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HomeMy WebLinkAboutM-81-0845i CITY OF MIAMI. FLORIDA INTEROFFICE MEMORANDUM TO Mayor and Members DATE October 1, 1981 FILE: of the City Commission SUBJECT Minority Vendor Procurement Program I FROM Howard V. Gary ...REFERENCES: City Manager ENCLOSURES: Transmitted herewith is a report from the City's Management Consultant concerning Minority Vendor relationships. This report was prepared pursuant to an agreement approved by the Mayor and City Commission. Arrangements have been made to have a representative of the Consultant present at the October 7, 1981 Commission Meeting to discuss this report. The main thrusts of the Consultant's recommendations are: A) A program to emphasize vendor relations with Black and Latin vendors within the City of Miami, provided they meet ethnic and economic requirements. B) A City outreach program to qualified vendors to inventory their ability to meet City buying requirements and to assist them in other ways to participate in the program. C) A City program to match, by size and type, City purchases to the abilities of qualified vendors. D) A goal of one -fifth of City purchases to be directed towards qualified minority vendors, based upon their abilities to meet City needs, with provision for interim annual goals until the one -fifth goal is met. The Consultant's report contains a policy resolution for consideration by the Mayor and City Commission as well as a proposed City Manager order to be issued if this program is approved by the Mayor and City Commission. This office recommends favorable action on this proposal and stands ready to implement it upon direction from the Mayor and City Commission. 13002 • ALL E N & HAM I LTO N Inc. V Mr. Howard Gary,.! City Manager City Hall (Dinner Key) City of Miami � f, 3500 Pan American Drive' Miami, Florida 33133 Dear Mr. Gary: September 25, 1981 Booz, Allen & Hamilton Inc., is pleased to submit this letter report concerned with the "establishment of effective minority ven- dor procurement policies", in partial fulfillment of our scope of services agreement dated December 18, 1980. This report and its recommendation are predicated upon a belief that a properly con- structed and administered minority vendor procurement program for both Blacks and Latins will benefit the City as a buyer and as an economic entity. The essential recommended components for a Miami Minority Vendor Procurement Program (MVPP), which emphasizes relations with Black and Latin vendors, are as follows: A policy resolution, for submission to the Mayor and City Commission, which finds that a Minority Vendor Procurement Program for Blacks and for Latins is in the best public interests of the City and which establishes general policy guidelines for the operation of the program. A definition of a minority vendor based upon ethnic and economic factors in order to direct this program to those able to respond to city requirements, but nevertheless are in need of assistance. This definition, which will make it feasible to emphasize Black and Latin vendor programs, will determine eligibility to participate in the program. An inventory, by skills and services offered, of minority businesses in the City Mr. Howard Gary Page 2 An aggressive city procurement program to match its requirements with the supply capacities of qualified minor- ity vendors in the City and an eventual goal of perhaps one -fifth of the City's total service and material acquisi- tions obtained through Black and Latin vendors. In order to help obtain this goal, the program will include a set - aside program for qualified minority vendors. A continuing effort, by appropriate city agencies, to tar- get service and/or material acquisitions to qualified Black and Lain vendors. Such a program depends not on artificial incentives, which too often leave the public interest unprotected, but conscious efforts to pro- vide a continuous stream of realistic business opportunities to qualified Black and Latin vendors. Such an approach will contribute to the health of the local economy and create job opportunities that are needed in the minority communities. GENERAL POLICY GUIDANCE FROM CITY COMMISSION IS FIRST REQUIREMENT A program which will provide minority vendors a realistic and practical opportunity to compete with other vendors in selling goods and services to the City will require a change in established poli- cies. As such, it is proper that it occur at the initiative and direction of the City Commission. More then with most policy - administrative matters, this program requires that both the Commis- sion and the Administration understand and approve the full scope of proposed actions. Because of that interdependence, this report out- lines both the policy and administrative follow-up actions recommended. This program assumes that the City will not: . Acquire any goods or services beyond its normal requirements Pay a special premium for its goods or services . Reduce or eliminate normal