Late last month, the New York State Legislature voted to approve changes to the state’s MWBE program, expanding opportunities for minority and women-owned businesses. Sponsored by Assemblymember Rodneyse Bichotte, who chairs the Subcommittee on Oversight of Minority and Women-Owned Business Enterprises, the legislation won praise from Speaker Carl Heastie, and Governmental Operations Committee Chair Michele Titus, who have made strengthening the MWBE program a legislative priority.
“Socially and economically disadvantaged businesses like many owned and operated by minorities and women have been continuously overlooked. Supporting these businesses means investing in our economy, communities and equal opportunity for all New Yorkers,” Titus said in a press release.
A highlight of the legislation was an increase in the personal net worth cap from $3.5 million to $15 million, with an allowance to increase the amount further in certain industries. According to the state’s 2016 disparity study, the low cap unfairly and arbitrarily penalized MWBEs, limiting their access to the financing and bonding necessary to compete for large contracts awarded by the state.
Gov. Andrew Cuomo vetoed legislation raising the cap in 2018.
The bill also increased the state’s discretionary spending threshold from $200,000 to $500,00, streamlined the MWBE certification process, and increased the amount of time firms may remain certified from two to five years. It also establishes a “Workforce Diversity Program” that will require agencies doing construction projects to meet diversity goals.
In addition to expanding opportunities for MWBEs, the latest initiative adds a layer of transparency to the program by requiring contracting agencies to report waivers that exempt them from program goals on their websites. Additionally, the legislation mandates increased reporting regarding:
- Expenditures that are exempt from program goals by the State Division of MWBE
- Annual participation rates for each agency
- Total number of MWBEs each year
- Total dollar amount spent on MWBE contracts
Agencies must also submit four-year growth plans for increased utilization of MWBEs.
More Changes to Come?
A second bill sponsored by Assemblymember Bichotte is also making its way through the New York States legislature right now. The bill proposes additional changes to the MWBE program, including a provision that would allow agencies to procure goods and services costing up to $500,000 from MWBE contractors without a formal bidding process. Additionally, the law would:
- Require that firms’ MWBE status be added to the criteria when agencies create a pre-qualified procurement list
- Create a small business and MWBE mentorship program in the NYC Department of Design and Construction
- Improve the ability of MWBEs to compete for contracts with NYC schools and the School Construction Authority.
The bill has been approved by the Ways and Means and Rules Committees, but has not yet come to the Assembly floor for a vote.
At The Carmoon Group, we work with women and minority business owners to help them realize their strategic goals. Our area of expertise is insurance and risk management, but our commitment to MWBEs goes far beyond that limited role. As a minority-owned business, we take our responsibility to mentor and advise others very seriously. Just let us know what we can do to help. Call us any time between 9 a.m. and 6 p.m., or reach out online and we will get back to you at a convenient time.