Marshawn Wolley: Bill would destroy supplier diversity in Indiana

Senate Bill 133 undermines supplier diversity and threatens Indiana minority businesses.

The proposed policy requires local government units (like Indianapolis) to accept key aspects of the Indiana Department of Administration’s minority-, women- and veteran- certification standards.

Indianapolis would lose its ability to control its certification process and race and gender program—which is supposed to be narrowly tailored to meet the city’s demographics, geography and procurement needs.

The city and state used to have agreements in which a company could more easily pursue state certification if it already was certified with the city. The city and the Indiana Department of Transportation currently have memorandums of understanding establishing a similar arrangement because they have the same federal criteria for certification.

Because the city and state have different geographic areas for their programs and different demographics and procurement needs, the city has a different definition of minority and more defined definitions of control, independence and affiliation. Only around 20% of businesses are certified by both agencies.

Indianapolis is among the most diverse areas of the state, so its spending goals are different from the state’s.

Perhaps more concerning is that, while the city does onsite visits to ascertain whether a business does what it purports to do, the state does not. The state also has reciprocity agreements with other states, allowing companies not domiciled in Indiana to bid on local contracts. This directly impacts the number of out-of-state businesses seeking to work with the city and reduces the intended benefit to local minority businesses—especially Black businesses.

This is a smack in the face.

There wasn’t any consideration as to how businesses from around the state and outside the state would be able to use state certification as a loophole to access city contracts.

Even as the state and local governments would likely see an increase in workload, there is no proposed increase in funding for an already under-resourced state office.

The state has 10 total employees for all Division of Supplier Diversity functions, including four that focus on certifications. Indianapolis has eight employees who are focused on certification and helping XBE vendors.

More cynical minds might believe the goal is to end Indiana supplier diversity

This bill wasn’t designed to help the Black business community. It was designed to be efficient. The conversations with very few Black-business-serving organizations happened only after the decision to pursue the policy was made.

When one juxtaposes this attack on the city’s certification office and very public pronouncements concerning efforts by state officials to eliminate state funding for diversity, equity and inclusion, one sees pieces falling into place.

Taking an understaffed agency that cannot do site visits and creating a massive incentive to expand the number of businesses applying for certification to their agency and not providing additional resources isn’t about improving effectiveness.

It is a recipe for reducing the credibility of the certification process by making it easier for businesses that don’t actually meet the criteria for certification to get by, or pass through.

Eliminate the need for a city office, leaving only the state office. Defund the state office. Supplier diversity in Indiana is gone. Sounds efficient.

My genuine concern is that some wish to have an “efficient” path to exploiting supplier diversity programs.

In the name of “efficiency,” supplier diversity will become indefensible in Indiana.•

__________

Wolley is president and CEO of Black Onyx Management Inc. Send comments to ibjedit@ibj.com.

Click here for more Forefront columns.