protections of the City's inter- ests such as bonding requirements. This program does assume that the City will actively encourage minority participation in the City's business activities by: Providing qualified Black and Latin vendors preferred opportunities to fulfill up to one -fifth of city service and material requirements based upon vendor qualifications i] Mr. Howard Gary Page 3 sizing purchase orders and bid calls, when appropriate, to the capacities of qualified Black and Latin vendors Making minority participation an element of evaluation in bids for professional service and larger construction contracts. The intent is to build a meaningful program of Minority Vendor Pro- curements that address the real capacities of Black and Latin ven- dors within a frame work of normal city requirements. At the same time it is intended that this program contribute positively to the City's economy by emphasizing relationships with local vendors. Exhibit I is a proposed resolution for submission to the City Commission. It finds that the Minority Vendor Procurement Program recommended in this report is in the best public interest of the City, establishes basic program policies, and directs the City Manager to take the necessary actions to implement the program. DEFINITION OF MINORITY VENDOR REQUIRED In order to direct the beneficial efforts of this program to those who require such assistance, it is necessary to define "a minority vendor". It is felt that the definition, in order to accomplish its public purposes, should be both ethnological and eco- nomic. It is suggested that the following elements be incorporated into the definition: A business enterprise that is owned or controlled by one or more socially or economicaly disadvantaged person or per- sons who are Black Americans, Hispanic Americans, American Indians, Eskimos, Aleuts, or Native Hawaiians. A business enterprise with gross annual current or pro- jected sales of no more than $1,000,000. Priority consideration should be given to business enterprises oper- ating legally within the City of Miami with secondary consideration to those businesses operating within Dade County but outside the City of Miami. On professional services and larger construction contracts, it may be desirable to consider, as one element of bid evaluation, joint ventures and/or partnerships with local businesses meeting the above definition. CITY ADMINISTRATION INITIATIVE IS ESSENTIAL TO PROGRAM SUCCESS Assuming passage of an appropriate policy resolution by the City Commission approving a Minority Vendor Program for the City of Miami, the success of the program will depend on follow-up action by I M 9 E Mr. Howard Gary Page 4 the City's administrative staff. The program anticipates participa- tion by most City Departments, but the lead role in carrying out the program will rest with the Purchasing Agent. That office will be required to: Compile baseline information to establish the extent of minority vendor participation in the City's 1980-81 pro- curement program. This will provide a basis for measure- ment of future progress and improvement of minority parti- cipation. It will also provide a beginning point for establishing a listed inventory of minority businesses to be eligible to participate in this program as recommended. Establish an outreach program to compile an inventory of minority business skills and/or services offered. This effort should encompass advice to minority businesses as to services and/ or goods purchased by the city, how to do business with the City, and how to participate in the Minority Vendor Procurement Program. This activity should be concentrated within the City of Miami. It may be con- ducted by the Purchasing Agents' staff, by a contract local community - based organization representing minority ven- dors, or a combination of both. Commence a procurement planning program to ascertain City goods and/or service requirements for the coming year, by quarters, and to break those requirements into packages commensurate with the abilities of minority vendors to han- dle business. Small purchases, ranging downwards from $50,000 to as little $1,000, which will not involve bonding or security arrangements by virture of the fact that pay- ment is not made until after receipt of goods or services to be delivered, should be targeted to qualified minority vendors. Provide a set of annual minority vendor procurement goals (dollars and types of goods and services acquired for the City) in terms of both the total volume of minority pur- chases and in terms of amount to be specifically set -aside for competition among qualified minority businesses. These goals should be established, after appropriate present base -line information is established, to bring the level of qualified vendor's participation to the prscribed one -fifth level as soon as practical. However, it is anticipated that a number of interim annual goals will have to be established and attained before this eventual goal is reached. The Purchasing Agent should submit quarterly reports, comparing performance to goals, to the City Manager. 