Houston disparity study: Program essential to M/WBE public contracting
Published on 05/22/2012
In mid-April, the City of Houston released the results of its minority and women-owned enterprise (M/WBEs) disparity study, which analyzed data on M/WBE participation on city-funded construction contracts between 2005 to 2010.
During the study period, M/WBEs as a group earned 29.2 percent of all construction dollars awarded. This finding indicates that the City of Houston currently has been meeting its annual goal of 22 percent M/WBE participation on city-funded contracts.
The study also discovered, however, that after the city stopped placing WBE participation goals on contracts following a legal settlement, WBE participation on city construction contracts decreased by more than 50 percent. Moreover, the study found disparity in ethnic minority groups' participation in the commercial construction market relative to their availability. This evidence led the researchers to conclude that the city's M/WBE program is "necessary to ensure full and fair access to opportunities; without outreach and contract goals, they would receive little or no work."
The study recommends that the city enhance or adopt various race-neutral and race-conscious measures to further increase M/WBE participation in city contracting, including:
- Increasing communication with M/WBEs regarding opportunities, networking events, certification information, and program policies;
- Unbundling contracts so smaller businesses can obtain work as prime contractors;
- Implementing a bonding and financing program;
- Maintaining a 22 percent M/WBE participation goal;
- Counting M/WBE prime contractor participation toward individual contract goals; and
- Crediting lower tier M/WBE utilization on individual contracts.
The City of Houston has administered a M/WBE program since 1984.
