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NYCEDC is the primary vehicle for executing NYC’s economic development agenda. There are a wide variety of elements that fall in this category, including:
MWBE goals represent a percentage of awarded contract value that should be earned and paid to firms that are owned by a qualified minority or woman and are certified as such by the appropriate entity. For example, if ABC Contractors (a non-M/WBE) wins a $1,000,000 prime contract with the City to renovate a streetscape and the project has a 20% overall M/WBE goal, then $200,000 worth of that streetscape work should be subcontracted out to M/WBE firms.
The work involved in each project is assessed to determine the capacity for M/WBE involvement. Once an analysis of the work is complete, we determine the amount of work that, under normal circumstances, would be subcontracted out to other businesses. We then determine what types of trades would be necessary and whether there are ample M/WBE firms available to execute the work. For certain trades-- with waterfront work, for example-- there are not many M/WBE firms available so it would be hard to set a goal without restricting competition. However, for most projects there are ample M/WBE firms and goals can be set as long as there is sufficient capacity for subcontracting.
In addition to considering inherent project opportunities, NYCEDC must consider the requirements of the funding entity. NYCEDC receives funding from federal, state and city sources. State M/WBE goals, City M/WBE goals and Federal DBE goals are all calculated differently and have different guidelines. Sometimes a single project will be funded by a mix of all three jurisdictions. The rule is that the highest funding jurisdiction’s program applies to the entirety of the project. For example, if there are any federal funds invested in a project, then federal guidelines apply, no matter how small the amount of federal funding. If only state and City funding is involved, then the State’s program is followed. While the difference between City and State M/WBE programs is minimal, the difference between those and Federal programs is substantial in that the DBE designation is used at the Federal level. The DBE designation, which stands for Disadvantaged Business Enterprise, is similar in spirit to M/WBE guidelines but it is designed to be race and gender neutral and focuses more on economic criteria. A business must prove it is owned and operated by one or more “socially and economically disadvantaged” persons.
For projects funded with NYC funds, Local Law 129 applies. Local Law 129 was crafted to address the effects of historical discrimination, which still effect MWBEs today (link to related question focused on LL129). This law calls for goals on projects that include trades for which there are ample MWBEs available to do the work. Agencies are required to meet a goal which varies depending on MWBE-type (HA, BA, AAP, etc) and work type (professional services, construction, standard services).
Goals are calculated as a percentage of payments made. For example, if a project award is $2 million and the MWBE goal is 20%, the aim is for MWBE firms to receive at least $400,000 worth of work.
Procurement Stage: The low bidder on a project with M/WBE goals must submit what is called a Subcontractor Participation Plan to show how, if selected, it will meet the M/WBE goals on the project. The Plan lists all the subcontractors the low bidder will use along with award amounts and expected start dates for each firm. We also require a signed Intent to Perform as Subcontractor form (IPS) from each subcontractor on the Plan to ensure that they have been contacted and have agreed to work with the low bidder on the project. Any deviations from this plan must be cleared with NYCEDC before the change is made.
Payment Stage: The Opportunity M/W/DBE team at NYCEDC reviews all payments to contractors before funds are disbursed. We keep a robust spreadsheet that tracks all payments and calculates progress towards M/WBE goals. If a project is falling behind on goals, our real time tracking process allows us to coordinate with the Prime Contractor to address any problems that would prevent them from meeting the project’s M/WBE goals.
In a 1989 Supreme Court decision Richmond v. J.A. Crosson penned by Sandra Day O’Connor it was determined that states and municipalities could have M/WBE goals programs only if they were backed up by disparity studies—studies that prove that M/WBEs are not being used in proportion to their availability in the marketplace. The goals laid out in legislation usually vary depending on minority type and work type and aim to close the gap verified by the local disparity study. For example, NYC’s Local Law 129 sets separate goals for the following minority types: Asian, Black, Hispanic and Women. The goals for each minority type vary depending on the categories of work: construction, professional services, standard services, goods and supplies. A critical concept here is the notion of availability. It is not enough for a disparity study to show that the City has not utilized many Black-American owned firms on professional services contracts. This number has to be considered in relation to how many such firms exist in the local market. In other words, M/WBE programs won’t address the problem of low business creation among any particular minority community in a particular sector. Capacity building programs, however, such as Blueprint to Success, do focus on correcting this imbalance by removing barriers to entry for M/WBE firms and focus on increasing the number of available M/WBE firms who are ready and willing to perform a certain trade.
NYCEDC has created the Kick-Start Loan program to help address this barrier.
Be persistent. Complete the application and then follow-up to see if it has been accepted. Major CMs will have at least one staff person in charge of M/WBE outreach or community affairs. Find out who this person is and reach out to them and let them know you are trying to get work with them.
No. Our Vendors List is an internal database of firms interested in doing business with NYCEDC. New York City M/WBE Certification is a distinct process administered by SBS.
There are both private and public agencies that certify businesses as M/W/DBEs. While there is some cooperation between agencies, there is currently no reciprocity between agencies for certified businesses. A business will need to apply separately to each agency. In New York City metro area, the following agencies will certify businesses:
Following are four most common certifications:
NYCEDC and SBS have staff members available to provide technical assistance on the certification process. On a monthly basis, SBS holds group seminars on completing the certification application. M/W/DBE staff at NYCEDC is also available to provide one-on-one technical assistance to businesses on the certification related issues. In addition, M/W/DBE staff can work with neighborhood groups to bring the certification and other technical workshops directly to the community.