4,6 s5 t'?t° `k.*n �L�.'�a ——- _ -, �I �.�_� �.��L4�w. .� .., _. -{.,. Mr. Howard Gary Page 5 Once the one -fifth goal of City procurement for qualified Black and Latin Minority Vendors is attained, the City may wish to consider discontinuing the program because it may be no longer necessary. Given the volume and diversity of goods and services procured by the City during any one year, this program has the potential for directing substantial business to qualified Black and Latin Minority Vendors in the City of Miami. As such, it also has the potential for elevating the city's economy by expending Miami dollars in Miami. Attached, as Exhibit II, is a proposed order by the City Manager putting the Minority Vendor Procurement Program into effect and assigning administrative responsibilities for various parts of the program. This order includes provision for the monitoring of pro- gram execution by the City's Affirmative Action officer. It is intended to be issued after passage of the policy resolution by the City Commission. Also attached, as Exhibit III, is a proposed instruction and form for the registration of firms wishing to participate in the City's Minority Vendor Procurement Program. It is intended to be used as a menas of screening program applicar'--- and of establishing the list of Minority Vendors to whom the City o procurement orders will be targeted. The success of this Minority Vendor Procurement Program is dependent on administration -wide participation in planning, execut- ing, managing, and monitoring the program's progress. Much of this responsibility is, in the final analysis, dependent upon the Pur- chasing Agent's performance. The judgement exercised in that office in targeting small purchase orders to qualified minority vendors and/or in breaking larger orders or contracts into smaller or com- ponent units to incourage greater minority vendor participation in the City's procurement process will be crucial to this program success. We look forward to the opportunity to discuss our recommenda- tions with you and your staff as well as anyone else you designate. Very truly yours, Exhibit I - Commission Resolution Proposed Concerning Minority Vendor Procurement Program WHEREAS, the City of Miami expends several hundred; thousands of dollars each year to secure goods and ser- Vices required by the City; and WHEREAS, there are many small minority owned and oper- ated businesses within the City of Miami and in the imme- diate surrounding area capable of providing such goods and services and WHEREAS, such minority owned and operated businesses have not in the past provided as much of the city required goods and services as they are capable of providing and WHEREAS, the Commission believes that it is in the public interest to provide greater opportunities for such minority owned and operated businesses to provide goods and services required by the City; THEREFORE, BE IT RESOLVED BY THE COMMISSION OF OF MIAMI, FLORIDA: Section 1. That it is in the best interests of the City of Miami that a Minority Vendor Procurement Program for qualified Black and Latins be established to enable the City to fully utilize the skills and services of such minority vendors in acquiring goods and services required by the City. Section 2. That the City Manager is hereby directed to institute a Minority Vendor Procurement Program to accomplish such utilization of minority skills and ser- vices. Such program shall at a minimum provide: A matching of city requirements with qualified Black and Latin Minority Vendor goods and ser- vices capacities A planned effort to ascertain the City's annual goods and services requirements and to target orders for up to one -fifth of such goods and ser- vices to qualified minority vendors by means of purchase orders and bid invitations issued pur- suant to City purchasing procedures and legal requirements i City Commission Resolution - Continued x (c) Establishment of an approved minority vendors list based upon qualifications of an ethnological and economic nature. Such qualifications shall include a business enterprise with gross annual i sales of $1,000,000 or less that is owned or con- trolled by Black Americans, Hispanic Americans, American Indians, Eskimos, Aleuts, or Native Hawaiians -- (d) Such other provisions as the City Manager, in his = discretion, may deem necessary to carry out the general intent of this resolution. Passed and Adopted this day of 1981. l v A i it C d tas u �t t t sx - T v z Ru. 7 Nei` i rallr t 7 f h ti v I t l W _ S S 7 r Sk ly r' 1 t' it J ti 3 ttQ�.971''".C�- f'� A a`�;I 4. w` '3 jW ry Ui d 7 lOA 4� f t ter Nii IW '�`i `!'"(�+J'�7�£tw� = yy,k" #_ 4.. �": � �.; `'.