Black businesses shorted on stimulus contracts

Aaron Glantz, New America Media

Black Business.jpgSince President Barack Obama signed his stimulus package into law inFebruary, the U.S. Department of Transportation has handed out morethan $150 million in contracts to companies for street, highway andbridge construction.

New statistics released this week by the Transportation Equity Network(TEN) show that from that pot of money not a single dollar had beenallocated to any African-American owned business.

"Stunning," is how TEN's media director Stephen Boykewich described his organizations' findings.

"What we're seeing all over the country is that in spite of statedlanguage in the stimulus bill that this was supposed to go todisadvantaged communities hit hardest by the recession, thosecommunities are having incredible difficulty gaining access to thosefunds."

TEN, a 22-state network of more than 300 community organizationsfighting for an equity-based national transportation system, crunchednumbers publicly available on-line at the Web site of the government'sfederal Procurement Data System ( in making their findings.

The federal Department of Transportation had so far given out $163.8million in direct contracts, they found, and of that only $16.8million, or about 10 percent, had gone to all minority-ownedbusinesses; $4.7 million, or about 3 percent, had gone Hispanic-ownedbusinesses. Not a single black-owned firm had received a contract fromthe DOT.

In Washington, a DOT spokesman refused to comment for attribution forthis story and wasn't able to offer an explanation of the statisticsassembled by the Transportation Equity Network.

He added that the DOT's Disadvantaged Business Enterprise (DBE) programdoubled in size over the last year. and he forwarded a press releasestating the agency "has participated in many national events" andorganized "workshops, presentations, and DBE Days" to increase theamount of minority contracting.

Transportation Secretary Roy LaHood also sent a letter to everygovernor in the country December 7 urging them to "take advantage ofexisting equal opportunity programs and resources and to createinnovative strategies to provide opportunities for theunder-represented" with transportation infrastructure dollars theyadminister under the $787 billion American Recovery and ReinvestmentAct.

Richard Copeland, the African-American owner of Thorn Construction inMinneapolis, says those efforts haven't been successful because LaHoodis only offering suggestions and not enforcement.

"You've got to put teeth in it and be willing to withhold the stimulusmoney if it's not being enforced," he said. "Unless you mandate andenforce it, it's not going to work.

"It's asking for voluntary participation and voluntary cooperation, andpower is not conceded using those types of methods," he said. "You'vegot to mandate that money goes into communities of color and thenfollow up.

Copeland, who is the immediate past president of the MinorityContractors Association in Washington, DC, said the small number ofminority firms receiving stimulus contracts is a partial cause of theDepression-like unemployment levels that now plague theAfrican-American and Latino communities.

In November, the Labor Department reported the seasonally adjustedunemployment rate of 15.6 percent for blacks and 12.7 for Hispanics. Itis 9.3 percent for whites.

"We know that 60 percent of the employees of minority firms are peopleof color," Copeland said, "so if none of us get contracts, people inour communities won't get jobs."

The Transportation Equity Network believes the best way to solve thisproblem is to create a 30 percent set-aside of work hours fordisadvantaged workers as part of any new jobs bill that passes theHouse in the coming month, as well as stronger accountability andtransparency in tracking the use of all federal funds for economicstimulus and job creation.

In the meantime, the Boykewich, pointed to Missouri as a state where significant progress is being made.

Missouri's Department of Transportation recently agreed that low-incomeconstruction apprentices would make up 30 percent of the work force ona $500 million highway project that was just completed. Working withtrade unions and community groups, the department also agreed to use$2.5 million of the project's federal funding to train low-incomeresidents in construction work.

"And the best part was the project came in on time and under budget," Boykewich said.

Boykewich said he's cautiously optimistic after seeing LaHood'sletter's to the governors. The Obama administration is moving in theright direction, he said, even if communities of color have yet to seeany results.