Shelby County relaunches minority- and women-owned business program

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Shelby County on Monday amended and prepared to relaunch its program to support minority- and women-owned businesses in government contracting, bringing back a program halted in November 2020.

The county halted the program after being sued by a group of contractors who argued that it resulted in discrimination against white-owned businesses.

Now, armed with data showing the county has a legal basis to prioritize businesses that are 51% owned by minorities or women, the program is poised to return so that the county can commit “to using its spending power in a manner that promotes a robust and inclusive economy that fully utilizes all segments of its business population regardless of race or gender,” according to the resolution approved Monday.

“This will be a very important step to relaunch this program,” said Commissioner Van Turner, one of the ordinance’s sponsors. “I think this is something all commissioners are wanting to see put back in place, so we are happy to work together to make that happen. I think the community will be well pleased with what we’re doing. We’re more specific with this program and more closely aligned with what they’re doing at the state and the city, so I think there will be additional support for the success of this program.”

Commissioners approved the third and final reading of the ordinance amending their policies for the program in a unanimous vote.

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The Equal Opportunity Compliance Office is now tasked with adopting rules and procedures to implement the program, with creating and distributing a directory of certified minority- and women-owned businesses, with ensuring that bids and proposals adhere to procurement procedures and with monitoring all prime contracts with minority- and women-owned business goals.

It also must now present an annual minority- and women-owned business enterprise utilization report to the Shelby County Board of Commissioners.

A core objective of the program is to increase the dollar amount and the percentage of supplies and services the county procures from minority- and women-owned businesses, more closely aligning those with the availability of those businesses in the area, according to documents approved Monday .

The ordinance was also updated from a previous reading to specify that disadvantaged groups include disabled individuals and service disabled veterans.

“We want to make sure that those who have served our country also have the opportunity to grow their businesses in the county as well,” Turner said.

Participants included in the program must be certified by the Equal Opportunity Compliance Office.

In June, consultants with Griffin & Strong PC presented the results of a 2022 disparity study to the Shelby County Commission. The study showed Black American businesses were underutilized in prime contracts with Shelby County Government across all five categories considered: construction, A&E, professional services, other services and goods. It also found that Asian Americans, Native Americans and non-minority women were also underutilized in prime contracts in several categories.

And, the study found evidence of disparities by race, ethnicity or gender status of the firm owners “even after controlling for capacity and other race- and gender-neutral factors.”

The study looked at a five-year period, from 2016-2020.

Shelby County previously had a program aimed at increasing spending on minority- and women-owned businesses, one that lasted from fiscal years 2017-2021. That was abruptly halted in November 2020 after Shelby County settled with a group of contractors that had sued the county, arguing that its program resulted in discrimination against white-owned businesses.

In order to justify a race or gender-conscious program, the courts have said a government must show “it had a compelling interest in ‘remedying the effects of past or present racial discrimination.'” And, they must prove that “compelling interest” with actual findings of discrimination, something the county hired Griffin & Strong to find.

Katherine Burgess covers county government and religion. She can be reached at [email protected] or followed on Twitter @kathsburgess.

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