A LegIslatIve Game Changer for MWBEs

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A History of reform

in 1992, a disparity study compared the number of Minority and Women-Owned Business enterprises (MWBEs) that existed in the City and the State against the actual number of MWBEs being utilized in City and State government contracts. the study concluded that MWBEs received a disproportionately small share of City contracts.

In response, Mayor David Dinkins introduced an executive order to direct 20% of the City’s procurement to MWBEs and to allow contracts to be awarded to MWBEs that were up to 10% higher than the lowest bid. As a result, the percentage of City contracts awarded to MWBEs grew from 9% in 1990 to 17% in 1993. In 1994, Mayor Rudolph Giuliani eliminated the 10% allowance.

A New Day in NYC

Over a decade later, in 2005, the City Council published a study finding that MWBes had the capacity to succeed on contracts under $1 million, and yet they still were not receiving their fair share of contracts.

As a result, Mayor Michael r. Bloomberg signed Local Law 129, creating a new MWBE program to be administered by the City’s Department of Small Business Services (SBS) and the Mayor’s Office of Contract Services (MOCS). Since the passage of Local Law 129, the number of certified MWBes in new York City skyrocketed from 700 in 2005 to more than 3,700 today, with MWBE firms winning over $3 billion in contracts in the process. On January 7, 2013, Mayor Bloomberg made history again with his signing of Local Law 1 of 2013. A multifaceted law designed to further increase the participation goals for MWBEs, Local Law 1 of 2013 builds upon the foundation created by Local Law 129 and opens new doors for small businesses in new York City.

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The 411 on local law 1 of 2013

Local Law 1 of 2013 improved Local Law 129 by eliminating the previously established $1 million cap on MWBE- eligible contracts and encouraging increased city procurement contracts for goods, professional services, construction, standard services as well as architectural and engineering services. these expanded prospects are expected to increase the total value of MWBe- available contracts from $433 million to $2.2 billion.

“Local Law 1 of 2013 improves the Minority and Women-Owned Business enterprise Program by eliminating the $1 million cap on contracts for MWBEs and enhancing oversight and reporting requirements to ensure that the City is meeting its contracting and MWBE participation goals,” says Mayor Bloomberg. “it also authorizes agencies to set MWBe utilization goals for contracts above the $1 million threshold established by the old law.  this will more than triple the number of contracts covered by the City’s MWBe Program. MWBEs have been awarded more than $3 billion in City procurement contracts since LL129 was implemented and will now be able to compete more effectively for higher-valued contracts.”

“Local Law 1 of 2013 demonstrates  the commitment of the City to increase opportunities for new York’s Minority and Women-Owned Business enterprises. By increasing procurement goals, offering capacity-building services and holding City agencies accountable, we have created a new paradigm for small businesses who want to do work with the City,” he adds.

Local Law 1 of 2013 also calls for the creation of a contract tracking system, more refined compliance procedures and an increase in on-site visitations to bolster the certification process. Likewise, the legislation establishes accountability measures including mandatory meetings for agency representatives to review progress toward achieving MWBE goals as well as efforts to espouse MWBE participation and partnership. in addition to the aforementioned provisions, Local Law 1 of 2013 has helped streamline the certification process and upgrade the City’s MWBE directory. MWBes benefit from a more robust Online Directory of Certified Firms – a critical resource for marketing MWBes to agency and corporate buyers.

The enhanced directory also allows firms to update their business information online in real time to include insurance and bonding information and thorough descriptions of recent work experience. “Our administration is committed to providing the essential tools that small businesses and MWBes need to compete for and win City work,” said Deputy Mayor Cas Holloway. “By expanding contracting opportunities for MWBe firms and focusing on accountability and results, this legislation will both improve business opportunities for MWBEs and ensure that the City gets high quality work at the best price.”