REMARKS
Council Member Won's Opening Remarks For Hearing on Equitable Access to Infrastructure Project Contracts
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7 min
Council Member Julie Won discusses the critical issues affecting minority and women-owned business enterprises (MWBEs) in New York City's contracting landscape, particularly in infrastructure projects managed by the Department of Design and Construction. Highlighting ongoing challenges such as historic discrimination, administrative hurdles, and significant disparities in contract allocations, Won advocates for updated policies and studies to ensure equitable access and oversight, including the introduction of legislation aimed at improving MWBE participation and accountability.
Speaker 2
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Thank you so much, Chair Brooks Powers.
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Good morning.
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My name is Julie 1, and I have the privilege of chairing the city council's committee on contracts.
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The purpose of this hearing is to discuss minority and women owned business enterprises also known as MWDEs as you all are familiar.
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Participation in city contracting specifically related to infrastructure projects overseen by Department of Design And Construction.
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MWBEs make up significant portion of small businesses in our city.
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However, historic global discrimination and other barriers have made it difficult for these firms to access city contract opportunities.
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The city seeks to remedy the the severity its MWD program and its annual 30 percent MWD contract utilization goal across our city in we just heard from Cherbrook's powers.
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We acknowledge that the mayor has said that he wants to reach 60%.
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So that is double the amount of goal that we currently have today.
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Yet, year after year, the city falls short of this target.
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The controller's latest annual report on WWE procurement found several issues, small shares of contracts awarded to MWBE's overall, disparity amongst minority groups in contract values, administrative hurdles and contracting processes, and late late payments to MWDs even after contracts are awarded.
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Further underscoring the outdated nature of the city's MWE policies, the latest comprehensive disparity study examining MWE utilization dates back to 2018 using data from 2015.
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I wanna put on the record that it is now the year of 20 24.
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Local law mandates the city con conducts a disparity study at least once every 2 years.
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Yet this requirement has been ignored over the last several years, both by the Adams administration and the Blasio administration, which is not in a city law, but it's federal and state regulations.
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As a result, 30% of utilization goals and other MWDB policies remain rooted in pre pandemic economic reality that does not reflect our current contracting landscape.
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An overdue refresh of the disparity study would provide crucial update and updated analysis to right side's goals and better target civic racial ethnic and gender category still facing disproportionate hurdles for contracting.
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As we push agencies like DDC to meet even basic utilization trip thresholds, an updated disparity study is necessary for accurate MWDE information regarding today's contracting reality.
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A report will be released today at 11:11 AM from the city controllers office, and it will reveal that DC continues to fall short on contracting with MWA's.
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DDC is responsible for over half of the city's MWA eligible contracting of requirements and roughly 31.3 percent of DDC's contracts went to MWE's in fiscal year 2023.
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However, those contracts only accounted for 2.8% of DDC's total for fiscal year 23 contract value use, subject to the 30% of the MWD utilization goal.
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So for me to hear that 2030, we're trying get to 60%, we have a long ways to go.
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This proportionate gap between number of contract awards and Dollar Valley does little to close the disparity for WBE Firms in the city.
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At today's hearing, we seek to understand why DDC in particular struggles to meet these aggregate WBE contracting goals.
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For example, on the largest city construction project last fiscal year, the $3,000,000,000 contract with a B, For the Brooklyn Detention Center, DDC established a 30% utilization goal for MWBE subcontractors.
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But less than a year into the contract, only 1%.
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1% was approved subcontractor spending has gone to MWA's.
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So a 30% goal, 1% actually given.
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This underscores of serious disparities that continue to exist in DDC's contracting, where MWBE's are winning a reasonable share of contracts by volume, that those contracts represent only a tiny fraction of the agency's overall construction spending.
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DDC's 2.8% prime contract utilization rate in fiscal year 23 shows backsliding from prior years and leave significant room for improvement.
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As we examined broader trends in the city's infrastructure contracting through an equity lens, we must address the persistent underutilization of MWDEs by DDC.
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The controllers analysis this makes it clear that while DDC has made some progress, there remains much more work to be done before the city meets its state of 30% goal or Mayor Adams' 60% goal.
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We look forward to hearing CDC's testimony on improving participation rates and subcontract oversight going forward.
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In addition to assessing the current state's state of DDC's contracting, today's hearing will also consider legislation aimed at improving accountability, oversight and outcomes for MWDEs, sponsored by majority of Woodbrook's power, intro 23.
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This bill would mandate the city controller conduct annual audits.
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Requiring regular focused audits will help continue shining a spotlight on disparities in this area while driving rec locations for meaningful change.
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As our recent controller analysis will show, CDC in particular would benefit from a enhance scrutiny through comprehensive yearly audits targeting equitable infrastructure contracting for MWBE Firms.
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We look forward to a thoughtful discussion around the potential impact of intro 23 as part of our broader efforts that meet the 30% MWDE utilization goal.
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And in summary, we want to determine what barriers exist that result in low MWD utilization rates across our city and at DDC.
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And our goal is to develop a solution that connects more certified MWDE firms with contracting opportunities as especially on vital infrastructure projects.
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And as you have heard from Cheyenne Brooks Powers, that we are focused on diversity within diversity.
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We are going to continue to aggregate your MWDE data to recognize that that out of 5% that were awarded to MWDEs, that 4% were awarded to white women.
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And we want to see within the minority data how much of it has gone to women of color which is 1%, which is 1% that aggregates for Asian women, black women, and brown women.
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Before we begin, I'd like to thank committee staff senior legislative counsel, Alex Paulinoff, Paul's Nissan analyst, Alex Yablon, Principal finance analyst, Neha Hayat, my chief of staff, Nicholoda, my legislative director, Isaac Blasenstein, my legislative fellow, Greg, and for all their hard work for preparing this hearing.
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I'll now turn over the floor to counsel to swear in the administration.