Elorza says less than 1% of Providence contracts go to women, minorities, despite goal of 10%

During a debate last month on Latino Public Radio with Michael Solomon, then his opponent for the Democratic nomination for Providence mayor, Jorge Elorza said that if elected he would do more to support minority- and women-owned businesses in Rhode Island’s capital.

"We have a goal of 10 percent of city contracts going to women and minority businesses," he said, referring to a City of Providence initiative. "In reality, less than 1 percent of contracts go to women and minority businesses."

Elorza’s statement came on Aug. 28, before he went on to beat Solomon in the Sept. 9 primary. He now faces independent Vincent A. "Buddy" Cianci Jr. and Republican Daniel Harrop in the November general election to succeed Angel Taveras as mayor.

Elorza has made the awarding of city contracts an issue in his campaign. He first made a claim about the lack of contracts going to minorities and women in an April 16 post to his campaign website that announced his "Equity in Business Opportunity" proposal. In that statement, he said the figure stood at "approximately 1%."

Has Providence really fallen so far short of its goal in awarding contracts to minorities and women?

While we waited for Elorza’s campaign to provide the basis for the claim, we found the city ordinance from 1990 that set goals for minority and women contracts. The ordinance is actually more ambitious than what Elorza described.

It has goals of 10 percent of contracts for minorities and 10 percent for women, or 20 percent total -- double the percentage Elorza cited. Charles Newton, of the Rhode Island Minority Business Enterprise, pointed this out to us. Taveras’s office confirmed it.

The ordinance notes that in 1990 and in the two previous years, less than 1 percent of contracts went to such firms. (In the Providence Code of Ordinances, see Chapter 21, Article II, Section 21-52.)

When John Taraborelli, a spokesman for Elorza, got back to us, he said Elorza’s statement about the low percentage of contracts awarded to minorities and women was based on a 2013 GoLocalProv story.

That story reviewed minutes of all the meetings held by the Providence Board of Contract and Supply from Jan. 1 to Dec. 31, 2012. Of $185.8 million awarded in contracts in 2012, only $1.6 million -- less than 1 percent -- went to companies owned by minorities, according to the story.

Taraborelli also said the campaign followed up with Brian Hull, Providence’s Director of municipal and intergovernmental affairs. Hull said the analysis of the 2012 numbers was accurate, according to Taraborelli.

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We spoke with Hull ourselves and he brought up several caveats when trying to analyze city contracts and also gave us more up-to-date figures.

First, the caveats. Not all city contracts go before the Board of Contract and Supply. The board reviews and authorizes city purchases of $5,000 or more.  Anything less than $5,000 is put out to bid by city departments, so those smaller contracts aren’t included in the records of the board.

In addition, for businesses to be considered as owned by minorities or women they must be certified by the state. However, not all businesses that could qualify decide to go through the certification process, which can be lengthy, said Hull. If those non-certified firms get city contracts, they aren’t counted as owned by minorities or women.

Now for the updated number. After Mayor Taveras took office in 2011, his administration formed a task force to bump up the number of contracts awarded to minority firms and studied innovative purchasing programs in other cities, including San Antonio, Texas and Bridgeport, Conn.

The efforts resulted in an increase. For 2013, the share of contracts awarded by the Board of Contract and Supply to minority- or women-owned businesses stood at 2.3 percent of the $208 million in purchases that year, according to an analysis done by Hull’s office. That’s about triple the equivalent figure of 0.8 percent for 2012.

To put the Providence number in perspective, we talked to Newton, the assistant administrator of the Rhode Island Minority Business Enterprise, the state agency that certifies minority businesses. The state has a requirement of 10 percent of all purchasing going to minority or women businesses. That share currently stands at between 4.5 and 5 percent, according to Newton.

Our ruling

Jorge Elorza said that Providence has a goal of awarding 10 percent of city contracts to businesses owned by minorities or women, but that in reality less than 1 percent of contracts go to such firms.

Elorza got both parts of the claim wrong. The goal is actually 10 percent for minorities and 10 percent for women, for a total of 20 percent. And the latest figures show that, in 2013,  2.3 percent of city contracts went to minorities, more than double the outdated 2012 figure Elorza cited.

The difference in the 2012 figure and the 2013 figure is large when the numbers are considered in relation to each other. However, even though there has been an increase, 2.3 percent is still well short of the 20-percent goal.

Elorza’s larger point -- that the city needs to act aggressively if it wants to meet policy goals in how it awards contracts-- may be valid, but the numbers he uses to support that claim are way off.

We rule his statement Mostly False.

(If you have a claim you’d like PolitiFact Rhode Island to check, e-mail us at [email protected]. And follow us on Twitter: @politifactri.)