Socially and economically disadvantaged businesses gained another ally Monday when the state-run Recovery School District announced the creation of a program aimed at improving their odds of obtaining school construction contracts
The new policy says that the district should make every effort to ensure that 25 percent of all construction work is provided by disadvantaged business enterprises. Socially and economically disadvantaged businesses must apply for certification with the state to participate in the program.
Local and minority business owners have complained about the difficulty in obtaining construction contracts since a $1.8 billion FEMA-funded school construction project began. Many local businesses claim the majority of contracts go to larger, out-of-state companies that have the financing to outbid smaller, independently owned businesses.
No data is available on the percentage of minority and local contracts versus out-of-state construction contracts. But an NAACP survey showed that in a city with a 66 percent African-American majority, 60 percent of local and minority business owners are unhappy with the amount of construction contracts offered by the RSD and the way the application process works.
The new program, headed by Sombra Williams, seeks to maximize the number of local businesses working on school construction and renovation projects that are set to go out for bid in the next 12 to 18 months. Williams will also provide tracking and oversight to ensure compliance among contractors.
Local and minority business owners, members of the NAACP and Urban League of New Orleans applauded the new policy at a news conference held at Sophie B. Wright Charter School on Monday.
“The city and the state is only as good as its policy,” said Bob Brown, managing director of the New Orleans Business Council. “We believe that economic development in this city is crucial as a crime-prevention tool, a stabilization tool, as well as an education tool.”
State Schools Superintendent Patrick Dobard said the new policy offers an inclusive, transparent and accessible means by which disadvantaged businesses in the region can benefit from economic opportunities within the RSD.
The policy outlines specific obligations that both contractors and businesses applying must follow and will be closely monitored by the program. The RSD will also track and review actual contractor compliance and compliance efforts.
“Contractors who fail to show a ‘good faith’ effort could be subject to a penalty of up to $3,000,” Dobard said.
The Orleans Parish School Board attempted to vote on a similar policy last week but the vote stalled when board members could not agree on the wording. The Orleans Parish School Board’s disadvantaged business policy differs from the RSD policy in that the OPSB set a goal of 35 percent for socially and economically disadvantaged businesses participation.