Agencies studying need for DBE programs

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By Janice Bitters
BridgeTower Media Newswires

As projects like the St. Croix Crossing bridge between Minnesota and Wisconsin fall short of goals for hiring businesses owned by women and minorities, Minnesota officials are embarking on a study of whether such preferences are still needed.

Michael Beer, project director at the Minnesota Department of Transportation, acknowledges that the $626 million St. Croix Crossing project won’t meet its goal of having 15.7 percent of the work go to so-called disadvantaged businesses. As recently as 2015, the bridge project between Oak Park Heights, Minn., and St. Joseph, Wis., appeared to be moving in the right direction.

But then an important contributor and woman-owned business — Colby-based J&L Steel and Electrical Services — quit after finding that it could not afford to continue working on the project. Now only 11.5 percent of the work on the St. Croix Crossing project is likely to go to disadvantaged businesses, Beer said.

Eight state and local agencies in Minnesota are now taking part in a study looking at the difficulties that minority- and women-owned businesses face when trying to land government contracts for construction, professional services, commodities and other services.

The study is expected to cost more than $1.4 million and is being organized by the Minnesota Department of Administration. The state and local agencies it looks at all have policies meant to give preferences to businesses that have been disproportionately passed over for work in the past.

Minnesota officials are not the policymakers to struggle with set-asides. Their counterparts in Milwaukee have done some similar soul-searching.

This summer, Milwaukee County officials approved an ordinance change that effectively gets rid of a limit that had prevented women- and minority-owned business that had seen their net wealth rise above $1.34 million from continuing to compete for parts of county contracts set aside for disadvantaged companies. In arguing earlier this year for the ordinance changes, Rick Norris, director of the county’s Community Business Development Partners division, said that “your wealth does not change your DNA.”

The Wisconsin Department of Transportation, for its part, has set-asides of its own for disadvantaged businesses trying to work on state-commissioned projects.

The department has disadvantaged-business goals that differ depending on whether a project is receiving federal highway money, transit money or aviation money. For the current fiscal year, the goals call for 14.13 percent of the work on highway projects to go to disadvantaged businesses, 2.78 percent on transit projects and 4.8 percent on aviation projects.

David Hunt, a spokesman for WisDOT, said the department’s disadvantaged-business policies have exceeded their annual goals in each of the last four years.

As for Minnesota’s disadvantaged-business policies, nothing guarantees that they will be around forever. To keep them active, agencies are required by state law to show that once-disadvantaged groups still face an uphill battle in securing contracts, said Alice Roberts-Davis, assistant commissioner of property and purchasing at the Minnesota Department of Administration.

“The purpose is for us to be able to further the program that we have in place right now, but only after we’ve demonstrated the disparity,” she said.

Yet not all projects in Minnesota are falling short. In downtown Minneapolis, for instance, the $1.1 billion Minnesota Vikings stadium project, finished earlier this year, has exceeded its various goals for work by both women- and minority-owned businesses.

The Daily Reporter staff writer Alex Zank also contributed to this report.