De Blasio’s Minority Contracting Plan Is ‘Insulting,’ Business Leaders Say

HARLEM — A plan by Mayor Bill de Blasio to increase the involvement of minority and women-owned developers in city housing and economic development projects is being panned by some of the largest minority business leaders in the city as "insulting."

Under the proposal announced by de Blasio and Public Advocate Tish James Wednesday, the city will create a $10 million predevelopment loan fund to help up-and-coming firms get the financing needed to launch projects. Another $10 million fund will help create a bond fund so the firms can bid on contracts.

The city also plans to break down large projects into smaller pieces and encourage larger firms to partner with smaller minority firms as equity partners on certain contracts.

The problem, according to multiple developers, is that the plan is not aggressive enough in the face of the city's poor record on minority contracting and does nothing to help more established minority development firms who are trying to compete for projects at the highest levels.

"Right now, the patient has been shot six times and is bleeding to death and all the mayor is offering are Band-Aids and two aspirin," said Larry English, CEO of Transportation Consortium of New York, a national group of developers that is attempting to become equity partners on the $4 billion redevelopment of LaGuardia Airport's central terminal.

Blacks and Latinos received only .43 percent of the $13.8 billion in city contracts given out in fiscal year 2015, according to a report from Comptroller Scott Stringer. That earned the city a D+ in Stringer's report.

"The mayor is saying all the right things and they are clearly engaged but I think they lack a fundamental understanding of how to address this issue. De Blasio seems very reluctant to use his bully pulpit to challenge the status quo in the city," English added.

The amount of money being committed to bond and loan funds sent many developers a message that the city is not taking the issue of minority contracting serious enough, said Don Peebles, CEO and founder of The Peebles Corporation, one of the largest minority-owned development firms in the country.

"The fact that he would propose a $10 million pool to support minority developers is an indication that the de Blasio administration doesn't know what they are doing," said Peebles, who is considering running for mayor in 2017.

The group estimates that each developer would only be able to access around $500,000 to $700,000 at a time from the fund.

"There is nothing that any developer can really do with that amount of money in a city where a $100 million project is considered small," Peebles added.

Peebles' chief information officer attended Tuesday's 90-minute roundtable meeting in City Hall's Blue Room which was also attended by de Blasio and the heads of the city's Economic Development Corporation, Housing Preservation and Development, Small Business Services and de Blasio's counsel and minority and women owned businesses director, Maya Wiley.

Critics say while Wiley is highly regarded, she wears many hats as one of the mayor's top advisors and could not devote the attention to minority and women owned business issues that the subject deserves.

"Maya Wiley is brilliant but unless Maya Wiley's only job is to build MWBE and she has the authority and power to do that, it doesn't matter," said Bertha Lewis, head of the The Black Institute and a founding member of The Working Families Party who supported de Blasio for mayor but has criticized the city's minority contracting efforts.

Critics have called on the mayor to hire a chief diversity officer — which he has resisted — saying his team does not have enough experience with minority and women owned business enterprise (MWBE) contracting.

Rev. Johnnie Green, pastor of the 1,500-member Mount Neboh Church in Harlem and president of Mobilizing Preachers and Communities, a group trying to increase minority participation in state and city contracts, said he refused to attend Wednesday's meeting.

Green said an earlier meeting in July on the topic with the mayor left him discouraged about how serious de Blasio was in addressing the issue and Wednesday's announcement proved it.

"This mayor was overwhelmingly elected by black and Latino people in this city," said Green. "He talks about income inequality and the 'Tale of Two Cities' but he's literally writing the next chapter in the 'Tale of Two Cities."

De Blasio received 96 percent of the black vote and continues to enjoy high support from both blacks and Latinos although some polls show the mayor's base is slipping.

"He's already losing black support. He just doesn't seem to know it," said Green.

Asked to respond to the criticisms of the developers and business leaders in the meeting, city officials cited the $1.6 billion in contracts awarded to MWBE firms in the last fiscal year.

The mayor also committed to continuing the conversation and working with the group to get banks to lend more to MWBE firms — an idea that lost support after the mayor and his staff dismissed a recommendation to get the banks that hold the city's deposits to increase MWBE lending as possibly against the law.

"It’s never possible to please every party, but here we have a real basis— backed by elected officials, advocates and the private sector — to continue the expansion of MWBE business done by the city," said de Blasio spokesman Wiley Norvell.

James agreed, saying there was "serious work ahead" but that she considered the plan "an important step."

Brian Benjamin, managing director and partner of Genesis Companies, which is rehabbing 28 buildings formerly owned by Abyssinian Development Corporation in Central Harlem, said he considered the plan the beginning stages of a longer conversation.

"While what they presented was not enough to move the needle, it's still moving in the right direction," said Benjamin. "If they stop moving, then I will have a problem."  Read article HERE

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