m/wbe disparity study update status of recommendations county administration april 17, 2007

M/WBE Disparity Study Update M/WBE Disparity Study Update Status of RecommendationsStatus of Recommendations

County AdministrationCounty Administration

April 17, 2007

2

Presentation Outline Presentation Outline

• Background Background

• Objectives, Scope, and MethodologyObjectives, Scope, and Methodology

• Legal ReviewLegal Review

• Consultant Recommendations Consultant Recommendations

• Status of Each RecommendationStatus of Each Recommendation

• Staff RecommendationsStaff Recommendations.

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BackgroundBackground

• Current M/WBE goals established in 1994 Current M/WBE goals established in 1994

• Goals based on M/WBE availability statewideGoals based on M/WBE availability statewide

• Geographical area changed to Central Florida Geographical area changed to Central Florida (Orlando MSA) in January 2002: (Orlando MSA) in January 2002:

OrangeOrange SeminoleSeminole

LakeLake OsceolaOsceola

• Number of available/eligible M/WBEs reducedNumber of available/eligible M/WBEs reduced

• Goals unchanged.

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BackgroundBackground (continued)(continued)

• Additional M/WBE segments:Additional M/WBE segments:– Graduation program Graduation program

• Implemented October 1998Implemented October 1998• 27 Graduate firms 27 Graduate firms

– Sliding scale bid award process Sliding scale bid award process • Implemented October 1998Implemented October 1998• Revised in January 2002Revised in January 2002

– Credit program Credit program • Implemented in January 2002Implemented in January 2002

• M/WBE Ordinance requires an updated M/WBE Ordinance requires an updated disparity study be completed every 5 yearsdisparity study be completed every 5 years.

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Disparity Study Disparity Study ObjectivesObjectives

• Previous Study analyzed: 1994 – 1999Previous Study analyzed: 1994 – 1999

• Current MGT StudyCurrent MGT Study– Analyzed M/WBE program: 2000 - 2004Analyzed M/WBE program: 2000 - 2004– Reviewed the effectiveness of current Reviewed the effectiveness of current

programsprograms

– Recommended improvements to the Recommended improvements to the M/WBE programM/WBE program.

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Disparity Study Disparity Study Scope and MethodologyScope and Methodology

• Legal Review Legal Review • Review Review – County status reportsCounty status reports– County expenditure reportsCounty expenditure reports

• Anecdotal information from M/WBE Firms:Anecdotal information from M/WBE Firms:– Written SurveysWritten Surveys

• 504 surveys504 surveys• 104 responses104 responses

– Focus Group (Roundtable) DiscussionsFocus Group (Roundtable) Discussions• 415 M/WBE firms invited415 M/WBE firms invited• 56 M/WBE firms participated56 M/WBE firms participated

– Telephone Interviews with 8 M/WBE firmsTelephone Interviews with 8 M/WBE firms

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Legal IssuesLegal Issues

• Relevant Case LawRelevant Case Law

• Legal Review CriteriaLegal Review Criteria

• Standards of ReviewStandards of Review

• Program RequirementsProgram Requirements

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Governing Case LawGoverning Case Law

• City of Richmond v. J.A. Croson City of Richmond v. J.A. Croson Company, (1989)Company, (1989)

• Engineering Contractors Association Engineering Contractors Association of South Florida, Inc. v. Metropolitan of South Florida, Inc. v. Metropolitan Dade County, (11thCir. 1997)Dade County, (11thCir. 1997)

• Hershell Gill Consulting Engineers, Hershell Gill Consulting Engineers, Inc. v. Miami-Dade County, Florida, Inc. v. Miami-Dade County, Florida, (S.D. Fl., 2004)(S.D. Fl., 2004)

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Legal ReviewLegal Review• Program must be based upon compelling Program must be based upon compelling

government interest and must be narrowly government interest and must be narrowly tailored to achieve that interest.tailored to achieve that interest.

• Local government must have sufficiently Local government must have sufficiently strong evidence of past or present strong evidence of past or present discrimination within its own geographic discrimination within its own geographic boundaries.boundaries.

• Racial and ethnic conscious affirmative Racial and ethnic conscious affirmative action programs reviewed under “strict action programs reviewed under “strict scrutiny.” scrutiny.”

• Gender conscious affirmative action Gender conscious affirmative action programs reviewed under “intermediate programs reviewed under “intermediate scrutiny.”scrutiny.”

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Standards of Legal ReviewStandards of Legal Review

• Strict Scrutiny (Maximum Scrutiny): The law Strict Scrutiny (Maximum Scrutiny): The law is upheld if it is is upheld if it is necessarynecessary to achieve a to achieve a compellingcompelling government purpose. government purpose.

