll get more
3 opportunities.
4 But that's about it.
5 They don't read the rules and the regs the
6 way that we do, they don't have a staff to go over
7 and look over the news and what's going on, because
8 they're building.
9 They're usually, 10, less than 50, people,
10 and they're building, and they're trying to get
11 their -- get their projects done.
12 And so they don't know the rules.
13 And when a company comes to them with some
14 scheme, that they say everybody else is doing, then
15 they join up.
16 And so, if we all had a -- guidelines, that
17 would help, especially with the MWBEs, because I get
18 a lot of calls from MWBEs asking me to do things
19 that I deem illegal or wrong.
20 But they say, Well, this other company did it
21 and it's fine, nobody said anything.
22 But, we get audited later, and we don't want
23 to have -- be answering the questions after the
24 fact.
25 We would like to know up front, this is
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1 exactly what you can do, this is following the
2 rules; and we're glad -- we're happy to follow them.
3 The certification lists, they seem very long.
4 But when you look at the kinds of work, the
5 specialty work, you're bringing down numbers a lot.
6 When you're looking for union workers, the
7 numbers are going down even further.
8 And so there has to be some more work by the
9 government to actually do training or recruitment
10 for companies that do this specialty work on
11 projects.
12 I am much more concerned in your questions.
13 I've written a lot more, so you can take your
14 time and read it.
15 But I'm much more interested in your
16 questions about day-to-day MWBE utilization.
17 SENATOR LITTLE: Yeah, one of the things you
18 talked about was greater vetting of the companies.
19 I will tell you that that's -- up north, in
20 our area, because we don't have as many, maybe
21 that's it.
22 But, they are vetting them to the point where
23 they don't understand a family-inherited business.
24 And they find that the women-owned business,
25 managers, are making more money than somebody that
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1 has been with the company, you know, when it was
2 owned previously for many, many years.
3 They get denied; absolutely denied based upon
4 that.
5 Which -- so they are vetting, and
6 I understand, they need more staff.
7 And I think that's the only way to get to
8 that.
9 The other thing that I would ask you:
10 I had a company that manufactured, something,
11 and I don't remember what it was. And then they
12 were having trouble with the implementation, getting
13 it put in. So they decided they would put it in.
14 They had to start a whole certification over
15 again because that was a new function of their MWOB.
16 There should be a way that you can grow your
17 business by expanding what you do.
18 And, yes, letting them know that, and qualify
19 under another category, but not starting over.
20 J. NAOMI GLEAN: Yeah, I'm not sure how that
21 process works.
22 I know I've worked with a company that
23 manufactures windows, and, they want to install
24 them, but they're not certified to install.
25 And they have the staff --
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1 SENATOR LITTLE: Very similar.
2 J. NAOMI GLEAN: -- and they're capable to do
3 it.
4 And, you know, it's really -- as far as
5 I know, I've been told that they just have to put in
6 more paperwork that says that they can do that.
7 And they haven't -- they haven't had the
8 interest in doing that. And I don't know why that
9 would be a hard thing to do.
10 SENATOR LITTLE: Maybe it's not a total
11 startover, but this company got penalized because
12 they were, you know, including that, and then that
13 couldn't be part of their --
14 J. NAOMI GLEAN: To your point on the WBE
15 standards, and certification, there's no black line
16 that says exactly what a woman is supposed to do,
17 what a minority is supposed to do, as the owner --
18 the 51 percent owner of the company.
19 So that also adds to some confusion.
20 Sometimes, when we go out to meet company
21 owners, you're kind of making a guess on, you know,
22 how much do they know about the company, and is
23 doing the payroll enough work to be the 51 percent
24 owner, or is that a sham?
25 And another -- you know, that's another nod
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1 to guidelines across the board, because the woman
2 could be there every single day, and then someone
3 else comes in and says, Well, she doesn't know
4 enough. She doesn't do enough on a daily basis.
5 SENATOR LITTLE: Right.
6 And, I had a brother and sister inherited a
7 company, so the sister had the 51 percent.
8 But since she was the office manager, the
9 bookkeeper, the organizer, the hiring, the human
10 resources, but he was in sales, and so they got
11 denied, because he was doing more.
12 But they don't give the same credit to what
13 the woman is doing, yeah.
14 Thank you.
15 J. NAOMI GLEAN: You're welcome.
16 SENATOR O'MARA: How much time do you spend
17 on a typical project in tracking down all of these
18 eligible MWBEs to meet your quotas?
19 J. NAOMI GLEAN: To meet -- to start the
20 plan, you're asking?
21 SENATOR O'MARA: Yeah.
22 J. NAOMI GLEAN: Well, our bid list is at
23 least ten projects long at any given moment, and we
24 spend a lot of time reaching out to the MWBEs.
