First draft of the City of New Orleans disparity study is released

5th March 2018   ·   0 Comments

By Fritz Esker
Contributing Writer 

The City of New Orleans unveiled a draft report of its Disparity Study at a press conference last Wednesday at the New Orleans Jazz Market. The findings confirmed what many knew and suspected: that minority and women-owned businesses did not have the same opportunities as other companies. 

The study included 5,000 surveys and comments from over 500 business owners, as well as census data, revenue data, past City of New Orleans contracting data, and other information. Keen Independent Research conducted the year-long study for the city. 

The study, available for view at noladisparitystudy.com, stated that African-American firms receive about 29 percent of the city’s contracting revenue under the current SLDBE (state/local disadvantaged business enterprise) program. However, these numbers were skewed by contracts worth over $60 million going to just two firms. Only 11 percent of the City of New Orleans’ construction dollars are going to African-American firms even though those firms make up 27 percent of the marketplace. 

Only seven percent of construction general contractors and 10 percent of architecture and engineering firms owned by people of color or women are used for commercial development projects in the overall marketplace (excluding city government).

At the press conference, New Orleans Mayor Mitch Landrieu commented on frustrations business owners voiced over the years. 

“We hear you…Over the years, you said that the ability to even compete for government contracts was viewed as a waste of many small businesses’ time because City Hall wasn’t about what you knew, it was about who you knew,” said Landrieu. “You told us… that the city’s DBE (disadvantaged business enterprise) certification process was not widely known, that it was too cumbersome, the office was inadequately resourced, and enforcement to ensure compliance was virtually non-existent.”

Judith Dangerfield, acting director of the Office of Supplier Diversity, said one of the most common hurdles minority- and women-owned businesses face is discrimination from lenders. She said the city established the BuildNOLA Mobilization Fund to help these businesses secure loans. The initial funding was $1.5 million, but she said they hope to increase that to $10 million. 

Dr. Silas Lee, a consultant on the study, said he was not surprised by its findings and the study confirmed that African Americans today face discrimination just as their parents and grandparents did. 

Those involved with the study agreed that ending discriminatory practices will require the assistance of both the government and the private sector. 

“City government can’t do it alone,” said Dr. Lee. “We need the involvement of companies from the private and commercial sectors.”

“The government is such a small part of the economy,” Dangerfield said. “Even when we push the government to its limit, there’s only so much the government can do without the help of the private sector.” 

Quentin Messer, Jr., president and CEO of the New Orleans Business Alliance, said that ending discrimination isn’t just the right path morally; it’s also the right path from an economic and business perspective. He said many national companies will not move to states where there are discriminatory practices. 

“Amazon was very clear (in its search for a new home),” said Messer. “Finding places that celebrated diversity and inclusion was a central criteria for them.” 

Dave Keen, principal of Keen Independent Research, agreed. The study noted that 44 percent of construction and professional services firms in New Orleans are owned by women or minorities. 

“If you hamper the ability of these firms to thrive and grow, it negatively affects the whole economy.” 

Keen said the final draft of the study will be released later in the spring. The city is still seeking comments from the public for the study until March 31 (comments can be anonymous). Anyone who wants to participate can visit the website at noladisparitystudy.com. 

“There’s a lot of people we haven’t heard from yet,” said Keen.

This article originally published in the March 5, 2018 print edition of The Louisiana Weekly newspaper.