Racial Disparities in Boston’s Municipal Contracts
Lawyers for Civil Rights calls on the City of Boston to implement immediate corrective action to address the gross racial disparities in municipal contracts confirmed by the City’s recently released Disparity Study. LCR stands ready to take legal action against the City if race-conscious measures are not implemented to diversify municipal contractors.
Recent reporting from the Boston Globe and WGBH has unveiled highly concerning statistics on just how little Boston awards municipal contracts to Black- and Latinx-owned businesses. Boston’s Disparity Study demonstrates that under the Walsh Administration just 1.2% of the City’s $2.1 billion spent in municipal contracts over a 5 year period went to Black- and Latinx-owned businesses. The City spent less than half a percent on Black-owned businesses. The racialized outcome — over which the City has direct control — raises the specter of deliberate and intentional discrimination against and exclusion of Black and Latinx-owned businesses on the part of City officials. In this manner, Boston’s municipal contracting program is essentially segregated, and taxpayer dollars are being funneled to white-owned businesses.
This stark and shameful disparity is even more shocking because the Disparity Study asserts that Black and Latinx-owned businesses are available to perform the type of work that the City needs, but the City is simply not contracting with them. According to the Disparity Study, the City could have easily awarded at least 3.6% of procurement dollars to Black-owned businesses. That is approximately 70million that could — and should — have gone to Black-owned businesses to help close the opportunity and wealth gaps in historically disadvantaged communities. The intentional concentration of wealth in white hands exacerbates and compounds gross disparities along racial lines that have long persisted in Boston, but that the City has not cared to address. The harm is real; it can even be monetized. The harm is also compounded annually — and generationally — as people in Black and Latinx communities inherit poverty and exclusion from municipal contracting opportunities in Boston.
The impact of the City’s ongoing reluctance and refusal to meaningfully diversify municipal procurement cannot be overstated. Boston is already one of the most racially and economically stratified cities in the country. A report by the Federal Reserve Bank of Boston documented how “the net worth of whites as compared with nonwhites is staggeringly divergent.” Business ownership is one of the primary ways in which families can accumulate, and pass along, wealth from generation to generation. By continually refusing to act to diversify the City’s procurement program, Boston is directly — and reprehensibly — contributing to and exacerbating this wealth gap.
The City must take immediate corrective action to ensure that these appalling disparities are materially addressed. Lawyers for Civil Rights has repeatedly called on the City to enact more meaningful programs to alleviate these profound disparities.
First and foremost, the CIty must immediately enact race-conscious measures to break down the discriminatory barriers to equal contracting opportunities that currently exist. The gross disparities reported by the Disparity Study amply confirm that a race-conscious procurement program is long overdue and must be implemented with urgency to cure the deep injustices embedded in Boston’s municipal contracting system. Additional necessary steps include:
1. Breaking down large prime contracts into smaller pieces that smaller companies can successfully compete for. This also has the advantage of increasing competition, thus resulting in better prices for the City.
2. Establishing small or local business programs that provide incentives and/or subcontracting requirements for all small or local businesses. Since M/WBEs are disproportionately small, a small or local business program will often increase M/WBE participation.
3. Requiring each city department to conduct an annual assessment of future needs for goods and services, and proactively communicating these future needs in outreach efforts to small businesses through community-based partners such as the NAACP, BECMA, Amplify Latinx, and the Greater Boston Latino Network.
4. Enacting prompt payment programs, to ensure that prime contractors pay their subcontractors in a timely fashion.
5. Quarterly public reporting of M/WBE participation, disaggregated to reflect MBE and WBE participation separately, as a means for city officials, the M/WBE community, and the public to see where progress is being made and where more work needs to be done.
6. Performance measures for department heads that include success at meeting M/WBE participation goals.
7. Eliminating unnecessary RFP/RFQ and other bid criteria to ensure that overly-stringent requirements do not unnecessarily inhibit competition and limit the ability of M/WBE firms to compete.
8. Providing bonding assistance by playing a brokering role between M/WBEs and financial institutions and bonding companies to help secure a required loan or bond.
9. Creating a publicly accessible dashboard and scorecard for transparency and accountability with respect to progress on M/WBEs.
10. Streamlining certification processes to ensure they are not cumbersome or inaccessible to small businesses.
The City has failed to adopt or implement these concrete and viable proposals. The lack of progress signals an intentionality surrounding the municipal contract apartheid system that currently benefits white people. There is a strong aversion to diversity and equity inhibiting progress.
If the city fails to move forward with aggressive steps to break down the discriminatory barriers that have now been documented, LCR stands ready to take legal action against the City on behalf of Black- and Latinx-owned small businesses that have been discriminated against and excluded by the City.
LCR also sent the City a cease and desist letter, and public records request in connection with the minority contracting scandal. The letter is available here:Cease-and-Desist-Letter-and-Public-Records-Request
LCR sent the DOJ and DOT a letter reiterating the urgency of its investigation following discussions with MBE’s eager to begin the remediation process and following the release of yet another vague Executive Order from the Walsh Administration. The letter is available here:Letter-to-DOJ-and-DOT-re-City-of-Boston