Technology and Outreach Efforts Diversify City Contracts
Technology and Outreach Efforts Diversify City Contracts
A strong commitment backs the City of Chicago’s efforts to attract and retain minority-and women-owned businesses as repeat vendors
David E. Malone, Chief Procurement Officer, Department of Procurement Services, City of Chicago, IL.
Referred to as the “front yard” of Chicago, IL, Grant Park offers the Field Museum of Natural History, the Shedd Aquarium, the Art Institute, and the Clarence Buckingham Memorial Fountain.
The Department of Procurement Services is housed in the City Hall located in downtown Chicago, IL.
As part of the City of Chicago’s Transparency in Government Initiative, city departments use the newest technology to communicate services and facilitate online transactions. Citywide efforts to make government actions apparent and available include the Department of Procurement Services and its nationally recognized Minority and Women-owned Business Enterprise (M/WBE) Procurement Program.
Over the last three years, Chicago’s Department of Procurement Services has converted its Web site into a portal of downloadable information critical to doing business with the city. Vendors currently doing business with, or wishing to do business with, the city and interested citizens will find a vast array of procurement-related information on the municipality’s Web site: www.cityofchicago.org.
“The city is using the newly redesigned Web site to provide a clearer understanding of its operations,” says Chris O’Brien, the city’s Chief Information Officer. “Chicagoans can watch their government in action in a way that citizens of no other municipality can.”
According to David E. Malone, Chief Procurement Officer for the City of Chicago, “It is our goal to make the procurement process as transparent as possible, and the Internet has been a major component of that goal.
“When this kind of information is made available to the public and potential vendors, we increase access to the city’s purchasing process,” says Malone.
“In turn, we benefit from a more competitive vendor pool that is better aware of the city’s procurement needs.”
The Department of Procurement Services’ Web site includes:
—a searchable Contract/Vendor Database, —a list of all contracts that have been advertised or will be advertised, —economic disclosures of city contractors, —downloadable M/WBE certification applications,
—dates and times for pre-bid conferences, workshops, and vendor fairs, —links to the procurement sites of sister agencies, and —e-mail alerts for news and special events.
The Contract/Vendor Database contains a record of city contracts going back to 1995. The database also contains cover-to-cover copies (in PDF format) of city contracts and vendor economic disclosure statements going back to early 2002. Site visitors can search the database by vendor name, date, and city department. There are more than 20,000 records in the database, with new records added daily.
Also available online is information including bid and RFP openings, M/WBE and Disadvantaged Business Enterprise (DBE) directories, a vendor ethics training program, and bid tabulations.
“Right now it’s informational,” says Malone. “We intend to provide the community with interactive capability that will allow vendors to do business with the city online as of the first quarter next year.”
The online bid component is in place, and the department is currently testing the security features of the Web site.
For now, the department accepts bids on paper and enters the information into the Web bid module. Many of Malone’s 140-person staff provide content for the site. The department’s operational group manages upcoming bid opportunities and is responsible for that content.
Although the entire department is involved in the city’s minority-and women-owned business effort, the M/WBE group manages that Web content.
According to Malone, “Content is universal in our department, and we have a Webmaster who is responsible for posting the information.”
Chicago’s Minority and Women-owned Business (M/WBE) Procurement Program demonstrates the city’s continued commitment to the success of minority-and women-owned businesses.
This nationally renowned program plays a key role in increasing the business opportunities for minorities and women in the city. The M/ WBE ordinance established a goal of awarding 25 percent of the dollar value of all contracts of $10,000 or more to MBEs, and five percent to WBEs. Additionally, all purchases of less than $10,000 are targeted for M/WBEs.
Since the passage of the ordinance in 1989, Chicago’s Department of Procurement Services has successfully met or exceeded its goals.
Minority-and women-owned business enterprises were awarded $466 million, or 48 percent, of city contracts from January to September 2003, marking a steady rise over the last several years. M/WBE participation rose from 42 percent during the same period in 2002. In 2001, minority and women business participation reached 33 percent.