• Intermediate Scrutiny: The law is upheld if it Intermediate Scrutiny: The law is upheld if it is is substantiallysubstantially related to an related to an importantimportant government purpose. government purpose.

• To withstand a legal challenge, a program To withstand a legal challenge, a program must be narrowly tailored.must be narrowly tailored.

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Factors To Determine Narrowly Factors To Determine Narrowly TailoredTailored

• Necessity for relief and efficacy of Necessity for relief and efficacy of alternative remediesalternative remedies

• Flexibility and duration of relief, including Flexibility and duration of relief, including the availability of waiver provisionsthe availability of waiver provisions

• Relationship of numerical goals to the Relationship of numerical goals to the relevant labor marketrelevant labor market

• Impact of the relief on the rights of Impact of the relief on the rights of innocent third partiesinnocent third parties

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Evidence/Documentation of Evidence/Documentation of DiscriminationDiscrimination

• Sufficient for: Sufficient for: – Creation and justification of race-Creation and justification of race-

conscious programsconscious programs– To demonstrate governmental interests To demonstrate governmental interests

and need for remedial actionand need for remedial action

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Program RequirementsProgram Requirements

• Consideration of workable race-ethnicity Consideration of workable race-ethnicity neutral alternativesneutral alternatives– Contract-by-Contract WaiversContract-by-Contract Waivers– Project-by-Project GoalsProject-by-Project Goals– Goals Cannot be QuotasGoals Cannot be Quotas– Sunset ProvisionSunset Provision– Periodic Review/Goal AdjustmentsPeriodic Review/Goal Adjustments

• Race-conscious programs used as a last Race-conscious programs used as a last resortresort

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Associated General Contractors, Associated General Contractors, et al v. Broward Countyet al v. Broward County

• March 15, 2007March 15, 2007

• Board members sued individuallyBoard members sued individually

• Seeks to strike the M/WBE program in Seeks to strike the M/WBE program in its entiretyits entirety

• Race/ethnicity based programs have Race/ethnicity based programs have recently been challenged in the courtsrecently been challenged in the courts

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Disparity StudyDisparity Study

• MGT Commended Orange County for Its MGT Commended Orange County for Its Efforts in the Following Areas:Efforts in the Following Areas: – Graduation ProgramGraduation Program– Vendor Rotation on Term and Vendor Rotation on Term and

Continuing A & E ContractsContinuing A & E Contracts– Wrap-up Insurance on Large Wrap-up Insurance on Large

Construction ProjectsConstruction Projects– Waiver Process on Specific ProjectsWaiver Process on Specific Projects– M/WBE Program Data ManagementM/WBE Program Data Management

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Barriers to Conducting Barriers to Conducting Business with the CountyBusiness with the County

• Size of Contracts Awarded by the County Size of Contracts Awarded by the County • Access to Loans and CapitalAccess to Loans and Capital– Business Start-upBusiness Start-up– Operating CapitalOperating Capital– Equipment Loans Equipment Loans

• Performance BondsPerformance Bonds• Restrictive Bid/RFP SpecificationsRestrictive Bid/RFP Specifications– Experience RequirementsExperience Requirements– Equipment OwnershipEquipment Ownership

• Slow PaymentSlow Payment

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Non-Policy RecommendationsNon-Policy Recommendations

1.1. Contract SizeContract Size2.2. M/WBE outreachM/WBE outreach3.3. Technical AssistanceTechnical Assistance4.4. Banking SupportBanking Support5.5. Bond AssistanceBond Assistance6.6. TrainingTraining7.7. Data Collection Data Collection 8.8. OrganizationOrganization9.9. Project GoalsProject Goals

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And Contract Size

And Contract Size

Contract Size

and Contract Sizeand Contract Size

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Consultant Recommendation 1:Consultant Recommendation 1:Attempt to reduce contract size (to Attempt to reduce contract size (to

allow smaller M/WBE firms to compete)allow smaller M/WBE firms to compete)

Status: Staff in Purchasing and Contracts and Status: Staff in Purchasing and Contracts and Business Development currently review each large Business Development currently review each large procurement to identify projects where significant procurement to identify projects where significant purchases can be separated into smaller pieces purchases can be separated into smaller pieces without affecting price or completion time.without affecting price or completion time.

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Consultant Recommendation 2: Consultant Recommendation 2:

Increase M/WBE outreachIncrease M/WBE outreach A.A. Bid advertising/notificationBid advertising/notification

B.B. M/WBE web site informationM/WBE web site information

C.C. Advance notification of upcoming projectsAdvance notification of upcoming projects

D.D. Presentations by M/WBE firms to County Presentations by M/WBE firms to County project managersproject managers

Status: Staff has completed a technology solution Status: Staff has completed a technology solution to address items A. and B, and working with local to address items A. and B, and working with local agencies to address C. Business Development is agencies to address C. Business Development is planning to arrange meetings to address item D.planning to arrange meetings to address item D.

