The Mayor’s Commission on Construction Industry Diversity has just held its first public hearing to take testimony on race and gender discrimination in Philadelphia regarding economic participation. The goal of the public hearing process is to make real-life experiences a part of the public record which will lead to a report due in September that will be delivered to the Mayor and City Council. Most of the commission’s work will focus on workforce utilization, which is also the subject matter of hearings to be convened by City Council after the report is due. Somewhat obscured in the process is the fact that workforce utilization is only one part of the economic participation equation, diversity in business contracting matters as well – if not more.

The Commission was formed in response to City Council deliberations on the expansion of the Pennsylvania Convention Center. The Convention Center Expansion legislation was introduced in City Council with a goal of only thirteen percent utilization of disadvantaged businesses and no workforce utilization goals other than new apprenticeship initiatives. The diversity goals approved by Council were far more aggressive by the time that we had our final say.

Subsequently, Convention Center and State officials pushed the Mayor and Council into giving final approval to the project before all diversity matters were properly settled, in deference to the creation of the Commission. Also obscured in that process was the fact that “public works” is only one component of business diversity, and our best opportunity to maximize our impact on the larger diversity issue was during deliberations over the largest public works project in the history of the Commonwealth of Pennsylvania.

The political opportunity that was somewhat lost in that process can be regained, in the examination of future projects, but even more importantly, in the review of local public policy and its implementation related to business diversity. Ironically, Econsult Corporation is advising the Commission on workforce utilization, but is also advising the City on its business diversity issues.

Pursuant to Title 17 of the Philadelphia Code, as amended in 2006, an annual disparity study and contract participation goals must be submitted to the Mayor and Council regarding business diversity plans for the next fiscal year (FY). The disparity study conducted by Econsult, minus participation goals, was just delivered to Council in the first week of the fiscal year, a month later than mandated by the Philadelphia Home Rule Charter.

The overall utilization of disadvantaged business enterprises (DBEs), as documented in the disparity study, actually declined from 22.8 percent in FY 2006 to 20.8 percent in FY 2007, the last full fiscal year of the Street Administration.

Overall DBE utilization was also down from 12.1 percent in FY2006 to 10.1 percent in FY 2007 for DBE firms located within the City of Philadelphia – but DBE firms located outside the City of Philadelphia experienced an increase in utilization from 5.5 percent in FY 2006 to 7.5 percent in FY 2007.

Needless to say, the charter change amendment that I sponsored, requiring the annual report, has given us crucial information related to business diversity in City contracting - but we still await a new day that ensures better DBE contract participation in the over $500 million spent by the City for goods and services with for-profit companies. It’s our money – it’s our government – business diversity matters, and we should buy from Philly first!