“The city is committed to minority and women business opportunities because it’s the right thing to do,” says Chicago Mayor Richard M. Daley. “When you bring more women and minorities into the business place, you unleash wave after wave of new energy and creativity.” Of the $972 million in total contracts awarded through September 2003, firms certified as African-American owned received 18 percent, or $170 million; Hispanic-owned firms received 13 percent, or $123 million; Asian-owned firms received five percent, or $53 million; and women-owned firms received eight percent, or $79 million.
“When I appointed chief procurement officer David Malone, I said that one of his major responsibilities would be to assure that we have a diverse supplier base. He has done just that,” says Daley.
Target Market Program
Along with M/WBE participation, Target Market awards also are on the rise.
Under the Target Market Program, when the city has three or more M/WBE-certified firms that can participate in a particular bid opportunity, the procurement department can make that bid available only to certified minority-and women-owned companies.
“We use the program on a discretionary basis for those categories where we feel that we have qualified, certified firms that can provide that particular service or supply,” says Malone.
Under those circumstances, the city will put out the bid and indicate that only certified M/WBEs may participate. If the bid is successful, the city then awards to the lowest bidder. If not, the city presents the bid in the open market.
“In most cases, we’ve done extensive outreach before we put a bid out to the target market,” says Malone. “We very seldom have to go open market after we bid something target market.”
During the first six months of 2003, Target Market awards reached 17 percent, up from 10 percent the previous year. Among them was a $49.2 million purchase for 2,500 marked and unmarked police vehicles awarded to Sutton Ford, an African-American-owned car dealership.
“We will continue to work toward a stronger, more diverse business community for the City of Chicago,” says Daley.
According to Malone, “The beauty of the Target Market Program is it allows a number of the M/WBEs to be prime contractors rather than subcontractors.
“Once the M/WBEs are in a position to learn more about doing business with the city directly, they are in a position to expand their business, and most importantly they are in control of the money, which is rare,” says Malone.
Prior to the program, a number of prime contractors were in search of quality M/WBEs with which to work. “I think we have helped build that resource,” says Malone. “Now these firms find it easier to partner with M/WBEs and meet city goals.”
While some non-M/WBE firms realize the benefits of the expanded M/WBE partner base, others have chosen to challenge the program in court. A lawsuit filed by the Greater Builders Association of Chicago against the city states that the program is unconstitutional.
“Many of us have testified in the trial to try to preserve the program,” says Malone. “There are two sides to every issue, and obviously this case is not an exception.”
The Department of Procurement Services hosted the annual Building New Partnerships Conference on November 5, 2003. The forum brought over 2,000 city department heads and M/WBEs together at Chicago’s McCormick Place.
Sessions helped M/WBEs under-stand how to do business with the city, how to become certified, and how to market themselves to other government entities and private corporations. Department heads networked with the city’s extensive M/WBE base, and upcoming bid opportunities were presented.
The city also holds “Doing Business with the City” workshops. Members of Procurement Services visit city wards, holding workshops on M/WBE certification and doing business with the city.
“One of our features this year was technology,” says Malone. “We are putting a major emphasis on our technological outreach.
“I am encouraged that M/WBE firms and businesses in general utilize our Web site because in government we all have to be much more efficient in terms of how we get the information out, and this is a great tool,” says Malone. “I’ve been encouraging firms to go to our Web site, and we are putting as much effort in that area in terms of providing information as any others.”
The Procurement Services Depart-ment’s efforts to highlight technology during conferences and ward visits prepare vendors for the launch of the interactive, online bidding.
“Our focus continues to be to make Chicago’s procurement process more efficient, accessible, and transparent,” says Malone.
The City of Chicago has successfully combined technology, communication, and education to expand and retain the number of women-and minority-owned businesses receiving contract awards, and with that goal comes citywide economic development.