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Consultant Recommendation 3:Consultant Recommendation 3: Provide more technical assistanceProvide more technical assistance

A.A. The Alliance, NEC, SBDC, MBDC, BBIF, The Alliance, NEC, SBDC, MBDC, BBIF, and HBIF and HBIF

B.B. Assist with bidding and estimatingAssist with bidding and estimating

Status: Staff is working with The Alliance, Status: Staff is working with The Alliance, SBDC, BBIF, HBIF, and surety companies SBDC, BBIF, HBIF, and surety companies to address both items A. and B. The to address both items A. and B. The Alliance, BBIF and HBIF provide assistance Alliance, BBIF and HBIF provide assistance with business plans, forecasting, with business plans, forecasting, accounting, management strategies, and accounting, management strategies, and other workshops. other workshops.

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Consultant Recommendation 4:Consultant Recommendation 4:

Seek banking institution supportSeek banking institution support A.A. Assure fair consideration is given to Assure fair consideration is given to

loan applications by M/WBE firmsloan applications by M/WBE firms

B.B. Consider “Linked Deposit Loan Consider “Linked Deposit Loan Program” Program”

Status: Staff is working with The Status: Staff is working with The Alliance, SBDC, BBIF, and HBIF and Alliance, SBDC, BBIF, and HBIF and several banks to address Item A. several banks to address Item A. Item B. requires working with the Item B. requires working with the County’s bank and The Comptroller’s County’s bank and The Comptroller’s Office. Office.

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Consultant Recommendation 5:Consultant Recommendation 5: Increase construction bond limitIncrease construction bond limit

A.A. Current County limit: $100,000; Current County limit: $100,000; Statutory limit: $200,000Statutory limit: $200,000

B.B. Review Bonding Assistance ProgramsReview Bonding Assistance Programs

C.C. Improve Payment Processes for Improve Payment Processes for ContractorsContractors

Status: Status: Item A. Requires an Procurement Ordinance change. Item A. Requires an Procurement Ordinance change. Item B. Staff is working with several surety firms to Item B. Staff is working with several surety firms to

identify alternatives to assist companies with identify alternatives to assist companies with the current bond requirements. the current bond requirements.

Item C. Staff teams are working on ways to improve Item C. Staff teams are working on ways to improve

payment processes.payment processes.

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Consultant Recommendation 6:Consultant Recommendation 6:Consider an internal training program Consider an internal training program for County project managersfor County project managers

A.A. Improve communication with M/WBE firmsImprove communication with M/WBE firms

B.B. Encourage primes to subcontract with Encourage primes to subcontract with M/WBE firmsM/WBE firms

C.C. Positive actions toward M/WBE firmsPositive actions toward M/WBE firms

Status: Staff from Purchasing & Contracts and Status: Staff from Purchasing & Contracts and Business Development work on an individual basis Business Development work on an individual basis with each Project Manager to encourage increased with each Project Manager to encourage increased communication. No formal training program has communication. No formal training program has been developed.been developed.

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Consultant Recommendation 7:Consultant Recommendation 7:Improve data collectionImprove data collection

A.A. Coding and classifying transactionsCoding and classifying transactions

B.B. Tracking expenditures compared to Tracking expenditures compared to awardsawards

Status: Staff has completed a technology Status: Staff has completed a technology solution to facilitate tracking, solution to facilitate tracking, categorizing, analyzing and reporting. categorizing, analyzing and reporting.

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Consider establishing an internal Consider establishing an internal M/WBE steering committee M/WBE steering committee

A.A. County AdministrationCounty Administration

B.B. Major County DepartmentsMajor County Departments

C.C. Business Development DivisionBusiness Development Division

D.D. Purchasing and Contracts DivisionPurchasing and Contracts Division

E.E. County Attorney’s OfficeCounty Attorney’s Office

Status: Internal coordination has been Status: Internal coordination has been achieved through the County Administrator’s achieved through the County Administrator’s Office on an “as needed” basis.Office on an “as needed” basis.

Consultant Recommendation 8:Consultant Recommendation 8:

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Consultant Recommendation 9:Consultant Recommendation 9: Establish goals based on % of M/WBE Establish goals based on % of M/WBE

availabilityavailability on a project-by-project basis on a project-by-project basis for large projects where applicablefor large projects where applicable

Status: This recommendation has been Status: This recommendation has been implemented by Business Development in implemented by Business Development in conjunction with user departments conjunction with user departments whereby the goals based on availability for whereby the goals based on availability for each project are determined individually.each project are determined individually.

