Minority contractors are asking how $8 billion in national high-speed rail grants were awarded without the same contracting goals that apply to highway projects.
The rail grants awarded last month, including $822 million accepted by Wisconsin, did not include disadvantaged-business enterprise contracting requirements for the construction and engineering work.
The National Association of Minority Contractors is trying to change that policy by pressuring Congress and the White House to add the contracting goals, said Tom Burse, president of the association’s Wisconsin chapter and a DBE-certified consultant seeking work on the Madison-to-Milwaukee line.
“We would like to see very similar percentages that we would see on our federal transportation highway and bridge projects,” said Burse, owner and CEO of Buveck Consultants LLC, Milwaukee.
Congress in 1983 ordered the Federal Highway Administration to ensure 10 percent of its contracting money goes to DBEs, which are small companies and businesses owned by minorities and women.
But the Federal Railroad Administration, which awarded the rail grants, is not authorized by Congress to set DBE goals, said Warren Flatau, senior public affairs specialist. Instead, the agency holds education sessions with state departments of transportation on how to promote fair contracting, he said.
“It’s what every federal agency does,” Flatau said, “whether they have a DBE program or not.”
Kathy Meyer, president and CEO of DBE-certified Meyer Contracting Inc., Minneapolis, said NAMC next week will send letters to President Barack Obama and U.S. Rep. Jim Oberstar, D-Minn., chairman of the House Committee on Transportation and Infrastructure, asking that DBE goals be added to the $8 billion in grants.
“We have asked for an amendment,” said Meyer, a member of the NAMC board. “And we have asked for all future dollars that are appropriated and opened for public letting include DBE goals.”
Burse said federal DBE rules carry more weight than those enforced by state departments of transportation. With federal goals in place, general contractors are required to look for DBE companies that could work as subcontractors. If generals do not meet the contracting goals and apply for waivers, the generals must show there are no DBE companies with the experience or capacity to do the work.
Meyer said her company has the skill and ability to work on the high-speed rail projects. Her firm excavated and moved water utilities as part of a project to build a streetcar system in Minneapolis and St. Paul, Minn. That project, she said, had a 15 percent, state-enforced DBE goal.
“You need true enforcement,” Meyer said. “If you had true enforcement, you would see those small DBEs grow and flourish.”
Burse is trying to grow his company by pursuing a consulting contract for the Madison-to-Milwaukee rail line. The Wisconsin Department of Transportation, after holding meetings in December to invite DBEs to pursue the work, is interviewing engineers this month for the consulting contracts.
But, with no DBE rules in place for the contracts, Burse is competing for a prime contract against much larger companies, he said.
“What better way to break into a market where there aren’t any goals?” Burse said. “To just flat-out win.”