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Maryland county underutilizes minority, women and the disabled businesses

A new study has found that Montgomery County underutilizes minority, women and the disabled business firms (MFDs) when purchasing goods and services for the benefit of the county.

The study, released on September 9th and conducted by the Griffin & Strong consulting firm, found that between 2007 and 2012, the County spent around 14 percent of available funds for goods and services on contracts with minority and woman owned firms while spending around 0.45 percent for similar contracts with firms owned by disabled individuals. In certain categories, such as construction or professional services, large disparities exist between the number of MFD firms available to provide services and the number of MFD firms that actually find work with the County. In the comments by Griffin & Strong, the firm noted that the disparity was "statistically significant enough to suggest the possible presence of discrimination."

In the case of construction work, Griffin & Strong found that 21.5 percent of purchase orders went to minority and women-owned businesses while noting that such firms represent 26.2 percent of the total number of contractors available to provide services to the county. The disparity between the use of minority and women-owned businesses and availability of those firms increases greatly for purchase orders of $500,000 and over. In such cases, women and minority-owned businesses accounted for only 15.5 percent of purchases. For professional services, such as accountants and attorneys, the percentage of total spending is around 8 percent with the study noting 18 percent of available firms being minority or women owned.

A similar 2005 study also found that Montgomery County underutilizes MFD firms. In response, the County created the Local Small Business Reserve Program and committed county agencies and departments to allocating 20 percent of their budgets for goods and services to small businesses. The County's General Services Department also began a program specifically focused on bringing more county work to MFD firms called the Minority, Female and the Disabled Persons Owned Business Program. While the 2014 study applauds the efforts taken since 2005, Griffin & Strong reported that Montgomery County must take further steps to close the gaps between level of usage of MFD firms and the number of MFD firms available.

The County Council has received the study and plan to hold hearings on the study next month.