City surpasses 35 percent participation goal
PHILADELPHIA – The City of Philadelphia’s Office of Economic Opportunity (OEO) released its Fiscal Year 2019 Annual Report, which details all City contracts with minority-, women-, and disabled-owned enterprises (M/W/DSBEs) during FY 2019. The overall City participation rate for FY 2019 was 36.02 percent, representing $254 million in contracts awarded to M/W/DSBE firms. This marks the first time the City exceeded its 35 percent participation goal of minority-, women-, and disabled-owned businesses (M/W/DSBE) on City contracts.
The FY 2019 Annual Report examines the portfolio mix of City contracts, including those from City departments and quasi-public agencies, awarded during the period of July 1, 2018 through June 30, 2019. Participation is defined as the total contracts awarded to M/W/DSBEs as a percentage of available contracting dollars. In FY 2019, the City and quasi-public agencies awarded nearly $601 million million in contracts to M/W/DSBEs, an increase of $160 million from FY 2018. The combined participation rate for City and quasi-public contracts was 31.31 percent, which was higher than the FY 2018 rate of 30.50 percent.
“When the City set our 35 percent participation goal five years ago, we knew it would take time, but with dedication and determination, we’ve succeeded in reaching this important milestone,” said Iola Harper, Deputy Director of Commerce for the Office of Economic Opportunity. “This past year serves as a reminder of the success we can achieve when organizations—public and private—work together. As our great city continues to grow, OEO will continue its work ensuring greater equity in the way the City of Philadelphia does business—working with more firms that reflect the diverse population we serve.”
The data in the FY 2019 Annual Report shows that OEO’s mission of improving access to opportunity for minority-, women-, and disabled-owned businesses is moving the needle. Though the City reached its 35 percent participation goal for City contracts, the important mission of OEO continues and the work remains. In the year ahead, OEO will continue to focus on capacity-building, tracking, and compliance.
In FY 2019, OEO collaborated with the Office of the Inspector General and the Office of the Controller to debar three vendors for non-compliance. This move sent an important message that fraud and abuse will not be tolerated in Philadelphia. Additionally, OEO established a compliance hotline, which fielded more than 40 anonymous tips about contracting issues last year.
Personal and Professional Services had the greatest increase of all contracting categories in FY 2019. Personal and Professional Services is the largest category in terms of dollars spent and provides a clear opportunity to drive growth. PPS participation grew by 7.09 percent, or $12 million. This surge in participation is due in large part to OEO’s efforts to encourage M/W/DSBE involvement on these contracts.
The City’s total M/W/DSBE participation (not including quasi-public contracting) of $254 million was $25 million less than FY 2018, but the percentage of total contracts going to minority businesses increased from 33.17 percent to 36.02 percent. MBE firms received more than $166 million in City contracts, up from $164 million in FY 2018; and WBEs received more than $88 million in City contracts, compared to nearly $115 million last year.
Due to outreach efforts by the Office of Economic Opportunity, the number of businesses that have been formally certified as minority-, women-, and disabled-owned enterprises by a City-approved certifying agency has expanded to 3,115—an increase of 280 in the past year. Philadelphia-based businesses make up 29 percent of the OEO Registry, and Pennsylvania firms (including those in Philadelphia) account for 56 percent of the Registry.