� xtc y ? ta. ti ti i�+ x ;x �,;�+�",Y�, Mt l x�� i I. R. w x } ' tr l r f is -6@* t f moo kiyi u o 'q7d c x Cs C P t i t ty S - €€1��`` JyF't5 ib 41 it r ' ii 9 i - �. EXHIBIT II Proposed City Manager Order Implementing Minority Vendor Procurement Program CITY OF MIAMI MINORITY VENDOR PROCUREMENT PROGRAM The City of Miami is committed to providing minority vendors with the opportunity to compete in selling goods and services to the City. To increase competition among vendors, while meeting the city's purchasing goals and objectives, actions will be instituted to provide a foun- dation for the effective functioning of a Miami Minority Vendor Procurement program. The following guidelines, which are not all-inclusive, provide the framework for institutionalizing the program. AUTHORITY The Purchasing Agent shall be responsible for estab- lishing and directing the City of Miami's minority vendor procurement program (MVPP). User agencies shall work with the purchasing agent in complying with the guidelines and requirements described herein. The City's Affirmative Action Officer shall be responsible for establishing moni- toring procedures to ensure compliance with the programs goals as they may be established from time to time. DELEGATIONS The Purchasing Agent is responsible for carrying out the provisions of this directive. Delegation of this re- sponsibility to any other individual(s) must be authorized in writing by the City Manager. DEFINITIONS For the purpose of these guidelines, the following definitions apply. Further refinements in these defini- tions shall be made by the Purchasing Agent. en- terprise that is owned more socially or economically disadvantaged per- sons. Such disadvantage may arise from cultural, racial, chronic economic circumstances or back Y j 2 S t A } X '1 -t t 2 l rt] H ground or other similar cause. Such persons in - elude, but are not limited to, Black Americans, Hispanic Americans, American Indians, Eskimos, Aleuts and Native Hawaiians. Business - Any corporation, partnership, individ- ual, sole proprietorship, joint stock company, joint venture or any other legal entity that is properly licensed to do business with the City of Miami, that has projected gross annual sales of no more than $1,000,000 for the current business year, and that has had gross sales of no more than $1,000,000 during the business year that immediately preceeded the current year. SCOPE The guidelines described herein shall apply to all user agencies in the City. Deviations from these guide- lines cannot be authorized without the written consent of the City Manager. PROGRAM COMPONENTS The City of Miami MVPP shall consist of several ele- ments that together provide the framework for maintaining a workable and ongoing program. These elements are brief- ly summarized below and include: Qualifications - The parameters for inclusion in the MVPP address both social and economic fac- tors. These factors shall be used to determine which vendors qualify for participation in the MVPP. Specifically, firms that meet the follow- ing criteria are eligible to participate in the program. Minority owned businesses operating legally within the City of Miami and Dade County. Priority shall be given to those businesses operating within the City of Miami. Joint ventures and partnerships with busi- nesses that are non -minority and that are operating outside the boundaries of Dade County are eligible if: .. Local subsidiary cent of the total venture -2 controls over 50 per - assets of the joint t least 50 percent of the joint Veft= titre employees are residents of the City of Miami Joint venture funds be deposited in a v financial institution(s) within the City of Miami. Minority -owned businesses with gross annual This information will be updated as often as necessary but at least once each year. Recruit- ment and screening will be conducted by the Pur- chasing Agent and staff and/or contracted with local community -based organizations that repre- sent minority vendors. A checklist will be used to screen eligible vendors (see attachment). Communications - Minority vendors will be in- 7 - -.4 ^" he%w +-n An hmCi nPCC wi i-h i-hp City. and J� iW k 5 1 � }} biatribution of publications and other tYpdb of literature to minority vendors Conduct or participation in workshops, semi- nars, conferences, etc. Although the City's purchasing program is making a reasonable effort to attract minority vendors, e.g., publishing bids in minority periodicals, additional measures such as those described pre- viously are needed and shall be initiated. Capacity Building - As time and resources permit, the City shall provide technical and general business counseling to minority vendors. This can be either done by purchasing and other de- partmental staff or sponsored through any of the governmental agencies, business and trade associ- ations, e.g., Minority Business Development Agency, providing such services. The services provided under this effort shall familiarize minority vendors with the City's purchasing procedures, requirements, etc. However, other forms of assistance can be provided, such as identifying financial assistance and bonding resources. The specific services provided shall be based on