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Small Diverse Business contracting disparity study for Pennsylvania DGS released
Published on 11/16/2018

The Department of General Services (DGS) for the Commonwealth of Pennsylvania has released their recently completed 2018 Disparity Study, which was conducted in order to evaluate the DGS's implementation of their Small Diverse Business (SDB) program. The survey looked at the participation of minority-, woman-, disabled-, veteran-, and LGBT-owned businesses that were awarded DGS contracts between July 11th of 2011 and June 30th of 2016.

The study found that there was an availability of 22.1 percent for minority- and woman-owned businesses (MWBEs), meaning that it would be expected that such firms would receive 22.1 percent of contracting dollars during the period of the study. However, MWBEs only received 4.5 percent of the total contracting dollars that were awarded during that period. Only 3.3 percent of total contract dollars, in fact, were awarded to MWBEs who were certified through the SDB program.

While MWBEs received 30.3 percent of subcontracting dollars during the period, the vast majority of funds awarded by DGS were through prime contracts. Overall, MWBEs scored very low on "disparity index" scores that show them as receiving fewer contract dollars than would be expected given their availability.

The study makes a number of recommendations to DGS, including that DGS consolidate a number of similar programs with the SDB program to reduce confusion, introducing an RFP method for more bids which would allow for best-value methodology in awarding bids (which would increase occasions on which SDB participation can be considered), increasing aspirational participation goals based on study data, requiring prime contractors to subcontract out certain percentages of contracts given to them, operating its own certification program, prompt payment policies, and more.

The full study can be read at https://www.dgs.pa.gov/Businesses/Small%20Diverse%20Business%20Program/Pages/Commonwealth-Disparity-Study-.aspx.

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