For many years the GBC has worked hard at developing positive, businesslike approaches to the M/WBE issue. We helped develop and worked very closely with the former Alliance Internship Program of the State of New York, which was designed to strengthen the M/WBE construction community in terms of quality construction companies which can compete, long term, in this difficult industry. We work closely with the Regional Alliance for Small Contractors, a New York City Public, Private Partnership designed to strengthen the M/WBE construction community through an integrated program of support in the areas of education (both supervisory and upper management), advice, and financial and bonding supports. In addition, we worked very hard with the State of New York to develop Article 15-A of Executive Law. Our aim, in that case, was to develop a workable law that was fair, realistic, and businesslike.

Any locality wishing, or any other owner required, to set up M/WBE requirements would do well to adopt Article 15-A’s provisions. This would help ensure uniformity and equity. Absent that, some potential pitfalls in such programs require comment.

UTILIZATION GOALS: Unreasonable goals increase the likelihood of dispute and problems, while placing an aura of confrontation rather than cooperation around the whole issue. When setting goals, issues of availability must be considered. In looking at availability one must look at the type of work available and likely to be subcontracted, the raw number of subcontractors capable of performing that work, and the net availability of those contractors given market conditions.

LOCAL RESTRICTIONS: Often found are requirements that for credit toward the goal, the M/WBE must meet certain residency requirements. Such a restriction is unconstitutional as violative of the privileges and immunities portion of the Constitution. In addition, it makes the attainment of the goals all the more difficult. Most importantly, it places discriminatory restrictions on M/WBEs not placed on majority firms.

SUB-SUBCONTRACTING LIMITATION: A limitation that the M/WBE may not subcontract more than a specified percentage to non-M/WBE firms is an undue restriction on the contractor’s right to do business. We have found that, in general, subcontracting limitations impede competitiveness.

SUBLISTING: Beyond the legal restrictions to sublisting noted in the SUBCONTRACTING AND SUBLISTING section, a sublisting requirement may tend to restrict M/WBE subcontracting opportunities rather than encourage them. The harried nature of the bidding process, the fact that many sub-bidders do not submit prices until the last 15 minutes of bid time, and the fact that many do not submit prices until post-bid, all combine with the sublisting requirement to discourage the use of M/WBEs. In fact, the listing requirement and the clause in many affirmative action plans requiring the contractor to negotiate with M/WBE firms are in direct conflict.