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Policy RecommendationsPolicy Recommendations

1.1. M/WBE GoalsM/WBE Goals

2.2. M/WBE Sliding Scale M/WBE Sliding Scale

3.3. Good Faith EffortsGood Faith Efforts

4.4. Small Business Enterprise (SBE) ProgramSmall Business Enterprise (SBE) Program

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Consultant Recommendation 10:Consultant Recommendation 10:Re-establish over-all goals on a regular Re-establish over-all goals on a regular basis, based on basis, based on availabilityavailability

Status: Staff concurs. This recommendation Status: Staff concurs. This recommendation is a policy decision requiring Board approval. is a policy decision requiring Board approval. (See the following slides regarding (See the following slides regarding availabilityavailability for more detail).for more detail).

“Narrow tailoring under the City of Richmond vs. J. A. Croson standard requires that remedial goals be in line with measured availability. M/WBE goals need to be adjusted on a regular basis as well.” – MGT of America, Inc.

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DefinitionsDefinitions

• Vendor Availability – percentage of Vendor Availability – percentage of M/WBE vendors listed on our bidders’ M/WBE vendors listed on our bidders’ list list

• Bidder Availability – percentage of Bidder Availability – percentage of M/WBE vendors who have submitted at M/WBE vendors who have submitted at least one bid or proposal as a prime or least one bid or proposal as a prime or sub during the past five yearssub during the past five years

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ConstructionConstruction

African American

%

Hispanic American

%

Asian American

%

Native American

%

Non-minority Women

M/WBE Subtotal

%

Bidder Availability

4.02 4.99 1.56 .60 2.92 14.09

Vendor Availability

9.66 7.07 1.81 .32 6.25 25.11

Average Average AvailabilityAvailability

6.846.84 6.036.03 1.691.69 .46.46 4.594.59 19.6119.61

Current Goals

12.90 4.50 .65 .65 6.30 25.00

M/WBE Utilization

4.5 10.06 .92 .79 5.76 22.02

Total Awards: $723M (55%)Total Awards: $723M (55%)

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Professional Services (A & E)Professional Services (A & E)

African American

%

Hispanic American

%

Asian American

%

Native American

%

Non-minority Women

%

M/WBE Subtotal

%

Bidder Availability

7.37 9.81 4.72 .10 3.11 25.10

Vendor Availability

4.32 7.14 4.98 .17 10.47 27.08

Average Average AvailabilityAvailability

5.85.8 8.488.48 4.854.85 .14.14 6.796.79 26.1026.10

Current Goals

NA NA NA NA NA 24.00

M/WBE Utilization

4.91 7.76 5.20 0 9.34 27.25


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Goods/CommoditiesGoods/Commodities

African American

%

Hispanic American

%

Asian American

%

Native American

%

Non-minority Women

%

M/WBE Subtotal

%

Bidder Availability

NA NA NA NA NA NA

Vendor Availability

4.5 3.12 1.33 .09 5.35 14.39

M/WBE Goals


M/WBE Utilization

.11 .49 .11 0 .81 1.53

Total Awards: $316M (23%) Total Awards: $316M (23%)

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Other ServicesOther Services

African American

%

Hispanic American

%

Asian American

%

Native American

%

Non-minority Women

%

M/WBE Subtotal

%

Bidder Availability

NA NA NA NA NA NA

Vendor Availability

9.54 6.17 1.87 .09 9.73 27.41

M/WBE Goals


M/WBE Utilization

.15 2.99 0 0 3.03 6.17


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New Goal PossibilitiesNew Goal Possibilities

• Establish new goals for Construction Establish new goals for Construction and A & E Services based on the and A & E Services based on the averageaverage of bidder availability and of bidder availability and vendor availabilityvendor availability

• Continue current goals for Continue current goals for Commodities and Other ServicesCommodities and Other Services

• BenefitsBenefits– More realistic goalsMore realistic goals– Legally defensibleLegally defensible

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Recommended New Recommended New M/WBE Goals*M/WBE Goals*

African American

Hispanic American

Asian American

Native American

Non-minority Women

Overall Goal

Construction 6.84% (7%)

6.03% (6%)

1.69% (2%)

.46% (1%)

4.59% (5%)

19.61% (21%)

A & E 5.8% (6%)

8.48% (8%)

4.85% (5%)

.14% (0%)

6.79% (7%)

26.10% (26%)

Goods NA NA NA NA NA 10%

Other Services

NA NA NA NA NA 24%

*Rounded to nearest percentage (%)*Rounded to nearest percentage (%)

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Overall M/WBE Goals for Overall M/WBE Goals for Each CategoryEach Category

Architect & Architect & Engineering Engineering

ServicesServices

ConstructionConstruction Other Other ServicesServices

Goods and Goods and CommoditiesCommodities

Current Current OverallOverall

GoalGoal

24%24% 25%25% 24%24% 10%10%

Revised Revised Overall Overall

GoalGoal

26%26% 21%21% 24%24% 10%10%

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Sliding ScaleSliding Scale

Contract AmountContract Amount Previous (Oct. ’98 Previous (Oct. ’98 – Jan. ’02)– Jan. ’02)

