How Milwaukee Plans to Help Minority Businesses by Rethinking City Contracting

The city is one of the most diverse in the nation. But not everyone has shared equally in its economic growth.
by Aaron Szopinski | March 26, 2018
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The following blog post is part of the  City Accelerator initiative, a collaboration between Governing, the Citi Foundation and  Living Cities  that aims to speed the adoption of innovative local government projects within and across cities that will have a significant impact on the lives of their residents, especially those with low incomes.

 

The city of Milwaukee has become remarkably diverse over the past generation. Non-whites comprised 29 percent of the population in 1980, and today comprise 63 percent of the city’s residents. Growing African-American, Latino, and Asian populations have kept Milwaukee from losing population at the rate of other Rust Belt cities.

But the city is one of the most segregated in the nation, and Milwaukee’s minority residents haven’t necessarily shared in the same economic growth that the city’s white residents have.

One way the city is striving to make its economic growth more equitable is to focus on its procurement strategies. Mayor Tom Barrett and Milwaukee’s leaders know that by improving the way we purchase goods and services, we can better engage with and support new partners. That’s why we’ve been excited to participate in the current cohort of the City Accelerator, an initiative of Living Cities supported by Citi Foundation. City Accelerator connects us to other cities focused on increasing inclusion through procurement and generating equitable growth. The Accelerator gives us the space and support to engage our partners and find ways to do more.

Our first step was understanding what we don’t know. That meant looking at the data and engaging partners who are best positioned to increase our impact. Mayor Barrett convened a stakeholder group to guide and advocate for our Accelerator project. Our stakeholders come from philanthropic groups, non-profits, lenders and Milwaukee’s ethnically diverse Chambers of Commerce.

One theme that echoed out of those conversations with stakeholders is that they didn't necessarily need the city to build a new program. What we needed to do was work better together on the existing efforts we have in place. Another important theme was that we need to be encouraging young men and women of color to took seriously as entrepreneurship, and start defining those opportunities as early as middle school. Finally, something that seems obvious, but important: When we seek out new businesses to work with the city, we should be able to show them an example of success that reflects their identity.

These important stakeholders will continue as guides and advocates for the project through its completion.

We then looked at data on city-certified Small Business Enterprises, and we compared those businesses to five other public certification programs in our area. We found a gap: Many minority- and women-owned businesses were certified with state or county government, but not with the City of Milwaukee itself. In the area of professional services alone, there were more than 100 eligible businesses not participating in Milwaukee’s SBE program. Identifying and quantifying that gap helps us set a goal to grow the available businesses to bid and partner on contracts.

In December, we launched a survey for Milwaukee businesses to gauge their impressions of city contracting and their desire to grow their capacity. Most critically, the survey will help us identify the issues that the businesses we want to work with see as a barrier to their participation. Based on our initial responses, those barriers include accessing information about bids and contracts, the complexity of the contracting process, and the perception of fairness.

We also want to gauge businesses' interest in some of the different ways we might work to boost inclusion, including joint ventures and co-bidders, mentoring workshops, and other supports for businesses.

The full results of this survey will help us better understand the needs of potential bidders for business support and hear their experiences in working with the city. Milwaukee’s team will use that data to inform capacity building efforts and new contracting strategies.

In the coming months, we’ll continue to harness data to inform our work and focus on actions that get results. That analysis will complement a discussion between city officials, business leaders and capacity builders. Over the next few months, we’ll also develop changes to our purchasing processes and develop a forecast of future contracts to keep us ahead of potential inclusion opportunities.

We will also be issuing an RFP to obtain guidance regarding how we can do a better job of rebranding and marketing existing inclusion efforts and programs. Lastly, we will be incorporating a non-traditional inclusion initiative into one of our RFP’s which will be specifically focused on engaging high school students, through a short-term internship or career shadowing opportunity.

We’re excited about where we’re going in creating a more open and inclusive procurement system for Milwaukee’s business owners, and excited to implement some of our ideas this year

Aaron Szopinski | Policy Director, Office of Milwaukee Mayor Tom Barrett |
Be part of the campaign for civic innovation at the City Accelerator, presented by Citi Foundation.