Opinion: Company hired for MWBE study has appalling diversity record

Imagine if the federal government announced that the 2020 census would be run by the Koch brothers instead of nonpartisan government employees. Would you trust the results? Would black or Latino households answer the door when it rang?

Probably not.

But here in New York City, another census is almost underway, and the firm commissioning the study is as out of sync with its mission as the nightmare I just described.

A 2009 law requires the city to begin comparing the availability rates of minority- and women-owned businesses (MWBEs) with their actual “utilization rates” (i.e., how often they’re selected) by city agencies in 2015 and every two years after. The results matter; they’re used to structure every program for black-, Latino-, Asian- and women-owned firms, from diversity goals to mentorship programs.

City Hall has quietly moved forward on this $900,000 “disparity study” with a bizarre choice of vendor: the Florida-based company MGT of America. MGT, a for-profit company, has successfully helped governments privatize prisons and cut jobs, but when it comes to disparity studies, you might not like their record.

In a 2013 disparity study it produced for the Miami-Dade school system, the company found that even though “only 1% of services and professional design contracts” and “only 5% of construction contracts” were going to African-American firms, it did not believe that racial disparities existed in key economic sectors. Appallingly, they even reported that African-American firms were “over-utilized” in one area.

Leading black advocacy groups like the NAACP and Urban League denounced the company’s conclusions. They issued a counter-report entitled “A Call to Action” that called the study “flawed, inaccurate and unreliable.” Even the school board that paid for the report quickly distanced itself from it and hired another expert to review the data.

Miami isn’t the only place where MGT’s attitudes toward MWBEs alienated the black community. In its $300,000 disparity study for Charlotte, North Carolina, in 2010, MGT shockingly recommended against creating an MWBE program in the city, suggesting a race-neutral program instead. As in Miami, a second consulting firm was brought in to clean up MGT’s mess.

And MGT’s divisive work in North Carolina continues. Earlier this year, the company was hired by Nash County to explore seceding from a multi-county school district, a move that the local NAACP chapter has called racially motivated.

These incidents show that the company has no interest giving historically disadvantaged groups a fair shake. To be successful, the city’s disparity study needs buy-in and participation from the minority business community. But given the company’s poor record, the minority business leaders I’ve spoken with are skeptical at best, and more inclined to boycott. 

While Mayor Bill de Blasio may have shirked responsibility on this issue, the City Council is standing up to him. Led by Councilwomen Helen Rosenthal, Elizabeth Crowley, Laurie Cumbo and Inez Dickens, the council is moving forward on a package of bills this Monday that will give us the transparency and oversight we’ll need to ensure MGT’s practices are aboveboard.

Without their help, the outrageously small 4 percent of city contracts awarded to black, Latino and Asian businesses could stagnate or drop further. Leaving the future of New York City’s minorities in the hands of a company like MGT is not good enough. But if the City Council is successful on Monday, we’ll have new tools to help MWBEs and fight this inequality.

Bertha Lewis is the founder and president of The Black Institute.