- Chicago to Reshape Minority Contracting
- March 12, 2012 | Author: Joseph F. Spitzzeri
- Law Firm: Johnson & Bell, Ltd. - Chicago Office
Chicago Mayor Rahm Emanuel recently announced plans to carve out construction projects under $3 million for small businesses and give city contractors credit for the minority hiring they do in the private sector under a plan to bolster minority contracting. Instead of maintaining the legally shaky “Target Market” program that allows minorities and women to compete against each other for the more lucrative role of prime contractor, Mayor Emanuel plans to launch a “Small Business Initiative” that’s race-and gender-neutral. Inspector General Joe Ferguson had urged the Mayor to immediately halt the “Target Market” program on grounds that it may be considered a quota program, which has been explicitly rejected as unconstitutional by the U.S. Supreme Court.
Small businesses will now have roofing, fencing and other construction work below the $3 million benchmark reserved just for them. That’s likely to total $30 million to $40 million in 2012 alone, officials said.
The second new initiative, known as the “Diversity Credit Program,” is aimed at leveraging the city’s purchasing power to bolster minority contracting in the private sector. For every $3 of private sector money shared with minority and women-owned contractors, a company will get $1 worth of credit when it comes time to bid on subsequent city work with a maximum credit of 5 percent. It is anticipated that the 5 percent credit may turn out to be the difference between being the low bidder or not. To qualify for credits, company attorneys and accountants will be required to sign sworn affidavits verifying minority contracting and open their books to periodic audits.