Current (Jan. ’02 - Current (Jan. ’02 - PresentPresent

0 - $100K 7.5% 0

$100K-$500K 5% 5.5%

$500K-$750K 3% 5.5%

$750K-$2M 3% 4%

>$2M 3% 3%

>5M - -

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Sliding Scale – FindingsSliding Scale – FindingsRandom Sampling of Construction Random Sampling of Construction

ContractsContracts

DescriptionDescription Award AmountAward Amount PercentPercent

Low bidder Achieved Goals / Good Low bidder Achieved Goals / Good Faith Efforts Faith Efforts

$218,113,351 55.1%

Sliding Scale Applied (2Sliding Scale Applied (2ndnd Bidder Bidder Awarded Contract) Awarded Contract)

$1,774,519 0.4%

22ndnd Bidder Outside Sliding Scale Limits Bidder Outside Sliding Scale Limits $159,826,183 40.4%

No Bidder Responsive to GoalsNo Bidder Responsive to Goals $16,354,228 4.1%

TOTALTOTAL $396,068,281 100%

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Consultant Recommendation 11:Consultant Recommendation 11:Increase sliding scale limitsIncrease sliding scale limits

Status: This recommendation is a policy decision Status: This recommendation is a policy decision requiring Board approval.requiring Board approval.

Contract Contract AmountAmount

Previous Previous (Oct. ’98 – (Oct. ’98 – Jan. ’02)Jan. ’02)

Current Current (Jan. ’02 - (Jan. ’02 - PresentPresent

Possible New Possible New ScaleScale

0 - $100K 7.5% 0 6%

$100K-$500K 5% 5.5% 6%

$500K-$750K 3% 5.5% 6%

$750K-$2M 3% 4% 5%

>$2M 3% 3% 4% ($2-5M)

>5M - - 3%

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2.2. M/WBE Sliding ScaleM/WBE Sliding Scale



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Consultant Recommendation 12:Consultant Recommendation 12:Consider rejecting bids that do not Consider rejecting bids that do not meet M/WBE goals meet M/WBE goals andand do not have do not have sufficient documentation of good sufficient documentation of good faith efforts to show attempts to faith efforts to show attempts to obtain M/WBE participation.obtain M/WBE participation.

Status: The County still uses good faith Status: The County still uses good faith efforts in the bidding process, however it efforts in the bidding process, however it has largely been augmented by the sliding has largely been augmented by the sliding scale process. This recommendation is a scale process. This recommendation is a policy decision requiring Board approval.policy decision requiring Board approval.

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Good Faith Efforts Definition Good Faith Efforts Definition The efforts undertaken by a contractor to The efforts undertaken by a contractor to obtain M/WBE participation in a contract, and obtain M/WBE participation in a contract, and shall include shall include allall the following actions: the following actions:

1.1. Advertisement in a general circulation media at Advertisement in a general circulation media at least seven (7) calendar days prior to openingleast seven (7) calendar days prior to opening

2.2. Written notice to potential subcontractors Written notice to potential subcontractors advising them of subcontracting opportunities advising them of subcontracting opportunities

3.3. Providing M/WBE participation in areas not Providing M/WBE participation in areas not traditionally performed by M/WBE firms where traditionally performed by M/WBE firms where appropriateappropriate

4.4. Direct follow-up and contact with M/WBE firmsDirect follow-up and contact with M/WBE firms

5.5. Submittal of quotes received from M/WBE subs Submittal of quotes received from M/WBE subs in comparison to non-M/WBE subsin comparison to non-M/WBE subs

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Consultant Recommendation 13:Consultant Recommendation 13: Consider Establishing an SBE ProgramConsider Establishing an SBE Program– Legally considered “race-neutral” Legally considered “race-neutral” – Establishes SBE goals Establishes SBE goals – May utilize SBE bid preferences and set-May utilize SBE bid preferences and set-

asides asides

Status: This recommendation is a policy decision Status: This recommendation is a policy decision requiring Board approval.requiring Board approval.

Staff Concerns:Staff Concerns:• Cost to implement Cost to implement • Overlapping goalsOverlapping goals• Dilution and Duplication of M/WBE programDilution and Duplication of M/WBE program• Legal implicationsLegal implications

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Staff RecommendationsStaff Recommendations

1.1. Increase Bond LimitIncrease Bond Limit2.2. Establish New M/WBE Goals Based Establish New M/WBE Goals Based

on Average M/WBE Availability on Average M/WBE Availability 3.3. Revise Sliding ScaleRevise Sliding Scale4.4. Re-define “Good Faith Efforts” and Re-define “Good Faith Efforts” and

Review FurtherReview Further5.5. Review SBE Program Review SBE Program 6.6. No Formal Board Action Needed No Formal Board Action Needed

TodayToday

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Sliding Scale Example #1Sliding Scale Example #1

Bidder Bidder NameName

Bid Bid Amount Amount

$$

Within Within 3%?3%?

