Revised City of South Bend Disparity Study Report

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City of South Bend Disparity Study 2020 B. Implement Race- and Gender -Conscious Measures The study's results support the determination that the City has a strong basis in evidence to implement a race- and gender -conscious M/WBE Program. The record— both quantitative and qualitative— establishes that M/WBEs in the City's market area experience significant disparities in their access to contracts without M/WBE goals, private sector opportunities and to resources necessary for busi- ness success. The dearth of available firms confirms that the obstacles to the for- mation of firms, described in Chapter V, adversely affect potential minority and woman entrepreneurs, especially Blacks. In our view, without the use of narrowly tailored goals, South Bend is likely to function as a "passive participant" in market- place discrimination. We therefore recommend the City adopt the following race - and gender -conscious measures. 1. Adopts Goals for a New M/WBE Program The City should set an annual, overall target for M/WBE utilization in City con- tracts (prime contracts and subcontracts combined). The availability estimates in Chapter IV should be the basis for consideration of overall, annual spending targets for City funds. This target can be the City's goal for its overall spending with certified firms across all industry categories. 168 In addition to setting an overall, annual target, South Bend should use the study's detailed unweighted availability estimates as the starting point for con- tract specific goals: As discussed in Chapter II of the Study, the City's constitu- tional responsibility is to ensure that goals are narrowly tailored to the specifics of the project. The detailed availability estimates in the Study can serve as the starting point for contract goal setting. There should be a goal set- ting module in the electronic system. This methodology involves four steps: 1. Weight the estimated dollar value of the scopes of the contract by industry codes, as determined during the process of creating the solicitation. To increase understanding and compliance, these industry codes could be listed in the solicitation as a guide to how the goal was determined and where the City expects bidders to seek MBE and WBE participation. Good faith efforts could be defined as, among several other elements, an adequate solicitation of firms certified in these codes. 168. We note that the regulations governing the U.S. Department of Transportation's Disadvantaged Business Enterprise ("DBP') program, 49 C.F.R. 4 26.45(d), provide that a recipient should consider adjusting its baseline goal to, among other factors, account for the impact of discrimination on the availability of DBEs. This is often referred to as a "but for discrimination" or "potential' availability estimate. These regulations have been upheld by every court that has consid- ered a facial constitutional challenge to the program. However, to our knowledge, no court has specifically upheld or struck down this approach fora state of local program (although, as discussed in Chapter Il, the constitutional standards are the same). ©1010 Colette Holt & Associates, All Rights Reserved. 99