25 I have a dedicated person in my office who
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1 sold -- well, her major role is to solicit firms.
2 So she's e-mailing, faxing, calling, all these
3 firms, and then following up with the e-mails.
4 And then the estimators are also following up
5 with the specific questions that the contractors
6 have.
7 So it's a little hard to figure out exactly
8 how much time it is, but it's definitely enough to
9 have a full-time person, plus other people, in the
10 company, monitoring that.
11 And then we have to gather all of that
12 information to get it back to the agencies.
13 SENATOR O'MARA: You're doing the work
14 because, I guess, kind of what I'm getting at, is
15 how many workers, how many employees, are doing this
16 work?
17 You're overseeing it.
18 You do other work as well, in addition to the
19 monitoring these MWBE projects? Or --
20 J. NAOMI GLEAN: No.
21 So, my sole responsibility is to work on
22 minority- and women-owned businesses.
23 Well, also, EEO issues.
24 And so I'm working from the beginning of the
25 project with the solicitation, all the way through
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1 to the end.
2 So, monitoring how we're using those firms,
3 and making sure that they're still providing a
4 commercially useful function throughout the project.
5 And then reporting how we're spending funds with
6 them. And answering any questions from the agencies
7 and the owners.
8 So it's myself, one other person with me.
9 And then the -- I meet with the project
10 managers on a monthly basis, to ask them to follow
11 up:
12 How are they -- minority-owned business
13 working?
14 Are they -- do they still use their own
15 staff?
16 Do they still have their own equipment?
17 Have they asked you for anything?
18 Do they need help fielding any issues they
19 have?
20 And then the estimators are, and purchasing
21 department is, also working to, you know, make sure
22 that we seal the deals with these minority- and
23 women-owned businesses.
24 So it's a lot of people working to make sure
25 that we meet these goals.
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1 SENATOR O'MARA: Now, as it comes to the
2 state program, which we're here primarily dealing
3 with, have you received any waivers?
4 J. NAOMI GLEAN: Far and few in between.
5 Let's see, just on state.
6 I don't remember the last time I got a waiver
7 on a State project.
8 And that does not mean, I try; I try all the
9 time.
10 But, I can't remember the last time I got a
11 waiver on a State project.
12 SENATOR O'MARA: And you submit all the
13 good-faith effort work you go through, and your
14 staff goes through, and everybody in the company
15 that's working on this, and you document it all, and
16 send your binders or boxes full of documentation,
17 it's not being looked at?
18 You're just being told, No, you got to get to
19 30 percent?
20 J. NAOMI GLEAN: Yeah, and, I mean, I'm not
21 going to tell you every single time they don't look
22 at it.
23 But, if I send you several binders worth of
24 information, and -- at 5 p.m., and then, at 10 a.m.
25 the next day, you say that my waiver is denied,
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1 I assume you didn't get to look through all of that.
2 And, to be honest, I've never asked for a
3 complete waiver. It's only partial waivers, because
4 we believe in the program, and we do subcontract out
5 to minority- and women-owned businesses, and
6 purchase materials.
7 So, it's never an entire waiver.
8 And I think, because it's not a full waiver,
9 and they see that we've gotten so close, they say:
10 Well, we'll just give you a little more time, you'll
11 figure it out. The project's not over yet, keep
12 going, something will pop up.
13 And so it's very hard to get a waiver,
14 especially at the beginning of the project.
15 At the beginning of the project, I don't
16 remember the last time I got a waiver.
17 SENATOR O'MARA: What's your company's market
18 territory?
19 J. NAOMI GLEAN: We're -- all of our projects
20 are in New York City.
21 SENATOR O'MARA: New York City?
22 J. NAOMI GLEAN: Uh-huh.
23 SENATOR O'MARA: Okay. You don't do anything
24 outside of City here?
25 J. NAOMI GLEAN: We're about to start one in
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1 New Jersey.
2 And we've had -- we've done some
3 "Hurricane Sandy" work and emergency work on
4 Long Island and Queens.
5 But, it's mainly in New York City.
6 SENATOR O'MARA: We get a lot of complaints
7 about the directory, as you talked about, and others
8 have, with not being properly categorized in what
9 functions they do, and difficulty of those firms
10 being able to change that designation.
11 And oftentimes, the designation, we've heard,
12 just seems to get picked by the State, and says,
13 "this is what you're certified in," when it's not
14 specifically what they do, or all that they do, for
15 sure.
16 And they have trouble changing that.
17 And, you mentioned you hear that as a problem
18 as well.
19 But, I guess one of the questions I have in
20 regard to that categorization, if you're a certified
21 minority- or woman-owned business, what difference
22 does it make what category you're certified in?
