Hartford Business Journal

www.HartfordBusiness.com • September 21, 2020 • Hartford Business Journal 9 aside, leaving crumbs for firms owned by racial and ethnic minority owners. "I can assure you that if you broke it out, you would see the numbers are skewed toward women," said Hurst, of the supplier council. "It would expose an unfortunate reality." Complicating matters is the fact that the state has not publicly report- ed a more detailed breakout of the contract allocations for more than a decade, making it difficult to say with certainty whether some groups are being treated unfairly compared to others, and if so, to what extent. That's led to calls for a new dispar- ity study, which would help deter- mine an updated set-aside target and prove the extent to which there is discrimination against minority en- terprises in the contractng process. However, lawmakers have failed to fund a study in recent years. It could cost $2 million and require a complex analysis of how many minority-owned firms have capacity to handle various types of state contracts in a geograph- ic market, and the extent to which they are getting an unequal portion of work. The state's last formal disparity study was conducted in 1992 and deter- mined the 6.25% minority set-aside tar- get that remains in place today, despite untold economic shifts since then. "They just need to put the money behind it," said the Minority Con- struction Council's Little-Greer of a disparity study. "Currently, because everything is being lumped togeth- er, the numbers are being skewed." There is some evidence from CHRO — which has advocated con- sistently for disparity-study funding — that women-owned companies were faring better than minority- owned firms back in the mid-2000s. A 2009 CHRO report revealed that in 2008, 38% of all certified minority enterprises were owned by minorities, while 60% were women- owned firms. However, minority- owned firms received just 15% of the contract dollars allocated that year, while women received 82%. The Hartford Business Journal requested a similar breakout from DAS for the past decade, but the agency said it couldn't provide it before press time because the data was not in easily usable formats. CHRO, meanwhile, ignored inter- view requests for this story. McCrory said he believes the data will show that not much has changed about the diversity pro- gram since 2008. "94% of the work can go to white men in this state and the other 6% can go to their wives and we would still be in compliance with the policies of the state of Connecticut," said McCrory, who is Black. "We've been at this the last 30 years and we've changed nothing." Fact finding Getting a disparity study off the ground has proven surprisingly difficult. Lawmakers in 2011 farmed out the task to the Connecticut Academy of Science and Engineering (CASE), but after approximately four years of work, the nonprofit group, which was paid $755,000 for the first three phases of its analysis, was unable to get additional funding for a final cru- cial phase. CHRO officials and others criticized CASE for being unqualified to conduct such a complex study on a topic with which it was unfamiliar. Terri Clark, CASE's executive director, told HBJ that she stands by the group's first three phases of analysis, and noted that CASE had hired an advisor who is an attorney and expert in disparity studies. CASE's initial reports found evi- dence of disparities by race, ethnic- ity and gender for factors such as business formation, earnings, credit access, homeownership and home lending, but the final phase of the study, which would have analyzed the presence, availability and utilization of minority-owned firms in Connecticut for state contracts — crucial pieces of a disparity study — was never funded. Over the past few legislative ses- sions, lawmakers have filed bills pro- posing that CHRO or other entities conduct the disparity study instead of CASE, but funding has not come through. The stakes of a new study would be high. It could find that some minority groups are more disadvantaged than others and therefore deserve a higher percentage of contract revenue. It's also possible that it finds there is less disparity than expected, which could lead to lower set-asides for minority groups. The need for the study to make changes to the set-aside program stems from a 1989 U.S. Supreme Court ruling that Richmond, Virgin- ia's diversity program was unconsti- tutional because it was not based on actual evidence that minority-owned firms faced disparities. The simple fact that the minority population in the Richmond area was greater than the amount of contracts won by minority-owned firms was not suf- ficient evidence, judges ruled. While there's been legislation in recent years seeking to make piecemeal changes to Connecticut's diversity program, lawmakers and officials have been wary to make them absent an updated study. "Any changes [to the contract set-aside program] made without the backing of a disparity study could put the whole program at risk if it were challenged in court," DAS spokeswoman Lora Rae Anderson said. "We want to make sure that if the legislature votes for changes, that they have the tools to do it right, and in a way that will make long lasting change." Agencies exceeding minority contract goals, but data misleading Connecticut's public agencies often greatly exceed the target of awarding 6.25% of their contract dollars each year to minority business enterprises (MBEs), which include those owned by women of any race. It's unclear from the state's Supplier Diversity Program performance reports whether certain minority groups are receiving more of the funding than others. 2012-2019 2012 2013 2014 2015 2016 2017 2018 2019 totals MBE goal $33,333,821 $36,102,415 $24,840,500 $40,130,302 $29,727,039 $25,859,182 $35,022,169 $32,079,137 $257,094,565 MBE actual $85,143,900 $124,451,054 $110,671,434 $140,458,174 $110,013,551 $130,110,307 $74,063,777 $125,901,088 $900,813,285 % of goal achieved 255.4% 344.7% 445.5% 350.0% 370.1% 503.1% 211.5% 392.5% 350.4% Source: DAS, CHRO Sen. Doug McCrory (D-Hartford) speaking during a June press conference about a broad legislative agenda to combat systemic racism. He wants the state to conduct a study of disparities faced by specific minority groups in accessing state contracts. Peter F. Hurst Jr. (far left), president and CEO of the Greater New England Minority Supplier Development Council, says the state must do more to ensure minority-owned companies win more state contracts. PHOTO | YEHYUN KIM, CT MIRROR PHOTO | OLIVIER KPOGNON

• Cover