DOVER – In the midst of nationwide debate on racial inequality, Delaware is moving forward with plans to review its own procurement processes and the lack of diversity among companies contracting with the state.
Up to $500,000 will be allocated for a comprehensive disparity study of the State’s procurement practices. The funds were authorized under the FY 2021 Capital Improvements bill, which passed both chambers of the General Assembly this week and Governor Carney signed into law today.
“To build a level playing field, you have to dig deep,” said Senator Bryan Townsend, D-Newark. “Making sure that businesses from the Black and Latinx communities have a chance to compete is a major part of that effort, and no entity is in a better position to foster diversity in competition than the state. There have been some efforts over the years, but a formal and broader disparity study gives us the opportunity to improve existing programs and make bold changes and investments.”
Currently, the Office of Supplier Diversity is tasked with identifying small businesses owned by minorities, women, veterans, service disabled veterans, and individuals with disabilities.
As of May 19, 2020, there were 355 Delaware-based businesses certified as diverse by OSD. Of those, 131 were minority-owned business enterprises owned by African Americans.
“Our state spends millions of dollars on services and projects in our communities,” said Senator Elizabeth “Tizzy” Lockman, D-Wilmington. “But using taxpayer dollars to build and improve Delaware isn’t just about volume, it’s about direction too. We should be following that money, in order to have a full understanding of which contractors are being hired and how they are being selected. We ask such questions regularly in the General Assembly and I am glad to see that the conversation is expanding to cover diversity as well. Ultimately, it’s on us to make sure that minority-owned businesses have an equitable opportunity to contract with the state and have the same chances to grow that some of today’s largest companies had in decades past.”
Delaware, a state renowned for easy incorporation, is home to a higher percentage of minority- and women-owned businesses than most states, according to a 2019 Delaware Business Times article. But, as the article points out, these businesses make up a very small share of the state GDP.
“For far too long, we’ve seen a lack of diversity in the contracts state government has issued for services,” said Representative Melissa Minor Brown, D-New Castle. “By establishing this review process, we are opening the door to opportunity. We are looking for the opportunity for good and qualified Black-owned businesses to ‘break through’ the network of long-established companies to prove themselves every bit as good — and possibly even better — than some of these other companies.
“This is about getting a foot in the door to ensure that minority-owned businesses have a chance to succeed, and that our state contracts reflect our society. There are plenty of good business owners out there just looking for that opportunity, and we want to look for ways to open that door.”
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Section 36. Disparity Study. The Director of the Office of Management and Budget, in collaboration
5 with the Department of Transportation, Department of Health and Social Services, and the Department of
6 Correction, shall conduct a comprehensive disparity study of the State’s procurement practices. The Director of
7 the Office of Management and Budget shall develop and submit to the Co-Chairs of the Joint Legislative8 Committee on the Capital Improvement Program, a funding and expenditure plan for such study to include, but9 not be limited to, General Fund and Transportation Trust Fund allocations to the Office of Management and10 Budget, the Department of Transportation, Department of Health and Social Services and the Department of11 Correction. shall be authorized to use up to $500,000 from Minor Capital Improvements and Equipment to
12 conduct the study.