PROVIDENCE — Minority- and women-owned businesses received 18.1 percent of state purchases and contracts in fiscal year 2026, marking the highest level in the 40-year history of Rhode Island’s minority business enterprise program, according to a new report obtained by the Globe.
Rhode Island has often fallen short of the requirement, first enacted in 1986, that at least 10 percent of the dollar value of state contracts and purchases go to minority- and women-owned businesses.
“It is exciting,” Pastor Chris Abhulime, deputy chief of staff for Governor Daniel J. McKee, said in an interview. “We are incredibly proud of what we have accomplished over the last six years.”
The minority business enterprise program is meant to spur economic development to help Rhode Island’s many “micro-businesses” and to further McKee’s goal of increasing state income levels, he said.
The program is important because “Rhode Island is small business,” said Keith W. Stokes, associate director of the state Division of Equity, Diversity and Inclusion.
More than 90 percent of the state’s small businesses are “micro enterprises,” with 10 employees or less. Many are sole proprietors who have the capacity to do the work but lack the resources to successfully bid for state procurements, Stokes said said.
In 2023, the state passed a law increasing the requirement to 15 percent. But the state had not reached that threshold over the previous decade. The low point was 4.07 percent in 2015, and the state reached 13.4 percent last year.
This year, participation rose to 18.1 percent, including 8.44 percent for minority business enterprises and 9.65 percent for women business enterprises.
Those businesses received about $124 million of out of $688 million in state contract value. Of that $124 million, the largest proportions went to firms owned by white women ($62.8 million), Portuguese men ($27.2 million), Hispanic men ($17.3 million), Black men ($9.9 million), and Asian men ($3.1 million).
The state surpassed the 15 percent goal despite Trump administration attempts to dismantle diversity, equity, and inclusion programs.
Stokes said Rhode Island is following the state requirement to assist “disadvantaged” companies that don’t have the capacity to compete for state contracts and purchases.
“What we are talking about today is not DEI, it’s a small disadvantaged business issue that transcends race, gender, ethnicity, or national origin,” Stokes said.
Senator Tiara T. Mack, a Providence Democrat who co-chairs the Rhode Island Black, Latino, Indigenous, Asian-American and Pacific Islander Caucus, said it was “encouraging” to see the increase, but she said, “We still have a ways to go.”
“It’s probably still not enough because many opportunities for Black-owned and minority-owned businesses have been attacked under the Trump administration,” Mack said. “Many people have lost their livelihoods because of those attacks.”
She said she’d like to take a closer look at how many Black and Latino owners received state contracts. She said some other states do not include Portuguese business owners in such programs.
Mack said she plans to introduce legislation that would add companies with LGBTQ+ owners to the program.
Stokes said Rhode Island was able to reach the 15 percent threshold in part because of of a “Rhode Map To Success” pilot program that provides procurement training, technical assistance, pre-bid support, and business-to-buyer networking to qualified minority- disadvantaged- women- and veteran-owned businesses.
Also, he said, Rhode Island Commerce has a new grant program the offers basic technical assistance to small disadvantaged businesses.
McKee included money in the budget three years ago to hire a contract compliance program service officer, Stokes said. “For the first time, we have dedicated staff people to work each day engaging with vendors, educating, and ensuring they understand state law,” he said.
Also, Stokes said, the 2023 law required that prime vendors, including large contractors who hire subcontractors, must show they made “good faith efforts” to comply with the law. He said the state now offers training for state agencies and prime vendors on the new requirements.
For example, he said members of his team were headed to the Center for Southeast Asians in Providence on Tuesday to provide training on how to assist small businesses and startups to be certified with the state program.
“This is economic development,” Stokes said. “Our goal is to get Rhode Island-based businesses to scale up and grow and succeed.”
Edward Fitzpatrick can be reached at edward.fitzpatrick@globe.com. Follow him @FitzProv.