The Black Economic Council of Massachusetts is stepping up pressure on the Baker administration to make more state contracts available to local businesses owned by people of color.
Segun Idowu, BECMA’s executive director, sent a letter to Governor Charlie Baker on Tuesday, expressing his dismay with what he described as appallingly low levels of spending, particularly during the COVID-19 pandemic.
In his letter, Idowu repeats a series of requests he made in January after public broadcaster WGBH reported that state spending with Black-owned businesses had declined 24 percent, in inflation-adjusted dollars, over a 20-year period. An update to the series that WGBH published on Tuesday prompted Idowu to make his requests in writing again, and to ask for a meeting with Baker to discuss them within the next two weeks.
In an interview, Idowu said the governor’s office on Thursday told him that Baker would meet with him, via a video conference later this month.
Idowu’s group, which has more than 300 members across the state, wants the state’s Supplier Diversity Office to become an independent agency with a bigger budget, reporting directly to Baker. (It is currently nestled within the Executive Office for Administration & Finance.) The council wants state agencies and quasi-public agencies to adopt what is known as the “Massport Model,” which requires diversity to be an important factor when picking a winning bidder in a property disposition. And it would like to see increased funding for technical assistance grants to help small businesses: a budget of $5 million in the next fiscal year, ramping up to $15 million in three years.
Idowu said he has had little success so far. He pointed to what he considered minor victories: a bill Baker filed this year but which remains in committee, which aims to promote greater participation of businesses owned by women and people of color in public construction projects, and a Senate-backed economic development bill that would apply the Massport Model for all state authorities.
“At the end of the day, it’s always about the action that’s taken,” Idowu said. “In our case, we’re usually dead last.”
BECMA’s prominence has risen significantly in the wake of civil rights protests since the death of George Floyd in May. However, Idowu said he’s been disappointed by the lack of action among state leaders since those protests began. From his vantage point, there are fewer truly successful Black-owned businesses in the state today than there were 30 years ago, with only eight reporting more than $10 million in annual revenue in a recent Boston Business Journal tally.
“If we’re saying ‘Black Lives Matter,’ so does Black wealth,” Idowu said. “Clearly, that does not seem to be a priority.”
He said he also wants to talk to the governor about building a pipeline for businesses owned by people of color to prepare them to bid for state contracts.
Of its discretionary accounts in its 2019 fiscal year, the state government spent $412 million with businesses run by people of color, according to the Supplier Diversity Office’s most recent annual report. That was a 4 percent decline from the previous year. But the agency said the state still exceeded its goal of 8 percent of its discretionary spending going to minority business enterprises, or “MBEs,” that year.
Patrick Marvin, a spokesman for Baker’s Administration & Finance office, said the administration has annually raised and exceeded benchmarks for participation by MBEs. The administration, he said, has boosted annual direct spending to MBEs by nearly $8 million, from the 2015 fiscal year to the 2019 fiscal year. The governor’s office, he said, is also in regular communication with BECMA.
The council is part of a coalition of small-business advocates that has been lobbying almost since the start of the COVID-19 pandemic for more grants from state leaders, partly to pay for professional advice for struggling firms. Joe Kriesberg, chief executive of the Massachusetts Association of Community Development Corporations, said the aid that BECMA seeks is one crucial tool to helping small businesses recover.
Figuring out how to navigate the recession and the pandemic is hard enough if you are a Fortune 500 company, he said, or a startup with venture capital backing.
“It’s nearly impossible for a struggling microbusiness that’s got creditors and bills to pay,” Kriesberg said. “You can give a business $10,000 and say ‘good luck’ or you can give that business $10,000 and a professional business coach to help them deploy that $10,000.”