M/WBE M/WBE %%

Good Good Faith Faith

Efforts?Efforts?

AA 3,000,0003,000,000 N/AN/A 2525 N/AN/A

BB 3.089,0003.089,000 YesYes 2525 N/AN/A

Bidder A recommended for award

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$$


M/WBE M/WBE %%


Efforts?Efforts?

CC 3,000,0003,000,000 N/AN/A 1010 NoNo

DD 3.089,0003.089,000 YesYes 2525 N/AN/A

Bidder D recommended for award

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$$


M/WBE M/WBE %%


Efforts?Efforts?

EE 3,000,0003,000,000 N/AN/A 1010 NoNo

FF 3.089,0003.089,000 YesYes 1515 YesYes

Bidder F recommended for award

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$$


M/WBE M/WBE %%


Efforts?Efforts?

GG 3,000,0003,000,000 N/AN/A 1010 NoNo

HH 3.089,0003.089,000 YesYes 1515 NoNo

Bidder G recommended for award

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$$


M/WBE M/WBE %%


Efforts?Efforts?

II 3,000,0003,000,000 N/AN/A 1010 NoNo

JJ 3.089,0003.089,000 YesYes 55 YesYes

Bidder I recommended for award

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Innovation Way Road ConstructionInnovation Way Road ConstructionAugust 1, 2006August 1, 2006

IFB Y5-711-DBIFB Y5-711-DB BidderBidder Bid AmountBid Amount Price Price

DifferenceDifferenceM/WBE M/WBE

%%M/WBE M/WBE AmountAmount

Prince Prince ContractingContracting

$25,782,345$25,782,345 ($593,830) ($593,830) (2.3%)(2.3%)

23.8%23.8% $6,136,198$6,136,198

Jr. Davis Jr. Davis ConstructionConstruction

$26,376,175$26,376,175 -- 25.1%25.1% $6,594,044$6,594,044

• Staff recommended award to Jr. Davis Const. Staff recommended award to Jr. Davis Const.

• The Board awarded to Prince Contracting. The Board awarded to Prince Contracting.

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Hiawassee Road ImprovementsHiawassee Road ImprovementsOctober 17, 2000October 17, 2000

IFB Y0-761-DBIFB Y0-761-DB

Bergeron Land Dev.Bergeron Land Dev.• $9,277,000$9,277,000• Bid Diff.:$151,000Bid Diff.:$151,000• M/WBE: 23.6%M/WBE: 23.6%

Southland ConstructionSouthland Construction• $9,428,000$9,428,000• N/AN/A• M/WBE: 25%M/WBE: 25%

• Staff recommended award to Southland. Staff recommended award to Southland.

• The Board awarded to Bergeron.The Board awarded to Bergeron.

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Project Status and Work Project Status and Work HistoryHistory

• Briefings:Briefings:– County AdministratorCounty Administrator– MayorMayor– CommissionersCommissioners– M/WBE Community and ContractorsM/WBE Community and Contractors

• Implementation of recommendations Implementation of recommendations (1 through 9) that are not policy (1 through 9) that are not policy issuesissues– Bonding IssuesBonding Issues– Technology ImprovementsTechnology Improvements

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Peer Agency ReviewPeer Agency ReviewPolicyPolicy ResourcesResources OutreachOutreach Tech. Tech.

Assist Assist

ComplianceCompliance ReportsReports

BrowardBroward X X X X XHillsboroughHillsborough X X X X XJacksonvilleJacksonville X X X X X XLeonLeon X X XMiami-DadeMiami-Dade X X X X X XOrangeOrange X X X X XPalm BeachPalm Beach X X X XPinellasPinellas X X X X X

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M/WBE Prime Contractor M/WBE Prime Contractor Awards – Construction Awards – Construction

1999 1999 – 2004*– 2004*

African African AmericanAmerican

Hispanic Hispanic AmericanAmerican

Asian Asian AmericanAmerican

Native Native

AmericanAmerican

WomenWomen M/WBE M/WBE TotalTotal

Total Total PaymentsPayments

$1.67M

.23%

$12.0M

1.67%

$.96M

.13%

0 $1.96M

.27%

$16.67M

2.31%

$723.21M

*Totals do not include OC Jail, Courthouse, or Convention Center*Totals do not include OC Jail, Courthouse, or Convention Center

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Number of Certified M/WBE Number of Certified M/WBE Vendors on Oct. 1, 2005*Vendors on Oct. 1, 2005*