23 If you're a woman- or minority-owned, then
24 you're eligible to do work.
25 And then it's up to you, as the prime
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1 contractor, or the general contractor, to determine
2 whether that's an entity that is capable of doing
3 that work.
4 J. NAOMI GLEAN: Well, no.
5 The agency will not -- that you're working
6 with will not give you credit if the firm is not
7 certified for what you're using them for.
8 SENATOR O'MARA: No, I understand that.
9 But do you think that's necessary, to have
10 each individual MWBE certified in every particular
11 category?
12 Once they've established the ownership, and
13 that it is an MWBE, why do they need to be
14 categorized and approved at each function or type of
15 work they might do?
16 J. NAOMI GLEAN: Well, it goes to vetting
17 their capability of doing the work.
18 So, if you don't -- if you don't know what
19 they're doing, you don't know how they get it done.
20 So if they're certified to -- let's say, if
21 they're a certified supplier, and they don't have
22 any labor, they have no staff -- they have no
23 workers, and then they say that they can actually
24 install things for me, where are they getting that
25 staff from?
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1 That's an easy way for me to ask that
2 question, so at least --
3 SENATOR O'MARA: Well, I see that can help
4 you.
5 But, there's no category listings for male
6 White contractors.
7 J. NAOMI GLEAN: Uh-huh?
8 SENATOR O'MARA: So if you're going to a
9 majority-owned firm, let me say, rather than a
10 minority-owned firm, there's no directory of what
11 their qualifications are, or whether they do
12 business or not.
13 So why do the minority ones need to be
14 categorized if other contractors aren't?
15 Because you can contract with others as well.
16 Right?
17 J. NAOMI GLEAN: Uh-huh.
18 SENATOR O'MARA: You don't contract just with
19 minority businesses.
20 J. NAOMI GLEAN: Well, there's like
21 ten things that I can put in that category of, why
22 do minority-owned businesses have to go to that
23 standard when White-owned businesses don't?
24 SENATOR O'MARA: Well, yeah, so why do we
25 make them do that?
127
1 J. NAOMI GLEAN: Yeah.
2 I -- I wish somebody would tell me.
3 I don't know.
4 I mean, it's the same thing with the cranes.
5 When I train my staff, I tell everybody that
6 you can't give a minority-owned business a crane if
7 that's not part of their subcontract.
8 And that's not something I would ever say
9 about a non-minority-owned business.
10 And that's -- I think that's something that
11 the regulations have to look at: the practicality of
12 how work is actually done.
13 I think there are definitely other portions
14 of the program that we can scrutinize and say, are
15 we actually helping the minority- and women-owned
16 businesses, or are we really penalizing them for
17 being -- for being a minority- and women-owned
18 business?
19 At some point, it is to their detriment to be
20 part of --
21 SENATOR O'MARA: If you weren't looking to
22 utilize that subcontractor to meet the quota, then
23 you wouldn't need to -- you couldn't care what
24 category they were in, because you would just -- you
25 would just contract with them to do the work.
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1 J. NAOMI GLEAN: Uh-huh. Yes.
2 And there's a lot of times --
3 SENATOR O'MARA: It would be up to you, as
4 the prime, to determine what their actual capability
5 is.
6 J. NAOMI GLEAN: There's a lot of times we
7 use and work with minority-owned companies, and
8 don't take credit for them.
9 They're going to do the job the best way, and
10 they're going to get it done on time and at a good
11 price.
12 But we think some agency might not like this
13 portion of how we're going to do the business, but
14 we're just going to work with you, because you
15 know -- have know-how and you're going to get it
16 done. But I'm not going the fight with an agency
17 about this minutia here. I'm not going to take
18 credit for it.
19 So we -- as a firm, we definitely use
20 minority-owned businesses at times that we don't
21 look for credit.
22 And sometimes we get in trouble for that
23 because every agency wants to take every penny of
24 the credit.
25 SENATOR O'MARA: Yep.
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1 J. NAOMI GLEAN: But there's a lot with the
2 program that I question, are we penalizing minority-
3 and women-owned business by scrutinizing them to
4 this extent?
5 And it's because some people try to get over
6 on the system.
7 And because a few people try to get over on
8 the system, and did the wrong thing, now everybody
9 is assumed to be in cahoots. And everybody is
10 assumed to -- you know, every woman-owned business,
11 it's really her husband that does it. Every, you
12 know, minority in business, where did you get that
13 money from?
14 And I think it's a backwards way.
15 I think we're at a point now, we've turned
16 the table of:
17 Everybody understands that we need these
18 programs and they are actually good;
19 And everybody knows that they need to
20 participate in it;
21 And there's no easy way out of just not
22 meeting your goals and not showing good-faith
23 efforts.
