When Angela Denmark signed a “master agreement” with the city of Cincinnati in July 2012, she expected the contract to help her one-woman court reporting agency grow into the thriving small business she wanted it to become.
Instead, Denmark has earned less from the city than she did in the year before she won the contract. And she has watched a larger competitor get work she thought would be hers.
“It just turned into a big, fat mess,” Denmark said. “I suffered financial devastation.”
Denmark calls her experience a “cautionary tale.” Other observers say the story helps explain why many local women and minority business owners don’t bother trying to get work with the city.
“What I say to people is you need to hunt where the hunting is good,” said Howard Elliott, president of Elliott Management Group, a local supplier diversity consulting firm. “As we look at the city, for most of these minority- and women-owned businesses, the city isn’t a good place to hunt.”
The city of Cincinnati has been under fire since 2009 for its track record when it comes to awarding contracts to women and minority business owners.
In 2013, for example:
• Small businesses owned by white women got $11.2 million in contracts from the city, or about 4.6 percent of total city spending, according to the city’s most recent report dated March 7, 2014.
• The city spent about $5.3 million with small, black-owned businesses during that same time frame, or about 2.1 percent of the total.
• Totals for Asian- and Hispanic-owned companies were even lower. Spending with Asian-owned companies amounted to less than 1 percent, and the $22,500 spent with Hispanic-owned firms barely registered in the city’s total spending of $246 million.
But the city’s results are far more nuanced than those percentages imply.
As much as advocates want to see women and minority business owners get more work with the city, Cincinnati has what is known as a Small Business Enterprise, or SBE, program that is race and gender neutral.
That means women and minorities can’t legally get special preference when it comes to awarding city contracts. Instead, the city targets spending with companies that are certified as SBEs, based on the size of the companies and the net worth of their owners.
Insiders can read more about how well the city is meeting its SBE targets, what other policies are in place to help small businesses win work with the city and how those policies did – or did not – work in the case of Denmark and another local business owner.