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Council Considering Racial Disparity Study for Businesses

By German Lopez · July 31st, 2013 · City Desk
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City Council might use leftover revenue from the previous budget cycle and money from the parking lease to fund a disparity study that would gauge whether minority- and women-owned businesses should be favorably targeted by the city’s contracting policies.

“Once we conclude the parking lease agreement and see the results of the close-out of the last budget year, I believe there may be a majority (of Council) that would support funding a Croson study,” Vice Mayor Roxanne Qualls told CityBeat.

The disparity study — named a “Croson study” after a U.S. Supreme Court case — could cost between $500,000 and $1 million, according to city officials.

Qualls expects to see the final revenue numbers from the previous budget cycle sometime this week. The numbers are expected to come in higher than projected, which would give Council some leftover money to allocate for newer priorities, including a disparity study.

Another potential funding source: the city’s parking lease agreement with the Greater Cincinnati Port Authority, which will take over Cincinnati’s parking meters, lots and garages and manage them through various private companies from around the nation.

The announcement comes shortly after minority inclusion became a major issue in the 2013 mayoral race between Qualls, John Cranley, Jim Berns and Sandra “Queen” Noble.

Cranley announced his minority inclusion plan, which includes a disparity study, on July 12.

Because of a 1989 Supreme Court ruling, city governments are unable to enact programs that favorably target minorities or women without first doing a disparity study that proves those groups are underrepresented.

The city’s last disparity study was done between 1999 and 2002. It found evidence of disparities but ultimately recommended race- and gender-neutral policies to avoid legal uncertainty that surrounded the issue at the time. But since the city did away with its affirmative-action contracting policies in 1999, contract participation rates for minority-owned businesses dropped from a high of 22.4 percent in 1997 to a low of 2.7 percent in 2007. Participation among women-owned businesses remained relatively flat, hitting a high of 6 percent in 2005 and otherwise fluctuating between 0.9 percent and 3.8 percent from year to year.

Rochelle Thompson, head of the city’s Office of Contract Compliance, points out that classifying as a minority- or women-owned business is now voluntary, whereas it was mandated through the city’s policies in the 1990s. That, she argues, might be understating how many contracted businesses are truly minority- or women-owned. Still, business leaders are calling on the city to do more. They claim minority-owned businesses are more likely to hire minorities, which could alleviate an unemployment rate that’s twice as high for them as it is for white Cincinnatians.

Qualls says City Council hasn’t pursued a disparity study until now because it was waiting for the full implementation of recommendations from OPEN Cincinnati, a task force established in 2009 after Mayor Mark Mallory and his administration were criticized for neglecting the city’s small business program. The resulting policies forced the city administration to be more transparent and accountable for the program’s established goals.

Thompson says OPEN Cincinnati’s changes “breathed life” into the small business program, but none of the changes specifically targeted minority- and women-owned businesses. Instead, the program broadly favors and promotes small businesses, which Thompson calls the drivers of job and economic growth.

 
 
 
 

 

 
 
 
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