African African AmericanAmerican

Hispanic Hispanic AmericanAmerican

Native Native AmericanAmerican

AsianAsian WomenWomen TotalTotal

ConstructionConstruction 29 22 1 6 13 71

Construction-related Construction-related Services & Supplies Services & Supplies

17 18 0 6 11 52

Professional Services Professional Services ( A&E)( A&E)

15 32 1 21 35 104

Non-A&E Prof. Svcs. Non-A&E Prof. Svcs. & Other Services& Other Services

13 3 0 1 3 20

Goods/Commodities Goods/Commodities SuppliersSuppliers

73 70 0 39 126 308

TotalsTotals 147 145 2 73 188 555*

*From Business Development Division *From Business Development Division recordsrecords

Note: MGT identified 1,020 M/WBE vendors in the Study ReportNote: MGT identified 1,020 M/WBE vendors in the Study Report

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Attrition of M/WBE VendorsAttrition of M/WBE Vendors

• Probable Factors from Staff Observation Probable Factors from Staff Observation – Geographical restriction to Central Florida MSA Geographical restriction to Central Florida MSA – Firm no longer in businessFirm no longer in business– Minority firms not recertifyingMinority firms not recertifying– Services offered are not used by CountyServices offered are not used by County– Sliding scale programSliding scale program– Graduation programGraduation program– Economic conditionsEconomic conditions

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HUBZone FirmsHUBZone Firms

• MGT provided a list of 22 firms in the MGT provided a list of 22 firms in the Orlando HUBZone area:Orlando HUBZone area:– 4 are already certified M/WBE firms4 are already certified M/WBE firms– 4 are majority (non-M/WBE) firms4 are majority (non-M/WBE) firms– 2 indicated they were M/WBE firms, but did not 2 indicated they were M/WBE firms, but did not

return applications for certificationreturn applications for certification– 3 were previously certified M/WBEs but no 3 were previously certified M/WBEs but no

longer want to be certifiedlonger want to be certified– 1 is outside the Orlando MSA1 is outside the Orlando MSA– 8 did not return calls or e-mails8 did not return calls or e-mails

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M/WBE Credit Awards

ConstructionConstruction• Capital Manufacturing was awarded a First Capital Manufacturing was awarded a First Time Use credit in the amount of $602,720.Time Use credit in the amount of $602,720.

• Centex Rooney received a non-County Centex Rooney received a non-County Utilization credit of $4,247,275.Utilization credit of $4,247,275.

Professional ServicesProfessional Services

• Post Buckley Schuh & Jernigan received a Post Buckley Schuh & Jernigan received a credit for its Minority & Women Employee credit for its Minority & Women Employee Recruitment and Training Program.Recruitment and Training Program.

• Earth Tech received a Non-County Utilization Earth Tech received a Non-County Utilization credit of $182,944. credit of $182,944.

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Jacksonville ProgramJacksonville Program

• SBE Program Implemented in 2004 SBE Program Implemented in 2004 – 9 new staff + operating exp.9 new staff + operating exp. $500,000$500,000– Bonding Assistance Bonding Assistance $500,000$500,000– Summits, Training, MentoringSummits, Training, Mentoring $300,000$300,000– Access to CapitalAccess to Capital $500,000$500,000– Accounting ScholarshipsAccounting Scholarships $100,000$100,000– Consultant to Analyze ContractsConsultant to Analyze Contracts$235,250$235,250– TotalTotal $2,135,250 $2,135,250

Continued next slide

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Jacksonville Program Jacksonville Program (continued)(continued)

• Considers only “sourceable” procurements Considers only “sourceable” procurements in determining goal achievementin determining goal achievement

• Exempts:Exempts:– Emergency purchasesEmergency purchases– Sole source procurementsSole source procurements– State contract purchasesState contract purchases– GSA procurementsGSA procurements– Cooperative purchasesCooperative purchases– Exempted procurementsExempted procurements– Purchases where no certified SBE existsPurchases where no certified SBE exists

71

SBE Programs – Peer AgenciesSBE Programs – Peer AgenciesSBE SBE

ProgramProgramSBE Empl*. + SBE Empl*. + QualificationsQualifications

Linked Linked DepositDeposit

SBE SBE StaffStaff

Sliding Sliding ScaleScale

# Certified # Certified FirmsFirms

BrowardBroward 1.5 yrs. 25 + sales no 15 no 2,576

HillsboroughHillsborough 1 yr. 50 + net worth no ? yes 549

JacksonvilleJacksonville 1.5 yrs. Net worth + sales

yes 9 no 343

LeonLeon none N/A no N/A no ?

