Council considers penalties for vendors that don’t meet minority-contracting goals

A proposal by the Indianapolis City-County Council would give teeth to the city’s minority contracting goals and policies, penalizing vendors that don’t meet its expectations.

Proposal No. 231 amends the code governing the Office of Minority-Owned and Women-Owned Business Enterprise to strengthen oversight of bidder commitments to meeting city expectations regarding the utilization of minority-owned firms.

The proposal calls for conducting a disparity study every five years and creating a utilization plan for minority-owned, women-owned, disabled-owned and veteran-owned businesses based on the disparity study’s results. Every city and county contract would be subject to adhering to the utilization plan.

The council’s Rules and Public Policy Committee on Tuesday voted 9-1 to advance the proposal to the full council for consideration. Only Councilor Brian Mowery, a Republican, voted against the measure, saying he wants to hear more about how the office will work with contractors to ensure they meet goals before they’re penalized.

Currently, city code calls for utilizing minority-owned, women-owned, disabled-owned and veteran-owned businesses (also known as XBE) for public works projects and procurement of goods and services for at least 27% of the dollars spent—15% for minority-owned, 8% for women-owned, 1% for disabled-owned and 3% for veteran-owned. The goals are not regularly updated, and there has been no ramifications for vendors or contractors that fail to meet those goals.

By amending the code to require a disparity study and utilization plan, plus laying out penalties for contractors that fail to meet goals, the City-County Council aims to eliminate discriminatory outcomes in contracting practices.

Should the proposal be approved, contractors would be required to make a “good faith effort” to reach the city’s contracting goals. That effort would be judged by the Office of Minority-Owned and Women-Owned Business Enterprise, which would consider a variety of actions by the contractor, including advertising in minority-focused media for at least 10 days before bids are due; mailings to XBE firms notifying them of contracting opportunities; documented reasons why a XBE firm’s bid was rejected; and documented efforts to provide technical assistance to any XBE firm in obtaining the bonding or insurance required by the city, among others.

If OMWBE’s director determines that a vendor failed to comply with the provisions of the utilization plan, actions could be taken against the contractor. First, the office would need to serve the vendor with a written notice of the deficiencies, and the vendor would then meet with the office to discuss correcting the non-compliance.

If the non-compliance isn’t corrected, the office would recommend the contracting department of agency take one of the following actions: withhold a portion or all future payments for the project until the vendor is in compliance; place the vendor on the city’s debarred vendor list, which prevents them from bidding on other contracts for a period of time; or terminate the contract agreement.

Representatives from that OMWBE told councilors that in the past, the city found vendors that weren’t meeting goals but couldn’t do anything about it.

The proposal moves to the full council, which next meets Sept. 14.