the expressed needs of minority vendors. Purchasing Goal - Long range purchasing goals need to be established not only to demonstrate the City's commitment to the MVPP but also to provide a "benchmark" or measure of the program's success. These goals are for the present, estab- lished at one -fifth of procurement dollars ex- pended for services and goods. These goals are further defined as one -tenth of procurement dol- lars for qualified Blank minority vendors and one -tenth of procurement dollars for qualified Latin minority vendors. The Purchasing Agent shall be responsible for establishing a baseline of current minority vendors (Black and Latin) procurements and for establishing a 1981-82 in- terim goal in concert with The Affirmative Action officer for submission to this office and subse- quent approval by The City Commission. get Aside - To provide additional opportunities or mi ority businesses to gain the experience necessary to compete successfully for city pur- chases, a certain percentage of all city pur- chases will be set aside for minority vendors. This percentage will be established each year by the City Manager and will be based upon a review of planned purchases and the previous year's total level_ of minority purchases. Bonding Requirements -- Existing bonding require- ments shall not be waived. The City, however, should assist minority vendors in identifying organizations who can provide bonding assistance or should establish its own program to provide bonding assistance. Program Monitoring - A system to record and mea- sure MVPP progress shall to be established. This system should maintain information and statistics on minority vendor participation, awards, dollar volume and goals and other appropriate types of information to analyze the program's success and progress. The Purchasing Agent should report quarterly to user agencies, the City Manager and the City Commission on the program's performance. In addition, the City's Affirmative Action of- ficer shall establish, in concert with the Pur- chasing Agent, the necessary monitoring proce- dures to provide continuous review of the program in its planning, implementation, and evaluation stages. Program Planning- The Purchasing Agent and staff lTidentind prepare a plan on the goals, Ma activities, timeframes and resources required for the MVPP each fiscal year. User agency input is critical to the success of the program. These plans should be adjusted periodically to reflect program performance and progress. Delivery System - Packaging of contracts and pur- chase orders is an effective means for encourag- ing minority vendor participation in the City's procurement program. This shall involve target- ing small purchase orders, such as those of less than $50,000, to minority firms. Similarly, i larger contracts may be broken up into smaller packages and targeted to minority firms. The size of these packages should be determined after analyzing current and previous procurements and consulting with minority vendors. SNORT -TERM ACTIONS The following actions will aid and assist in formulating and maintaining a realistic and workable MVPP. They do not require major policy changes or signi- ficant budget commitments. They can be implemented quickly and provide meaningful results for increasing minority vendor participation with the City of Miami. Baseline current procurement activity with re- spect to minority vendors. At a minimum, the following information should be recorded: Total dollar value of procurements; by department and product and service Total dollar value of minority vendor procurements Percent of minority vendor procurements to total Total dollar value of minority vendor pro- curements by product and service - Total dollar value of minority vendor pro- curements by product and service and department. Prepare listing of current minority vendors doing business with the City as defined by this guid- ance. The information compiled should reflect the items described under the Certification re- quirements in this guidance. Establish an inventory of minority vendors, in- cluding skills, who are not currently doing busi- ness with the City. This should reflect the re- quirements under the Certification process and can be accomplished through several sourcing techniques including: ��. i l31 ,�' t i • 6� ! f L A i i t -. x t �' T Canvasing of targeted minority communities 4 : ti^ = Buyer -initiated contacts with minority vendors y}... f = Obtaining external directories = Contacting local community -based business and trade organizations - Placing advertisements, public service an- nouncements etc, through local media - Identifying minority vendors through the bid rr' = solicitation process. Identify and initiate contacts with governmental ti agencies, business and trade organizations to arrange technical, managerial, general business 4; and bonding assistance for minority vendors. , �-a Prepare MVPP plan for the next fiscal year (81-82) identifying: Goals and objectives - Activities and timeframes s Resource requirements, e.g. staff, facili ties, supplies, etc. • Encourage professional service firms and their subconsultants contracting with the City to de- velop and implement affirmative action plans. Produce new and/or distribute existing literature on how to do business with the City in buildings and other locations serving the minority community. Initiate discussions with Dade County officials on MVPP to identify common goals and objectives and to combine resources on mutually beneficial projects. Prepare, on a quarterly basis, a list of upcoming contracts and distribute to representatives of minority contractor assistance organizations. OW fit LONGER -TERM ACTIONS Additional areas requiring further study are noted below. These areas may require major policy changes or can only be implemented after initiating the short-term actions described previously. They are as follows: Establish a contractors' funding assistance pro- gram Implement a prompt payment process for minority vendors Target small purchase orders to minority business Package contracts in units which encourage greater minority vendor participation in the pro- curement process Review potential for establishing Minority Enter- prise Small Business Investment Company (MESBIC) which was created by an amendment to the Small Business Investment Act to stimulate creation of investment corporations for minority loans. AMENDMENTS EXHIBIT IIT Instructions For Completing Minority Vendor Fact Sheet The following are instructions for completing the Checklist for screening eligible minority vendors for par- ticipation in the City's Minority Vendor Procurement Pro- gram (MVPP). The Purchasing agent and his/her staff is responsible for collecting and recording the information required in this document and updating it on an annual basis. The information required is: 1. Name, address and telephone Number - Identify the name, local address and telephone number of the applicant applying for minority vendor status in the MVPP. 2. 3. 4. 5. 6. 7. Type of Business - Identify with a check mark the appropriate description of the kind of business under which the firm operates. Principals) - Identify the name of each individ- ual owner/officer who has controlling authority in the business entity. Product/Service offered - Record the products and/or services for which the vendor would like to be considered, e.g., automotive parts and sup- plies, graphic design, janitorial services, etc. Other Business Skills - List other capabilites of the business that are relevant to the products and/or services offered, e.g., graphic design - printing and reproduction. Minority Status - If the business is a minority concern, identify whether it is minority owned and/or operated. If minority ownership, indicate the percent of minority ownership Occu ational and Other Special Licenses - Identi- y the type of -licenses (and by whom) issued to the business concern. Attach copies of each one listed. A. 7 Minority Classification - Identify the appropri- ate social classifications) of minority status 9. Gross Annual Sales - Identify prior and projected annual sales figures for the business. Audited financial statements or other appropriate docu- mentation should be attached -to verify the figure recorded. 10. Total Number Of Employees - Identify the total number of staff employed by the vendor by type and location. All those individuals employed outside the City and Dade County should be re- corded under the column headed "other" 11. Local Financial Institution - Identify the name, address and telephone number of the financial institution with which the vendor has established credit and/or accounts. 12. Comments - Use this space to record any pertinent data regarding the applicant's operations that affect's its status under the MVPP. Also, list the documents provided or to be provided by the applicant, e.g., licenses. The Purchasing Agent shall establish and maintain a minority vendor procurement file with this fact sheet and any supporting documents provided. The Purchasing Agent should also attempt to verify the accuracy and validity of the data provided. S £Y = � - `• 3. Principal(s): .' r 1 Name of Firm. ' Address: 4. Product(s)/ " Telephone No: ( ) Services(s) z Offered: l Corporation 5. other 2. Type Business: [ SkillsHusiness (Please Check One) [ ] Partnership Specify): I dividual (Please h s [ ] n Sole Proprietorship Joint Stock Company 6. Minority Check Status One)[ ] Owned other (Please (Specify % Minority r' (Please Specify) Ownership) [ ) Operated 7. Occupational B, minority Classification License Category: (Please Check One): [ l Black American ( ] Hispanic American LL [ ] American Indian other Special [ ] Eskimo Licenses [ J Aleut (Please Specify): [ ] Native Hawaiian [ ) Other 9. Gross Annual Sales: (Please Specify) (Prior Year ) (Estimated this year) Ai i ill I��III !IIII I'll I'1911 �i,,l lli �l ����� �ll71111711117111 .ii�ri llll 11 l�� �ili ,: 1,.. , r��'q it u�llp 11 ►V'��'