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For Procurement Reform, Cities See Value in Learning What's Worked Elsewhere

Lots of cities want to increase their outreach to women- and minority-owned businesses. Often, that means taking a look at the best programs in other jurisdictions.

Beale Street at night in Memphis
Downtown Memphis, Tenn.
This story was produced with support from the City Accelerator program.

The way Joann Massey sees it, city procurement is an issue of civil rights. As the director of minority- and women-owned business development for the city of Memphis, Tenn., Massey says she wants to use her city’s purchasing power to help bridge gaps of class and income inequality. And she points to Memphis’ own history as an epicenter of the civil rights fight, where Dr. Martin Luther King Jr. was assassinated in 1968, a day after delivering his famous “Mountaintop” speech.

“A lot of Memphians have carried a burden or shame of sorts for many, many years,” she says. “That shame has been a motivator, thinking of how [King] died fighting for civil rights in our city.”

For Massey, that history serves as a “guiding light” for her current efforts to increase opportunities for small businesses, especially those owned by women, African-Americans and Hispanics. “We’re still not to the mountaintop. We have all this potential that we still haven’t lived up to,” she says. “We wanted the city to know that the hope they’ve felt for many years is not just a slogan.”

The slogan she’s referring to is “We Mean Business,” a city initiative in recent years to improve its efforts around minority contracting. It’s a wide-ranging push to make local contracts more equitable by gathering more data about procurement, encouraging nontraditional firms to compete for contracts, and eventually working to tear down the barriers that can stunt small business growth, such as cumbersome insurance and bonding requirements.

Now Memphis is stepping up those efforts even more, including making certification free for qualifying vendors and varying its contract sizes to encourage participation. It’s doing that as part of the City Accelerator program, a joint initiative from Governing, the Citi Foundation and Living Cities, a national organization focused on spreading urban innovations that address the needs of low-income residents. Memphis is one of five cities -- along with Charlotte, N.C.; Chicago, Los Angeles and Milwaukee -- selected earlier this year to join the City Accelerator to focus on procurement reform. Over the course of 12 months, according to Living Cities, each city will “receive coaching, technical assistance and a $100,000 grant to implement new strategies that increase the diversity of municipal vendors and contractors and direct more spend to local minority-owned businesses.”

In addition to those resources, Massey says the real value of joining the City Accelerator is the chance to connect with the other participating cities and share best practices, compare new ideas and discuss common challenges. “People aren’t necessarily opening up emails and newspapers every day to read what we’re doing,” she says. In other words, it’s helpful to learn from her peers about what’s working.

For example, Massey says she’s already worked with the team from Chicago, learning to strike a better balance between social media outreach and direct media. That’s already resulted in a significant increase in participation rates for minority- and women-owned business enterprises (MWBEs) in the procurement process, Massey says.

Chicago’s procurement office has also already been working with its counterpart in Charlotte, to foster an idea for a standing center to help provide resources for businesses in the city. “One of the things in our work plan is to create a city university,” says Charlotte’s Hannah Cook. “We want to create something where people can learn how to connect with businesses in their local communities.”

Charlotte plans to model its program on the Chicago Anchors for a Strong Economy (CASE), which has secured nearly $52 million and 180 new jobs since its inception in 2014, all while assisting nearly 450 firms in the city. CASE includes 16 core “anchors,” including the University of Chicago, the Chicago Housing Authority, ComEd, BMO Harris Bank and the Rush University Medical Center. The anchors pay an annual membership fee to be in the network, and they leverage their data to help see and create different opportunities for local businesses in Chicago -- all with an emphasis on hiring local talent. Other cities including Albuquerque, Cleveland, Detroit and Philadelphia have somewhat similar programs.

For all five of this year’s City Accelerator participants, sharing (and replicating) success stories like the CASE program is the whole idea behind coming together in the first place. As Memphis’ Massey says, the goal is to learn from each other and create smarter, more equitable procurement programs that will last for years to come. “We want to have a system that is data-driven, performance-based and sustainable,” she says. “It’s not just about now. We want this to outlive what we’re doing right now.”

Julian Wyllie joined Governing as a City Accelerator Fellow. This story was produced with support from City Accelerator, a joint initiative of the Citi Foundation and Living Cities.

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