Business Market Availability and Disparity Study SHELBY COUNTY - - PowerPoint PPT Presentation

Business Market Availability and Disparity Study

SHELBY COUNTY SCHOOLS

Report Presentation

November 28, 2017

Agenda

• Introductions
• What is a Disparity Study?
• Background
• Study Framework
• Quantitative Results
• Qualitative Results
• Recommendations
• Questions and Answers

Key Disparity Study T eam

• DR. FRED SEAMON

MGT Executive Vice President/ Technical Advisor

• Provided

technical and methodological advice and expertise to the MGT teams throughout the engagement.

• MR. REGGIE SMITH

MGT Executive-in- Charge

• Responsible for

ensuring the MGT teams have the resources to fulfill all contractual requirements, including delivering a final report that is accurate, valid, and legally defensible.

MS. VERNETTA MITCHELL

MGT Project Director

• Provided the

day-to-day management of the study, the MGT teams, and has regular interface with the District Project Manager.

• MS. JANICE BANKS

Subconsultant, Small Planet Works

• Conducted

interviews with business owners and stakeholders, managed the public hearings and conducted the custom census surveys.

Disparity Study

Disparity Studies are the primary means by which government entities determine whether there is legal justification for the establishment, continuation, or modification

• f programs designed to promote the full and

fair participation of disadvantaged, minority-, and women-owned businesses in government contracting

Background

Shelby County School District (District) contracted with MGT to conduct its first Disparity Study. The study objectives included:

Determine whether the District, either in the past or currently, engages in discriminatory practices in the solicitation and award of contracts in Construction, Architecture and Engineering, Professional Services, Nonprofessional Services, and Goods & Commodities to M/WBEs. Determine if a legally justified need exists for the establishment

• f an M/WBE program in

accordance with the guidelines set forth by the Supreme Court and relevant subsequent cases.

Legal Framework

• Must show a compelling interest with factual

predicate evidence.

• Remedy must be narrowly-tailored.

Strict Scrutiny

• Recommendations linked to findings.
• Goals linked to availability.
• Limit burden on 3rd parties.

Narrow-Tailoring

• Private sector disparities linked to public sector

can provide a compelling interest.

Passive Participant

Report Sections

Chapter 1. Introductions Chapter 2. Legal Framework Chapter 3. Review of Policies, Procedures, and Programs Chapter 4. Market Area and Utilization Analyses Chapter 5. Availability and Disparity Analyses Chapter 6. Private Sector and Non-Goal Analyses Chapter 7. Anecdotal Analysis Chapter 8. Findings and Recommendations

Study Outline

• Expenditures analyzed for years between July 1,

2011 and June 30, 2016.

• Business Categories included in the study:

– Architecture & Engineering – Construction – Professional Services – Nonprofessional Services – Goods & Commodities

• Study includes prime analyses only.

Relevant Market Area

The Relevant Geographic Market Area identified for the District is Shelby County.

M/WBE Prime Utilization

• Architecture & Engineering: Minority Firms earned 0.08% and Nonminority

Women earned 7.52% of the total dollars

• Construction: Minority Firms earned 0.55% and Nonminority Women

earned 1.21% of the total dollars

• Professional Services: Minority Firms earned 30.70% and Nonminority

Women earned 0.78% of the total dollars

• Nonprofessional Services: Minority Firms earned 12.41% and Nonminority

Women earned 0.18% of the total dollars

• Goods & Supplies: Minority Firms earned 12.97% and Nonminority Females

earned 2.46% of the total dollars

Private Sector Analysis

In a statistical analysis of survey data in the District area that controlled for the effects of certain variables (such as, company capacity, owner level of education, and experience), all M/WBE-owned firms earned less revenue in 2016 than did their non-M/WBE counterparts supporting the conclusion that M/WBE status is negatively related to earnings when compared with earnings for non-M/WBEs Econometric analysis using data from the 2011-2015 American Community Survey (ACS) data for the Memphis Public Use Microdata Area found statistically significant disparities for entry into self-employment for African Americans and Nonminority Women.

Anecdotal

QUALITATIVE DATA COLLECTION ACTIVITIES

Telephone Survey 3 Public Hearings 51 In- Depth Interview s 5 Stakeholder Interviews

Barriers

With respect to disparate treatment, M/WBE anecdotal respondents reported

Anecdotal

• Experienced discrimination

in the private sector  13.6%

• That an informal network

precluded their firms from

• btaining work in the

private sector  15.8%

• Competing with large

companies  47%

• Limited time to prepare bid

package or quote  26%

• Selection process criteria

26%

Disparity

Business Ownership Classification Architecture & Engineering Construction African American Underutilization* Underutilization* Asian American Underutilization* Underutilization* Hispanic American Underutilization* Underutilization* Native American Underutilization* Underutilization* Nonminority Women Overutilization Underutilization* *Indicate a substantial level of disparity, which is a disparity index below 80.00. Not Applicable denotes the analyses cannot be applied in this case due to the mathematical constraint of division by zero.

Disparity

Business Ownership Classification Professional Services Nonprofessional Services Goods & Commodities African American Underutilization* Underutilization* Underutilization* Asian American Overutilization Overutilization Overutilization Hispanic American Underutilization* Underutilization* Underutilization* Native American Underutilization* Underutilization* Underutilization* Nonminority Women Underutilization* Underutilization* Underutilization* *Indicate a substantial level of disparity, which is a disparity index below 80.00.

Commendation & Recommendations

COMME NDAT I ON

The District should be commended for their pursuance of a disparity study to determine if there is evidence to support a M/WBE program

R E COMME NDAT I ONS

• Establish subcontractor

project goals

• Collect subcontractor data

for all contracting areas

• Establish a SLBE Program
• Narrowly tailor future

MWBE programs

Aspirational Goals

M/WBE GOAL Architecture & Engineering 13.68% Construction 24.17% Professional Services 35.24% Nonprofessional Services 32.57% Goods & Commodities 24.02%

Conclusion

The study provide factual predicate evidence to support the MWBE Program.

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