Mayor Cranley: Cincinnati must work faster to improve results for women- and minority-owned firms

'Numbers getting better, but not good enough'

CINCINNATI – The city of Cincinnati is making progress when it comes to contracting with businesses owned by women and minorities.

It's just not happening fast enough.

That's according to Mayor John Cranley, who created an Economic Inclusion Advisory Council in February to try to figure out where the city can boost spending with women- and minority-owned companies.

"The numbers are getting better, but they're not good enough," Cranley told WCPO in an exclusive interview. "We're still far short of where we need to be."

The city's minority contracting results have been under fire for years. Cranley's advisory committee marks the third time since 2009 that officials have undertaken a major effort to improve the city's dismal minority contracting numbers .

Cranley highlighted the issue during his campaign for mayor, arguing that strong women- and minority-owned businesses were a critical part of any thriving city.

The city has a Small Business Enterprise, or SBE, program. City officials measure success based on contracts awarded to companies that are certified as small businesses with the city. Those certifications are based on the size of the businesses and the net worth of their owners and do not take race or gender into account.

City officials track their spending with businesses owned by women and minorities when the business owners provide that information voluntarily. But businesses are not required to provide it.

Even so, the city has faced considerable pressure from the public and business leaders to boost its spending with women and minorities, who make up a large percentage of the city's population but win a tiny fraction of the total contracts awarded.

Mayor Aims to 'Reflect The Diversity Of The City'

Between Jan. 1 and March 31 of this year, for example:

• The city spent nearly $70 million on various products and services.

• Of that total, the city spent about $1.8 million, or 2.6 percent, with small businesses owned by African-Americans.

• The city spent about $2.6 million, or 3.2 percent, with small companies owned by white women.

• In all, the city spent roughly $10.4 million, or 18.5 percent, with certified SBEs. That includes businesses owned by minorities, white women and white men.

"We've done a great job of meeting the SBE goals over many years, which is good," Cranley said. "But we clearly campaigned on the belief that our contracting policies should reflect the diversity of the city."

That's where Cranley's advisory council comes into play. He and Cincinnati City Council members appointed the group in late February to find ways to boost spending within the confines of the city's current program.

The council has about 75 members, including high-ranking executives from Kroger , Horseshoe Casino Cincinnat i and Hightowers Petroleum , one of the largest minority-owned companies in the regio n. Janet Reid and Vincent Brown, two veteran economic inclusion consultants, are leading the work.

Having Reid and Brown at the helm has helped attract a broad cross-section of business and community leaders to help with the work, said Crystal German, a member of the council who is vice president of the Minority Business Accelerator and economic inclusion at the Cincinnati USA Regional Chamber.

"I think people know if they're going to get involved in this, it's going to go somewhere," she said. "It isn't an effort in futility."

The council has met a number of times, and about three dozen of its members went to Cleveland recently to learn more about that city's approach to economic inclusion. A trip to Atlanta is planned, too.

German said she was impressed so many business and community leaders in Cleveland seemed to share a common view and determination when it came to minority inclusion.

"Cleveland is a different kind of town," said Eric Ruffin, a member of the council who also went on the Cleveland trip. He's owner of ABEL Building Systems. "They have a strong mayor government where the mayor's allowed to pound on his desk and say, 'By golly, we're going to get this done because it's the right thing to do.'"

Cranley seems determined to do as much of that as he can in Cincinnati within the structure of Cincinnati's city manager form of government, Ruffin said.

But in Cleveland, he said, "They got passionate about it. And they made it happen."

Multiple Efforts Continue

The council is scheduled to complete a plan to improve Cincinnati's results by Oct. 1, 2014.

While that group continues its work, the city also has hired a different consulting firm to conduct a so-called Croson study to look for disparities in the way the city issues contracts to companies owned by women and minorities.

If the Croson study finds such disparities exist, it could pave the way for the city to change its program and make race and gender a consideration when awarding contracts.

City officials also have been trying to improve their results by working more closely with the city departments that spend the most money, said Rochelle Thompson, the city's contract

compliance officer. Consultant Steve Love has been working with Thompson's office to help departments examine their spending and figure out whether there are ways to restructure contracts in a way that can make it easier for small businesses to bid on them, Thompson said.

Love has been working specifically with the city's Transportation & Engineering, Health, Metropolitan Sewer District, Water Works and Enterprise Technology Services departments, she said.

Several of those departments showed strong results in the city's First Quarter SBE Report:

• Transportation & Engineering, for example, spent nearly $2 million with SBE firms between Jan. 1 and March 31 of this year. That represented 35.1 percent of the department's overall spending.

• The Health Department spent $6,841 with SBE companies during that same time period. That was 80.5 percent of its overall spending.

• And Water Works spent nearly $4.4 million with SBE firms, or 44 percent of its total for the quarter.

Love said that shows his recommendations and the city's efforts are working.

Performance reviews for department heads and other key city employees now include ratings on their small business contracting results, Love said. And the city requires competitive bidding for professional services because of those changes, he noted, something that wasn't required in the past.

But the city still has a long way to go to make sure women and minority business owners are winning contracts, he said.

"There's not been enough improvement in that area by far," said Love, who also is a member of the Economic Inclusion Advisory Council.

Ultimately, Love said he wants Greater Cincinnati to become known as a region where women and minorities can establish businesses and grow them. That, he said, would help create more jobs for women and minorities and help improve the region's neighborhoods.

But the region is a long way off from that goal, he said.

"We have a lot of hard work to do," Love said. "We need to roll up our sleeves and continue that work."

For his part, Cranley told WCPO he's confident the city can improve its results.

"It will require vigilance and determination, but we have those things. My only worry is the speed at which we can improve," the mayor said. "There's no question we can make dramatic strides over the next two years. The only question is how much progress we can make over the next six months because that will set the pace."

For more stories by Lucy May, go to www.wcpo.com/may . Follow her on Twitter @LucyMayCincy.

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