PROVIDENCE — Two organizations sent a letter to Rhode Island officials on Monday, alleging the state contracting system has continued to engage in a pattern of discrimination against minority- and women-owned businesses.
The Rhode Island Black Business Association and Lawyers for Civil Rights sent a letter of demand to Governor Dan McKee, the Department of Administration, and others, claiming the state has violated federal antidiscrimination laws by systematically excluding minority-owned businesses from state contracts.
“Black and brown businesses have been overlooked and underutilized in this state for far too long,” said Lisa Ranglin, the president and CEO of Rhode Island Black Business Association, or RIBBA.
In 1986, lawmakers required that at least 10 percent of state contracts go to women- and minority-owned businesses. In the 37 years since the Minority Business Enterprise was written into state law, the state has met or exceeded that requirement only three times — in fiscal years 2018, 2019, and 2022.
The state’s Office of Diversity, Equity, and Opportunity, which administers the program, released a scathing report in 2021, which outlined the significant inequalities across all sectors in Rhode Island’s public contracting practices. It found that non-male minority-owned businesses were awarded just 2 percent of the $900 million in construction purchase orders the state contracted during the study’s period between 2014 and 2017 — an industry with some of the largest disparities among those who obtain state contracts. Tasheena Davis, a litigation fellow at the Lawyers for Civil Rights, said this is despite the minority- and women-owned businesses being “comparable in size, capable and readily available to perform contracts at much higher rates.”
Since the disparity study’s release in 2021, “Rhode Island has had ample time to implement changes to reduce the disparities in state contracting for minority-owned businesses,” Davis said. “Federal law does not permit the continued systematic exclusion of minority-owned businesses.”
“Without a proactive stance, the disparities will continue to increase,” the letter read.
Ranglin said she, the RIBBA, the Lawyers for Civil Rights, and other advocates will meet with Attorney General Peter F. Neronha on Tuesday to discuss Rhode Island’s “systematic under-utilization of minority-owned businesses.”
“We want to make sure the attorney general understands that affording equal opportunity to minority-owned businesses is not only economically beneficial for the state, it is legally required,” Ranglin said.
Iván Espinoza-Madrigal, the executive director of Lawyers for Civil Rights, said the groups are hopeful that after “outlining potential legal liability” in their letter, “reforms will be forthcoming.”
Department of Administration spokesperson Laura Hart told the Globe in an email Monday that the data used in the disparity study, which was cited in the advocate’s letter, “does not reflect the latest efforts of the [Department of Administration].”
“Historical data shows significant improvement in the equitable awarding of state contracts over the years,” said Hart, who noted that 13 percent of all contracted awards by the state were to minority- and women-owned businesses in 2022. The previous administration, under former governor Gina M. Raimondo, waived the 10 percent requirement during the pandemic in order to meet emergency procurement needs, she said.
Lawmakers and business leaders have called for reform since the 2021 report was released. Pawtucket Senator Sandra Cano introduced a bill in the 2023 legislative session that would raise the existing 10 percent cap to 20 percent.
“I am the bench player who never gets a chance to get in the game,” testified Vennicia Kingston, who registered her construction firm as a state-certified woman- and minority-owned company, during a hearing at the State House in May on the issue.
Hart said the Department of Administration “prioritizes equity in its state contracting procedures” and is “taking significant steps to increase the utilization” of minority- and women-owned businesses.
Rhode Island this year increased the minimum percentage of state contracts that must be awarded to women- and minority-owned businesses from 10 to 15 percent in the fiscal year 2024 budget. McKee, according to Hart, also requested that disparity studies take place every five years beginning in fiscal year 2025.
“The state’s charade of raising the goal to 15 percent, while continuously failing to meet the 10 percent benchmark, is a key reason why highlighting the potential legal exposure is critical now. It reflects a change on paper with no meaningful investment in reform,” said Davis in an email to the Globe. “False commitment to equity is precisely what federal anti-discrimination law is designed to protect against.”
The state also funded a new software system specifically to track the Minority Business Enterprise program to increase “transparency and accountability.” The software should be fully implemented in early 2024, Hart said.
Ranglin says the recent improvements are not enough.
“We will continue to fight for these businesses to have opportunities to participate and to call out Rhode Island officials who fail to make that a reality,” she said. “Our focus is on enforcement and utilization.”
Boston faced a similar critique recently.
In February 2021, three Black and Latino organizations filed a federal civil rights complaint against the City of Boston, alleging that the city’s contracting practices violated federal civil rights law, and that its practices “create a disparate impact and exclude minorities.” The federal government declined to open an investigation of the city, claiming it lacked jurisdiction over the groups’ claims under Title VI of the Civil Rights Act.
In June, the Boston area-based groups filed a new lawsuit against the US Justice Department, accusing it of “looking the other way.”