Miami-DadeMiami-Dade 1 year X no X yes X

OrangeOrange none N/A no 9 yes 555

Palm BeachPalm Beach 2.5 yrs. 30 + sales no 5 yes 237

PinellasPinellas 2 yrs. 100 + sales no 3 no SBE only

* The Federal Government considers a firm with <500 employees a small business.

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Race-neutral AlternativesRace-neutral Alternatives

• ACG v. State of Florida, 2004 ACG v. State of Florida, 2004 – Simplification of bidding proceduresSimplification of bidding procedures– Relaxation of bonding requirementsRelaxation of bonding requirements– Training and financial aid for disadvantaged Training and financial aid for disadvantaged

entrepreneurs of all racesentrepreneurs of all races

• Orange County Race-neutral AlternativesOrange County Race-neutral Alternatives– Sliding scale bid award processSliding scale bid award process– Graduation programGraduation program– Wrap-up insuranceWrap-up insurance– Rotation on term contractsRotation on term contracts

73

Disparity Study Disparity Study Legal ConclusionsLegal Conclusions

• A Legally Defensible M/WBE program:A Legally Defensible M/WBE program:– Must be narrowly tailored to remedy Must be narrowly tailored to remedy

identified discriminationidentified discrimination– Should have sunset and termination Should have sunset and termination

provisionsprovisions– Should include standards for location, size, Should include standards for location, size,

and net worth for M/WBE certificationand net worth for M/WBE certification

Continued

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Disparity Study Disparity Study Legal ConclusionsLegal Conclusions (continued)(continued)

• Race-neutral alternatives should be Race-neutral alternatives should be considered and evaluatedconsidered and evaluated

• Quotas are prohibited Quotas are prohibited • Remedial goals should be:Remedial goals should be:– Regularly reviewed and adjustedRegularly reviewed and adjusted– Established on a project-by-project Established on a project-by-project

basis for specific large projects and basis for specific large projects and include waiversinclude waivers

– Linked to vendor/bidder availability Linked to vendor/bidder availability

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Legal ReviewLegal Review

• ““To withstand scrutiny, an MBE program To withstand scrutiny, an MBE program must be narrowly tailored to remedy must be narrowly tailored to remedy identified discrimination”*identified discrimination”*– Necessity for relief and efficacy of alternative Necessity for relief and efficacy of alternative

remediesremedies– Flexibility and duration of relief, including the Flexibility and duration of relief, including the

availability of waiver provisionsavailability of waiver provisions– Relationship of numerical goals to the Relationship of numerical goals to the

relevant labor marketrelevant labor market– Impact of the relief on the rights of innocent Impact of the relief on the rights of innocent

third parties third parties

*Engineering Contractors v. Dade County, 1997

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Necessity for Relief and Efficacy Necessity for Relief and Efficacy of Alternative Remediesof Alternative Remedies

• Evidence of Discrimination Must Be Evidence of Discrimination Must Be Sufficient to Impose Race-conscious Sufficient to Impose Race-conscious GoalsGoals– Historical dataHistorical data– SurveysSurveys– InterviewsInterviews

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Flexibility and Duration of Relief*Flexibility and Duration of Relief*• Contract-by-Contract WaiversContract-by-Contract Waivers

• Project-by-Project GoalsProject-by-Project Goals

• Goals Cannot be QuotasGoals Cannot be Quotas

• Narrow Tailoring Requires Sunset ProvisionNarrow Tailoring Requires Sunset Provision

• Periodic ReviewPeriodic Review– County Mayor AnnuallyCounty Mayor Annually– BCC every four (or five?) yearsBCC every four (or five?) years

*City of Richmond v. J. A. Croson, U.S Supreme Court, 1989

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Relationship of Numerical Goals Relationship of Numerical Goals to the Relevant Labor Marketto the Relevant Labor Market

• Goals Must Be Related to AvailabilityGoals Must Be Related to Availability

• Goals Must Be Adjusted on a Goals Must Be Adjusted on a Regular BasisRegular Basis

• A local agency has the power to A local agency has the power to address discrimination only within address discrimination only within its own marketplace.*its own marketplace.*

• Goals May Be Set at Lower Amounts Goals May Be Set at Lower Amounts than Absolute Paritythan Absolute Parity


79

Impact of the Relief on the Impact of the Relief on the Rights of Innocent Third Parties* Rights of Innocent Third Parties*

• Lessening the Burden on Third Lessening the Burden on Third PartiesParties– WaiversWaivers– Limiting certification into an M/WBE Limiting certification into an M/WBE

program based on size and locationprogram based on size and location• Graduation program based on net worthGraduation program based on net worth• Geographical locationGeographical location


m/wbe disparity study update status of recommendations county administration april 17, 2007

Documents

mwbe program

additional mwbe segments

disparity study scope

background current mwbe

updated disparity study

graduation program

credit program

goals unchanged