Relationships are the foundation of inclusion

By Robert Gonzalez

It's all about relationships.

Recently, the National Association of Minority Contractors-Wisconsin Chapter met with Milwaukee developers Mandel Group and The Towne Group. NAMC-WI members also met with contractors Gilbane Building Company, Milwaukee, and Beyer Construction, New Berlin.

These meetings were unique because we were invited to discuss construction projects before they started in southeastern Wisconsin. That represents a change - inclusion rather than exclusion - in the way the construction industry works with minority and disadvantaged businesses.

Although the relationships and levels of participation still aren't where they should be, there is a cautious air of optimism among our members. Owners and developers are recognizing it makes more sense to work with certified minority and disadvantaged businesses early rather than falling short of participation goals.

Reaching those goals is a problem for some agencies.

Milwaukee's Emerging Business Enterprise Program is under inspection. An internal audit showed the city in compliance. An external audit will show the 18 percent goals are not being met.

The Wisconsin Department of Transportation's Disadvantaged Business Enterprise Program is littered with so called good-faith waivers, which let prime contractors submit bids without disadvantaged-business participation if the prime makes a good-faith effort to request bids but can't get any of the 270 DBE subcontractors to submit a low bid. Unfortunately, this is usually the norm.

WisDOT is the first to talk about the high DBE numbers on the $800 million Marquette Interchange project. The agency exceeded 20 percent DBE participation on the Marquette, but WisDOT is around 8 percent for the rest of the state.

Wisconsin's Minority & Women Business Enterprise Program, which is certified through the state Department of Commerce, is having problems as well. Sometimes getting through the bureaucracy of the certification process is enough to deter minority contractors from trying to get certified.

An inept 2 percent to 3 percent participation is the norm for the MWBE. Gov. Jim Doyle appointed a task force to find out why the 5 percent goal was never achieved and what can be done to correct the problem.

It seems odd that no one from NAMC was appointed to the task force. NAMC is the largest and oldest minority contractors association in the country, our contractors would be the major group impacted by the study, and we could provide a wealth of insight.

One would think the governor would be interested in the opinions of a locally represented national organization to help resolve the problem.

There are programs that work. The Milwaukee Public Schools Contractor Program not only sets an attainable 18 percent goal, but it also requires prime contractors to include lists and breakdowns of their subcontractors.

On bid day, the prime contractor submits a list of subs that have the various certifications, which include DBE, EBE, MWBE, Small Business Enterprise or Wisconsin Supplier Diversity Certification. This makes it easier for primes to find qualified, certified subcontractors. On bid day, if there's not 18 percent, then there's no bid.

The Wisconsin Housing and Economic Development Authority has a similar program with an aggressive participation goal of 25 percent of subcontracts. WHEDA also identifies with all disadvantaged certifications.

The Milwaukee Metropolitan Sewerage District recently met with NAMC-WI to discuss the district's interest in a program similar to those of MPS and WHEDA and the need for the minority/disadvantaged business subcontractor list on bid day.

That should be the template for all public-sector projects, including those commissioned by Milwaukee County, which offers an ineffective DBE program.

What will make these programs effective is the owner's support of the development and participation of minority and disadvantaged businesses. This is simply small-business development, and if the owners enforce inclusion there will be more opportunities. As owners, MPS and WHEDA understand the value of participation and the elimination of good-faith waivers.

That's why it's so important to meet with companies like The Towne Group and Mandel Group. In the private sector, these owners understand relationships.

When the owners understand, prime contractors like Gilbane and Beyer will understand and look to create and strengthen relationships with disadvantaged businesses.