24 And so I think now we can reevaluate the
25 program and say, you know, what is actually going to
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1 benefit the minority-owned businesses?
2 Us not giving a joint check for a lender, and
3 a minority-owned supplier who's saying, "I need
4 money from this lender; otherwise I can't get the
5 supplies from the manufacturer," that's not helpful
6 to them.
7 You know?
8 There's just like a blanket rule with
9 agencies that said, No joint checks for
10 minority-owned businesses.
11 And it just doesn't make sense.
12 I think it's a point where we understand
13 enough of the basics that we can delve into the
14 nuances of the program.
15 SENATOR LITTLE: And when a business is just
16 starting out, two young women, and their -- both of
17 their fathers owned the business, were renting
18 office space, got denied. And they had already
19 started the business, and they were doing work.
20 And, it just doesn't work.
21 You know, I just want to say, as we -- you
22 know, your idea of "penalize them," that's true,
23 because they are being held to a totally different
24 standard, even though we're trying to help.
25 And I voted for this, because I did believe
131
1 that this was a good thing.
2 But the 30 percent is a goal. It is not a
3 quota. It is not a restriction.
4 Is that, the whole state, an overall
5 30 percent of the contracts are minority-owned
6 businesses.
7 And they're putting it on 30 percent on each
8 and every project, each and every place, even though
9 we don't have access in our area to a number of -- a
10 large number of businesses to get that 30 percent
11 goal; and, therefore, the business goes elsewhere,
12 and it's not helping the economy of our districts.
13 So, there's a lot of work that needs be done
14 on it.
15 I think the motivation for the program is a
16 good idea, but, I really appreciate the comments
17 that we've heard today.
18 J. NAOMI GLEAN: Great.
19 Yeah, I mean, this is an anecdote.
20 Within our company we have a
21 general-contracting division. And then we have the
22 specialty divisions.
23 It's a lot easier to meet our goals on the
24 general-contracting side. We have a lot more scopes
25 of work. There's a lot more places where we can
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1 make smaller contracts, as opposed to on our
2 specialty work.
3 And so, if the goals were assessed to what's
4 actually there, and not insurance and bonding and
5 overhead, if it was actually assessed to the scopes
6 of work, I think we would -- we would definitely
7 meet the goals a lot easier and help a lot more
8 companies that way.
9 SENATOR RITCHIE: I would like to say, thank
10 you for your comments. They were very helpful.
11 Appreciate it.
12 J. NAOMI GLEAN: Thank you.
13 Thanks for your time.
14 SENATOR RITCHIE: And I would just like to
15 say, this will conclude our final hearing.
16 We have, I think, a number of themes that
17 we heard over and over again throughout the
18 six hearings, the issues like:
19 Regional staff that's needed.
20 We need help building capacity.
21 The program needs to reassess the 30 percent
22 goal, but, is being implemented as a requirement.
23 We need to take another look at the personal
24 net worth.
25 You know, I appreciate Senator Little and
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1 Senator O'Mara for being here.
2 Certainly, Senator Akshar, who took a lot of
3 time going across this state.
4 We'll all be working together to put
5 recommendations in place as we go back to Albany in
6 January.
7 I want to thank our Senate staff that's here.
8 And, also, I want to thank Lisa Harris, who
9 has spent a lot of time helping us. Our counsel has
10 really put a lot of work, and traveled to the
11 hearings too.
12 With that, once again, to all of our
13 speakers, thank you for taking the time.
14 We certainly will take what you said back to
15 our meetings, when we're putting forward
16 recommendations.
17 And, Senator Little, did you have anything to
18 say, to close?
19 SENATOR LITTLE: No, I think that we've
20 gotten some really good ideas, and concrete ideas.
21 And as we've gone through all of these, we're
22 finding that a lot of the comments are the same
23 around the state from different groups.
24 But, it's become a struggle, and that's not
25 what it was meant to be.
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1 So I think that we really need to relook at
2 the program and see how we can clean it up, and fix
3 it.
4 And if New York City can do it, I'm sure that
5 New York State should be able to, too.
6 Thank you for being here.
7 SENATOR O'MARA: Just, thanks, everybody, for
8 being here.
9 It's a pleasure to listen to you and get your
10 input on this issue.
11 I want to thank Senator Ritchie for your
12 leadership on this with Senator Akshar;
13 And, Betty, you being here as well.
14 I think I've attended four of these across
15 the state, and it's been very helpful in us
16 determining which direction to try to move forward
17 to improve this program.
18 SENATOR RITCHIE: Thank you.
19 With that, we will adjourn the hearing.
20
21 (Whereupon, at approximately 1:31 p.m.,
22 the public hearing concluded, and adjourned.)
23 ---oOo---
24
25