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Policy lacks oversight, council hearing told
Wednesday, June 28, 2000 By Timothy McNulty, Post-Gazette Staff Writer
With a seemingly simple task, City Council began a review yesterday of participation of minority-owned and women-owned businesses in government contracts. It started by trying to figure out just who is supposed to oversee and correct the policies.
Business owners and city and county government officials at the afternoon meeting all acknowledged problems with the set-aside programs, from sham contracts to haphazard certification procedures. But few knew a sure-fire way to correct them, noting the programs have been deeply flawed for years.
Allegheny County Executive Jim Roddey suggested the city and county start with a study of minority-owned and women-owned businesses in the region to discover just how many there are. The city-county percentages set for contract participation -- 25 percent for minority-owned and 10 percent for women-owned businesses -- could be unrealistically high, Roddey noted, "inviting abuses" of the process.
He also said it's up to regional leaders, such as himself, Mayor Murphy and the owners of the Steelers and the Pirates, to make sure changes are implemented. Roddey said they could do so by merging the separate city and county offices that oversee the set-asides, as he and Murphy have previously suggested, or through other means.
The set-aside problem "is not difficult to solve. It depends on the determination of leadership, the people at the top, and whether they want to solve it," Roddey said.
Yesterday's meeting was called by City Councilman Jim Ferlo on the heels of a Pittsburgh Post-Gazette investigation of participation in Plan B contracts.
It showed that at least a third of the $117 million in stadium and David L. Lawrence Convention Center contracts that went to the minority- and women-owned businesses was passed on to firms owned by white men, or to companies that no longer qualify as disadvantaged under the certification process the city-county Sports & Exhibition Authority uses.
About 50 people participated in or attended the session.
Minority and women business owners complained that oversight of set-aside policies is confusing, and some prime contractors keep them from growing by holding payments for services they've completed and by pressuring them to take payoffs.
City and county officials said their oversight is constrained by conflicting laws and certification procedures: City, county, state and federal rules on the programs all differ in some ways.
Stephen Leeper, executive director of the sports authority, said his agency depends on officials from the sports franchises, their project managers and various consultants to help it through the contracting and certification processes at the stadium projects.
He admitted some difficulty with knowing how much minority- and women-owned firms are being helped by Plan B, but still said "there are a lot of firms getting a lot of business [at the stadiums] that are legitimate minority businesses."
Murphy's communications director, Doug Root, said the mayor has consistently tried to improve participation in contracts since taking office in 1994, and last year coordinated an effort to enroll and train thousands of city residents in building trade jobs.
Root said Murphy is "upset" by the findings of the Post-Gazette reports and said the mayor wants to merge the city and county compliance offices to solve the problems the report raised.
With a dose of politics, city Controller Tom Flaherty, who is against the proposed merger and, lately, much of what the mayor has proposed, said Murphy should be upset. According to Flaherty, the Plan B buck stops with him.
A merger of the city and county offices would "be abdicating [the city's] responsibility to represent minorities in the city," Flaherty said near the end of the 41/2-hour hearing. "This all occurred under Mayor Murphy's watch."
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