PHILADELPHIA – Today, Mayor Cherelle L. Parker took bold action by signing an Executive Order establishing the Office of Business Impact and Economic Advancement and setting in motion a new direction for the City’s contracting and procurement policies. These changes introduce support and development tools designed to expand opportunity for small and local businesses while ensuring that Philadelphians can fully participate in the City’s contracting process.

The Executive Order emphasizes the City of Philadelphia’s commitment to fostering economic opportunity for all businesses, particularly small and local businesses, which are crucial for supplying essential goods and services and creating job opportunities.

It also formally establishes the Philadelphia Small and Local Business Program. Under this new program, City departments will be required to invest in businesses defined as small, local, or both. A three-tier trajectory model for small businesses—emerging, midsize, and middle market—will be implemented. To qualify as local, a business must be headquartered in Philadelphia or meet specific criteria regarding employee residency and work locations.

“Our administration is committed to making sure every Philly business has a fair shot at City contracting,” said Mayor Cherelle L. Parker. “For too long, the old, broken system has failed to deliver real opportunity. We are changing that. Through our Office of Business Impact and Economic Advancement, we are launching a new strategy that expands access for small and local businesses, keeps dollars circulating in our neighborhoods, drives innovation, and creates sustainable jobs. This is about building a contracting system that actually works and reflects our values. Out of crisis comes opportunity, and we are taking decisive action to expand economic growth that is truly inclusive.”

Before signing the executive order in a public ceremony at the Philadelphia African American Chamber of Commerce for PA, NJ & DE before a group of diverse business owners and leaders, Mayor Parker and senior administration officials previewed the executive order to an invited group of business leaders in Mt. Airy on Tuesday. During the roundtable, Mayor Parker engaged directly with business owners, chamber representatives, and community leaders, including City Solicitor Renee Garcia, Chief Deputy Mayor Vanessa Garrett Harley, Director of Business Impact & Supplier Diversity Nadir Jones, and Interim Chief Diversity, Equity & Inclusion Officer Donna Jackson Stephans. Participants shared their insights and posed questions about the goals of the new policies, which align with the City’s broader vision of fostering an inclusive economy that benefits all Philadelphians.

Under the new program, City departments will be required to invest in businesses defined as small, local, or both. A three-tier trajectory model for small businesses—emerging, midsize, and middle market—will be implemented. To qualify as local, a business must be headquartered in Philadelphia or meet specific criteria regarding employee residency and work locations.

“We learned from experience that real growth will not just happen from helping businesses obtain City contracts, we also need to support them through technical assistance designed to help them compete in the overall market,” said Chief Deputy Mayor Vanessa Garrett Harley, whose portfolio includes the new city contracting program. “While these changes in the law may have accelerated this process, we were always determined to change this program, improve it for Philadelphia small and local businesses, and stay rooted in our identity and our shared purpose.”

“We are not abandoning the businesses that the City has worked with in the past,” said Nadir Jones, Director, Office of Business Impact and Economic Advancement adding that the majority of current vendors will still qualify as small and/or local businesses. “Faced with the necessity of adapting to the current state of the law, the Parker Administration recognized this challenge as an opportunity to pivot. We developed a program that focuses on genuine small business development and incentivizes the local business community, resulting in the creation of the City of Philadelphia Small and Local Business Program.”

City Solicitor Renee Garcia explained how federal court rulings, including a 2023 decision in the U.S. Supreme Court that found the race-based admissions policy at Harvard to be unconstitutional, as well as a more recent federal court ruling involving project labor agreements in Philadelphia, which mirrored the language in the city’s existing minority- and women-based contracting program, led the Law Department, assisted by outside counsel from Washington, D.C., to advise the mayor that Philadelphia’s old system of awarding contracts was running afoul of legal precedent and putting the city at intolerable legal risk.

“My job as Solicitor is to assess risk for the City of Philadelphia and provide the best legal guidance to my clients that protects the city’s legal interests, ensures compliance with the law, safeguards public resources including our tax dollars and helps the City operate responsibly and effectively,” said Renee Garcia, City Solicitor. “There is a point when the risk is so great that there’s really no choice but to pivot. That was the case here.”

Hear what local small businesses and chambers of commerce are saying:

• “Today, the African-American Chamber of Commerce of PA, NJ & DE hosted Mayor Cherelle L. Parker for a press conference and executive order signing highlighting the City’s updated contracting and procurement policies,” said Regina A. Hairston, President & CEO, African-American Chamber of Commerce of PA, NJ & DE. “As we navigate these policy shifts, we will move forward with realistic pragmatism: hopeful that Philadelphia’s Black business community will benefit from these new policies, while remaining vigilant of the discriminatory practices that led to the creation of MWBE programs across the nation. During this time of uncertainty, the AACC will do more than simply advocate for opportunities that lead to additional business growth. We will continue to serve as a custodian on behalf of Black entrepreneurs and look forward to our continued work with the Parker Administration to further uplift small businesses through the Small and Local Businesses Program.”
• Catherine Hicks, President of the Philadelphia NAACP and Publisher of the Philadelphia Sunday Sun said: “I applaud Mayor Parker for her immediate response to the changes in contracting and procurement policies, convening a community meeting at a local female-owned establishment, to allow small, minority, and locally owned businesses to hear directly from the mayor and her administration about the changes, goals and equitable economic participation that locally owned small businesses can expect, who may be impacted by the changes in contracting and procurement policies in response to the new federal court rulings.”
• “I have observed firsthand the significant challenges that small, midsize and diverse developers face when trying to enter the realm of City work,” expressed Rick Young, Founder, Urban Developers Association. “Mayor Parker’s recent executive order serves as a definitive indication that Philadelphia is genuinely committed to ensuring fair access, establishing predictable regulations, and creating meaningful opportunities for these developers.”